I. Identification

1. The Issue: Bonded Child Labor in India and the Beedi Industry

The Global economy's insatiable need for larger quantities of cheaper and better products has adverse effects on the well-being of the poor and vulnerable who produce these items. The dynamics of consumerism indirectly contributes to the existing problem regarding debt bondage child labor in India. Millions of children are often sold to growing industries such as silk, carpets, beedis, jewelry, among other exports. Parents often find themselves in situations where they are obligated to sell their children in order to pay back their debtors. These enslaved children are often physically abused, forced to work beyond their physical and mental capacity, and locked in these factories under unsanitary and inhumane conditions. Despite existing local and international child labor laws, the number of children exploited and forced to work under inhumane conditions keeps increasing alarming rate in order to keep up with international demand for a variety of goods.

2. Description

The study will explore bonded child labor in India, as well as the economic and social reasons that drive to such employment methods. What roles do culture or existing economic conditions in India play in sustaining these practices today? The study will also look at different efforts made to end this inhumane practice, such as Indian laws against child labor, slavery and debt bondage. Furthermore, this case will look into the possible reasons for their unsuccessful implementations. International efforts to end illegal child labor will also be looked into. Where does the United States stand in terms of imports made with illegal child labor? What is the international community doing to eradicate this problem? The answer lies in looking at United Nations efforts, such as the ILO Convention 182 against worst forms of child labor.

The main focus of the study will center around the Beedi cigarette industry. However, this case study will also do a brief overview of the carpet industry in India, also known for similar labor practices. Finally, this case will also look into the effect of the consumer awareness of the realities that goes into the making of this popular product. How did American consumers react after the showing of the 60 Minutes II show uncovering debt bonded child labor in the Beedi industry? How did the banning of this product come about? How did trade laws affect the decision of the American government to ban this product?

Bonded Child Labor in Beedi Industry and other types of child slavery

India: Facts about Child Labor

Child Labor is increasingly becoming an important issue of concern for the world community, with over 250 million children working around the world (Collingsworth p.1). India is one of the worlds' leading countries in terms of employing children with an estimated number between 60 and 115 million children working. Most of these children work in the agricultural sector, leaving about 15 percent of these children in the service and small-scale industries (Human Rights Watch p.15). Bonded labor is also becoming a major problem in India. Families who cannot pay their debt sell or trade their children to their debtors in exchange for the money they owe. Money owed to rural banks, the government, or local creditors is usually managed by the local moneylender who takes labor in exchange. Human Rights Watch estimates that about 15 million children work under these conditions (Human Rights Watch p.17). Children are forced to work to help pay for their families' debt, and have absolutely no say in voicing whether they agree to working under the presented circumstances. They are sold like objects, and are submitted to working under terrible conditions. Bonded labor is clearly an abuse of their basic rights as humans.

The Beedi cigarette industry is an important example of a growing export commodity that employs child labor. Beedis are unfiltered hand-rolled cigarettes apparently unique to India. Although consumption of Beedi cigarettes is increasing in the US, only 75 milllion beedis were sold in 1998, compared to 435 billion conventional cigarettes sold that same year. However, Beedi cigarette exports to the US rose from $915,000 in 1998 to $1.28 million in 1999 (Edgecliffe- Johnson, Andrew ). Recently, a growing number of reports are being uncovered, depicting similar stories of young children who were bonded in debt and forced into slavery in this particular industry (International Justice Online).

The carpet industry is also notorious for employing children. With enough children put to work, more carpets can be made in a shorter period. The majority of the children working in the looms and factories are actually stolen and kidnapped from their families. These children, as young as four years of age, are forced to hand-weave carpets, under inhumane conditions. They are barely fed, work on only few hours of sleep, and sometimes have their hands burned with irons so that they do not bleed on the carpets (Oldernburg P. E5). The Western's demand for these luxury items only further contributes to this existing problem. An estimated 500,000 children are believed to be working in the hand-weaving carpet industry in South Asia today. The carpets made by slaves are cheaper and thus lower the price for the rest for the rest of the industry. Other carpet manufacturers who do not employ children and whose cost is higher are forced to sell their carpets at a cheaper cost in order to keep up with the competition. Illegal child labor harms all stake holders in the end, even the ones that make the profit. India's profit from exporting hand-woven carpet increased from $65 million to $229 million between 1979 and 1983. Consumer education and awareness campaigns dropped that figure down to $150 million by 1993, indicating the power consumers have to putting an end to child labor by not buying carpets made by children (Suzanne Charle p. 22). The cycle behind the beedi industry follows similar economic and social dynamics and the beedi industry.

