The real estate boom in India rides on the underpaid labour of brick kiln workers from whom every ounce of effort is mercilessly extracted with no respect for the law
Urban growth has been central to the remarkable growth rates that we have achieved over the last three decades. Especially since the 1990s, when structural adjustment policies were introduced, markets and private capitalist ventures have significantly driven our urban growth process. However, unlike what is taught in economics textbooks, markets have neither been free in a classical sense, nor welfare-enhancing for all. Focussing on any aspect of the urban growth process would bring out these pathologies, not merely in the urban sector but in the larger growth model. Since construction and real estate have been a crucial component of urban growth, an analysis of one of the building blocks (brick kilns) of this sector in and around Hyderabad city throws light on several of these issues.
Open brick kilns are located in and around the outer boundaries of the rapidly growing city of Hyderabad. These kilns employ lakhs of people, mostly seasonal migrants, who travel long distances from across the country, to live and work in extremely trying conditions. In particular, more than two lakh workers travel from western Odisha districts (mainly Koraput, Bolangir and Kalahandi) to Hyderabad typically in the pre-summer and summer months of the year, in pursuit of a livelihood.
Typically, most of the workers are from the Scheduled Tribe communities or more broadly from Dalit communities, who are landless workers, tenants or cultivators, working on meagre amounts of land back in Odisha. One of the pathologies of the Indian growth process is the widespread and uneven outbreak of agrarian distress across the country wherein the majority of our workforce still depends on agriculture, which is not remunerative and, therefore, does not suffice in providing sustainable livelihoods to all those dependent on it.
This creates the phenomenon of distress-induced out migration that is seasonal or sometimes more long-term. In this case, some of the seasonal kiln-worker migrants from Odisha work in their small plots of land during the rainy season. They usually grow one crop (e.g. paddy) that does not sustain them throughout the year. Given the inadequacy of institutional credit, they live precariously, caught in inter-linked markets (credit-product or land-credit markets). These interlinked markets, as most economists know, do not function like free competitive markets but endow the market intermediaries with a lot of market power. If there are consumption shocks (e.g. marriage or death of a family member) or production shocks (like tubewell investment or crop failure) for these farmers, the situation gets further compounded and the families get locked in long-term relations of indebtedness. The fear of being trapped in debt with all its ramifications then pushes them out to seek work elsewhere, typically in some sector (such as brick kilns) of the rapidly growing urban India.
The kiln workers get a lump-sum payment at the beginning of their migration to the south, of an amount of around Rs. 12,000. They are also supposed to be provided weekly allowances at the destination in Hyderabad as their living stipend. There is a team in Odisha of Sardars or labour contractors, who handle the recruitment and the initial advance payments to workers, and then travel with them to Hyderabad. The Sardars act on behalf of kiln-owners, who largely hail from the Coastal Andhra region. Having taken the advance, and having moved to a foreign location, the workers are largely captive and forced to act as bonded labour during the contract period. The implications are many.
First, workers are forced to work extremely long and irregular hours at the kilns (sometimes, 4 a.m. to 11 p.m with a half-hour lunch break). Second, the conditions of work are quite hazardous and affect their long-term health. Third, their living conditions are quite appalling, as they are forced to house themselves right next to the kilns. Fourth, child labour is rampant as the workers bring their families along when they migrate. Fifth, women constantly undergo sexual harassment at the hands of the Sardars and owners. It is a journey from one set of unfree markets at the source to another set of unfree markets that borders on slavery at the destination during the contract period.
In terms of remuneration at the destination, there are major violations in paying the prescribed minimum wages of the Andhra Pradesh state. In several of the kilns, in terms of the consolidated amount that is paid to the brick moulders for the piece-work they perform, the actual wages (about Rs. 150-200 per 1000 bricks) are roughly half of the prescribed minimum wages (Rs. 376 per 1000 bricks). The situation is no different for brick loaders. At the same time, while the actual cost of making bricks is around 50 paise, it is sold in the market for about Rs. 2.50. The profit margins are in the range of 400-500 per cent, making it an extremely lucrative venture for capital. Of course, some of the margin goes into supporting the Sardars, the local police, State officials, so that this highly exploitative process can go on relentlessly. The real estate boom and the rapid urban construction growth in India over the last two or three decades ride on these emaciated workers from whom the last ounce of effort is extracted without mercy or any respect for the law. This also throws light on the rapidly escalating inequalities in the country since the 1990s.
In terms of the impact of the brick kiln industry on local villages, there is a major diversion of agricultural land for the production of bricks. This land cannot be used for cultivation for a few years after that. Local farmers who lease out the land benefit from the rents. Local merchants benefit greatly with the influx of migrant populations for a few months. Otherwise, there is very little employment generated for the local workers of these villages.
There has been a spirited effort to organise the migrant kiln workers by some university students, interested academics, NGOs, and some trade unions, who have formed a solidarity committee for them. It is extremely difficult to organise the workers because of the nexus between the state, owners and contractors, the indifference of well-meaning liberal middle classes to the processes that are building their dreams and prosperity, the vulnerability of workers at an unfamiliar workplace in Hyderabad, their vulnerability in the power equations that work in Odisha, the general difficulty of organising workers in the unorganised sector, the language barriers between the organisers and workers, and the dire threats issued to the organisers by owner-sponsored mafias.
However, such mobilisation efforts need support from all quarters (especially all labour unions) to question both the unfreedom that gets promoted in the name of free markets, and the exploitative processes through which a minority becomes prosperous in our society. These efforts have to be undertaken in conjunction with questioning the already crisis-prone neoliberal growth process in India and across the globe that has tended to see a proliferation of urban informal sector jobs with low wages and poor working conditions, while creating very little employment in the organised sector. We have to lay the foundations for a better growth model not by stimulating the ‘animal spirit’ of domestic and foreign investors as our Prime Minister has often said, but by building a better economy for the majority through the creation of equitable institutions, and through the progressive redistribution of gains from growth.
(Vamsi Vakulabharanam teaches at School of Economics, University of Hyderabad)