APPL tea workers wait outside a hospital in Assam, India. Photo by: Amruta Byatnal / Devex

TEZPUR, India — Rita Bhuyan has a high fever and cannot walk. For the last nine years that she has worked at the Hattigor tea estate in India’s Assam state, she has only taken five sick days. On an August afternoon, she complained she was feeling ill and was sent home. But there was a caveat: she couldn’t be off sick for more than two days.

“If we skip work for more than two days, they cut our wages,” she told Devex in her house in the workers’ colony on the tea estate. “How can I make sure I’m ready to work in two days? The doctor comes for just two hours during the day, when I was out picking leaves,” said the 36-year-old tea worker, who used a pseudonym to speak frankly.

 “We started with very high ambitions for this project … It’s been extremely difficult to reach those ambitions because of the multiple challenges.”

— Rana Karadsheh, regional industry director for manufacturing, agriculture, and services, IFC

The tea estate is part of Amalgamated Plantations Private Limited, in which the International Finance Corporation has a 16% equity share. APPL, whose majority share is owned by Tata Global Beverages Limited, operates 25 tea estates in northeast India and is India’s second-largest tea producer and supplier, employing over 30,000 workers, with 155,000 people living on its tea estates.

IFC’s failure to ensure proper working conditions for tea plantation workers like Bhuyan has been highlighted by its watchdog, the Office of the Compliance Advisor and Ombudsman or CAO — first in an investigation report in 2016, and later, in a monitoring report in January this year. In response, the World Bank’s private sector arm vowed to take the necessary steps to adhere to IFC’s performance standards. But almost 10 months later, the situation on the ground remains unchanged.

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In an interview with Devex, a senior IFC official said it has been difficult to maintain proper working and living conditions for workers. “We started with very high ambitions for this project … It’s been extremely difficult to reach those ambitions because of the multiple challenges,” said Rana Karadsheh, IFC’s regional industry director for manufacturing, agriculture, and services.

In its report, CAO warned IFC of the consequences of failing to meet performance standards. “If noncompliance with IFC requirements persist, IFC, as a part owner of APPL, risks perpetuating a system of employment with well documented negative impacts on workers and their families,” the report states.

IFC has been unable to ensure compliance but has now shifted focus to facilitate a dialogue between APPL, workers, and the NGOs involved, in an effort to resolve some of the issues. However, questions on the sustainability of the project and the well-being of workers remain.

The case

Activists who had complained to CAO about the lack of social and environmental protections believe that IFC should take more responsibility than attributing its failure to “challenges.”

Promotion and Advancement of Justice, Harmony, and Rights of Adivasis, or Pajhra — an NGO that works with tribals in Assam, and one of the complainants to CAO — has been fighting this case since 2013.

“IFC has the responsibility to improve the living and working conditions of tea workers, and be a leader in the sector. We are agitated because right now, they are denying this basic right to thousands of workers,” Pajhra director, Stephen Ekka said.

Pajhra first filed a complaint in 2013 with CAO highlighting, among other issues, worker intimidation, the lack of protective gear while spraying pesticides, and poor living conditions on the tea estates.  

CAO’s November 2016 compliance investigation report responded to this complaint from three NGOs, including Pajhra, on behalf of workers from three APPL estates in Assam: Hattigor, Majuli, and Nahorani.

In Hattigor, Bhuyan points to her broken toilet. “The APPL people come and take photos but nobody does anything about it,” she said. The ceiling of her house — one of those given to permanent workers on the estate — is leaking. A tin sheet covers it temporarily. “We were promised a job and a house. But what is the point if everything is broken and [there’s] no money to fix it?” she asked.

Around her house, open drainage is yet another example of the lack of proper sanitation in worker colonies. Complaints by other tea plantation workers included long working hours without lunch breaks, intimidation, fear of losing their jobs if they spoke out, and the lack of basic services.

‘High implementation risk’

In response to CAO’s compliance investigation report in 2016, IFC said the APPL project was aligned with World Bank’s priorities to “undertake engagements in challenging frontier environments that offer potentially strong development impact, but also carry high implementation risk.”

IFC was convinced that its performance standards would help raise labor and environmental conditions in an industry “where few operators demonstrate interest or capacity in promoting sustainability,” according to its communication with CAO.

