Labour Laws, Trade Union

Demonetization – A Cruel Joke on the Working Class

The Anna Hazare Movement in Delhi showed how the serious issue of corruption in governance could be inverted to lay all the moral blame at the door of the ordinary citizen. Making the people defensive helped bypass the twin question of corrupt, anti people rulers and policies of sale of the country and its resources to corporate. The issues of unbridled corporate loot, of huge scams by corrupt politicians, corrupt bureaucrats being middle men in making huge money out of the sale of India, were equated with the bribe paid by an ordinary cyclist to a policeman for letting go of his cycle at a red light or with bribing a postman to get a money order released.
The Modi Govt. has carried forward this inversion of guilt with the determined twin aim of not merely protecting the real defrauders of the country but also providing for future possibilities of loot for them by stocking up the banks. The method of RSS BJP is both sinister and diabolical, reeking of their fascist methods. The vast masses including even the middle middle classes have been plunged into an unimagined, continuing hell. Backed by a twisted, mischievious propaganda machinery that says that the black money looted from the country is right here, between you, it has managed to blind people to the fact that the only target is the meagre 4-5% kept in untaxed cash by small shopkeepers, owners etc. In the masses it induced an unhealthy glee by a false sense of superiority- while you all suffer hell standing in line day after day, grin because the guilty are also sweating it out. It is no matter that this guilty is only a pint sized pigmy among giants. The suffering the people are being put through relentlessly, the over 80 deaths for which no one is guilty apparently as the people collectively submit to ‘national interest’ –all is not at all mindless. It is to cure the people of ever daring to cast their gaze at the looters of the country; they should be afraid of ever asking for those guilty of hoarding the country’s wealth, or of accountability by ruling classes or their representatives.
This is what Modi has decided to do by the current demonetization with the extra benefit of being able to serve imperialists by opening up retail sector to corporate, forcing import of even grains and of course explaining away a the economic slump which was coming anyway. The common people are being exhausted by the elementary need to stand in serpentine queues day after day,even for elementary money. Caught off guard, the physical exhaustion is tiring out the ability to think straight while propaganda constantly bombards them that this is ‘for the nation’.
For the working class of India, Modi has demonstrated his contempt full score. Earlier, this Govt. has been doing its best to pauperize this class, rob it of all its hard won rights, break unionization and push down wages to the barest type of living, all in service of corporate masters. The vast sections of unorganized private sector regular workers receive their wages by the 10th of the month. A small section of these get wages on the 7th. In one brutal blow, those who received payments on 7th and 8th November 2016 found their pay rendered redundant. For those yet to get wages, workers and even small owners went through hellish situations. In many places workers were offered payments in old notes and went through days of standing in line simply to get a meagre 2000 worth of these changed. If they have no account in the bank, this is the money they were supposed to subsist on for the entire month. Even those who had some money in the bank accounts and could have carried on were denied the right to do so by having to stand in common lines day after day for the same and also suffering the cap of banks on the amount they could withdraw.
The Govt. was allowing exchange of upto Rs2000 till 30th December but put a sudden stop on 24th November. This also has the same end of making workers subsist on Rs. 2000 a month when the minimum wage for a helper is nearing Rs. 10,000 in many states. This is the prelude to the dilution of Minimum Wages Act contemplated in the anti worker labour law amendments which the Modi govt. is proposing.
For the salaried working class like govt. employees, public sector and organized private sectors who had received wages on the 1st of the month through bank accounts or even cash, the situation is almost similar to that of the other workers. Modi’s placebo of allowing ration shops to accept old notes fell flat on its face as less than 50% workers in unorganized sectors have ration cards and also ration shops refused to give change and demanded that ration be taken for the entire note. The same is the experience at Mother dairy booths.
Machines in industries in the country have stood silent as workers stand in lines. They are now silent as production has slowed down, as owners and contractors are sending workers’ on forced leave. Labour chowks have desolate crowds as anyone who can postpone construction work does so. Daily wagers have been laid off in massive numbers. The problems of other unorganized sections are equally acute.
Punjab’s famous textile industry has hit the doldrums(19th Dec.2016 Hindu). This relies heavily on the winter months to boost profits. In the past one and a half months 30 textile processing units have been closed due to a cash crunch. There are a total of 60 such units and the rest are operating at about 30% capacity. These units prepare dyes and print fabrics and are the backbone of 700 to 800 textile factories which do warp knitting, embroidery, spinning etc. Layoffs have commenced as these units are labour intensive. According to the Gen. Sec. of the Punjab Textile Manufacturers Association, the weaving industry has seen a 50% retrenchment due to the twin problems of lack of cash for wages as well as a drastic drop in orders. Retail sales based on woollen fabrics are the worst affected. The zardori industry in Lucknow and other parts of Uttar Pradesh is without work. Retrenchments are on in the textile sector and this is the story of formal workers too. Already industries in Tamil Nadu have laid off workers.