The result of the dynamics of child labor in different industries lead to questions Western consumers' belief that they are helping alleviate poverty in less developed countries by buying products made by these children or employing these children directly in sweatshop like working conditions. If the parents of these children made enough money to support the entire family, these children would not have to help contribute to their family income as well. The West can help, for example, by having their multinational companies pay adult workers in these countries enough to sustain a decent standard of living (Oldernburg P. E5).

Case Reports of children enslaved to beedi cigarette industry:

Case of Shama Ismael - Pernambut, India (Vellore District)
Shama Ismael, who is now 10-years-old, was bonded to close the ends of beedi cigarettes in order to pay her family's debt. Her family had incurred this debt with medical expenses for her younger sibling. For 13 hours each day, with only a 15 minute break for lunch, Shama was forced to close the ends of 2,000 cigarettes for about $0.08/day. If she made it to work later than her 7am starting time, or if she did not meet her quota, she was beaten. Fortunately, Shama's story has a hopeful ending. In 1998, the International Justice Mission helped release and enroll her in school. In this case, her moneylender was prosecuted and is now in prison (International Justice Mission website).

Case of Sathya Selvam - Pernambut, India (Vellore District)

Sathya Selvam, who is not 13-years-old, was also bonded to close the ends of these cigarettes, just as Shama Ismael did. His family had also incurred debt as result of medical costs. He closed the ends of 1,000 beedi cigarettes each day for 6 hours on weekdays. On the weekends, he worked for 12 hours in order to complete the same job for 2,000 cigarettes. He was only paid $.50/per week. In this case, his father, Selvam, 32, was also bonded to the same moneylender. He was released in 1999 and is now attending school. As in the case of Shama Ismael, his moneylender is also now in prison (International Justice Mission website).

List of Cases based on the following categories: South Asia and Human Rights

Bengali : US-BAngladesh Waste Trade
Bhopal : Bhopal Disaster
Grammen: The Grameen Bank and Nutrition oF Women in Bangladesh
Indbeef: India's beef and meat exports to rest of the world
Kashmir: Kashmir Deforestation
Kidney: India Kidney Trade
Nepalsex: Nepal Sex Trade
Nike: Nike Shoes and Child Labor in Pakistan
Rugmark: Rugmark & Child Labor
Uschina: US China Rhino and Tiger Dispute

List of Cases based on the following category: Country (India)

Basmati: Basmati
Bhopal: Bhopal Disaster
Body: Human Body Parts Trade
Chipko: Chipko Movement
Grammen: The Grameen Bank and Nutrition oF Women in Bangladesh
Himalay: Himalayan Trekking
Indbeef: India's beef and meat exports to rest of the world
Indiatea: India Tea and Environment
Indpower: India Water Project
Indshrmp: Shrimp Aquaculture in India
Iranpipeline: Iran to India Natural Gas Pipeline
Kashmir: Kashmir Deforestation
Kidney: India Kidney Trade
Rugmark: Rugmark & Child Labor
Sandalwd: Sandalwood Case
Tigerind: Tiger Trade from India

Descriptive statistical analysis of cases relating to bonded child labor in the beedi industry

List of Cases based on the following categories: South Asia and Human Rights

The search engine resulted in 11 related cases with categories pertaining to both South Asia and Human Rights. Of all the cases in the South Asian region, 64% of them were from India. More than half (64%) of these cases involved import bans as measures with 36% of all cases having bilateral scopes. In terms of the types of problems, the most common were issues regarding rights (36%) and some type of pollution (27%). The chemical, medical and manufacturing industries each represented 18% of the cases. The textile industry only accounted for 9% of these cases. Based on this particular filter results, India accounted for more than half the cases dealing with human rights in that region, perhaps suggesting a cluster of this type of problem in that particular area.

List of Cases based on the following category: Country (India)

The search engine resulted in 16 related cases with a specific category pertaining to India as a country. Around 44% of these cases dealt with issues regarding human rights. The food (35%) and wood (19%) industries took the lead in terms of number of cases, compared to the manufacturing and chemical industries each representing only 6% of all cases. Most of the cases had a unilateral scope (44%). The most common type of measure involved import bans, accounting for 31% of al cases. Based on both analyses, an important issue to explore for the beedi industry case study would be all aspects explaining the higher rates of abuse of human rights in India.

5. Discourse and Status: Disagreement and Allegation

6. Forum and Scope: India and Unilateral

7. Decision Breadth: 1

8. Legal Standing: Law

Legal Issues Regarding Beedi Cigarette Trade

The main problem regarding the import of Beedi cigarettes into the United States revolves around the discovery of use of child slavery in making the product. Following the CBS show "60 Minutes II" revealing the use of forced child labor in the making of the beedi cigarettes, United States Customs denied the entrance of Ganesh Beedis from Mangalore to the US pending further investigation .

