// By Dan McDougall

In the UK we have coined the phrase “the race to the bottom” to sum up the practice of western retailers and their foreign contractors cutting corners—seemingly at all costs—to keep margins down and profits up.

In the past month I have exposed three of the world’s major retailers: Otto-Heine, the largest online retailer in Europe, Esprit, the world’s fifth largest clothing store; and Gap Inc., one of the world’s most widely recognized fashion brands, for employing children. All three companies employed Indian contractors who displayed scant regard for the consequences of subcontracting. Next month, two more international firms, who I am presently unable to name, will join this growing hall of shame.

In India, investigating and exposing the Race to the Bottom is, by all means, a complex and dangerous process. For a start, you have to find the sweatshops. In the maze of narrow, mud-bricked lanes that form the spine of Delhi’s poorest market areas where many of America’s fashion garments are created, packs of stray dogs bark aggressively at passers-by. Outsiders are highly conspicuous. Runners and watchmen are everywhere, protecting illicit drinking dens, brothels and of course the unimaginably horrific sweatshops.

In the months before uncovering the Gap Unit, I had been badly beaten in a sweatshop in the lawless Haryana border area of Delhi; the police or foreigners rarely come into this maze of ancient alleyways and streets. The tightly packed buildings and heavily secured basements make it difficult to detect what goes on behind closed doors. Some of the units I discovered there were hidden behind trap doors and, in one case, in a half-demolished building accessed only by a rope ladder.

During the course of one of five visits to this area, I found out how seriously the sweatshop owners guard their interests when my photographer and I were violently attacked and beaten by a lynch mob who chased us for over half an hour through the dusty maze of winding streets. In an attempt to grab our evidence, the mob eventually smashed my photographer’s flash and threatened to kill our translator.

Before we were attacked, however, I discovered children making garments for Esprit. At one point, I vomited with fear and exhaustion as my pursuers refused to give up their chase. A fist fight with the most dogged pursuer enabled me to escape.

The fight against child labour is becoming increasingly dangerous for both journalists wanting to investigate and activists wanting to keep the issue in the public domain, says Bhuwan Ribhu, a lawyer and activist for The Global March Against Child Labour, which has had a number of activists murdered by gangsters who run sweatshops.

“What consumers need to understand is it is an impossible task to track down all of these terrible sweatshops and factories employing children, particularly in the garment industry, when you need little more than a basement or an attic crammed with small children to make a healthy profit,” Ribhu said.

“The police have to rely on rare tipoffs because it is difficult to track down child workers, with employers setting up small units in crammed back alleys where the children are hidden from public eye. But even before the search parties get to the factories, the owners are tipped off and many of the children are cleared out. More daring unit owners even hide the children in sacks and in carefully concealed mezzanine floors designed to dodge such raids.

“We have lost a number of activists, murdered in the course of their duties, others have been dragged in chains behind cars and had threats made against their families. Consumers should start, certainly with major international retailers, by thinking the worst. A lot of money is at stake here.”

THE FACTS

Bhuwan himself admits that this is an understatement. At least 80 percent of major U.S. clothing firms farm out labor to India’s teeming cities, where production costs are cheaper than anywhere else on the planet. Meanwhile, local factory owners attempting to dodge India’s powerful labor unions and cut costs are turning to the ever-growing pool of destitute rural families eager to put their children to work to keep the family finances afloat. The Indian textile industry is worth hundreds of billions of dollars.

Here are the hard figures. Somewhere between 60 to 115 million children are working in India in the textile and agriculture sectors, picking rags, making bricks, polishing gemstones, rolling cigarettes, packaging firecrackers, working as domestics, and weaving silk saris and carpets.

In the last decade, efforts in some regions have driven child slave labor out of factories and into households, which are partially exempt from the law, changing child slavery’s manifestation but not its prevalence or intensity. In many areas, particularly in cities like Delhi and Mumbai, child slave labor still flourishes openly in tiny market units.

One of the most controversial industries that thrives on child labor across the sub-continent is sequin or Zari work, intricate embroidery that has become immensely popular in American and European fashion stores. Sweatshop owners prefer to employ children because their thin, nimble fingers can work quicker on intricate ethnic designs.

By the time the youngsters engaged in the Zari sector reach their mid-teens, their fingers and hands often are badly damaged and their eyesight weak from long hours of tedious work in dark rooms. Their growth is often stunted by years of sitting in uncomfortable, hunched positions at the bamboo framed workstations. Child workers have no fixed hours of work, nor is there any trade union to fight for their cause. For those children “lucky” enough to get paid, the combined wages of five unskilled child workers is less than that of a single unskilled adult.

Woeful tales of torture, sexual abuse, unhealthy working conditions, and cruelty by employers are only part of the hellish narratives of these child workers. In reality, the children are trapped in a circle of exploitation and abuse that will deprive them of their teenage years. The long sticks of their supervisors and the heavy padlock on the grilled iron entrance to the courtyard of the sweatshop tell the real story of their lives.

