Continuing Decline of Bengal Economy

Atanu Chakravarty

There is no denying the fact that West Bengal is an industry–starved state, with the age-old traditional manufacturing industries at their throes, reeling under a plethora of crises. Since 1990s, West Bengal's agrarian economy is facing stagnation. Neither CPM-led Left Front (LF) Government in their 34 years of rule or misrule nor Trinamool Administration for the last three successive terms did anything positive to stem the rot. The much-touted political stability of a particular dispensation in West Bengal could not ensure economic development–be it industry or in agriculture. In 2008, LF represented 234 elected representatives in the 294-strong Assembly House. In the last assembly election Trinamool grabbed 213 seats, registering an all-time high vote of 47.9 percent. A couple of MLAs defected from other parties and joined TMC, thus increasing their tally. But this bountiful electoral harvest and political stability failed to salvage the sinking economy of the state.

When LF came to power in the state, the industrial situation was grim and they had to inherit a falling industrial economy. According to Debraj Bhattacharya, the new industrial policy of 1978 gave priority to small and cottage industries and sought to curtail the stranglehold of big houses, foreign multinational firms in the organised sector. This policy, on the contrary, failed to revive the industrial climate of the state, and the net result was between 1980 and 1990, in terms of State Domestic Product, West Bengal ranked 13th among Indian States’.’ (Why the lack of Industry in West Bengal).

Riding on the crest of anti- land acquisition movement at Singur, Nandigram, Mamata Banerjee after assuming state power promised not to forcibly acquire land from the peasantry for the big industrial houses and ironically, like her predecessor, emphasised on small and medium industries as the industrial policy of her government. The successful land reform programme initiated by the LF Government had limitations within. And when the agrarian impasse stubbornly raised its head, the fruits of cottage industry failed to produce the desired goal, the LF Government ventured recklessly on the paradigm of neo-liberal path of industrialisation that triggered its doomsday. Mamata Banerjee’s political compulsion led her to tread a cautious path and according to her, Small and Medium industries were prioritised, boastfully claiming, ’’ We are number one in India in MSME sector". The NITI Aayog study noted that the nature of growth in West Bengal is driven by the unorganised sector. As creation of capital is the most important component of industrial growth, West Bengal lagged in this aspect. According to Annual Survey of Industries (ASI), from 2011 to 2017, the annual average growth rate of the current capital for the firms in the formal sector is negative 0.09 percent in West Bengal. On the other hand, that of net fixed capital is an astounding negative 147 percent. These figures give an indication of a double whammy for the formal sector firms, first in the crisis of creation of retained earnings and secondly a precarious crisis of creation of durable assets. This proves that the registered manufacturing firms in this state is confronting a chronic problem of sustainability as they are failing to add modern machineries and equipments in their assets and losing the value of their existing plant (West Bengal's Industrial Decline: A Crisis of Capital Creation, Indian Researcher, by editorial team,March 22, 2022).

Jute, the labour intensive traditional industry of the state employs 2.5 lac workers and sustains over 40 lakh families. Out of the 93 mills in India (2006 data) 70 jute mills are in West Bengal, which is the hub of India's Jute Industry, valued at around Rs 10,000 crore.

For the first time, the National Jute Board (NJB), a Central Government organisation, conducted a study for assessing the socio-economic conditions of the Jute Workers of West Bengal and their families to assess the status of their well being and their families.

The survey found that the average income of the workers’ Households (HH) is Rs 11,015 per month. However, there is wide variation of income across the HHs. Maximum households (57.4 percent) have reported monthly income in between Rs 5,001 to Rs 10,000 and 6.4 percent HHs have income above Rs. 20,000 per month. On the other hand, 3.8 percent HHs have income below Rs. 5000 per month. An overwhelming 54 percent HHs are in debt. The average amount of loan is Rs39,592 whereas the amount of loan varies from Rs 1,500 (for treatment) to Rs12, 00,000 (for building house, home loan taken from Bank). Social obligation is the most common (35.6%) for taking loan followed by repairing houses (18.1%) and medical care (17.8%). In 78.5 percent cases the loan was taken from PF. Another independent organisation, Wazir Advisors, was engaged by the state government of West Bengal to conduct Primary and Secondary Research on the current scenario of the jute industry. They have found that low wages and laborious work are the major issues faced by jute workers. The study found, wages in this industry is abysmally low–monthly income of 50-55 percent jute workers hovers around 6,500-7,000 per month. The joining wage of a new entrant is Rs 370, which, the study noted, is lower than the wages received by skilled workers in other industries of the state. Apart from low wages, this industry is plagued by default in the payment of statutory dues for years together. This report also noted, Non- payment of PF and Gratuity is staggering, which has crossed Rs 500 crore. Piling statutory dues are reducing the attractiveness of working in a jute mill. The owners of the jute mills are only interested in maximising their profit within a very short period and are not interested in investing again in the mills. The textile ministry in a report has mentioned that the annual turnover of jute industry is more than Rs 10,000 crore, but data reveals that between 2007-2011 the industry spent Rs 274 crore, a paltry 2.7 percent of its annual turnover on modernisation and technical upgradation. This trend and scenario remained the same in the following years. The owners who mainly hail from Rajasthan and Gujarat are feudal in outlook and treat the state as their colonial possession. Their sole purpose is how quickly to maximise loot at the expense of workers and the industry as well. They hardly bother about development. Also, this industry has been a principal source of generating black money. The British owners, mostly Scottish, built quarters for workers but Indian owners are now dismantling them to make space for multi-storied real estate business. Also, vacant space of jute mills on both sides of the river Hooghly are dotted with a large number of housing projects. There lies easy money.

