The Small Hands of Slavery
India's Bonded Child Laborers and the World Bank
by Lee Tucker and Arvind Ganesan
Multinational Monitor January/February 1997
Whether they are sweating in the heat of stone quarries, working
in the fields 16 hours a day, picking rags in city streets or
hidden away as domestic servants, India's 60 to 115 million working
children-the highest number of any country in the world-endure
miserable and difficult lives. They struggle to make enough to
eat and in some cases to help feed their families as well. They
do not go to school; more than half of them will never learn the
barest literacy skills. Many of them have been working since the
age of four or five, and by the time they reach adulthood they
may be chronically sick or irrevocably deformed. They will certainly
be exhausted, old men and women by the age of 40, likely to be
dead by 50.
Most of these working children are compelled to work, whether
by their parents, by the expectations attached to their caste
or by simple economic necessity. At least 15 million of them,
however, are working as virtual slaves. These are India's bonded
"Bonded child laborers" are children that work under
conditions of servitude to pay off debts. The debts that bind
them to their employers are incurred not by the children themselves,
but by their relatives or guardians, usually a parent. In India,
these debts tend to be relatively modest, ranging on average from
$14 to $214, and are usually incurred for necessities such as
food, emergencies such as treating illnesses or a marriage dowry.
As the cost of living and unemployment in India increase,
the rate of child labor and bonded child labor is also rising.
A 1995 report by the government-appointed Commission on Labour
Standards and International Trade found child labor to be increasing
in India at the rate of 4 percent a year, "while the working
conditions of the children have remained unchanged, if not deteriorated."
Children sold to bond masters work long hours over many years
in an attempt to pay off these debts. Due to the astronomically
high rates of interest charged and the abysmally low wages paid,
they are usually unsuccessful. Many will pass the debt on, intact
or even higher, to a younger sibling, back to a parent or on to
their own children.
The past few years have seen increasing public awareness in
India itself, but particularly in the international arena -of
the high incidence of child servitude in the carpet industry of
South Asia. But bonded children also make up a significant part
of the work force in agriculture, and in the production of silk
and silk saris, beedies (hand-rolled cigarettes), silver jewelry,
synthetic gemstones, leather products (including footwear and
sporting goods), handwoven wool carpets and precious gems and
diamonds. Bonded child labor is prevalent in service areas including
prostitution, small restaurants, truck stops, tea shops and domestic
Culture of exploitation
Child debt servitude has been illegal in India since 1933.
Since independence, India has adopted a plethora of additional
protective legislation, most importantly the Bonded Labour System
(Abolition) Act, 1976, which strictly out laws all forms of debt
bondage and forced labor.
These extensive legal safeguards mean little, however, without
the political will to enforce them. In India, whether due to corruption
or indifference, this will is sorely lacking. All existing labor
laws are routinely flouted, with virtually no risk of punishment
to the offender. In the rare cases of prosecution, offenders typically
receive negligible fines. India-the Indian government, the ruling
elite, business leaders and the populace as a whole-tolerates
this slavery in its midst largely due to a vast and deeply entrenched
set of myths. These myths hold that bonded labor and child labor
are inevitable products of India's poverty. They represent the
natural order of things; if they are to be changed at all, it
can only be through slow evolution.
In fact, poverty is only one of many factors at play in creating
and sustaining the conditions that facilitate endemic bondage.
In India, other key factors include: a paltry social welfare scheme
to safeguard against hunger and illness; a non-compulsory and
unequal educational system; insufficient employment opportunities
and living wages for adults; the lack of small-scale loans other
than from bonding for the rural and urban poor; corruption and
indifference among government officials; and societal apathy.
Most importantly, the Indian government has failed to protect
India's most vulnerable children. When others have stepped in
to try to advocate on their behalf, Indian leaders and much of
the country's media have attributed these actions to ulterior
In response to the international focus on child labor in export
industries and the threat of sanctions against exports made with
child labor, the Indian government has accused its international
critics of "protectionism" benefiting wealthy nations.
The government has adopted superficial remedies designed to assuage
international concerns about goods made for export with child
labor while continuing to ignore its legal obligation to identify,
release and rehabilitate bonded laborers.
World Bank bonds
Additional responsibility for the growing use of bonded child
labor rests with multilateral lending institutions, notably the
World Bank. In its effort to promote export-oriented industrialization,
the Bank has neglected to ensure that the projects it funds do
not involve the use of bonded child labor. The silk industry exemplifies
the serious consequences of this neglect.
The production of silk thread and saris is historically one
of India's most important industries. With substantial government
and international subsidies for silk projects and marketing schemes,
the industry has been expanding rapidly over the last several
years. The bulk of Indian silk thread and silk cloth is consumed
domestically, but silk exports are growing rapidly. Silk exports
earned India approximately $260 million in 1995, and the Indian
government expects silk exports to reach an all-time high of $300
million in 1997.
