Kapil Tamang
The tea industry, Bonus and Abandonment
On 2nd September 2022, the annual bonus for the tea garden workers and employees of North Bengal was fixed at 20 per cent on a virtual meeting between the representatives of tea planters and trade unions. It was decided that the amount would be disbursed among the workers by 22nd September. According to Consultative Committee of Plantation Associations (CCPA) sources, 47 gardens identify as “distressed” have been exempted from the payment. Indian Tea Association’s senior official however said that the 47 gardens will be given bonus at least by 11 per cent rate but below 20 per cent.
Within a week or so, the management of the 10 tea gardens which come under the Darjeeling Organic Tea Estates Pvt. Ltd (DOTEPL), known as Bansal Group, abandoned the gardens without notice. The management was also irregular with the wage payment; now, they have left the workers helpless with no wage or bonus payment. DOTEPL includes Happy Valley, Ambootia, Monteviot, Magarjung, Moonda-Bansghari, Rangmook-Cedars, Chongtong, Alubari, Rangaroon and Pandam tea estates which have around 8000 workers in total. The irregularity in wage payment and bonus payment in instalments or paying less than 20 per cent became common after 2017 in Darjeeling hills tea estates; however, it was widespread in the tea estates of Tarai and Dooars region mainly after 2000.
The “crisis” in the tea industry especially in the Registered Tea Garden (RTGs) or commonly known as the estate gardens which the Planters’ owners have been propagating ever since the series of lockdowns and abandonment after 2000 (refer to CEC report 2007) cannot be understood only by focusing on the gardens, workers and management alone. The changing political economy of the tea industry, the changing market regulation and consumption pattern, the changing policies of the government and the changing nature of the capitalist invested in the tea industry are responsible for the ongoing chaos within the tea industry. Let us discuss it further in detail.
The tea industry is one of the largest agro-based plantation industries in India. It is also one of the oldest, with around 10 lakh permanent workers and around the same number or more casual/ temporary workers, that includes more than 50 per cent women workforce. Every year the total turnover of the tea industry is around ₹10,000 corers sometimes more. Yet, the tea industry is one of the organised industries which pays the lowest wage, and do not implement the Minimum Wage Act 1947. The lower wage and the disparities between the management and the working class of the tea industry has its roots to the colonial past which has transcended even after the 75 years of Independence.
Changing political economy`
Tea industry has two important parts; one is the production and the other is the market. During the colonial period there was a vertical integration of both the parts i.e., from the production to marketing was governed by the same firm or corporation. However, after independence, the intervention of the state to restrain capital outflow, tax system was established and slowly the colonial owners left the tea estate which were replaced by the Indian owners within that some took over the tea estates fully and some collaborated with the former British owners after corporate mergers and acquisitions. Post 1990s, after trade liberalisation, global players and Multi-National Corporations took over the business part and the vertical integration business model transformed into value chain model. This led to accumulation of the profit within the market part while dispossessing the production part. The uneven profit distribution and lack of investment to maintain the production mechanism properly, led many owners to either sell the tea estates to smaller merchants and traders who has no prior knowledge about running a tea estate or abandoned the tea estate whenever there is no production or profit from the tea estate.
Changing market regulation and consumption pattern
Tea industry was established by the British colonisers to export the final product abroad. This continued even after independence. In fact, India was the 2nd largest exporter after China for quite some time. However, after the establishment of Tea Board of India in 1953, the domestic market was focused with lots of advertisement and government initiatives as well. By 1960s the domestic market grew steadily. Today, more than 80 per cent of the tea produced in India is consumed within the country and export wise India is behind China, Sri Lank, and Kenya. Within the domestic market, there is cut-throat competition after the trade liberalisation. Countries like Sri Lanka, Kenya, Vietnam etc has become tough competition with low cost of production and cheaper rate of tea in the market. Hence, the tea industry of the country is trying to cut off the cost of production and restructure the industry more towards Small tea Growers (STGs) and Bought leaf Factories (BLFs) where the cost of production is cheaper than the Registered Tea Gardens (RTGs). The consumption pattern also changed with the liberalisation of the market. The branded and package tea took over the market. The advertisement and marketing of the Global Tea Sellers like Lipton, Tetley, Unilever, Tata etc. captured the market and small tea sellers who use to sell unpackaged tea slowly disappeared focusing the tea market more towards blending, packaging, branding and marketing. This shift of market and consumption pattern change the tea business towards value chain system where production and marketing governance and management bifurcated.
Changing policies of the Government
The state had little to no intervention during the colonial time in tea plantation. Indentured labourers were bound to work within the plantation with low wage and were not able to migrate elsewhere. The Workmen’s Breach of Contract Act 1863 abide them to work within the plantation for at least five years. Although the act was implemented in the tea plantation of Assam more and less on North Bengal. However, the culture of “hattabahar” or out-casting was quite popular within the region. After independence, the workers movement all over the country favoured the tea workers as well. Acts like Industrial dispute Act, Factory’s Act, Standing Orders Act, Provident Funds Act etc were also implemented in the tea industry securing the permanent position and rights of the workers. However, it was Plantation Labour Act 1951 which provided security and facilities to the tea workers which were unavailable during the colonial times. Although, Minimum wage Act 1947 is still a distant dream for the tea workers and the wage negotiation process remained a historic blunder in the 15th Indian Labour Conference 1957 where only 1.5 units of consumption were considered instead of 3 units for the determination of minimum wage for tea workers. Hence, the wage remained low even today and no rethinking has been done.