Existing laws in United States that made this import ban possible include The Sanders Amendment to the Trade Act of 1930 , which "prohibits the importation of products made with forced or indentured labor into the U.S. (Rugmark website) ." Section 411 ofThe Trade and Development Act of 2000 "clarifies that the ban on articles made with forced and/or indentured labor under the Trade Act of 1930 now includes goods made with forced and/or indentured child labor (Rugmark website)."

The World Trade Organization

Opening economies by liberalizing trade is a highly recommended development model by the Global North. This recipe for growth suggests that lowering trade barriers expands markets and creates opportunities for employment, thus promoting economic development. The incentive for lowering trade barriers centers around the idea that exposing local markets to global competition encourages innovation and improvement, thereby increasing labor productivity, and quality of goods and services. Furthermore, international trade presumably benefits both markets and consumers because it gives consumers a wider choice of products, while markets, in turn, have access to a larger consumer population. Nevertheless, the Global South faces challenges as a direct result of exposing their vulnerable economies to industrialized economies of the Global North.

Based on grounds of violations of child labor laws and workers' rights, the US imposed the ban on these cigarettes on November 29 of 1999, a day before the WTO meeting in Seattle. The ongoing debated regarding the use of "core labor standards," such as use of illegal child labor, has divided the international trading community between developing and developed countries in terms of accepting these standards as WTO grounds for trading rules. The argument made by officials in developing countries is that poorer countries do not have the luxury to pay higher wages as developed countries are able to, thus lowering their comparative advantage. They claim that if the WTO enforced labor standards under its rules, poverty in developing nations would be further perpetuated (Global March Online). Another issue is the recent debates regarding tobacco trade related issues is the unbalanced moral standard enforcement regarding import barriers, usually in the interest of the more developed country. The United States tobacco industry has been working diligently to create a market for its product in India. As result of encouragement from international financial establishments pushing liberal market policies, India cannot impose high trade restriction on tobacco products from the United States, thus allowing the sale of this product at competitive prices. Critics have argued that this is perhaps unfair, considering that beedis have been baned from entering the US market based on moral standards regarding violation of labor rights (EPW online).

The International Labor Organization and Child Labor Laws

India: Child Labor Laws

India has ratified a number of labor laws that should prevent situations such as cited in the previous sections from occurring. However, statistics of increasing violations of child labor laws indicate that these laws have no effect if there are not properly enforced. The Indian Constitution ensures "the right to life and liberty," making slavery and bonded labor illegal. The Bonded Labour System (Abolition) Act, 1976 aimed at abolishing all types of labor in exchange for settling debts (Human Rights Watch p. 30). The Child Labour (Prohibition and Regulation) Act, 1986 prevents children under the age of 14 to work, and regulates the working conditions for older children by prohibiting certain industries, and setting a maximum amount of labor hours they can work (Human Rights Watch p. 36). Despite the large fines and years of imprisonment for violation of some of these acts, children as young as five years of age are still forced to work under hazardous conditions for long hours at a time with most likely no pay whatsoever. The vicious cycle of poverty, combined with the growing economy's demands, sets the ideal conditions for the growing problem of child labor. If other powerful and developed countries continue to import products made by children, and governments fail to enforce companies to adopt standards and codes that would prevent the use of child labor, the problem will not only continue, but eventually worsen as well.

The International Labor Organization and Child Labor Laws

The International Labor Organization (ILO) adopted The Worst Forms of Child Labour Convention - No. 182 in Geneva on June 1999, as an urgent and immediate measure to eliminate "child slavery, forced labour, trafficking, debt bondage, serfdom, prostitution, pornography and various forms of hazardous and exploitative work(ILO pamplet p.2)." By ratifying the ILO Convention No. 182, governments would be pressured to put an end to all forms of illegal child labor through enforcement and monitoring of child labor laws. The goal of the ILO is for all member countries to adopt and ratify this new convention, and work on ways to help ensure its effectiveness (ILO Pamphlet p 10). The government should work with Non-governmental organizations and other non-profits in leading information campaigns that will educate society as a whole. Ratifying the convention is just a first step. Governments must agree to strict enforcement and prosecution of offenders. Civil society should also play a major role in helping alleviate the problem by actively helping with the monitoring process and informing the general public about the statistics, realities, and current situations regarding child labor. The key to the success of the ILO Convention No. 182 is cooperation among governments, the civil society and the general population, in fighting to put and end to the problem. Although India is one the leading countries in terms of having a problem with debt bonded child labor, the country has not yet ratified this important convention that would help eliminate this type of child slavery .

