How To Create Unemployment

Kanpur Tanneries Face Extinction

By a Correspondent

As one travels from one town to another, small and medium businessmen, factory owners and unemployed workers will share—almost in unison—that government policies have made traditional industries unsustainable, and how their livelihoods have been impacted the most over the last few years. Some blame the Yogi Adityanath-led BJP government for such a state of affairs, while others don’t. However, none shies away from venting out their discontent.

Kanpur, often considered as the business capital of India’s most populous state, is one such cluster abounds with such desperate stories. After most cotton mills have shut down, their out-of-work employees still waiting to get a majority of their dues. Some that remain are struggling to survive in the face of one adversity after another.

However, it is the Muslim-majority Kanpur cantonment seat, home to hundreds of tanneries that has shot to the limelight for having been particularly hit by recent executive orders. Ahead of polling on February 20, tales of losses and perishing businesses pervade campaign talks and discussions on voting choices Jajamau, the biggest locality in the assembly constituency, housed over 400 tanneries until three years ago. These employed over 10 lakh people directly or indirectly. Since 2018, executive decisions made by the Union and state governments have paralysed the tanneries and forced around 200 of them to shut shop. The resultant employment crisis generated over the last three years has been entirely ignored by the state government, tannery owners say. The first jolt to the industry came in 2018 when the Uttar Pradesh Pollution Control Board (UPPCB) ordered a complete shutdown of the tanneries as one of the measures to clean river Ganga three months ahead of the grand Kumbh Mela in Prayagraj. The ban on tanneries lasted nearly 14 months. The tanneries had barely recovered from the losses when the state’s pollution board ordered permanent closure of 248 units, without citing any reason.

Thereafter, similar orders to select units crippled the industry further, one of them from the UP Jal Nigam which stopped operations of all tanneries for an indefinite period in April 2021 to take up cleaning of 1165 metre-long sewer.

To be sure, tanneries discharge most of their effluents into the sewer that drains out in river Ganga. However, tannery owners believe that the shutdown of thriving industrial units is hardly a solution.

The processing of raw leather is a time-taking effort and releases a good amount of pollutants, but the tannery owners say that the industry alone should not be held responsible for “polluting the holy Ganga”.

“The government holds us solely accountable for river pollution. But there is still not a dedicated sewage treatment facility for the industry. The current sewer line is mostly flooded as it handles both the industrial and city’s waste,” said a tannery owner.

Tannery owners have consistently demanded that the government bodies should improve infrastructure for effluent discharge, increase sewer capacity, and build water treatment and recycling units to meet the industry requirements.

“Yet, successive governments have barely moved in that direction. The current BJP government, I believe, has not even spared a thought on how to sustain our leather industry,” the tannery owner added.

“Are we the only ones to take the blame ?” he asked, adding not to be named in any condition.

“I am scared. My tannery is one of those which have been meticulous about implementing the government’s standards. I don’t want to unnecessarily draw the pollution control board’s attention by being critical,” he said, adding that the tannery owners are most scared of the pollution control board.

A majority of the tanneries are owned by Muslims. They feel that such stringent action against tanneries during the Adityanath regime is somewhere derived from the chief minister’s “hate” towards minorities.

“Even the Hindu owners are equally affected. We know that they (BJP) don’t want Muslims to economically prosper. Much of the crisis in the Kanpur leather industry stems from such thinking,” said a Hindu tannery owner. “For on-record statements, you should visit our association but you won’t get the real truth there,” he added. One of the Muslim tannery owners in the room hinted at the scale of losses of the tanneries which was estimated to be a Rs 50,000 crore five years ago. “Three years ago, there were 410 tanneries in Jajmau alone, apart from others in different parts of Kanpur. Now there are only 270. Over the last few years, I can name many such units whose annual turnovers have fallen drastically.”

He pointed to a tannery in the vicinity and said, “This unit had an annual turnover of Rs 100 crore. It employed more than 500 people. This year, it showed a turnover of only Rs 40 crore.”

To keep pollution in check, the UPPCB has now created a roster which mandates that a particular tannery can operate only for 15 days a month. Previously, the UPPCB had also slashed the production capacity of most units by half. This practically means that a unit can process only one-fourth of its leather-processing capacity.

The implications of the orders are more than what meets the eye. Since 2017, after chief minister Adityanath closed down many slaughterhouses, the tanneries suddenly found themselves in a situation where sourcing raw leather became a challenge. Most Kanpur tanneries source their raw leather from licensed slaughterhouses. After they figured out alternative arrangements to source raw leather, they got rankled with successive UPPPCB and Jal Nigam orders.

Meanwhile, Adityanath also reversed the taxation benefits that the previous Akhilesh Yadav-led government had given to the leather industry. “Even as subsidies were taken off, we came under the GST regime. Although we come under the 5% tax slab, the GST returns take a year or more to come. That restricts our spending capacity even more,” the Muslim tannery owner said, as others nodded in agreement.

Two decisions specifically by the Union government also harmed them in a similar way. One, the Narendra Modi-led union government stopped the export incentives that the leather industry used to get in the previous UPA regime. “The tanneries flourished because the leather industry was primarily export-driven. Once the Centre stopped the 6.7% export drawbacks, our costs shot up. Indian giants in the finished leather goods’ business depend highly on the drawbacks to compete in the international market. They could increase their volume, lower their prices, and make a good bid in the international fashion market, only because drawbacks covered a good part of the cost,” a 27-year-old Muslim tannery owner who also owns a belt and equestrian goods factory said during discussions.

Two, yet another jolt came the leather industry’s way when the Modi-led union government recently imposed an import duty of 1.9% in 2020. “We used to import belt buckles and a lot of metal fittings used in leather products from China and other countries. Additional import duty has compromised our bargaining power in the international market,” said the young entrepreneur.

“First the shutdown, then the duties. How are we supposed to compete? When the Kanpur tanneries were shut down, there was so much fear in the international fashion market. India was the world leader in exporting leather products since most serious buyers wanted only the Kanpur buffalo leather. But now most of the international orders are gradually moving towards Bangladesh, Vietnam and China,” he said, adding that he has been struggling to retain buyers in the face of a ‘never-ending’ crisis.

The industrial decay in Kanpur directly impacts the most marginalised of Indian society. Most of the workers who lost jobs as a result of the leather industry’s crisis were either Dalits or Muslims since other sections of the population look at leather work with contempt and consider it as dirty.

“Most of the workers had a fixed income until three years ago. After the tanneries stopped working for half a month, they now depend on daily wages. However, since the income is meagre, a large section of them—mostly people from the Kanpur region—have started to migrate to Manesar near Gurgaon which is also a leather industry hub,” one tannery owner said.

The crisis in the leather industry of Kanpur is only one such instance where you see a socio-economic crisis arising out of an avoidable convergence of Hindutva dogma, unimaginative governance, and the government’s pre-disposed priority towards doctrinal concerns over problems like unemployment and other economic issues.

The largest revenue-earning region—the Muslim-dominated Jajamau—is different from its counterparts in Kanpur city in many ways. Tanneries mostly shut, poor roads, and piles of garbage dot the Kanpur cantonment constituency, in stark contrast to planned urban infrastructure, an upcoming metro rail, and big malls in the city centre.

Yet, how to revive or even sustain a decaying leather industry is a question that is writ large not only on the minds of tannery owners but hundreds of commoners who depended on the prosperity of the region.

[Courtesy: Cowin]

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Vol 54, No. 37, March 13 - 19, 2022