Transitions from skilled cultivators to industrial labourers: Employment promises and realities in the mining and metals industry

Posco mining in Sundargarh district, OrissaPosco mining in Sundargarh district, Odisha

Felix Padel and Samarendra Das examine how few key mining/metal-producing projects, being promoted in India as haven for employment opportuntiies, are leading to an extremely exploitative situation in which jobs are controlled by mafias, cultivators are being displaced and converted into an industrial labour force, and their standard of living and control over their labour have witnessed a dramatic decline Hundreds of thousands of Adivasis and non-tribal cultivators have been removed from their land and enrolled as industrial labourers in India’s mining industry and metals factories during the last 30 years. The majority are employed informally as construction labourers and miners on a contract labour basis, with little if any job security. Similar numbers face this transition right now and in coming decades. What are the realities of work conditions, pay, compensation, for women and children as well as men in this informal sector of the economy? Are the employment promises generally kept through which new mega-projects are promoted? From Bhilai Steel Plant, Posco, Tata, Nalco and Vedanta mines and factories in Chhattisgarh, Jharkhand and Odisha to similar projects in other states, how does this transition play out in the lives of individuals and the impact on cultures?

What is certain is that these three circles of reality – informal labour in the mines, quarries, metal factories and construction, formal employment by the big firms, and the informal rural economy of millions of cultivators still rooted to traditional livelihoods but in imminent threat of displacement – are very closely connected, especially through the burgeoning business of distress migration labour. India’s new mega-projects based around mining and metal production depend for their profits on exploiting cheap labour at lowest possible wages, as well as on dispossessing hundreds of villages of their land and resources. These connections need to be much better understood.

Bhilai and beyond: Shankar Guha Niyogi, India’s most famous union organiser, who was murdered by industrial interests in Bhilai on September 28, 1991, was often angry at the seeming disinterest of mainstream trade unions about the growing problems of contract workers, which he knew in detail at first hand at Bhilai Steel Plant’s captive mines where he worked. Contractors in effect were appointing the main union leaders, and in 1977 the living and working conditions of contract workers were appalling. He took pride in his negotiations at the Dalli-Rajhara iron ore mines, which, from soon after they opened in 1958, supplied all the iron for Bhilai Steel Plant, in halting the move towards full mechanisation there. After about 10,000 jobs had been lost through mechanisation at Bailadila mines in Bastar to the south, the fruit of these negotiations was ‘semi-mechanisation’ at Dalli-Rajhara, ensuring continuing jobs for a large proportion of the workforce.

Long before recent mega-scams about illegal iron ore mining and exports, in Karnataka, Goa and Odisha, Niyogi highlighted discrepancies between iron ore prices, showing that most iron ore was being exported for far too little local, as well as government, gain. He also focused on the transfer pricing scams behind foreign engineering companies’ machinery being bought for new Indian factories through questionable joint ventures. One of his main concerns was the falling number of permanent employees in relation to contract workers in mines and factories. For example, in 1991, Simplex Engineering Works, supplying SAIL (Steel Authority of India Ltd) units in Chhattisgarh (including Bhilai Steel Plant), employed about 150 permanent workers out of a total estimated workforce of 2,000. Above all, he confronted the goondas and mafia organisations, that prey on informal sector workers (as well as full-time employees) in most if not all of India’s ore- and metal-producing mines and factories.

Certainly, he showed how extensive these networks are in Chhattisgarh, and how nefarious their tactics. His murder in 1991 followed a line of similar assassinations, as well as workers killed in police firings, for which no-one was ever convicted. The fact that he was killed in the year that India’s New Economic Policy started is significant. If anything, the condition of contract workers has continued to get worse, and the mafia-goonda networks still control wages and suppress dissent in factories and mines throughout the country, keeping pay low and compensation for accidents and industrial diseases minimal.

