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Ground Report: Solapur’s Beedi Industry Dying a Slow Death After Twin Blows of Demonetisation & GST

Already reeling under exploitation, beedi workers have had to bear the brunt of the Modi govt’s destructive policies.

Nanda* (16) is busy rolling beedis. She stopped going to school after failing IX grade. Her mother Jayamma* (40) delivers 800-1,000 beedis to a factory in Solapur. Nanda helps her mother to meet the daily targets. 

Due to the labour of the mother-daughter, the family manages to earn Rs 2,500-Rs 3,000 per month. On an average, Jayamma spends eight to ten hours a day rolling 1,000 beedis. The raw materials — tobacco and tendu leaves — are provided by the Desai Brothers factory, where Jayamma is employed.

“My husband works in a power loom factory. I have two daughters and one son. The eldest one doesn’t go to school and helps me make beedis now. The younger ones study in XI and V grades,” Jayamma told News Central 24×7. She explained that her family struggles to make ends meet and that they do not have any savings.

This is the story of around 70,000 workers, dependant on the 14 major factories,  a part of the women-dominated beedi industry in Solapur. 

Rampant exploitation

In 2014, the Maharashtra government had fixed the daily minimum wage at Rs 210 for rolling 1,000 beedis. However, this minimum wage rule is not followed by any factory in Solapur, workers and activists informed News Central24x7. An unofficial ‘agreement’ between the workers and factories fixed the wages at Rs 150 for 1,000 beedis. As a result of the government’s refusal to take action against erring business establishments, the beedi workers of Solapur are forced to live a life of poverty. 

While factory owners have agreed to pay Rs 150 for 1,000 beedis, they use other tricks to ensure that workers are paid an even lesser amount. For instance, while giving raw materials, they hand over 25-30 poor quality tendu leaves to each worker. When the labourers return beedis made using these leaves, the managers take these without accounting them for payment. “Sometimes, I buy leaves with my own money in order to replace the torn ones given by the factory. However, they always reject around 100, on some pretext or another and keep all the beedis without paying us for the rejected ones,” beedi worker Mala Bugadi* told News Central24x7. 

A beedi worker shows poor-quality tendu leaves given by a factory owner.

Also read: West Bengal: GST Hits Bankura Bidi Workers As Sales Drop; TMC MPs Didn’t Raise Their Issues in Parliament

The permanent workers are officially allowed to take 12 weeks of maternity leave, but paid maternity leave is a distant dream. Moreover, they have to get back to work merely 15-30 days after giving birth. Due to the continuous exposure of workers to tobacco during pregnancy, many women deliver premature babies.

When inquired, a factory owner said that they allow maternity leaves as per the government’s instructions. The women workers, however, seemed to be unaware of their rights. “We can take maternity leave for one month. If there are complications (with the pregnancy or delivery) then workers usually talk to the manager and if he (the manager) is convinced, the period can be extended. But, these are unpaid leaves. Why should they pay us when we are not working?” Mala Bugadi said.

Other women in Kumbhari — the housing society for beedi workers — are also not aware that they can take casual leaves and maternity leaves. Some of the factories remain open for five days a week, while others are open for six days. “On the days we don’t work, they don’t pay us, it is simple,” Bugadi added. 

Representational image. Credits: Wkimedia Commons/PIB

The permanent workers can avail gratuity, 8.33 per cent of their annual income as a bonus on Dussehra and a pension amount of Rs 1,000 per month upon attaining 58 years of age. Some of the workers — those without beedi workers’ identity cards — are paid on a contractual basis. They get Rs 100 for 1,000 beedis as daily wage payment. They are not entitled to any other benefits.

Wounds of demonetisation

On November 8, 2016, the beedi workers of the town found themselves staring at a new challenge. The factory owners refused to pay them cash when Prime Minister Narendra Modi announced demonetisation of Rs 500 and Rs 1000 currency notes. The employers suggested that money will be directly deposited in the workers’ bank accounts. Before this, the workers were paid cash on a weekly basis but now, the factories pay on a fortnightly or monthly basis. 

Many workers did not have a bank account, there were a few who had opened an account under Jan Dhan Yojana, but the banks informed them that those were not usable. Almost everyone did not have an ATM card.

“The workers are not educated. Suddenly going to the banks and understanding how to operate ATMs was difficult for them. Imagine more than 50,000 people queuing up in the few branches,” a local reporter Srinivas Dasari told News Central 24×7.

There was chaos. The financial condition of the families of the beedi workers worsened post-demonetisation as they were not paid salaries for a long period. “A 58-year-old beedi worker Neelamma died of heart attack during that phase because she was unable to take the stress,” Dasari said. 