In 1989, Tea Board on its Eight Plan started promoting small growers in order to fulfil the growing demand of tea. From then onwards STGs and BLFs started to grow exponentially and today STGs and BLFs contributes about 50 per cent of the total production of tea in India. This has impacted the tea industry in many ways. First of all, the STGs are those who owns up to 25 acers of land for tea cultivation. They do not come under PLA and hence are not obliged to provide any welfare to the workers. Although the workers working on STGs are mostly family members or relatives yet this leads to further exploitation. Second, rise of middle agents. Since, the STGs do not own factory to produce the final product, they sell the green leaves to near by tea estates or Bought Leaf Factories set up independently. This transaction has led to the emergence of agents who negotiate with the growers as well as the factory owners creating another tributary of profit flow which comes at a price of further exploitation of the labourers. Third, since, the production of tea is fulfilled by the STGs and BLFs with as much capacity as RTGs, this has further promoted Value Chain system, a breakdown of production part and restructuring of the tea production, which has impacted Estates gardens whose cost of production is more as compared to Small Growers. The Government is facilitating the establishment of STGs and BLFs more, now they have their own association, tea board has a separate board to look the operation of STGs.
Further, the government lacked monitoring system in the tea estates hence, the facilities like creches, hospitals, schools or evening housing maintenance have disappeared from most of the tea estates. There is no liabilities or punishments for the violation of the Act. In fact, many of such welfare measures like providing subsidised ration, roads for transportation and housing are provided by the government with different welfare schemes releasing the management from such responsibilities yet there is no improvement in the lives of tea workers. After liberalisation, the state has come up with different policies to promote casualisation of workforce pushing the tea worker towards more precarity.
Changing nature of the Capital
The colonial capital was established to exploit the plantation and to siphon the product and the profit to their respective countries. It is said that the plantation was the engine that ran European colonial capitalism. The British company that owned the tea estates received capital for investment from the British Banks and the companies had control over the trade and business from production to distribution. They established the foundation of corporate sector in the tea industry.
After independence, the government took initiative to restrain the flow of profit from the country. The global market of tea reached new heights but the profit was siphoned to the British firms and reinvestment was lacking. In order to assert the grip over global capital the government introduced Foreign Exchange Regulation Act (FERA) 1973. This led to the shift of capital, the Indian owners who replaced the British were from merchant and money lenders background. They invested more on management system by hiring huge number of managers and controlling from the distance. This further led to the deterioration of the tea estates with corruption, mismanagement and lack of reinvestment in the garden.
However, it was after the liberalisation of trade in 1990s that worsen the condition of the tea estates. The investment of Global Capital and Multi-national Corporation changed the tea business to a whole new level. The production and marketing became a separate operation. The marketing part i.e., blending, packaging and retailing became lucrative with maximum profit while the production had small profit with more obligations and responsibilities. Slowly, the capital invested in the tea estate focused their interest more toward marketing and left the production part to small merchants and firms who has no prior experience or knowledge to run the tea estate but were involved in tea business. Hence, by 2000 series of lockdowns and abandonment of the tea estates especially in the state of West Bengal and Kerala was seen. Even today, 12 tea gardens are officially closed and around 18 per cent of whole tea estates in India are in distressed or what commonly known as “sick” condition.
Conclusion
It is clear that the worst condition the tea estates are facing today is not just because of the lack of interest or laziness of the workforce which is quite popular opinion among the owners’ narratives or the climatic change hampering the production of the tea leaves or huge burden of the cost of production but the changes that happened within the political economy of the tea production and the tea business and lack of interest and monitoring of the government which has led to the present condition of the tea estates and its workers. I am not denying the former opinion, the workforce is decreasing and its not the laziness but the survival instinct that is pushing them out of the tea estates. The amount of wage they receive is less than MGNREGA scheme. The facilities and subsidies they used to receive has disappeared. Hence, they look for better opportunities outside of the tea estates. The climate change is happening but the production of tea is growing every year and the contribution of the tea is increasing from STGs and decreasing from RTGs because the estates are not investing in replantation, replacement of old bushes, proper irrigation and lack reinvestment measures. The business is taken over by big capitalist and they have monopolised the market were as they are not interested in the production part because they have to bear the cost of production especially the welfare of the workforce. The neo-liberal global capital function the same way in every sector which is not a new thing. While the government can intervene given the condition of the tea estate and its workers, they only show their concern during the election season and forget the rest of the time. Most of the tea estate in West Bengal has been replaced by small trades. Big owners like Duncan-Goenka, McLeod Russel etc have sold most of their tea estates or are selling one after the other. Recently, 15 percent of the land of tea estate can be used for tourism and other purposes was announced by the government. All these things clearly indicates that the surplus generation from the tea estates have reached its saturation point and the owners are looking for new ventures and ways to run away from the responsibilities and the government is on their side.
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