This month's burning alive of 21 people in West Bengal by tea garden workers, angered by fresh recruitment, is the surest sign yet that India's once famous tea industry is now in deep distress. Tea garden owners were quick to blame aggressive trade unionism in Communist-ruled West Bengal for the Nov. 6 tragedy. But nearly everyone agrees that the roots lie in the crash in global prices for the beverage leaf, along with other commodities, over the last four years.
India, the world's largest producer of tea with annual production exceeding 850 million kilogrammes, has been hit particularly badly because its traditional markets in the countries that made up the former Soviet Union have been steadily drying up. Tea exports have declined from 99 million kg in the 2001-2002 fiscal year to 71 million in the last fiscal year, representing a 28 percent drop in what is a major export earner for the country.
On top of that, domestic consumption of tea, which accounted for 673 million tonnes in 2001, has increasingly been losing out to the manufacturers of bottled beverages. Transnationals like Coca-Cola and Pepsi have been carving out large chunks of the market ever since they were allowed into the country under India's decade-old liberalization policies.
But close watchers of the tea industry, such as the economist and parliamentarian Biplab Dasgupta, have been trying to draw the central government's attention to large Indian tea cartels such as Tata Tea and Hindustan Lever. These have been accused of manipulating prices at tea auctions so that both planters and workers are hit adversely by low prices. Tata Tea became the world's second largest tea company after it acquired the Tetley Group of Britain two years ago, while the transnational Unilever remains the biggest.
"The planters are not prepared to point fingers at the big corporates and find it easier to make their workers pay for the plunder through lowered wages and poor living conditions," Dasgupta told IPS.. Dasgupta pointed to a report commissioned by the state-run Tea Board, released last year by the international management consultants A.F. Feguson and Co, which had also questioned auction procedures and suggested that there existed a nexus between tea brokers and buyers that worked to depress prices.
Market studies have shown that the phenomenon of falling prices is far worse in India than in competing countries, indicating distortions brought on by manipulations at the auctions. When the price of Indian tea fell by 18.73 percent in 2000, the price of Indonesian tea actually rose by 13.55 percent. Kenyan tea prices rose by 13.48 percent and Sri Lankan tea by 7.86 percent.
Dasgupta said that stipulations that the bulk of tea has to be sold at the auctions, designed to encourage competition and fair prices, now work in favor of the cartels and prevent true market forces from operating. These, he continued, bring ruin to both planters and workers, as well as the whole tea industry. Around the Dalgaon Tea Estate, where last week's massacre took place, more than 30 tea estates are now closed thanks to falling prices and labor problems. Many more are slated to follow suit.
• Production - Rs.60, sale - Rs.47
Similar stories of closure are now commonplace in the neighboring tea-growing areas of Darjeeling, famed for its fine teas, and Assam which accounts for half of India's total production.
Ranajit Guha, a leader of the All-India Trade Union Congress (AITUC), says that while established tea gardens are closing down, West Bengal has seen a mushrooming of smaller tea gardens that do not see the need to follow prescribed norms.
"These gardens have no processing facilities and but sell off their leaves to the larger units and see fit to default on provident fund and other dues so that the condition of their employees is best described as pathetic," Guha said.
There is little good news from the Nilgiri hills of southern India where, last year, plantations owners were actually able to negotiate with trade unions to lower wages by 10 percent from the $1.80 U.S. they get for a day's labor. This has been a setback to workers in northern India, where unions have for years been trying to raise the prescribed minimum daily wage of about a dollar to match levels prevalent in the Nilgiri hills that straddle Kerala and Tamilnadu. Plantation owners across India have succeeded in making unions accept an increase in leaf-plucking quotas by 10 percent and other tasks by 16 percent, citing adverse market conditions and threatening closures.
Hindustan Lever, a leader in the tea industry, has served notice to workers in its Srikundra estate in the Nilgiris, reducing daily wages to 1.3 dollars and increasing hand-plucking quotas from 25 to 27.5 kg with penalties for failing to meet targets.
A study team drawn from several trade unions said the pluckers, most of them women, were being compelled to use mechanical harvesters that were unwieldy and caused their muscles to ache. "These workers told us that the managements advised them to have their uterus removed in order to handle the machines better," said Suneet Chopra, a member of the team. Chopra believes that mechanisation, as opposed to the traditional hand-plucking, was also responsible for the poorer quality of Indian teas. This, in turn, has resulted in the loss of export markets in Russia and Britain to competitors like Sri Lanka, Chopra added.
In the Peermade and Vandiperiyar areas which fall on the Kerala side of the Niligiri hills, employers have locked out or abandoned as many as 14 plantations while at least two major estates have been abandoned in Gudalur in Tamilnadu. "If the tea industry is to survive, it must be freed form the stranglehold of the auctions and workers allowed to form cooperatives that can take over sick and abandoned estates," Chopra said.