With Dalli-Rajhara mines near exhaustion now, and a workforce that used to stand at 16,000 down to about 1,200, SAIL (which is public sector) has applied to open new, ‘Greenfield’ mines on the Raoghat mountains in Kanker district, where extraction is planned as fully mechanised. In the context of the ‘Operation Greenhunt’-Maoist civil war, with the Raoghat mines threatening to disrupt the livelihoods of an estimated 25,000 Adivasis who live in and around this range, and Maoists declaring opposition to the project, the construction of the mines and new railway linking Dalli-Rajhara to Raoghat – about 95 kms through Maoist-controlled forest areas – is to be guarded by a contingent of about 4,000 police, consisting of two battalions each of CRPF (Central Reserve Police Force) and BSF (Border Security Force). By contrast, it is estimated that the mine workers and railway employees themselves would run the fully mechanised mines with a workforce of just about 200 workers. To counter Maoist propaganda against the Raoghat project, SAIL has started corporate social responsibility (CSR) projects in the Narayanpur area 25 kilometres away, enrolling Maria Gond youths in sporting events etc.

The lands being taken over for mines, railway and police barracks are estimated at 750 sq.kms, with over 3,000 hectares of forest to be felled. The iron deposits in Raoghat are estimated at over 7 billion tonnes of high quality iron ore (over 62 per cent grade fee), of which over 500 million tonnes are to be exploited to supply Bhilai Steel Plant. SAIL’s CEO announced a plan for sub-leasing the mines on a private basis in May 2011. At least 20 tribal villages are likely to be displaced or badly affected by pollution and the drying up of streams, which the history of Bailadila and Dalli-Rajhara areas shows is bound to be extremely severe, in a mountain range that sustains some of central India’s greatest surviving biodiversity, and lies adjacent to the Abujhmar forest, where Maria Gonds maintain cultural traditions that were little damaged until recent times.

From this Maoist-affected area relatively little news seeps out, and organising grassroots movements is even more hazardous than in Niyogi’s time. Yet it is clear that the main population around Raoghat is strongly opposed to the mines, that the Environmental Impact Assessment (EIA), on whose basis the project has been cleared, is full of distorted information, and that the whole process of clearance, supposed to be based on Public Hearings and the principle of Free Prior Informed Consent, has been done in a way that contravenes the principles of tribal people’s constitutional rights – as is the case for many, if not most EIAs and Public Hearings for controversial projects.

What are the relative values given to the iron ore, and to the communities that have lived for centuries around and on top of these deposits? The ore is at the centre of multi-million plans, ruthlessly implemented with no regard – except through PR promotion of CSR projects – for Adivasis.

How are traditional Adivasi livelihoods understood in relation to the formal economy? Basically, the two are barely conceptualized in relation to each other at all.

And how are Adivasis – throughout the country – being forced into the formal economy? This last question is relatively easy to answer – by ‘converting them’ to an industrial labour force. The main conversions being made in India today are not to Christianity or any other religion, but to an ideology of industrialisation, masterminded with a view to maximizing profits far away and minimizing costs. The human costs, in terms of tens of thousands of livelihoods destroyed and inhuman working conditions for millions, remain under the carpet, out of sight, conceptually as well as visually, to the world’s elites.

Posco project: The Mining Zone People’s Solidarity Group report has produced an easily accessible report about the Posco project that sets an example for a more holistic way of assessing social impacts, and calculating costs in relation to benefits for a major project. Among other aspects, it places key focus on jobs offered in relation to livelihoods destroyed. The Odisha government, with Posco, has mentioned the figure of Posco providing 870.000 jobs for 30 years, based on the cost benefit analysis carried out by the National Council for Applied Economic Research in 2007. Careful reading of this report shows that only 7,000 direct jobs are on offer for 5-10 years, with another 17,000 jobs in direct or indirect employment during the same period, while at least 22,000 jobs are being destroyed of owner-cultivators of betel vine plantations and their wage labourers, in a thriving agricultural economy, and 20,000 or more fishermen’s livelihoods are likely to be destroyed by the steel plant and its port, due to huge environmental effects on marine life.

In addition, Posco’s planned mines on Khandadhara mountain range are bound to adversely affect over 30 tribal villages in Keonjhar district, and over 80 in Sundargarh district. Already the Kurmitar mines there have expanded to become one of the biggest iron ore mines in Odisha, less scrutinised than others, sub-leased by the Orissa Mining Corporation to the Kalinga Commercial Corporation, whose website boasts it is exporting large quantities of iron ore and manganese ore to China and ‘a certain company in South Korea’, from Paradip as well as Vishakhapatnam ports. In many ways, the expansion of mining in the Khandadhara range, that has already involved ‘mountain-top removal’ of a major mountain in the range, is comparable to the Raoghat mining plan, in scale and quality of ore, as well as the biodiversity and cultural wealth under threat.