THE WAKE-UP CALL FOR U.S. FIRMS

And here is the wake-up call for American firms sourcing garments from India. The situation is not going to change; it is, in fact, getting worse. These days the hard figures always seem to work for the new India. Its population will soon reach one billion, it has the most trained IT experts in Asia, and it is one of the world’s fastest growing retail, Internet and telecommunications markets. It should come as no real surprise then that the country is also home to the largest population of children in the world.

Behind these positive statistics lies a deeply tragic one: India is the world capital for child labor. From hazardous industries to homes, every day hundreds of thousands of Indian employers violate the Child Labor (Prohibition and Regulation) Act of 1986 banning employment of children below 14.

In fact, according to the United Nations, child labor contributes an estimated 20 percent of India’s gross national production. In India today, 75 percent of the population lives in rural areas, but the land holdings of each successive generation are shrinking, forcing massive numbers of people to work as day laborers for pay that is sometimes a mere handful of rice and beans at the end of the day. At the same time,thousands of new industries, themselves hubs of exploitation, are opening to supply both export demands and India’s growing middle class.

In the last few months, largely prompted by the Gap Inc. investigation, New Delhi Police and labor department officials have conducted a series of raids on garment factories in the Indian capital and rescued hundreds of minors working in embroidery units. But most NGO’s remain cynical, claiming the raids are simply PR stunts designed to show that something is being done about the problem.

In India only 4,000 people have been convicted of violating child labor laws, but of those, 3,500 were fined the equivalent of only $10, according to a new report by an Indian chamber of commerce and the International Labour Organization. Rather than reducing child labor, the laws and the negative publicity have simply prompted factory owners to find new ways to circumvent legal restrictions and dodge activists who conduct surprise raids to rescue child workers. According to the Global March Against Child Labour, it is not unknown for children to be rescued from units and then, after bribes are paid to the police, get returned to their “owners.”

Professor Sheotaj Singh, the cofounder of the DSV (Dayanand Shilpa Vidyalaya), a Delhi-based rehabilitation center and school for rescued child workers, believes that as long as cut-priced embroidered goods are sold in stores across the West, major retailers will continue to inundate India’s main export firms with lucrative contracts.

“It is obvious what the attraction is here for Western conglomerates. The key thing India has to offer the global economy is some of the world’s cheapest labor, and this is the saddest thing of all: the horrors that arise from Delhi’s 15,000 inadequately regulated garment factories, some of which are among the worst sweatshops ever to taunt the human conscience, are unspeakable and largely unreported,” Singh said. “The facts are straightforward for the consumer. Cut-price stores in the West can only cut prices by ordering in bulk, huge numbers of garments, and somewhere along the chain of suffering and exploitation enslaved children are inevitably going to be involved. Everything is subcontracted in this country. These consumers should not onlybe demanding answers from retailers but looking to themselves and how they spend their money. Globalization has a great deal to answer for.”

THE EFFECT OF GLOBALIZATION

Globalization is a phenomenon that has shaped the economy of virtually every nation, set the agenda for almost every industry and—good or bad—significantly impacted billions of lives. Idealistic economists will tell you it is meant to signify integration and unity—yet it has proved, in its way, to be polarizing.

The architects of globalization are right that international economic integration is not only good for the poor, it is essential. To embrace self-sufficiency or to deride growth, as some protesters do, is to glamorize poverty. No nation has ever developed over the long term without trade. East Asia is the most recent example. Since the mid-1970’s, Japan, Korea, Taiwan, China and their neighbors have lifted 500 million people out of poverty, chiefly through trade.

But the protesters are also right. Huge corporations in the United States, Germany, the United Kingdom, France and Japan have become unfathomably wealthy and powerful through subcontracting to poorer countries and effectively racing to the bottom in a bid to heighten profits.

Indian demographers estimate that globalization will continue to set the agenda across the subcontinent as the country’s rapidly growing population pushes more rural families into poverty while economic liberalization fuels demand for many products made with child labor.

WHAT MATTERS TO CONSUMERS?

The key question behind international investigations like the one I carried out into the Gap’s production process is, “Do consumers really care?” A generation ago, few people would have had a very clear idea of what you were talking about had you mentioned corporate social responsibility (CSR). The responsibilities of a corporation—aside from making donations to carefully chosen charities—were seen by shareholders and management as absolutely focused on one thing: Profit.

On the whole, however, the idea of corporate social responsibility appears to be in the ascendant. In America, the Enron scandal certainly helped the growth of CSR, as do child labor exposés. With customers, investors and potential investors being fed a steady, indigestible diet of corporate scandal after corporate scandal, companies are bending over backwards to prove they are not engaged in the race to the bottom, in the pursuit of profit above everything. They do this because they believe the consumers care about the origins of their work shirts, the beans for their morning cups of coffee, the rugs for their homes or the bio-diesel to fuel their cars.