In Bengal 2500 workers of Sree Hanuman Jute Mill in Howrah were officially told that the mill is shutting down (HT 7th Dec) because there is no cash available. The Indian Jute Mill Association has anyway been seeking an urgent meeting with the state Govt. 20,000 people in Murshidabad Dist. of W. Bengal in Kamalpur and Durgapur (IE 16th Dec) used to earn 3000 to 4000 a month rolling bidis. The Sec. of Bidi Merchants Association says that Central Bengal has more than 6 lakh bidi workers. Most are now jobless not only because there is no cash to pay the workers but also tendu leaves’ supply from Chattisgarh, Jharkhand and Odisha has dried up due to the cash crunch. The rent for the trucks is a lakh with Rs 20,000 to be supplied in cash compulsorily for en route expenses. The district administration of Darjeeling in West Bengal has expressed concern (21st Dec HT) over the growing unrest in tea gardens which are already facing hunger and joblessness. Due to demonetization, 40% of the wages of November and the wages of December are still due. Prior to demonetization the workers got weekly or fortnightly wages in cash. Nearly 4.5 lakh workers are employed in this industry in Bengal. Post 8th Nov. the State govt and the RBI worked out a system whereby an account under the DM would be used to deposit and withdraw money by managements to disburse wages. RBI discontinued this and gave another formula which was worked till 5th December. Now no further method has been advanced by the RBI. There are no proper banking or ATM facilities in the tea gardens.
In Surat the diamond industry employs approx. 8 lakh workers. Hundreds of small units of polishing and cutting have virtually not opened after Diwali. 20,000 diamond workers have already lost jobs as small units with 5-10 machines have shut down. 12 merchants of Surat are said to control 40% of the city’s diamond business while 60% of the work is done by thousands of smaller and tiny units. In Agra (IE Dec 15th) 100 or so workers of a shoe factory ( Tej Shoes) blocked the highway protesting against being paid in old notes. This is also the situation in a majority of shoe factories in this city with this sector employing 90% unorganized workers. 60% of the shoes sold in the country are made in Agra, according to the report. And these are only a few examples only of the widespread loss of jobs and of production that is occurring in India. It is estimated that there will be job loss of 4 lakhs throughout the country in which the attack on daily wage jobs is not accounted for. 2 lakh job cuts are estimated in the e commerce sector as the cash on delivery services come to a stuttering slowdown. Loss of 1 lakh jobs is estimated in the real estate, construction and infrastructure sector.20% of the 2.5 lakh workers in the leather industry are expected to be hit. The textile and garments sector employs 32 million workers of which one fifth are daily wagers who have already lost jobs.
Production of mobile phones in India is down by at least 40% due to demonetisation (HT, Dec. 19, 2016). Handset manufacturers including Foxconn, Flextronics and GDN Wistron are either cutting jobs or sending employees on leave. Foxconn (Taiwan based, makes iphones for Apple) has sent 1700 out of 8000 employees on paid leave. This company accounts for 70% of all smart phones assembled in India. Local player, Lava, has stopped production for 10 days. The Rs. 1,30,000 crore cellphone manufacturing industry primarily depends on cash.
Domestic workers, another big section of employees are also facing problems as owners have no new notes in which to make payments. Many employers are offering to pay part of the salary by financing groceries by online payments but this puts a restriction on the workers’ freedom and for reasons that make it difficult to hold the employers guilty.
In the private industrial sectors of Delhi, especially as studied in Okhla and Mayapuri industrial areas, in the larger factories both of export and mechanical industry the workers have remained relatively undisturbed wherever payment by cheque or into accounts has been the norm. They do have a problem with withdrawal, but owners are being considerate and giving workers some hours off to go and stand in lines. It is in the small mechanical and other units that there is mayhem as salary payment was in cash and as owners do not place workers on record let alone giving them minimum wages. Here workers received wages for November in old notes and have mostly been able to exchange only a part of them as they either do not have bank accounts or have an account in the village. What exchange was possible at all was only after standing in lines for days and days. Workers with accounts who received wages in cash have often been handed large sums of money as advance payments in return for surrendering their original ID proofs to the owners. Whilst many do not mind this, their problem is that the lump sum will not be adjusted against stipulated minimum wage as the workman lacks bargaining capacity for several reasons. Another category is of the daily wage workers who are, quite simply, without jobs. Equally hard hit are the redi wallahs selling lunches etc. in the industrial areas who neither have money for daily investment as they do not have new notes and who are also facing a severe lack of customers as workers also have no new notes to spend. Workers employed in small concerns have moved in a fair number to the villages, also because the owners are encouraging them to go and return after a few months. The worst scenario is probably of the self employed construction workers of Delhi of which a massive chunk is migrant in nature. On 16th Nov. IE reported that the Sadar Bazar Bara Tooti Chowk, which it described as one of the largest labour chowks of Delhi, has hordes of construction workers bereft of work. Over 100 construction workers come daily to the Sarita Vihar labour chowk and hang around the whole day in hope of at least some small work. Many workers are eating one meal a day, and those whose families live in the village have also taken to eating a meal at the local temple. Hindu of 16th Dec. 2016 described the situation in Azadpur Whole sale Mandi of Delhi, which is the biggest wholesale market of the city, as one of ‘trade collapse’. Statesman reported on 15th December that a day earlier 10,000 daily wage workers living at Kirari, a slum in NW Delhi, held a demonstration against job losses. Here there are around 15,000 small units making shirts, biscuits, trousers, shoes.
