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Poverty. Riches. The world's largest democracy. An ancient caste system. Bollywood. India is a land of contrasts, a booming new power that remains baffling to outsiders and insiders alike. The Shiva Rules is a year-long GlobalPost series that decodes the many mysteries of India's uneven rise in the 21st century.

India labor unions 2012 01 27
Activists from the Indian Workers Union march to parliament in New Delhi on Nov. 23, 2011. (Raveendran/AFP/Getty Images)
India

Shiva's Rules: Union strikes threaten India Inc.

This year's spate of strikes gives an ominous glimpse into a possible future for Indian manufacturing.

Editor's Note: The Shiva Rules is a year-long GlobalPost reporting series that examines India in the 21st century. In it, correspondents Jason Overdorf and Hanna Ingber Win will examine the sweeping economic, political and cultural changes that are transforming this nascent global power in surprising and sometimes inexplicable ways. To help uncover the complexities of India's uneven rise, The Shiva Rules uses as a loose reporting metaphor Shiva, the popular Hindu deity of destruction and rebirth.

NEW DELHI, India — This autumn, some of India's highest paid industrial workers took to the picket line.

One of the largest and longest running industrial actions to hit the country's manufacturing sector in recent years, the strike by employees at Maruti Suzuki's Haryana automobile factories sent an ominous signal.

In the '60s, '70s and '80s, frequent strikes and lockouts slowed India's industrialization, costing companies millions and causing industry to abandon some states like Kerala and West Bengal altogether.

Now it looks like those days of industrial turmoil may be on the way back. It couldn't have happened to a more important symbol of the new India.

“There is already what I would call a hidden, unexpressed sense of grief and violence amongst the people.”
~Kuriakose Mamkootam, professor at Ambedkar University

Maruti Suzuki is the showpiece success story of India's post-1991 economic liberalization. One of the country's most respected companies, it ended years-long waiting lists for cars built by Hindustan Motors. And it paved the way for investments by the world's largest car makers by proving that manufacturing in India could be profitable.

The joint venture, in which Suzuki Motor Corp. owns a 54 percent stake, became the largest contributor to its Japanese parent's bottom line in 2009.

This fall's strike, which resulted in a wider-than-expected 60 percent plunge in Maruti's profits for the second quarter, suggested the company — and India — may be entering a new era.

More: Did Gandhi kill India, Inc?

“It's everybody's dream to work for a multinational company like Maruti Suzuki,” said 25-year-old Pradeep Singh, vice president of a new, independent union that workers at the company's Manesar plant fought to establish this fall. “But once you get hired and see the reality, it's a big disappointment.”

Singh is typical of India’s disgruntled union laborers. He has achieved what might be described as the Indian dream. His father, a farmer, ekes out a living from an acre or so of land. But Singh left the fields behind and effectively broke into the middle class with his job at Maruti.

He normally earns about $300 a month — nearly three times the national average income. Like many of today's workers, however, Singh has higher aspirations. Now, along with around 30 other union leaders, he’s under suspension for his activities during the strike, convinced fighting is the only way to get India Inc. to share its growing prosperity with the work force.

“Maruti is No. 1 when it comes to profit,” Singh said. “But when it comes to salary, it's around seventh or eighth.”

India's large corporations have faced 10 major strikes in the last three years, and things may well get worse before they get better. This year alone, there have been strikes and protests at Coal India, Bosch India, Air India, Comstar, Ceat Tyres, Volvo Buses and at textile factories in Punjab, according to Outlook Business.

“If the management does not learn to deal with the sensitive dimension of labor and their circumstances, I am afraid these kinds of things may increase,” said Kuriakose Mamkootam, a professor at Ambedkar University who has written extensively about industrial relations in India.

“There is already what I would call a hidden, unexpressed sense of grief and violence amongst the people.”

That tension stems partly from the gradual dismantling of India's socialist economic policies begun by then-Finance Minister Manmohan Singh in 1991. But successive governments' reluctance to swallow the bitter pill and reform some of the country's tougher labor laws has also contributed to the friction.

Prior to 1991, national unions helped put in place tough labor laws.

One such law forces firms with 100 or more employees to seek government approval before they can fire workers or close down. Labor laws also prevent companies from reassigning workers to different tasks, so there is no way for companies to adjust to changes in the market.

As a result, the official employees of companies like Maruti have it pretty good.

More:

http://www.globalpost.com/dispatch/news/regions/asia-pacific/india/111106/union-strikes-india-economy-labor-maruti-suzuki