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| State of garment sector workers in 7 countries |
At a time when top Indian American economist Prof Arvind Panagariya, known to be close to Prime Minister Narendra Modi, wants Government of India (GoI) to drop the minimum wage criterion for labour-intensive garment sector to survive, top international NGO Oxfam said, wages in India’s garment sector are already one of the lowest in the seven countries it has studied.
Panagariya, who resigned last year as vice-chairman, Niti Aayog, the GoI think tank, citing bureaucratic interference, but has remained a Modi faithful, in a recent article gave the example of Shahi Exports, an apparel exports firm, for creating 252 times more jobs that the Reliance Industries Ltd (RIL), to say why the “apparel industry model” holds “the key for India’s job creation requirements.”
“Jobs that Shahi Exports creates are what India needs most today”, insisted the top economist, adding, “On average, these workers earn Rs 15,000 a month. About 60% of Shahi Exports employees are women.” However, Panagariya warned, to sustain the “model”, the minimum wage criterion should be shed.
An Oxfam study, titled “Reward Work, Not Wealth”, released recently, providing comparison between seven countries, has found that not only the minimum wages in India’s garment sector are one of the lowest.
Thus, India’s 50.7% of workers working in the garment sector earn less than the minimum wages, which is worse than all but Philippines, where 53.3% of workers in the sector earn less than the minimum wages.
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| Garment sector: Non-compliance rate (%) by gender |
In Vietnam, only 6.6% workers in the sector earn less than minimum wages, in Combodia it is 25.6%, in Pakistan 37.4%, in Thailand 37.5%, and in Indonesia 39.1%.
According to Oxfam, when the policy for enforcing the minimum wage criterion is enforced, in India, as elsewhere in the seven countries studied, things go “more to the benefit of men than women.”
Thus, the study says, “In the garment sector of Pakistan, for example, 86.9% of women are paid less than the minimum wage, while the figure for men is 26.5%. India, the Philippines and Thailand also have double-digit gender compliance gaps.” In India, 74% males working in the sector get minimum wages, as against 45.3% females.
Even as pointing out that “In countries like India and the Philippines, at least one in every two workers in the garment sector are paid below the minimum wage”, the study estimates, “It would take 941 years for a minimum wage worker in rural India to earn what the top paid executive at a leading Indian garment company earns in a year.”
The study further says, “It would take around 17.5 days for the best paid executive at a top Indian garment company to earn what a minimum wage worker in rural India will earn in their lifetime (presuming 50 years at work).”
It adds, “It would cost around Rs 326 million a year to ensure 14,764 minimum wage workers in rural India were paid a living wage. This is about half the amount paid out to wealth shareholders of a top Indian garment company.”
According to Oxfam, when the policy for enforcing the minimum wage criterion is enforced, in India, as elsewhere in the seven countries studied, things go “more to the benefit of men than women.”
Thus, the study says, “In the garment sector of Pakistan, for example, 86.9% of women are paid less than the minimum wage, while the figure for men is 26.5%. India, the Philippines and Thailand also have double-digit gender compliance gaps.” In India, 74% males working in the sector get minimum wages, as against 45.3% females.
Even as pointing out that “In countries like India and the Philippines, at least one in every two workers in the garment sector are paid below the minimum wage”, the study estimates, “It would take 941 years for a minimum wage worker in rural India to earn what the top paid executive at a leading Indian garment company earns in a year.”
The study further says, “It would take around 17.5 days for the best paid executive at a top Indian garment company to earn what a minimum wage worker in rural India will earn in their lifetime (presuming 50 years at work).”
It adds, “It would cost around Rs 326 million a year to ensure 14,764 minimum wage workers in rural India were paid a living wage. This is about half the amount paid out to wealth shareholders of a top Indian garment company.”
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