Tatas’ interests: Tatas’ steel plants under construction and planned in Kalinganagar, Odisha and Lohandiguda in Bastar district, Chhattisgarh, likewise seek legitimacy through job offers as well as benefits to the national economy. These too have been promoted with high levels of violence and manipulation, not least in the process of forced land acquisition and distorted Public Hearings. As at other companies’ mines and metal factories, local people, especially those who are displaced, can rarely aspire to anything more than the lowest pay grade of jobs, mostly on a sub-contracting basis. A large proportion of these are Adivasis, and the realities of these non-formalised jobs are extremely harsh. Tata, like other companies, avoids responsibility for appalling conditions of its lowest grade jobs through sub-contracting, combined with rapidly rising numbers of sub-contracted labourers in relation to actual employees. The real self-employment of tribal cultivators that is being sacrificed through displacement is almost never seen in relation to the jobs on offer, which tend to be greatly exaggerated, as in the Posco case.

padel dasFelix Padel and Samerendra Das

In many ways, Tata Steel’s reputation towards its employees in Jamshedpur, where it built its first steel plant, is undeservedly high. A large part of the land in and around Jamshedpur was originally tribal land belonging to 24 villages, from which thousands of families were displaced. The Chotanagpur Tenancy Act, which prohibited the sale and transfer of tribal land to non-tribals, was reportedly delayed until 1908 to allow Tata to acquire the land they needed for the steel plant in 1907. Of those displaced back in the 1900s and their descendents, many have worked on a contract basis but very few have got permanent jobs, and even their homes have been under threat by a new Tata land grab of 14,000 acres through a 2005 Renewal Lease Agreement.

Tatas’ iron ore mines at Noamundi started production in 1925, and were largely mechanised in 1967-8, from which time they started supplying about 90% of Jamshedpur steel plant’s requirements.  Local testimony says that in order to force Adivasis to work for them, company employees cut down a large number of kusum trees in the nearby forests, which Adivasis depended on. A similarly malicious tactic is reported from the year 2000, aimed at Agaria Tola, whose inhabitants allege that their spring was bulldozed on purpose by Tata Steel, with a view to claiming more of the surrounding land. These are examples of the general trend we are highlighting in this paper, of trying to convert cultivators, with livelihoods attuned to the natural cycle, to industrial workers of the most exploited variety.

In September 1980, to promote a new factory planned near Noamundi and Gua, the head of Tata Steel Russi Mody flew from Jamshedpur, but was unable to land since Adivasis opposed to the project had swarmed the airfield. Ordered to take strict action against the agitators, a police firing took place, and a subsequent massacre of wounded Adivasis in the hospital, followed by a reign of terror that lasted weeks, when hundreds of Adivasis were arrested, beaten, tortured and killed. Estimates of the number of people killed in the Gua massacre vary between 12 and 40 or more, and it was certainly one of the worst attacks on Adivasis in India since Independence, and has been seriously under-reported.

There is a long list of abuses by Tata Steel in the Noamundi area since then, including molesting several Ho Adivasi women workers at a pelletization plant nearby in 1991, where tension mounted to a police firing and numerous arrests. Tata Trade Unionists V.G. Gopal was assassinated in October 1993, like his mentor, Tata Trade Unionist Abdul Bari, who was assassinated as he was about to meet Mahatma Gandhi on 28th March 1947. The reason for Gopal’s murder was apparently his opposition to Tata Management’s plans for downsizing the labour force, which were favoured by rival unionist Amrendra Kumar Singh, convicted in 2006 of hiring the goondas who assassinated Gopal.

Police operations during August 2011 in the very large Saranda Forest aimed at clearing the area of Maoists on behalf of iron ore mining projects by Tata Steel and other companies resulted in several Adivasis being shot dead and a lot of harassment. This is another major iron ore deposit area of outstanding natural and cultural wealth, apparently being prepared for ‘greenfield’  mines.