Jute industry of this state is a symbol of anarchy, lawlessness. No uniform wage pattern, grade- scale is followed by the captains of this industry. Unscrupulous jute traders and bailers turned owners, having shady connections with an influential section of the ruling party during different regimes are ruling the roostwhich have helped them to thrive in spite of political vicissitudes.

Almost all the trade unions affiliated to different political parties have their functional presence in Jute and Tea, the two most important labour-intensive industries in this state. Barring INTTUC, the trade union wing of the ruling party, all trade unions, irrespective of their political affiliation, still follow the fine tradition of united movement in these two industries and charter of demands is submitted before the owners of the Jute and Tea industry unitedly.

Both these two traditional industries are facing similar crises—acute shortage of workforce. Main reason for this persistent malady is abysmal low wages which is not attracting new workers in these industries. The last tripartite industry-wise wage agreement of the jute industry was signed in 2019. That agreement failed to enhance the wages of jute workers and hence all the left trade unions stayed away from renewing that agreement. After expiry of that agreement, a new charter of demand has been submitted before Indian Jute Manufacturers Association (IJMA), state labour department and all the concerned stakeholders in March 2019, but the labour department has failed to settle this wage agreement till date.

In the Tea industry, the last tripartite agreement was signed way back on February 20, 2015, assuring implementation of minimum wage (MW) in the tea sector for the very first time in this 170- year- old scheduled employment. A 27- member MW Advisory Committee was formed comprising 9 representatives each from the owners, TUs and labour department. The agreement endorsed that the MW calculations should be over by the next 6 months time through a series of parleys amongst stakeholders. The time and terms of agreement ended on March 31, 2017. Meanwhile, more than 20 MWAC meetings have been held since 2015. Wage calculations, both from the employers and the TUs side were placed before the labour department by December 13, 2017.The MIC, Labour out-rightly denied to have received any such formulations in 2018 till date. It remains a fact that the WB Government lacks the political will either to fix the MW in the tea sector or to initiate a tripartite meeting to arrive at negotiated settlement on wages.

On the contrary, the labour department through issuing a series of unilateral government orders increased wages on interim measures amounting to Rs 7 to Rs 10 at a time. The present daily wages for a plucker stands at Rs 232.

To derail and defuse the long standing demands and with an aim to de–consolidate the unity of 26 TUs active in North Bengal tea sector viz. Joint Forum, the latest interim increase has been declared as Rs 18 more, making the daily wages Rs 250 in April 2023.But the employers immediately sought relief before the Hon'ble High Court and could successfully stall the disbursement through a stay order, whose tenure is now extended to July 31, 2023.

The Joint Forum initiated demonstrations before the BL&LRO offices in Terai, Dooars and Hills demanding rights of ownership of the homestead lands within the garden areas (parja-pattas). These demonstrations witnessed spontaneous participation of a large number of workmen from most of the gardens. The workers, during the demonstrations, also raised slogans expressing their refusal and demanding revocation of Cha Sundari Housing Project 2017 and Tea Tourism Act, 2019. Such projects and acts are primarily meant to evict the workers from their perennial labour line settlements and sell out the garden lands to corporates for the purpose of tea tourism. Several tea garden owners have already earmarked big tracts of garden lands converting them to construct tourist resorts. One such vulgar instance is New Champta Tea Estate (the first ever tea garden in Terai established in 1867), where the Mayfair Group has erected a huge 3-star hotel illegally occupying more than 24 acres of land instead of 5 acres as per the deed. Such structures are also seen in the famed Makaibari Tea Estate in Kurseong hills, in Kamala and Hansqua tea gardens in the Terai region.

The Mamata Banerjee Government is following the footsteps of neo-liberal economy, albeit in a different way. After the Singur episode, she earned the image of anti-industry–street fighter and to refurbish her anti- corporate image she promised the industrial house for a bandh–free, strike-free Bengal. Any industrial action, within the permissible legal limit and even against the economic -industrial policies of Modi government were not only discouraged but was mercilessly crushed by the police administration and her trade union wing. During her rule, mandays lost due to strike is zero, while the same due to illegal lockout jumped to an all-time high to 100 percent. But none of those lockouts were declared illegal by this government, which eventually encouraged the employers to increase their all-out offensive against the workers. Registration of new trade unions under this dispensation has fallen drastically, thanks to the arbitrary and stringent conditions imposed by the labour department that only augured well to restrict the formation of new unions, albeit in a cunning manner. Thousands and thousands of posts in different departments of state government have been lying vacant for a few decades. Recruiting whopping number of informal employees in formal employment indiscriminately, sans social security and low wages, has become the norm of this government.

West Bengal has the highest number of MSME's–comprising 11 percent of the country's total. These predominantly informal sectors, accounting for more than 95 percent of the total manufacturing firms in the state, are neither registered by the government nor have access to institutional credits. Approximately 93 percent of the total workers are employed in these sectors and are beyond the pale of labour laws. According to the periodic labour force survey (2019), 52 percent of the non-farm sectors are home based and 95 percent are working with less than 6 workers.

A defining feature of West Bengal's agriculture is two -third of all rural households (65.2%) own no land, as per the latest round of National Family Health Survey 5, 2019-21. De-peasantisation and subsequent proletarianisation is the present feature. As agriculture has failed to absorb labour, millions of young labouring youth are migrating to other states and a considerable section is fetching their fortune in the construction sector, which is almost driven entirely by casual labour, whereas more than half of the workforce engaged in manufacturing and services is self-employed.

Organising the nameless and faceless informal workers who are everywhere, for living wages, decent work, safe and better working conditions, social security, giving special emphasis on the working women are the challenges before the trade union movement of West Bengal.  

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Vol 56, No. 17-20, Oct 22 - Nov 18, 2023