GST Hits Beedi Industry Hard

The beedi factories in Solapur claim that after the introduction of Goods and Services Tax (GST) in July 2017, their sale has dropped by 35-40 per cent. “We used to sell a packet i.e. 25 beedis for Rs 15. After GST was imposed, we increased the price to Rs 18. Our customers are labourers, rickshaw pullers, and others from a low-income background, a sudden jump of Rs 3 has hurt the industry,” Balasaheb Jagdale, General Manager of Sable-Waghire and Company Pvt Ltd, who manufacture the popular Sambhaji beedi, told NewsCentral24x7

Post-GST, the manufacturing cost of 1000 beedis is Rs 640 and the wholesalers buy this quantity for Rs 650 from us, Jagdale said. On tendu leaves, tobacco, packaging paper with pictorial warnings: 18 per cent, 28 per cent and 12 per cent GST is imposed respectively.

The mandatory display of new health warnings covering 85 per cent of the principal display area on all tobacco products from April 1, 2016 has also impacted both the production cost and sale of beedis.

Due to the increase in production cost and the drop in sales, profits have dipped rendering many workers unemployed. Moreover, many factories prefer to get beedis from contractual workers rather than employing permanent employees.

“The demand is less. Previously, every worker was asked to deliver 1000-1500 beedis. Now, each worker is asked to give not more than 800-1000 beedis daily. Where is the question of employing more people? Also, contract workers give 1000 (beedis) for Rs 100 and they won’t have to be paid gratuity and other things. So, many factories prefer contract workers over permanent ones. But, they (factories) can’t be completely dependant on contractual workers too,” Sudheer Sable, the president of the Maharashtra Beedi Udyog Sangh, told NewsCentral24x7

“This govt only works for industrialists” 

In the 2014 Lok Sabha election, Bharatiya Janata Party (BJP) MP Sharad Bansode won from Solapur constituency after beating former union minister Sushil Kumar Shinde by a margin of 1,49,674 votes. The MP has never visited the workers after getting elected, the workers complain.

Solapur Beedi
BJP MP Sharad Bansode

Even when the they were reeling under a severe financial crisis during the demonetisation episode, Bansode was nowhere to be seen, say the workers. For 2019, the BJP has replaced him with Lingayat community spiritual leader Jai Siddheshwar Shivacharya Swami. The Congress party has fielded Shinde again while Vanchit Bahujan Aghadi’s (VBA) Prakash Ambedkar is also contesting from the constituency

The beedi workers want their pension amount to be increased to Rs 3,000 (as announced in Budget 2019 for the unorganised sector) by the next government and better health and education facilities. Not many are aware of the minimum income guarantee (NYAY) scheme announced by the Congress party. 

Recently suspended Communist Party of India (Marxist) [CPI(M)] leader Narsayya Adam, fondly referred to as “Master” by the beedi workers and other locals, is credited for making affordable housing possible for the beedi workers. The Left party suspended him for three months, accusing him of praising Prime Minister Narendra Modi during the latter’s Solapur rally, in January. 

CPI(M) leader Narsayya Adam

In 2006, then prime minister Manmohan Singh had inaugurated the housing project for beedi workers, spread across 182 hectares, at Kumbhari, about 8 km from Solapur city. To buy a house, the beedi worker paid Rs 60,000 and the balance Rs 40,000 was paid equally by the State and Union government. There are 10,000 houses in the colony inhabited by the workers. 

Speaking to News Central24x7, Adam said, “It is true that Modi came to inaugurate 30,000 houses for the unorganised section workers here. I’ll give credit where it is due. But, the workers fought for it. We went to the streets. The government (Modi government and the Devendra Fadnavis-led government in Maharashtra) only work for industrialists. If they impose fine on a few factories not paying the minimum wage, everyone else will fall in line. Basically, all political parties don’t want to pay heed to the problems of the workers. But, the conditions of the workers have become worse under Modi’s regime.”

Adam added, “The government needs to at least ensure that the minimum wages are paid to the workers. Besides that, they should be paid for all the beedis that they deliver and the factories should not be allowed to chaat beedi (reject and select beedis) and they should provide only usable tendu leaves. And they are not just facing financial problems. The health condition of women also gets affected. I have seen my mother suffer, my sisters are also into beedi-making.” 

The burgeoning cost of production has forced many Solapur beedi industry owners to shift focus towards other industries. The workers point out that they don’t want their children to make beedis. Lack of good education facilities and financial constraints are stopping them from switching to a new way of life. 

*Names changed to protect identity. 

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