Wistron-type incidents raise image issues for the country
What exactly happened at the Wistron Corp plant at the Narasapura Industrial Estate in Kolar district, Karnataka? Was the company playing fast-and-loose with labour laws, as suggested in a Karnataka Government report? Did it shift from an eight-hour to 12-hour working day and not explain this clearly to workers? Or, were the workers incited to commit violence by anti-social elements recruited for the company in a rushed effort to hire 10,000 people?
The Taiwanese, who are looking to reduce their excessive dependence on Chinese manufacturing, have been sizing up India with its vast labour pool and the violent scenes must have made them wonder about India’s industrial climate. From India’s side, both the Central and the State governments fear the violence may hit their efforts to woo companies looking to exit China. Karnataka Chief Minister BS Yeddyurappa has gone on record to say Prime Minister Narendra Modi is alarmed by the violence and fears it may dent India’s attempts to sell itself as the world’s manufacturing destination of the future. The Karnataka government has quickly arrested around 100 people as it strives to maintain its reputation as a destination for setting up plants.
The fact is contract manufacturers like Wistron work in ways unfamiliar to India, paying relatively low salaries. Workers are often bussed back-and-forth from plant to company-provided housing. Recent legal changes have also made 12-hour working days legal. In China, the government often intervenes to ensure labour harmony. But, in India, any heavy-handed moves against factory workers will end up in the press and turn public opinion against both the government and big corporations. Everyone involved will need to be mindful that what works in China isn’t necessarily going to work here and make their plans accordingly.