Unsafe factories: A roadblock to India's manufacturing hub aspirations

India’s aspirations to become a global manufacturing hub could stall on a basic weakness: Poor safety on the factory floor. According to the government data collated by IndiaSpend, three people died and 11 were injured every day on average between 2017 and 2020. The situation does not appear to have improved significantly since then. In this calendar year, according to the data compiled by IndustriALL, a 12-year-old global union federation, at least 240 workplace accidents occurred in India’s manufacturing, mining, and energy sectors, resulting in over 400 deaths and more than 850 serious injuries. The organisation reckons the numbers may be significantly higher since workplace accidents are notoriously under-reported. The mental stress such hazardous workplaces extract from workers is one obvious element of the problem. Unsafe workplaces also impact worker productivity, a point prospective investors often cite for choosing other emerging market destinations, creating a vicious cycle of inadequate investment and low job creation that inevitably impacts workers’ rights. 

The problem lies in the structure of the Indian labour market, where the informal sector accounts for 83 per cent of the workforce. Many of the roughly 250,000 registered factories employ workers on a contractual basis without benefits, rights, or a voice with responsibilities for worker health often palmed off to the labour contractor. There are countless more unregistered outfits that operate under the radar in worse conditions. An inadequate and corrupt supervisory system that wilfully overlooks lax safety standards and lack of accountability add to the problem. Routinely overworked and poorly trained workers complete the picture of lethality in the average Indian factory. The overall picture is one of conscious exploitation rather than benign neglect. “Crushed 2024”, the sixth annual report from the Safe in India Foundation, tracking auto-industry safety, found that the severity of injuries among low-paid, unskilled, and less educated workers was higher than among better-paid and educated workers. Those earning less than Rs 8,000 a month lost more fingers in accidents than those earning above Rs 20,000 a month. The same difference obtains between workers educated up to the fifth standard and those with diplomas. The report also noted that dire financial circumstances of women led employers to pressure them to operate power presses — a key source of hand injuries — while earning much lower than men for the same job. 

Compounding this dire situation is the fact that compensation for work injuries is either non-existent or inadequate, a situation that is virtually unchanged since the Union Carbide disaster in Bhopal in 1984, the worst industrial disaster in India’s history. The Safe India report pointed out that the Employees State Insurance Corporation (ESIC) e-Pehchan (identity) card, which enables workers to access health services, was made available to a large majority of injured workers only after the accident, contrary to ESIC regulations. In 2020, the government passed, as part of a package of labour reforms, the Occupational Safety, Health and Working Conditions (OSH) Code to relax the Factories Act, 1948, stipulations. The Code, which is still to be implemented, doubles the threshold of the number of workers in a factory to qualify for a safety committee and government scrutiny. That could leave thousands of workers prey to exploitative factory owners, a situation that is out of sync with India’s manufacturing ambitions.