The World Bank has actively promoted the silk industry over
the last decade and a half. From 1980 to 1989, the Bank loaned
$54 million to support sericulture (the raising of silkworms)
in Karnataka. In 1989, the World Bank provided two more loans
totaling $177 million for the National Sericulture Project in
Karnataka and Uttar Pradesh. In 1994 and 1995, the Bank loaned
another $3 million loan to modernize the Karnataka silk industry
and helped back a $157 million project to upgrade overall Indian
silk production and quality. The Bank has also proposed a $190
million agricultural loan for Uttar Pradesh, part of which would
The Bank's rationale for assisting with the promotion of sericulture
is to create jobs, alleviate poverty and help disadvantaged groups.
But by failing to monitor or even restrict the use of bonded
children, the Bank has, in effect, underwritten an industry which
relies on bonded child labor at all stages of operation. In the
two main stages of production, silk reeling and twisting, and
silk handlooms, the bondage rate for child workers who are not
the children of employers is reportedly 100 percent. In the Karnataka
silk industry, there may be as many as 100,000 bonded children
involved in every stage of silk production.
It is not unusual for children to begin working in the silk
industry when they are five years old. These children earn very
low wages, typically 10 rupees a day or less, and suffer occupational
hazards and the threat of employer abuse. They are, in the words
of R. K. Misra, who studied child labor in the sari industry of
Varanasi, "cage-birds ... condemned from their very birth
to be captive workers." Pomabhai is a 12-year-old boy. Both
he and his older sister work in the silk industry; his other two
siblings are in school and his father works as a waiter in a local
hotel. When Pomabhai was eight, his father took a $126 advance
in order to pay for his eldest daughter's marriage; Pomabhai was
taken out of school and put in the factory, and he has been working
there ever since. "I want to continue my education,"
he says. "But first, we have to eat."
In the Karnataka town of Ramanagaram, India's largest silk
cocoon market, Ajad and Marukh, both 10 years old, have been working
in the silk industry since the age of five. As reelers, the boys
dip their hands into scalding water and palpate the silk cocoons,
sensing by touch whether the fine silk threads have loosened enough
to be unwound. They are not permitted to use spoons instead of
their hands when checking the boiling cocoons, on the theory that
their hands can more easily discern when the threads are ready
to reel. At age 10, their palms and fingers are white with the
thick tracks of fissures, burns and blisters.
Tens of thousands of children also weave the silk. Most silk
looms are crowded together in dark, damp, poorly ventilated rooms.
These crowded conditions encourage the spread of contagious illnesses
among the child silk workers. In his 1985 study, "Child Labor:
The Twice Exploited," B. N. Juyal of the Gandhian Institute
in Varanasi identified tuberculosis and digestive disorders as
"the occupational disease[s] of the weaving community."
Cuts are also endemic and difficult to cure. A researcher in Kanchipuram
reported seeing a boy with fingers so badly cut that he was unable
to feed himself. Employers do not provide medical care or even
first aid to injured workers, and those who are unable to work
receive no wages for the day.
Human Rights Watch has called on the World Bank to suspend
funding for the industry until the Indian government fully implements
the Bonded Labour System (Abolition) Act, and the process of identifying,
releasing and rehabilitating these children begins. Human Rights
Watch has also urged the Bank to implement programs to ensure
that these children are able to go to school, arguing that this
is the only way to break the cycle of bondage.
The World Bank generally denies responsibility for, or complicity
in, India's bonded labor problem. "Child labor has not been
a major problem in Bank projects," says Durudee Sirichanya,
a World Bank spokesperson. "We have regularly appraised"
India's silk projects, Sirichanya says, and the problem of child
labor "has not shown up in any of our reports . "
Sirichanya emphasizes that "the Bank does not condone
the use of child labor in projects we finance." While "the
issue of child labor is complex ... because in some areas child
labor is essential for families to survive," she says, "the
Bank has tried to look in terms of providing the environment to
discourage child labor."
Smoking out child labor
Bonded child labor is also prevalent in non-export industries,
including production of "beedies," cigarettes produced
for the domestic market. More than 325,000 children work in the
beedi industry, most in the southern state of Tamil Nadu.
The child beedi workers toil in brutal conditions, in a climate
of fear and terror. "The agent would beat me with a stick
if I was not there on time, he beat me if I could not roll 1,500
beedies a day and he beat me if I was tired," says Panjaran,
a 10-year-old former beedi worker who was bonded at the age of
six for a $14 advance. "If I looked around, he beat me. He
made me put a matchbox under my chin; if it fell, he would beat
In 1991, the Supreme Court of India ordered the government
to prohibit all child labor in tobacco manufacturing units which
threaten children's health. In addition, the court ordered state
governments to formulate a plan to either end child labor immediately
or phase children out of the beedi industry within three years.
By late 1996, however, no such plans had been implemented.
The search for political will
The eradication of bonded child labor in India depends on
the Indian government's commitment to two imperatives: enforcement
of the Bonded Labour System (Abolition) Act, and the creation
of meaningful alternatives- schooling-for already bonded child
laborers and those at risk of joining their ranks. Non-governmental
groups will also have to shoulder enormous watchdog responsibilities,
blowing the whistle whenever the government is lax.
Lee Tucker and Arevind Ganesan are consultants to Human Rights
Watch's Children Rights Project
World Bank, Structural Adjustment