#WorkersStrikeBack: Noteban, GST, Cow Vigilantism Have Hit Workers Hard in Agra’s Shoe Making Hub

[As lakhs of workers gear up for a historic All India Strike on January 8-9, called for by ten central trade unions, NewsClick brings to you glimpses of the lives of industrial workers in different parts of the country.]

AGRA (Uttar Pradesh): The life of workers in the unorganised shoe manufacturing hub in Agra, the city of Taj Mahal, is a picture of government neglect and apathy.

Forced to live in inhuman conditions, with little income and extremely unhygienic surroundings, most of these workers work day and night in their one or two-room dilapidated homes-cum-workshops to earn a living that is insufficient to make two-ends meet – forget about educating and bringing up their children.

What has added to their woes is the sudden growth in cow vigilantism, demonetisation and the shoddy implementation of GST (Goods and Services Tax), which has hit the footwear business hard. In Agra, where one-third of the population is directly or indirectly connected to this industry, the footwear business has almost come to a standstill in the city, hurting struggling workers the most.

Raj Kumar, a shoe-maker in Qazipara locality, a ghetto of footwear-makers in the city, doesn’t have much idea about the nitty-gritty of the GST, but says that the new taxing system and demonetisation have broken the back-bone of small manufacturers.

“I take work from factories for which I get fixed rate. For example, we get Rs 4 for cutting synthetic leather according to the approved design, Rs 15-20 for making the upper part of shoes, Rs 10 for making shoe bottoms and Rs 5 for the final finishing. Shoe-making involves seven steps, and one individual works on one job. A person can earn a maximum of Rs 6,000-8,000/month after working for at least 10 hours a day. And we get work for six months in a year. We have to depend on our little savings so as to sustain ourselves for the rest half of the year because there is no work in that period,” Kumar told Newsclick,which visited the shoe manufacturing hubs of Qazipura, Jagdishpura and Heeng Ki Mandi to take a closer look at the workers’ plight.

Asked how they manage the expenses in the period when people don’t have work, Kumar said: “We survive on our little savings. Some people borrow money and pay it back once they begin getting work. Shoe-makers survive in extremely tough situations.”

The workers said for work that cannot be done at home they go to factories as big machines are needed. “The minimum wage there is fixed at Rs 7,400, which is even less than Rs 8,000 they make at home. People get salaries (Rs 7,400 to Rs 15,000) according to the skills they have. If the company is a ‘limited’ one, it gives some other benefits, and if it’s not, the payment is given against cash without any signature,” Kumar added.

Another shoe-maker said they now have to bear the additional burden of electricity payment. “Earlier, electricity was free to a certain limit. Now, it is not. In addition, we are getting notices from the municipal corporation to pay taxes. Demonetisation has broken the backbone of small workers. After the GST was implemented, the police have started harassing us. It’s a cottage industry, how can we work on paper? Our income is the same, but our expenditure has increased manifold” he added.

Cow Vigilantism Impact

With the unprecedented rise in cow vigilantism, the supply of leather has gone down. Also, it has become too costly, as a result of which small footwear makers cannot afford it. “Small shoe-makers have switched over to synthetic leather or rexine,” he said.

Gajendra Babu, a shoe-maker in Jagdishpura reaches a small factory at 8 am each morning and leaves around 7 p.m. After 11 hours of hard work, he said he managed to earn only Rs 200-250. “I manage to earn Rs 200-250 per day after making 60-65 pairs. But this is insufficient for bearing family expenses. I have four children who study in government schools. They are unable to get good education. Unable to do anything in future, they are forced to get engaged in the same business,” he said.

Asked how much he is paid for assembling shoes, Babu said he is paid Rs 5 for one pair and manages to make 50-60 pairs each day. “The earning earlier was not good but okay to make two ends meet, but with the inflation and skyrocketing prices, profitability has dipped. Small manufacturers borrow money from banks to set up a factory, but they are unable to return it given the low returns because of which many of them have committed suicide. Because of GST and demonetisation, the production cost has gone up, resulting in the high prices of the final product, which is difficult sell in the market. The demand for rexine shoes have come down because of its high prices. As a result, we are getting less work,” he added.

Jagan Sinh, a daily wage labourer, buys raw material on his own and makes a hundred pairs every month. “I manage to earn Rs 100-150 per day but that too is not regular, as I don’t get work every day. It is extremely difficult to look after the family. Since the Modi government has come to power, life has become hell. Earlier, I used to earn Rs 1,000 a day. But following demonetisation, this has plunged to Rs 100. I have to work for 14 hours from 6 am to 8 pm,” he told Newsclick.

Mata Prasad, a shoe fitter, says despite working for 14 hours a day, he is unable to earn enough to meet family expenses. “Ek waqt kama leta hun aur dusre waqt ke lale par jate hain (I manage to earn for one-time meal, but struggle for the next meal). For work worth Rs 30, we get Rs 20 by factory owners,” he said.

Prasad had sad story to narrate. “My wife suffered cardiac arrest recently and died on December 22. I could not take her to hospital because I did not have money. If I had money, I would have got her treated and she would have been with me. Forget about the expenditure on treatment, I did not have even enough money to cremate her, which was done with neighbours’ contributions,” he said.

Prasad had an appeal to the governments in the Centre as well as the state. “I appeal to Modiji and Yogiji with folded hands, please make such a policy for workers so that their life can be improved. When we go to the manufacturers for work, they say there is no work because of GST. When we insist, they exploit us,” he concluded.

Footwear Business at Standstill

With the sudden growth in cow vigilantism, demonetisation and tardy implementation of GST, the footwear business has come to a standstill in Agra.

Industry leaders in the city say the demand of handmade footwear has fallen drastically. As a result, there is not enough work.  Agra caters to 65% of the country’s requirement of footwear, which is more of a cottage industry, with families operating from their homes.

Manufacturers – the new GST norms say – are required to mention maximum retail price (MRP) on the footwear they produce. Many workers involved in footwear manufacturing industry in the city, who are estimated to be around three lakh, apart from around 50,000 shopkeepers and their staff, are illiterate and unable to comply with the idea of mentioning MRP on products.

“The MRP can easily be mentioned on the product where production takes place through machines, but it is tough to do so for small-scale manufacturers, especially when it has to be indelible,” Anil Shroff, director of Shroff Sales Corporation, told Newsclick.

Footwear below Rs 300 was earlier exempted from VAT (value added tax) in Agra but the government has imposed 5% GST on footwear below Rs 500 and 18% on the higher range of products.

Pooran Dawar, chairman of the Council for Leather Exports (Northern region), said, “Tax rates on footwear should have been fixed at par with clothing which has 5% GST till Rs 1,000, as it is also a daily necessity. Footwear coming in the range of Rs 500-1,000 has been placed in 18% tax category which seems to be irrational.”

He said “Agra has more than 25% share in footwear export from India. The new tax regime will hit the industry hard and will bring down the export.”

Since demonetisation, the footwear market has been sluggish, he said, adding “GST has come as another blow”.