However, in its 2016 response, IFC told CAO it did not sufficiently review contextual risks before making the investment, and did not consider the financial resources and time required to make the improvements needed to ensure compliance with the IFC-mandated Performance Standards — the effects of which are now being faced by workers across the plantation.

A CAO spokeswoman told Devex the 2019 monitoring report concluded that IFC had conducted limited supervision of the environmental and social issues raised by tea workers, and has not satisfactorily addressed CAO’s noncompliance findings. “Based on CAO’s compliance investigation and subsequent monitoring, adverse impacts on workers are well documented,” she added.

Financial constraints

Risks in the sector include what IFC calls “legacy issues” — problems that have been plaguing the tea industry for decades, making it a less profitable industry than it once was.

APPL, which has reported financial losses since the 2015 fiscal year, told CAO that the implementation of steps to guarantee workers’ rights had been held back due to financial losses, and would require “more capital than is currently available,” as the CAO monitoring report states.

In its March 2019 response to CAO, IFC said “continued financial distress in the industry” has presented challenges to addressing all the issues in the CAO complaint.

Accountability Counsel, an NGO that advocates for people who say they have been harmed by internationally financed projects, has supported Pajhra in its complaints to CAO, and remains critical of IFC’s inaction.

“If it is genuine about its development mandate, then IFC as part-owner of APPL, must draw from its significant financial resources to invest in workers’ health and safety,” said Anirudha Nagar, the organization’s communities co-director. “This will increase the productivity of tea workers, and bring tangible improvements to APPL's bottom line," he said.

“[Ensuring] that such investments are made in accordance with IFC requirements will require the dedication of resources and relevant sectoral expertise beyond that which IFC dedicated to this investment, in particular social and labor expertise.”

— CAO spokeswoman said.

Action plan

In response to CAO’s 2016 investigation report, IFC guaranteed that APPL would implement an action plan to address “shortcomings and legacy issues” in key areas, such as human health, worker health and safety, housing, and sanitation infrastructure.

IFC also agreed to commission a third party to undertake an annual audit and worker perception survey across 25 estates owned by APPL, update its legal opinion on APPL’s compliance with national minimum wage requirements and ensure that the action plan was disclosed to and consulted on with workers.

However, in its 2019 monitoring report, CAO noted that this had not been done either.

IFC underestimated the environmental and social challenges associated with the project, and investments like this will need more financial resources and a better understanding of the industry, the CAO spokeswoman told Devex.

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“[Ensuring] that such investments are made in accordance with IFC requirements will require the dedication of resources and relevant sectoral expertise beyond that which IFC dedicated to this investment, in particular social and labor expertise,” the CAO spokeswoman said.

IFC declined to respond to questions about specific steps it had taken to guarantee workers’ rights. Instead, Karadsheh said, “Over the last several years, we have learned a lot through our meetings with members of the community, civil society, and APPL, talking with all parties about the best way forward, especially with a view to preserving jobs for workers.”

In its response to CAO, IFC said the investment sought to “bring fundamental change to an industry that faces large fixed costs, low productivity, and burdensome regulation[s],” calling itself an “honest neutral broker to support a fair transaction” between employees and existing shareholders.

Dialogue

IFC has stated in its response that tackling many of the endemic issues highlighted in the CAO report will take broad stakeholder engagement and a sector-wide approach in Assam.

In the absence of financial resources, the organization sees dialogue as most crucial to resolving the issue.

"IFC is committed to facilitating a meeting between the complainants, their representatives, and APPL to work together on some of these priority actions. IFC believes that a process of dialogue, engagement, and collaboration between APPL and the complainants is key to charting a path forward,” an IFC spokesperson told Devex.

APPL also highlighted the need for industry-wide reform to ensure the sustainability of the tea production business.

However, civil society members are not convinced that dialogue alone will resolve tea workers’ issues, or that it could be a viable alternative in the absence of adequate resources to do that.

“While we see value in a dialogue, tea workers expect it will be geared towards actionable solutions to their pressing concerns,” said Nagar of Accountability Counsel.

About the author

  • Amruta%2520byatnal%2520pic

    Amruta Byatnal

    Amruta Byatnal is an Associate Editor at Devex. She reports on global health and human rights, with a special focus on the politics of international food policy. Previously, she worked for News Deeply and The Hindu. She is a graduate of Cornell University where she studied international development.