The current offensive by global powers against the Third World countries comes in the form of imposing liberalisation policies, in which the ‘The Great SEZ Rush’ reflects the dynamics of a new economic and political world order, granting almost full freedom to capital to exploit labour.

The structure of SEZs/EPZs is such that it establishes an unquestioned supremacy of capital within the enclaves, not only in the economic sphere but also in the political, social and cultural spheres. Developers have full authority over operations, including security, and maintenance of the zones. The Development Commissioner (DC) is the single-point authority for the zones, with all the rights of state and central government departments with respect to the zones. There is no interference of any public body and no one can enter the zones without the permission of DC. The SEZ/EPZ authority has no elected representatives. It is headed by the DC with three representatives from the central government and two representatives from the private developers. Thousands of workers toiling in the SEZs have no representation. In such a situation, it is but natural that the DC (also the labour commissioner for the SEZs) will behave like an agent of the investors.

Labour is seen as a tool only for generating profit, and the implied industrial relations regime is making the EPZs/SEZs the new war zones of the Third World. In most countries which have EPZs/SEZs, the peasants have revolted against the acquisition of land, and everywhere they were suppressed. Working class movements, however, followed soon after. Often, they find expression in sudden outbursts. Although in these new situations, workers find it difficult to organise themselves, once they take to the streets, the state finds it difficult to handle them. 

The Political Economy of SEZs /EPZs  

The SEZ rush is a unique war among Third World countries to win more and more foreign investments from and more and more share in exports to developed countries. It is unique because victory depends on another war — with its own people, its own working class. The victor is the one who is able to suck more blood from its own labour. In this cut-throat competition, the capital of one country flourishes at the cost of other. Whatever the outcome, labour in all countries faces inhuman hardships.

The classic example is China. “China’s accession to the World Trade Organization and phasing out of the Agreement on Textiles and Clothing (ATC) which allocated clothing export quotas to developing countries, have accelerated the recent trend of shutting down operations in various countries throughout the world and relocating to the Chinese zones. The International Textile, Garment, Leather Workers’ Federation (ITGLWF) estimated that the phenomenal rise of China would lead to a million jobs lost in Bangladesh (an estimate confirmed by the UNDP), another million in Indonesia, around 200,000-250,000 in Sri Lanka, several thousand more in the Philippines and many other countries. Hundreds of factories have closed down in Mexico since their orders have gone to China, which offers cheap and perhaps the most exploited labour.” (M Suchitra, ‘Prospects for labour’, Seminar, February 2008) Many countries are competing by using the same strategies to win foreign investment, and competing to export the same goods, for example, textile products.

As capital is freer and more mobile than ever before, a country may attract huge foreign investments at one period of time. However, soon after, it may face disinvestments if the investors locate better conditions elsewhere. Garment exporters are free to choose locations according to the speed, quality and price. Most of the Third World countries are trying to compete, with increasing intensity, by offering low wages, thereby making the lives of workers hell. In India, industrial lobbies are demanding more liberalised labour laws — like those in China — to compete in the international market. 

Problems of Unionisation and Emerging Counter Strategies of the Working Class

The dynamics of the SEZ rush has a significant role in framing the new industrial relations regime in the Third World. According to a report of International Confederation of Free Trade Unions (ICFTU), the danger facing the free trade union movement is that EPZs became established as links in a global chain used by internationally mobile capital to set off a competitive downward spiral in the observance of international labor standards. (ICFTU 1991 & 2004) Therefore, it will also affect the counter strategies of the working class. 

It is an almost universal phenomenon that in SEZs/EPZs labour laws are either not applicable or, even if applicable, these are moulded to give a free hand to capital. EPZ investors and collaborating governments are hostile to trade unions and express strong opposition to international labour standards. For example, “The Pakistan government told the ILO that it was not in a position to correct major legal violations of trade union rights in its EPZs because the repressive law in question [which prohibits trade union activities] represented a precondition set by foreign companies for investment.” (ICFTU 1991) In countries such as the Dominican Republic and Sri Lanka, EPZ companies made it clear that a ‘union-free’ environment is crucial for their continued investment. (Herbert 2006).

The extreme competition for foreign investment among EPZ host countries and their willingness to compromise on workers’ rights poses a threat to the achievements and continuing work of trade unions in such countries. Host governments do not exert themselves to monitor and enforce national labour legislation within EPZs for fear of frightening off the foreign investors. Here, in India, the government initially tried to grant SEZs complete freedom from labour laws. Though having failed in this broad aim, the declaration of SEZs as public utility services has paralysed union activities.

The structure of the workforce and the working conditions in the enclaves also make unionisation of workers difficult. The feminisation of the workforce is a common feature of SEZs/EPZs all over the world, though some scholars argue that India does not follow the global trend in this respect. Unmarried females are preferred; they face a high risk of sexual exploitation. They are mostly new entrants to the labour market and usually do not wish to take the risk associated with organising activities. A major section of the workforce is composed of casual and contract workers. They have no job security. This makes them extremely reluctant to support any unionisation efforts. Workers are mostly in the age group of 16-28 years. They work 10-12 hours daily and do not receive minimum wages. The workload is such that one can work only when young. Child labour is also reported in some zones. (Mohammed Ahmadu 1998, PRIA 2000, M. Suchitra 2008, Vyas and Sunanda 2008, etc.).

Dismissals are routinely used in Central American EPZs to get rid of workers who attempt to form unions. In the United Arab Emirates, where 85 per cent of the workers are migrants, mainly from Asia, workers face the possibility of expulsion if they try to organise trade unions. In Egypt, trade unions report that most workers in the ‘Tenth of Ramadan City’ zone are forced to sign letters of resignation before beginning employment so that they can be fired at the employers’ convenience.” (ICFTU 2004).