Tata Steel’s plan for a new plant near Gopalpur-on-Sea in Odisha, backed by Posco and BHP, and for which a MoU was signed with the Orissa government in 1995, met intense opposition from 25 villages of non-tribal farmers slated for displacement. Over 20 thousand people were threatened with displacement, and the 25 affected villages swiftly formed an organisation called Gana Sangram Samiti to resist displacement. They broke up a foundation stone inaugurated by India’s Prime Minister Narsimha Rao in December 1995, and formed a Nari Sena (women’s army), which came to the forefront in August 2006, when an estimated 6,000 police were sent to try and force acquisition of the land, arresting several hundred men and injuring many women in lathi-charges, including two who died from their injuries. Police invaded the area again in March 1997, and opened fire against people’s resistance, injuring four people severely. The villages were under police siege for many months – a prototype of the situation observed since 1996 in the Kalinganagar and Posco areas. The Gopalpur villages set up 14 gates to protect their land against Tata Steel, erecting a pillar with the words ‘Water, land and environment belong to us and no-one else has any rights to them.’

The movement was betrayed by politicians in 1999, resulting in the forced displacement of several villages, whose land was surrounded by a high wall which has been under guard ever since, though no factory has yet been built on it, leading to accusations of land speculation against Tata Steel, since the value of the land has obviously risen greatly since 1999, and it has not been put to productive use.

 Tatas’ Jharkhand employees experienced a massive cut in their workforce during India’s neoliberalising years: from 78,000 permanent employees in 1993, balanced by an approximately similar number of informal sector workers, to 38,000 in 2006, with the number of informal jobs doubled or tripled, since numerous kinds of jobs, from drivers to sweepers, were now outsourced to contracting firms, while large numbers of labouring jobs in mine and construction work was increasingly sub-contracted. Over 25,000 ‘permanent employees’ lost their jobs much sooner than had been planned. Tata Steel’s ‘Voluntary Redundancy’ packages have involved a lot of pressure and manipulation, according to many witnesses and evidence brought in a number of court cases. Within the same 14 years, the percentage of Tata Steel’s profits spent on social welfare fell from 21 per cent to 4 per cent. Tatas’ scheme guaranteeing a job for one son or daughter of each long-term employee was also cut during this period.

At Kalinganagar, Tatas’ construction of a new steel plant has been exceedingly controversial, employing extreme levels of police and goonda violence, starting with the laying of landmines and police firing that killed 13 Adivasis on 2nd January 2006, and continuing with an escalation of violence at the start of 2010, after steel companies paid for a new police station at Kalinganagar, opened by Chief Minster Naveen Patnaik on 16th December 2009. A high profile article in Forbes Magazine in April 2013 shows that huge financial pressure was exerted to boost construction of the project during these years, with the aim of completing the plant by October 2013. Amazingly, subheadings in the article entitled ‘The Battle for Kalinga’ and ‘The War Zone’ do not even refer to the diabolically cruel takeovers of tribal land and attacks on villages resisting displacement since 2010 – the article blandly, and falsely, states that ‘Tata Steel managed a volatile situation well after police firing killed 13 tribals’ – but rather to financial pressures. These were also revealed by a human fallout of the article, in which a Tata Steel employee suspected of whistleblowing and leaking information was hounded by management to the point that he committed suicide in May 2013.

The greater human cost has been the police and goonda violence and Tatas’ inability to hold any proper dialogue with the villagers being displaced. When Adivasis threatened with displacement by Tata formed the Bisthapana Birodhi Jan Manch (BBJM, People’s Platform Against Displacement) in 2004, this was an act that focused resistance to the forceful dispossession of Adivasis going on in many areas of Odisha and neighbouring States. According to Sudhir Patnaik, editor of the alternative media centre Samadrusti, ‘Kalinganagar was a turning point in anti-displacement struggles… They said a complete no to displacement with the slogan: money cannot compare to the lands we have.’

Goonda assassination attempts began in March 2008, and a member of the BBJM named Amina Banara was shot dead in front of the gates of Rohit Steel plant on 1st May that year. On 10th January 2010, emerging from Naveen Patnaik’s new Kalinganagar police station, police opened fire on protesting villagers again, using 300 rounds of LALA 76 rubber bullets. They did so again in Baligotha village on 30th March, injuring 30 people severely, when the state of police siege now under way made it very difficult to get people to hospital.