CSR today may be a good deal more than just PR. It may be, to put it bluntly, a rational response on the part of the business community to the fact that on the very issue of survivability, time is running out. It has become apparent to even the most narrowly focused laissez-faire capitalist that on critical social and environmental issues, the business community has to take a leadership role, if only to ensure a future for itself. A mere generation ago, environmentalism was something for baby boomer hippies; social activism for woolly democrats.

But today, with the effects of climate change being felt on the ledgers of national economies and companies reeling from consumer pressure to address ecological concerns (forestry), labor injustices (clothing and shoe manufacturers) and health issues (food producers), businesses have begun to pay attention to the dire warnings that were formerly dismissed as typical doom and gloom of anti-capitalists.

INDEPENDENT INSPECTIONS REQUIRED

Transparency has largely become the watchword of the day, and the mere mention of sweatshops would make a clothing manufacturer begin to look anxiously at its bottom line. Transparency is what the Gap displayed in the aftermath of the revelations I put to them about their production process. They admitted the problem, sought to fix it and promised to radically re-examine the working practices of their Indian contractors. They did, though, resolutely refuse to supply me with their full list of Indian suppliers.

At the height of my discussions with Gap, I raised the question of a RugMark certification program for clothing. A decade ago India launched a new carpet certification program called RugMark, primarily because of pressure from Germany, its biggest carpet importer, and from Indian organizations such as the South Asian Coalition on Child Servitude. Under the program, government and independent monitors are supposed to inspect exporters’ looms to certify that children are not employed, and then tag carpets with a certification seal. RugMark is widely perceived to have successfully reduced the number of children involved in the carpet industry.

According to Bhuwan Ribhu from the Global March Against Child Labor, the retail industry could adopt a similar approach. The key to its success would be to allow independent auditing. He claims: “The first part of the solution to tackle child labor is prevention: Helping parents to increase their income through income generation programs and encouraging them to save for the future. This would prevent their children from being forced into labor in desperate situations. Secondly, caring for children who are in labor. Help to release them even if it means paying their debts. Arrange for these children to attend school or vocational training. Thirdly, advocating. We work with other humanitarian organizations and the government to ensure that laws are strictly enforced and to have more policies to protect children. It is also important to create awareness in the communities so that they can find ways of protecting the rights of their own children.”

“We also believe that international retailers should take transparency one step further and open themselves up to independent inspection in a similar fashion to the RugMark model. Unfortunately we believe this will not happen. Major retailers quite simply don’t trust their own suppliers in countries like India.

This is why they won’t open their books up for inspection. It will take one company to make a stand and say, good or bad, we will put ourselves up for independent auditing.”

He added, “The public also has a major role to play. They need to learn more about who makes the products they buy and support organizations with programs to stop child labor. Raise funds, join campaigns and talk to friends about child labor to make more people aware of the seriousness of the issue.“

The reality is, most major retail firms you use are playing exactly the same game, cutting costs and not considering the consequences. They ultimately know what outsourcing to India means. Employing cheap labor without proper auditing and investigation of subcontractors inevitably means that children will be used somewhere along the supply chain. This may not be what they want to hear as they pull off fresh clothes from clean racks in stores, but shoppers in Germany should be thinking: Why am I only paying $20 for a hand-embroidered top? Who made it for such little cost? Is this top stained with a child’s sweat? That’s what they need to ask themselves. Not only that, but have the children who made this top been sexually and physically abused? Or have they been kidnapped or stolen from their parents? These are questions that need to be asked by consumers and sellers.”

It is May 2008, almost eight months after the Gap story broke, and I am standing in Patna Railway station in northern India waiting to board the Sampoorna Kranti Express from Bihar to New Delhi. Around me red-turbaned porters balancing huge bundles trot barefoot past into the iron carcass of Old Patna Station.

The throaty shriek of a steam whistle pierces the heavy, humid air. It’s 10 pm. In the cavernous main terminal, a tiny girl smiles as her mother tucks her in on a grimy patch of floor. Around them, hundreds more rag-wrapped Indians settle in cheek by jowl in the darkness. Thousands more flow past. I’m swept into the current of chattering passengers and piping vendors surging toward my platform.

In the throng, I catch quick glimpses: Two naked young boys play on a pile of half-burnt garbage; an itinerant holy man, forehead white with smeared ashes, leans on a wooden staff; a sudden skinny hand thrusts in my face, palm up.

Before I can respond, I’m pushed forward. An ocean of desperate, pleading faces in the land of multitudes, endlessly stirring, pushing, moving, at once teeming and vigorous and urgent train stations, above all else, represent the real India.

