Yanam is Everywhere: Trouble at Adidas/Reebock/Puma manufacturer Adigear, Manesar

On 27th of January the police killed a worker at Regency Ceramics in Yanam, Andhra Pradesh, during a conflict with the locked-out work-force, in dispute over wages and regularisation of workers hired through contractors. Workers in response attacked the factory and managements’ houses, during which a top-manager was killed. Workers burnt down parts of the plant, the company college, lorries and other equipment, workers in the surrounding neighbourhood used the opportunity to loot neighbouring companies, e.g. a cooking-gas bottle supplier.

Yanam is potentially everywhere. Below you can find a short report about current disputes at Adigear in Manesar, a manufacturer for Adidas and other international sports gear brands. During one of the conflicts a top-manager got beaten up. The ‘textile’ sector in India is not excepted from the general tendency of crisis. On 6th of February we could read in the Economic Times:

“Yarn, fabric and clothing companies are in a sweet spot. They owe banks so much that now it is their lenders’ job to ensure they survive. With wild enthusiasm, banks have lent the textile industry Rs 2,50,000 crore in the last 12 years. Now companies say they can’t even pay interest on Rs 50,000 crore in working capital loans. Up to 15 per cent of loans to this industry are stressed and the number is rising fast. In today’s precarious times, such a gaping hole could be the last straw for banks. Most of these loans have already been ‘restructured’ once. If payments fall behind a second time, the account has to be classified as a ‘Non Performing Asset’ on the bank’s balance sheet. In December, a dozen banks asked the RBI to relax the rules on declaring bad loans and let these twice restructured loans remain standard. Because such relaxation flouts international prudential and accounting norms, quite sensibly, RBI refused.

The biggest players, with enough backward and forward integration to ride out the storms, continue to make money. Those in distress today were clearly unworthy of large loans in the first place and should now be written off. The real issue is that Indian textile companies are small, labour-intensive, non-integrated spinning, weaving, finishing and apparel-making outfits. Only 3% are large composite mills. Today’s world demands economies of scale. Indiscriminate government subsidies in the name of job creation further encouraged promoters to use public money for creating more such fragmented capacities that are inevitably idled at first signs of trouble. It is a mirage that the textiles industry is too big to fail. On the contrary, its myriad small units have outlived their utility. Their exit will occur only when banks face the consequences of their actions. And subsidy schemes should stop. Individual livelihoods can’t be protected by industrial dinosaurs.”

We remember the attack on the huge composite mills in Bombay in the mid-1980s, when the representatives of capital proclaimed that this ‘large-scale’-form of production is outdated and small, flexible units are supposed to be the future. We remember the recent mass waves of strikes and riots in the textile export zones in Bangladesh, where, according to this view, capital found better investment options. We are reminded that the problem of profit-margins, over-production, 16-24-36 hours shifts paralleled by rising unemployment is an universal problem. The crisis, and the ‘solutions’ proposed in the article above (the only solution the current system can provide), will create one, two, three, …many Yanams.

Adigear International Worker
(Manufacturer for Adidas, Reebok, Puma, FILA etc.)

(Plot 253, Sector VI, IMT Manesar)
Shift starts at 9:30 am in the morning. The 100 female workers finish work at 8 pm and the 800 male workers work till 1 am, sometimes till 6 am the next morning. On Sundays workers work till 6 pm, sometimes till 1 am. The male workers work 180 to 240 hours of overtime per month, paid at single rate. Wages are paid delayed, the August wages were paid in small installments from 20th of September onwards. On the 20th of September at 11 am, when wages were handed out, there was a lot of commotion. The six-foot personal security officer of the company director slapped one of the workers. Why did he hit him? The workers wanted to know, but the security officer had left the place. During meal break workers left the factory and started to question the security officer, but he escaped with the help of another security officer. The workers then met the general manager outside the plant and the workers treated him as the due representative of the security officer. He was then admitted to the ESI hospital. The company has close relations to the district police, so they acted immediately. The police arrived and arrested 42 workers, whose names were given by management, and brought them to the Manesar police station. In protest all remaining workers stopped working and left the factory. In return 21 workers were released, but the others remained locked-up. The workers did not re-start work, the factory remained idle from 23rd to 25th of September. Workers said: Release all of the arrested, withdraw the cases filed and pay compensation for lost wages… if you want the next orders to be shipped in time, fulfil these demands. Conflicts continued since then. On 3rd of December, when workers who had been sacked came to get their August wages, management called the cops again. We don’t know whether these workers got their wages in the end. When our October and November wages were still not paid on 15th of December, we stopped working at 9:30 am. When work was still not resumed at 1 pm the company send seven bouncers who started hassling workers. In response all of us left the factory…
http://www.adigear.com/clients.html