There were more killings in April, with the body of a Dalit protestor named Rasananda Patra dumped in a field by tractor at night. On April 29 police came with a team to demolish villages in Baligotha village. Another police firing took place in Chandia village on May 12, leaving one man dead and 35 injured, many houses illegally demolished and looted, by police as well as former neighbours who had previously accepted compensation, and had been trucked in supposedly to demolish their own houses, but actually also to demolish the houses of people still holding out against displacement.

This highlights one of the most painful aspects of such displacement: the systematic dividing of communities, turning neighbours against each other who had previously lived together as a common unit in near self-sufficient villages. Only a minority of Kalinganagar families possessed patta, so the majority were just offered a concrete house in a colony and the lowest grade of labouring jobs, without any job security. Tata CSR projects make the employment and rehousing prospects of oustees appear rosy: an image that could not be further removed from realities on the ground.

The true story of Kalinaganagar, and the reasons so many Adivasis have held out so long against impossible odds, have yet to be told. As in the Posco case, communities that consisted of largely self-employed cultivators, and men and women in charge of selling their own labour, have been dispossessed in the cruelest ways, converting them into a labour pool of coolies and unemployed, ‘unskilled’ workers.

Nalco and Vedanda: India’s aluminium history is very similar to the story of steel: basically a massive expansion, masterminded by a cartel of foreign- and city-based elite interests, including the World Bank, who make huge profits, especially at the higher end, through loans, metals trading deals, and speculation on these deals. While the popular view, pushed by the media, shows this massive surge in aluminium and steel production as ‘India rising’, ground realities tell a very different story. Water is one basic aspect: the Wuppertal Institute in Germany calculates that every tonne of steel produced consumes over 40 tonnes of water, while every tonne of aluminium produced consumes over 1,300 tonnes of water.

So while steel and aluminium factories in Europe are closing, the new ones opening in India are doing so on indigenous farmers’ fertile fields, using their water, converting the farmers who lived and worked there over generations into an industrial labour force that faces remorseless exploitation, compounding the dispossession of land and villages. This is the basic pattern behind Odisha farmers’ movement around the Hirakud dam since 2006: the DFID (Department for International Development of the UK Government) refurbished the dam, supposedly to bring farmers the water that had never reached them. What actually happened was that canals dried up even more because several new metal factories had positioned their intakes to consume huge quantities of water, including Bhushan steel plant, Vedanta’s new aluminium smelter, and Hindalco’s new smelter (under construction). So basically, India’s surge in metal production is based on consuming the land and resources of India’s farmers.

 In the case of bauxite miners and aluminium factory construction workers and employees inside the factories, we have conducted many interviews that show a great deal about the non-formalised labour these companies depend on. In the case of Nalco, villagers from the Kond village of Kapsiput, below Panchpat Mali, India’s biggest bauxite mine, in Koraput district, have testified that they walk up the mountain every day to get labouring jobs, largely because the perennial streams from the mountain that used to supply their fields have dried up since the mining started in the 1980s. Once at the mountain top, they face a selection process, and men admitted they had given bribes of several thousand rupees to get preferential selection, for jobs where they get just 60-70 rupees per day.

Nalco’s promises to families ousted from their villages in the 1980s for permanent jobs in the refinery that displaced them have long since evaporated, and to get jobs here too, bribes have to be given.  After thirty years of aluminium-boosted ‘development’, Koraput district has some of the worst poverty indicators of any district in India; and among the informal sector workers in Damanjodi – a town of rampant unemployment – are an estimated 500 sex workers – an ugly side of industrialising and industrialised areas that – along with the top-to-bottom bribes, illegal liquor shops, goondas, and mafias controlling every aspect of economic life – find amazingly little mention in most published discourse.

In the case of Balco’s refinery-smelter complex at Korba in Chhattisgarh, taken over by Vedanta in 2001, workers have testified to us that huge numbers of ‘voluntary redundancies’ were forced onto unwilling workers, while the construction of a new smelter financed from London gave jobs to outsiders working on a contract basis. Those who still had permanent jobs said they were forced to work long extra hours for no extra pay. Asked about medical check-ups – since aluminium factories are notorious for their health hazards – they confessed that if they told us what really happened here they would lose their jobs. Full employees in Korba numbered about 900 in 2011 in relation to about 4,600 contract worlkers, with union members saying that when a Balco employee retired now, he usually was not replaced.