Prior to the The Worst Forms of Child Labour Convention - No. 182 , the ILO adoptedThe Minimum Age Convention 138 (C138), 1973 , which enforced ratifying countries to eliminate child work by raising the working age "to a level consistent with the fullest physical and mental development of young persons. " This age was dictated as the age was 15 or the age reached by students after completing the country's mandatory educational requirements. As of February 2001, India has not yet ratfied this convention (Rugmark Website).

Labor Rights Advocacy Organizations

Campaign for Labor Rights

Child Labor Coalition

Corporate Watch

Global Exchange

Global March Against Child Labor

International Labor Rights Fund

National Labor Committee

RUGMARK

Beedis are unfiltered hand-rolled cigarettes apparently unique to India. Following China as the leading producer of tobacco, India currently takes the position of the World's second largest tobacco producer. Environment and ecological conditions favoring the growth or tobacco have allowed India to export this product to over 80 countries world-wide. The tobacco industry employs around 26 million people in both the agricultural and marketing aspect of the production.

Although consumption of Beedi cigarettes is increasing in the US, only 75 milllion beedis were sold in 1998, compared to 435 billion conventional cigarettes sold that same year. However, Beedi cigarette exports to the US rose from $915,000 in 1998 to $1.28 million in 1999.

19. Exporters and Importers: Key exporters and importers of Tobacco

Leading exporters and importers of Indian Tobacco

Leading importers of Tobacco - quantity in million tons

1996 TOTAL IMPORTS

Leading exporters of Tobacco (regional) - quantity in million tons

1999-2000 TOTAL EXPORTS

India's Tobacco Export Performance - quantity in tons

The data for the tables above was gathered from the Tobacco Board: Ministry of Commerce-Government of India Website.

India fits under the region for South & South East Asia and only comes 4th in terms of leading exporters. This data was rather confusing considering that some other sources cited India as the 2nd largest world producer of tobacco. This information leads to believe that perhaps India is a top producer of Tobacco, but not necessarily a top exporter. India's export performance, however, showed a clear steady growth in term of export quantity over the past 10 years.

The United States still ranked 1st as top importer of tobacco, which is relevant and useful information in terms of exploring the effects of import bans on beedi cigarettes.

22. Resource Impact and Effect: High and Regulatory

" Ford Foundation Report, Spring 2001, 21.

Edgecliffe- Johnson, Andrew. "Child Labour Claims Trigger Beedi Cigarette Crackdown." The
Financial Times, 25 November 1999, 7. Available from http://www.lexis-nexis.com

EPW Online. "QR Removal and ITS PROBABLE Implications." EPW Online. Available from
www.epw.org; Internet.

Global March Online. "Child Labour News Service: Clinton to promote child labour standard at
the WTO." Available from www.globalmarch.org; Internet.

"From Bondage to Freedom." The Hindu News Wire, 17 March 2001. Available from
http://www.lexis-nexis.com

Human Rights Watch/Asia: Children's Rights Project, "The Small Hands of Slavery: Bonded
Child Labor in India." United States 1996.

International Justice Mission. "No Mercy: Bonded Child Labor and Forced Prostitution in
India." International Justice Mission on-line. Available from www.ijm.org/India.htm.

International Labour Office Pamphlet 1999, "A New Tool to Combat the Worst Forms of Child
Labour ILO Convention 182." Switzerland; 1999.

Mishra, Lakshmidhar. Child Labour In India. New Delhi Oxford: University Press, 2000.

Oldenburg, Don, "Child Labor Debate." The Washington Post, 30 September, 1997: E5.

RUGMARK Foundation USA, "Child Labor Laws." Rugmark USA online. Available from
Http://www.Rugmark.org; Internet

Sawyer, Roger. Children Enslaved. London: Routledge, 1988.

Third World Traveler. "The Small Hands of Slavery: India's Bonded Child Laborers and the
World Bank." Third World Traveler on-line. Available from
www.thirdworldtraveler.com/IMF_WB/SmallHands_MNM.html

Tobacco Board, Ministry of Commerce - Government of India. Available from http://www.indiantobacco.com/

"U.S. Bans Bidi Press." Newsday, 25 November 1999, A89. Available from
http://www.lexis-nexis.com

U.S. Department of Labor, Bureau of International Labor Affairs. "By the Sweat and Toil of
Children: A Report to Congress." July 15, 1994

U.S Department of Labor. "IV. Forced and Bonded Child Labor." Available from
www.dol.gov/dol/ilab/public/media/reports/sweat2/bonded.htm.

World Vision's "Today" Magazine. "Child Labor: Robbing God's Cradle," World's Vision
on-line. Available from www.worldvision.org/worldvision/mag.nsf/stable/WVT_child_labor_0196