The other myth is that all people can have a bank account. They cannot. The camps operating to open accounts ask for some identity document. Technically, accounts can be opened by the owner attesting to the worker on the Company letterhead, but that means owning up to the workers. So the contradiction moves from where it really is onto the continuing owner- worker one. The workers forget that if the owners did not pay taxes to the Govt (i.e. they hid the Govt.’s share from it) they also did not pay the workers minimum wages (i.e. hid the workers share from them). The Govt. is well aware of this. However it has never lifted a finger to ensure that the owners’ deliver the workers’ minimum wages to them; rather Modi is reversing the labour laws and the dismantling the machinery which enforces them. Now that the Govt. is crusading about the untaxed income being its right, the working class has a right to expect that the Govt. should have carried on this crusade for implementation of labour laws too.
Opening accounts is only a step. What follows? Salaried working class and employees through out the country gloated that the Govt. was right to forcibly ‘seize taxes’ ( ofcourse all the while forgetting that this is at the most 5% of so called ‘black money’). They are not so sure now as they stand in lines day after day but are told that they can actually withdraw paltry sums like Rs.4000 from their accounts in spaces of 10 days irrespective of the official announcements of Rs. 10,000 as there is now no money in the banks. Everyone knows that it is in the first week that rents, wages of domestic workers, are paid and groceries bought not to speak of school fees.
But not all business is at a standstill. Govt of India is going to import 20,000 tonnes of currency paper from 9 companies of Europe and Russia in order to print notes. (IE, Dec. 12, 2016) These include a German company which was blacklisted earlier. This import is thus far higher than the approx. 8000 tonnes imported in the current year. So the Govt. is doling out work to foreign companies. Also delighting are Paytm (major shareholders are Alibaba of China and its affiliate Ant Financial, Silicon Valley Bank, Reliance and others. Yahoo and Japanese MNC Softbank are the major shareholders of Alibaba) and Reliance with all the work pouring their way as are Amazon (US ) and other e-com companies which rely on pre-payments. Because now we know that the real slogan is not no black money but ‘use plastic money’. Use plastic money in a country with none to poor internet connectivity, with frequent shut down of internet services in areas of struggle (In Kashmir, for instance, which Central Govt. asserts is irrevocably part of India) or in Tamil Nadu where a natural calamity like Cyclone Vardah knocked out internet services and with rampant poverty and illiteracy. The probable idea is that the poor anyway need to buy nothing from the market. In all the hullabo and the peasants facing cash crunch endangering the rabi crop, the Central Govt. has quietly totally lifted import subsidies on foreign wheat, thus spelling ruin for the indigenous crop. Anyway the Govt. of Modi is boasting and dancing about plastic money being the issue because already bundles and bundles of new money are being recovered from bank officials and BJP activists throughout the country, counterfeit new notes of 2000 denomination have been recovered in lakhs, so the country is bound to see beyond the false propaganda that the ‘counterfeit money of terrorists will stop’ sooner than later.
The working class of India must look beyond the obvious, must look beyond the propaganda of the Central Govt. This Govt. is snatching jobs now invoking patriotism and a major reason is that it could not force changes in labour laws earlier also because of the fight put up by the working class. The economic downturn in the world makes the needs of imperialists for loot much more severe and Modi Govt. is out to bleed India dry for them. The effects of this demonetization will be far reaching for the economy, for production in small and middle scale industries in India. We must unite with those democratic forces calling for a recall of this decision. Working class must demand that the names of those who have bled India’s banks dry in NPAs should be made public. Working class must demand that the money stashed in foreign banks and accounts, in estates and gold, all of which is money out of the production process in India and the real black money, be brought back immediately. We must demand that all should have the right to withdraw freely from their bank accounts and the banks must tell the people to whom they lend. It should be made compulsory that all the excess taxes collected now be given in loans to peasantry and small business alone in order to revive production. Trade unions must come out to help workers decipher how the Modi govt. has attacked them, while all the time creating circumstances where sometimes the owner and at other times the bank manager appears as the main enemy. The trade unions must lead the working class to fight back and expose the true intentions of the Modi Govt. Of course for this it is necessary that they not only be willing to expose the pro corporate pro imperialist policies of this Govt. but also to lead the workers to fight these policies too.