fractured earth

Home » 2017 » June

Monthly Archives: June 2017

Beyond Surat’s GST strike: New technologies, Chinese imports are causing a churn in textile sector

At one time, the neighbourhood around Surat’s textile markets was noisy.

The street resounded with the clacketing of powerlooms – five or six machines in dark, poorly ventilated rooms with split levels. Most of these were family-run businesses. The looms were on the groundfloor with families working by day and sleeping upstairs at night.

Now, the inner city is more quiet. There are still powerlooms aplenty in the industrial clusters around the town. But within the town, they increasingly show up in junkyards and the shops of scrap merchants. The premises that used to house them now lie empty or have been repurposed. Some are used by people in the embroidery trade. Others serve as parking spaces for two wheelers.

The castes that traditionally operated these looms – Khatris and Ghanchis – have left the trade as well. Some have entered new businesses. This reporter met some driving rickshaws. Others have given out their premises on rent and live off that income.

This silence – and the departure of weavers from their traditional trade – reflects something important. Surat’s small and medium businesses were struggling even before the government announced that it would implement the Goods and Services Tax from July 1, subsuming all indirect taxes, from octroi to service tax, into one rate that would be consistent nation-wide. This reflects the situation Scroll’s Ear To The Ground project found in the other states we reported from as well. There too, small and medium enterprises were in trouble.

The second (and concluding) part of our article on Surat’s textile cluster gets into more detail — and asks pointed questions about India’s vapid claims of manufacturing competitiveness.

In Surat’s textile hub, small businesses are afraid of GST – but big companies are not

Rajesh Mehra is desolate.

A big-boned man in his mid-fifties, he is a trader in women’s blouses.

Until ten years ago, Mehra used to take orders from garment wholesalers in big cities like Mumbai, Kolkata and Bengaluru, buy the cloth and thread he needed from garment clusters like Silvassa, and get the blouses stitched in Amritsar.

But this business model ran into trouble when blouse-making units came up in Surat, one of India’s biggest synthetic fabric and sari-making clusters. Enjoying advantages like proximity to cloth- and thread-makers, these units made cheaper blouses than their counterparts in Amritsar.

In response, Mehra made a hard call. He left his family behind in Amritsar and moved to Surat, working on the assumption that having a perch in that city would help him sell better.

Now, as India readies to overhaul its tax regime for businesses, replacing a welter of sales and income taxes with a single tax called the Goods and Services Tax, Mehra has run out of ideas. “Kya hoga?” he asked. “Kaise chalega yeh sab?” What will happen? How can this business continue?

Anxieties about how GST will impact their businesses have prompted textile traders to go on a nationwide strike over three days this week. But not everyone in Surat’s textile hub is worried.

No more than 20 minutes away from Mehra’s shop in the basement of a building opposite Surat’s old Ratan Cinema, in the heart of the town’s textile market, lies the soot-blackened industrial estate of Pandesara. This is where Sanjay Saraogi works.

Saraogi, who looks far younger than his 46 years, is the managing director of Rs 450 crore Laxmipati Saris.

Described by his peers as one of the sharpest minds in the Surat textile industry, he entered the family business at 14 when his father fell very ill – he would go to school in the morning and spend the rest of the day in the shop. Over the last ten years, he has steered Laxmipati beyond trading into sari manufacturing.

When it comes to GST, he is relatively unconcerned. It will be good for businesses like ours, he said.

The contrasting responses of Mehra and Saraogi offer a picture of how GST will affect people and companies in India’s manufacturing economy.

What’s common between coaching classes in Bihar and its bahubali leaders?

Career Plan Coaching Centre is not much to look at. It is a tiny room, tightly packed with benches and desks, housed in an unplastered brick structure, one half of which is a garage.

A board advertises the services offered by the centre, located in Geetwas, a small village near Araria in northeastern Bihar: tuitions for students between class 8 and class 12.

But, as Gautam Kumar, a mathematics graduate in his mid-twenties who runs the centre, explains, he does not merely provide supplementary education to students lagging in one or two subjects – he teaches the entire school curriculum.

Career Plan is a homegrown response to the larger crisis of public school education in Bihar.

The third — and concluding — article in our series on government functioning in Bihar looks at the aftermath of a state absenting itself.

Bihar’s Nitish Kumar has been in power for 12 years. Why has he failed to change its fortunes?