It is the train that unlocks this incomprehensible land to the traveler. India’s steel arteries carry 11 million people a day to the nearest village market, the farthest foothills of the Himalayas and the banana plantations of the far south.

But the train on the platform before me, the Sampoorna Kranti, the Bihar to Delhi Express, represents another reality of a chaotic nation in the midst of an economic resurgence. It is packed to bursting point with migrants. Many of them, at least 80, are children, some as young as 7 and 8 years old, heading to the city to work in factories and unspeakable sweatshops.

The Buddha may have gained enlightenment here in Bihar, 500 miles north of Delhi, but that was more than 2,500 years ago. Today the rich, Ganges-fed plains of Bihar are now notorious as India’s “wild west”; a byword for utter despair. Bihar and its 85 million people— roughly the population of Germany— embody the problems that face the world’s most populous democracy and threaten its emergence as an economic superpower to rival China.

In India’s poorest and most chaotic state, murder and kidnapping are the fastest-growing, indeed almost the only, industries, caste wars are more certain than jobs, corruption is rife, rebels wreak terror and infrastructure is non-existent.

At night, large tracts of the capital Patna, Bihar’s downtrodden and violent capital, are powerless and pitch black. Roadside fruit sellers trade by the light of a candle. In villages, barely accessible by crumbling or nonexistent roads, electric power is available only two or three hours a day.

Here before me on the Bihar to Delhi Express lies the most telling statistic surrounding child labor in India’s capital: NGOs estimate that almost 90 percent of the children enslaved in New Delhi’s garment sweatshops hail from the Sitamarhi district of Bihar.

This region, straddling the Nepalese border, is steeped in poverty; it has no industries; most inhabitants are illiterate and a majority of families have seven to eight children. As a result, many families have no choice but to send their children away to Mumbai, Delhi or Surat to work as child laborers. They are stepping out of the frying pan into the fire, but grinding poverty makes any alternative seem attractive.

Sitting on the floor of the train’s filthy cattle-class compartment, his shirt buttonless till the waist, 10-year-old Mohammed is hungry and tired. Above all, he’s confused. He told me he had been approached a week earlier in the village of Ragarpura in the Sitamarhi district of Bihar by a man who introduced himself as Sadiq.

He dazzled them with photographs of girls dancing in a Bollywood movie, and promised more in New Delhi, then convinced their parents to let them go for a small fee (10 Euros) and the promise of more money to follow. The next day the children readily walked out of the village and were crammed onto a truck to the Bihari capital Patna. He then immediately sold the children onto Rakesh, a second agent who had travelled up from Delhi, who told the children he was their new owner.

“Sadiq was funny. He told us he would show us many more movies and give us lots of sweets if we go with him to New Delhi and do two hours of light work every day,” Mohammed told Stern. “We all wanted to go with him. This new boss, Rakesh, won’t tell us where we are going, we are frightened of him. I tried to tell a policeman in the station but he laughed and sent me away. Rakesh threatened to stab me with a knife,” said Mohammed.

Sikandar, the oldest of the eight boys, sits quietly at the back of the carriage. He knows what to expect, having been arrested and sent home from Delhi on a number of occasions. Unlike the majority of the youngsters he is choosing to make the trip south again.

This time he is set on making money. Sikander tells me he will never forget the times he fell asleep at his job in a slum embroidering clothes with a shimmering thread. “Once when I dozed off in a sweatshop in Old Delhi I was given the worst beating of my life,” he tells me. “The owner, he hit me with a hammer here and here,” he adds, pointing to a heavily scarred arm and a right elbow, which he can no longer straighten.

“Another time, the same owner punched me in the face. My jawbone is still broken. You may think I am crazy for going back down, but this time I am older now, I will last longer. When the police come, I will hide and not get sent back home. There is nothing for me in Bihar. Most of the children here are being forced south but there are others like me who want to work and learn. Delhi is the only hope we have of making money.”

After five years in various zari units in New Delhi, it is clear that 14-year-old Sikander is profoundly insecure out of one. Sitting on a wooden bench in the baking compartment, dignified despite his holey grey T-shirt, he brings down his faded Hessian sack every now and then and sorts through his possessions. In a small plastic pencil box lie his collection of needles and a tiny square of embroidered cerise chiffon, the product of his toil and proof that he can do his job.

Outside in the darkness of the station, a huge horn sounds to signify the train’s imminent departure. As the sound floats into the night, a policeman spits out a huge red blotch of betelnut and waves the children goodbye to a childhood of servitude, most likely for another western retailer.

“Somebody in Bihar gives birth to them, and they become our headache!’’ he tells my translator without prompting as we are last to board, his face wrinkling in disgust. “Good riddance to them. They are Delhi’s problem now.”

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Dan McDougall is a journalist for The Observer newspaper in Great Britain.

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