The bauxite mines at Kawardha supplying Korba are expanding on tribal land with inadequate compensation. Most labour is again done on a sub-contracting basis with inadequate safety equipment and appalling working and living conditions. Though they promised to correct this at earlier AGMs, shown photographs of Kawardha bauxite miners still in sub-standard conditions at the 2012 AGM, Non-Executive Director Naresh Chandra quipped – ‘That could be anywhere!’

As for the construction of Vedanta’s refinery below Niyamgiri in Lanjigarh, Kalahandi district, Odisha, which started in 2004, contract labourers vastly outnumbered Vedanta employees, allowing Vedanta plc to show very few accidents and deaths in their annual reports in London, while the reality, well-attested from many sources, was of hundreds of deaths during construction and on the roads around the factory. Several hundred Chinese workers were employed from a couple of Chinese firms, and several thousand were employed by Larsen and Toubro and Simplex in various sectors of the factory. Higher-paying jobs nearly all went to non-locals, and so did many of the labouring jobs. But many of the lowest grade labouring jobs went to local people, making stone chips out of the area’s granite rock formations, constructing roads, walls, bridges etc. Some testified that contractors ran off without paying them, even after many days’ work.

Displaced villagers in Lanjigarh, resettled in ‘Vedantanagar colony’, provide a labour pool of desperate, unemployed former-farmers. When we visited here soon after the initial displacement in 2004, people had tears in their eyes, knowing they would never be able to grow their own food again. In Lanjigarh we witnessed at close quarters a transition from a rural area, where people were poor, but channeled clean water onto their fields and usually had enough to eat, with a remarkably egalitarian social structure, to a reality of desperate pollution, water scarcity, skin diseases from the polluted water sources, dire poverty, constant surveillance and repression.

Yet Vedanta CSR projects, promoted in annual ‘Sustainable Development Reports’ and London Annual General Meetings (where they have been consistently challenged by shareholder-activists) maintain an alternative reality of exemplary development statistics. Asked to prove this, a Director reads out a list of crores of rupees spent on health centres, training colleges, Self Help Groups, and so on – which close enquiry in the area reveals barely exist, and certainly not in the form claimed. Repeated demonstrations outside the refinery for jobs by locals – many of them ‘trained’ so as to ‘upgrade’ their employment potential yet still unemployed – tell a different story.

A ‘reality gap’ is characteristic of the whole discourse on ‘Resettlement and Rehabilitation’, between policy and practices, promises and their betrayal, CSR projects and corporate patterns of violence and falsehood, promoted by the PR companies employed by major companies to maintain a clean façade.

In several articles he has written in the mainstream media, Anil Agarwal, the head of Vedanta Resources plc, advocates an era of greatness for India based on his American heroes, and the five he names (Cornelius Vanderbildt, Andrew Carnegie, John Rockerfeller, J.P. Morgan and Henry Ford) are among the most notorious ‘robber barons’, who ‘made America great’ while ripping off the public and crystalising the genocidal takeovers of indigenous land in the United States – five men who compensated for their robberies by conspicuous donations to public Trusts, establishing ‘good works’ which laid the foundations for what has become the CSR system of corporate philanthropy: a top down model designed to circumvent any public regulation and avoid any proper exercise of responsibility, while establishing control of ‘knowledge-generating’ funds and institutions that have hardwired a top-down mentality into health, education, academia, policy making, and other key areas of public life.

The corporate conceptual structure of beliefs and values presents a complete contrast to the Adivasi beliefs and values under attack, and its root is today’s ‘most dangerous fundamentalism’: the ‘doctrine’ of ‘orthodox’ neoliberal economics, in which most of the people running the world are trained as deeply as medieval priests were trained in theology. Converting indigenous farmers, who have maintained traditional systems of harnessing and harvesting natural resources based on restraint, into industrial labourers is an expression of this fundamentalism. It has become part of the doctrine that subsistence farming is ‘uneconomical’, and – sad and traumatic for them though this may be – that the majority of farmers will have to move to make way for industries, converting fertile land into level playing fields for profit.

This is an abridged version of the paper presented by Felix Padel and Samarendra Das, for a seminar on ‘The Unorganised Sector in India: Extending the Debate to Mining and Quarrying’, at the Institute of Development Studies, Jaipur, July 27-28, 2013