The working class is now facing new challenges. It is fighting and learning to evolve new strategies to counter the new offensive of capital effectively. Workers have already started challenging the anti-labour policies in the SEZs/EPZs. A recent instance of the SEZ workers’ struggle is a national strike by garment workers in Bangladesh. In 2001, the Bangladesh Garments Workers’ Unity Council (BGWUC) called a national strike. They wanted trade union rights for the EPZ workers, and settlements, schools and hospitals for workers in the zones, among other demands. In 1986, the Bangladesh government declared, under the BEPZA Act, that the IRO (Industrial Relations Ordinance) was not applicable in the EPZs. The 2001 strike was a great success and drew international attention. Under pressure from the American labour unions, the US pressurised the Bangladesh government to allow trade union activities in the zones. Thereafter, the government declared the withdrawal of restrictions imposed on trade union rights in the EPZs from 1 January 2004.

In 2004, a two-day First National Conference of EPZ workers was held and an organisation — EPZ Workers’ Centre, Bangladesh — was formed. In 2008, there was a referendum on the issue, and 69 units in the Dhaka and Chittagong EPZs went ahead to form trade unions. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) wanted to form workers’ welfare committees (WWC) in place of unions but the trade unions rejected the idea. The WWC experiment was tried in Sri Lanka but failed; later, the workers formed their own trade unions. One hundred and twenty more eligible industrial units in two EPZs of Bangladesh will hold a referendum on this issue by 2010 (Clean Clothes Campaign 2001 and The New Nation 2004).

Wild-cat strikes are now becoming a common feature in the SEZ enclaves. In China and Vietnam, these are well reported and it is increasingly becoming a trouble in many Third World countries.

Unlike with EPZs, organised sector workers outside the zones will not be immune to the industrial relations regime inside zones. This is because SEZ workers will very soon constitute a significant section of the organised sector workforce in India, and if anti-labour policies are implemented inside the zones, these will, one way or the other, be made acceptable outside the zones also. Therefore, it will have devastating impact on the industrial relations regime of the country as a whole. Despite this, national trade unions are still not paying greater attention to unionising SEZ workers.  Previously, major efforts were made to organise workers in EPZs, an example of which was the Madras SEZ Workers’ Union affiliated to CITU. CITU also organised a national conference of SEZ workers in 2002 in Vishakhapatanam. However, these efforts could not be carried forward as EPZs were converted to SEZs, as in the case of the Madras SEZ Workers’ Union, nor did strong unions emerge as SEZs began to emerge on their own in other locations. Currently, unions in SEZs are either absent or have only a dismal presence in one or two units. There have been a few unit-level strikes in some zones but till now no such struggle has caught nationwide attention.

At the grass-roots level, the strategy of shop-floor unionism and other older organising strategies seem to have become ineffective. The new challenging situations demand new strategies and painful efforts to organise the SEZ workers. Experiences were shared by union workers of different countries in an international workshop on ‘Trade Union Strategies for Promoting Labour Rights in EPZs and Factories’ held in Puebla, Mexico, on 25-27 May 2001. In Sri Lanka, the Progress Union is organising the EPZ workers. Their organisers went to the boarding houses in the guise of workers’ relatives or approached them in buses when they were travelling to their work places. In South Africa, various social organisations such as youth and community organisations, the church, etc., were utilised to approach the workers. In Guatemala, the organisers work clandestinely in the beginning, develop cadres and start raising demands on gaining some strength. In Brazil, safety committees are allowed, and these are utilised to organise the workers. In Dominican Republic, the unions approached the women in their residential areas, formed neighbourhood committees and women`s orientation committees and tried to form unions through these committees. It was also reported that in some cases, some dismissed workers were taken back through international pressure by international federations and through solidarity actions in the concerned MNC’s host country. (K Hemlatha, ‘Mexico workshop on labour rights’, People`s Democracy, xxv[31] 2001)

Future Efforts 

The emerging counter strategies of the working class demand more emphasis on following aspects.

The SEZ/EPZ workers’ struggle has an inbuilt international dimension. An international platform of the working class is now more relevant than ever before. It becomes difficult to get better conditions for SEZ workers in a country if there is no working class movement for the same in other competing Third World countries. The fate of the working class of developed countries is now linked to the fate of working class in the Third World. Solidarity actions play an important role against victimisation.

Without a national-level platform, the SEZ/EPZ workers’ struggle cannot advance, since their fate is decided by a central SEZ Act. Moreover, it becomes difficult to win better working conditions in an SEZ if there is no struggle for the same in other SEZs. A national platform can also accelerate the unionisation process because it can fight against the victimisation of workers involved in trade union activities.

To build an effective organisation requires permanent members with stable support. Old unionisation strategies were mainly based on the workers, who had some kind of job security and who stayed longer in the units. But in the new situation, the majority of workers are casuals and they do not stay for long in any one unit. However, they stay for a long time in the same enclaves working in different units. Moreover, working conditions in different units of the enclaves are more or less the same and, therefore, their issues are also broadly similar. In such situations, it is better to start with organising the workers of different units on a general platform.

It has become difficult to freely talk to workers and promote unionisation inside the enclaves. To overcome this problem, union activities must reach the colonies of workers, building the bases of unions in the colonies.

Since women represent the majority or significant section of the workforce, more emphasis must be placed on unionising them. The trade union structure also needs to be transformed to give them more space. Their issues must also be given greater importance.