Kanwar jheel is a freshwater lake spread over 6,311 hectares in Bihar’s Begusarai district. Till the 1970s, the lake used to attract as many as 100,000 freshwater birds each year. But, in recent decades, it has been under attack. Landowners from the Bhumihar caste have been draining Kanwar jheel to farm on its lakebed. This has resulted in protests from local fishermen, belonging to an extremely backward caste called the Sahnis.

What is telling, said Arvind Mishra, an environmentalist who lives in Begusarai, is the government’s reaction. Despite an order by the Patna High Court and appeals from the Sahnis and environmentalists, it has not intervened.

The fallout: Sahnis, who are seeing their fish catch fall, are hunting birds instead. Between that and the habitat loss, the number of birds coming to Kanwar jheel has fallen to 4,500-5,000 each year, he said.

What explains the lack of government response?

The second part of our trilogy on why Bihar underperforms on the welfare and development front.

Bihar is struggling to improve the lives of the poor even after 27 years of backward caste rule

The district hospital of Muzaffarpur, 100 km north of Patna, Bihar’s capital, is struggling with a shortage of doctors.

With 160 beds and an estimated inflow of 500-600 new patients each day, the hospital should have 48 full-time doctors and 52 nurses, said one of its administrators. What it has, instead, is 12 full-time doctors, 24 part-time doctors and 28 nurses. The Intensive Care Unit should have four doctors but has just one. The unit for newborn babies, which should have four pediatricians, is managing with just one.

Given such understaffing, the hospital doesn’t meet the district’s healthcare needs.

When Madina Begum, a resident of Ratnauli village, took a neighbour with a temperature of 104 degrees Fahrenheit to the hospital, she said, “All the doctors did was give her a bottle of saline. Nothing else. No medicine.” The woman’s companions had to put wet clothes on her all night to cool the fever down.

That is the story across Bihar. Seventy years after Independence, the state’s healthcare infrastructure continues to be grossly inadequate. Seventeen of the 38 districts in the state have no more than three government doctors for every 100,000 people. One district, Siwan, has just one doctor for 100,000 people. The highest, Sheikhpura, has eight doctors per 100,000 – or one for every 12,500 people. To put that in perspective, the WHO-prescribed level is 1:1,000.

In the same way, while the Right To Education law mandates student-teacher ratios at 30:1 in primary schools and 35:1 in upper primary, the ratio in Bihar districts hovers between 43:1 and 96:1. As a result, learning outcomes are poor in the state.

All of which echoes what we saw — in relatively greater detail — in the state’s remarkably inadequate response to both arsenic contamination of groundwater and the rising incidence of dengue. Embedded in all this is a paradox. In the last 12 years under chief minister Nitish Kumar, as the article says, Bihar has notched up large improvements in law and order, road connectivity and electricity supply. But its performance on issues crucial for the poor – like health, education and land redistribution – remains weak.

Which is odd. In the last 27 years, the state has been ruled by backward caste leaders, who rose to power by appealing to the poor. Given that, why is Bihar’s track record on crucial issues that most affect the poor so underwhelming?

Out today is the first of a three-part answer to that question.

How technology is changing popular culture in Bihar

Sudhanshu is hard at work in his shop on Patna’s busy Boring Road. The small strip of a shop has two desktop computers, both loaded with music and movies downloaded from the internet.

The songs and films are Sudhanshu’s livelihood. Boring Road, with its government college and several dozen coaching centres, is a beehive of students. Every day, several of them visit the shop to purchase the latest movies and songs for their phones and pen drives.

One sleepy afternoon in March, Sudhanshu, who does not look older than 20, rattled off the names of the hit movies of the moment: Akhil The Power of Jua, Heart Attack, Businessman 2, Shivam, Viraat, The Return of Raju. All South Indian films, mostly Telugu, dubbed into Hindi for audiences in the north.

“We have more people coming here for Tamil and Telugu films than for films in other languages,” Sudhanshu said. Apparently, South Indian films have soared in popularity in the last five years. And not just in Patna. At an autorickshaw stand outside the Jawaharlal Nehru Medical College Hospital in Bhagalpur city on another March afternoon, two young men were watching a movie on a mobile phone.

Which film? “Tamil hai,” one of them replied. It is Tamil.

Wait! Why are people in Bihar watching Tamil/Telugu movies all of a sudden? Read on.