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Poor labourers paying price for India’s cheap car boom

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PHUKET MEDIA WATCH

– World news selected by Gazette editors for Phuket’s international community

Poor labourers paying price for India’s cheap car boom
Phuket Gazette / Reuters


PHUKET:In a dingy factory in the sprawling industrial hub of Manesar in northern India, a plastic moulding machine malfunctioned, mangling Visheshwar Prasad Singh’s right hand as he made parts for a supplier to the country’s major automakers.

Singh was one of thousands of poor labourers, many temporary, who toil for 12 hours a day making auto parts for as little as $3-a-day to feed India’s cheap car boom.

“I had no training to use the machine and was asked to operate it one day,” said the 51-year-old, who made parts for Ranee Polymers, supplying to Honda Motor Co (7267.T) and Yamaha Motor Co (7272.T).

Doctors reattached his hand, but after 14 months and three operations it remains near-paralysed.

The plant manager at Ranee Polymers said the company did not allow workers to operate machines without proper training. There were only one to two accidents a year at the plant, which employs 250 people, R.K. Rana said.

Honda Cars India, which sources from Ranee, was not aware of the accident as it did not occur when making parts for the company, a spokeswoman said, adding that audits of incidents impacting safety or supplies were conducted.

Honda Motorcycle and Scooter India said a spokesman was not available to comment. India Yamaha Motor did not respond.

Car makers such as Maruti Suzuki India (MRTI.NS) and Hyundai Motor (005380.KS) see huge growth in India, set to become the world’s third-largest auto market by 2020 as millions buy their first new car. Price tags can be as low as $3,000 for a new Tata Motors (TAMO.NS) Nano mini-car.

India is also becoming a low-cost export hub for global car makers such as General Motors (GM.N) and Ford Motor (F.N).

Consultant McKinsey estimates India’s auto parts sector will grow five-fold to about $200 billion by 2026, with exports rising to $80 billion from $11 billion.

As the sector expands, some of the work is sub-contracted out to small factories operating on paper-thin margins, where poor contract workers often have little or no access to safety equipment or health benefits, industry experts say.

“Undoubtedly, the workforce of suppliers, especially at the bottom of the chain, are paying for the growth in the auto industry,” said Puneet Gupta, associate director at consultant IHS Automotive. But with more focus on quality and with India becoming an export hub working conditions would improve, he added.

Car makers say they conduct audits at their main suppliers, but it is not possible to check all the smaller companies that may be outsourced work.

A Maruti spokesman said the company conducts safety and quality audits at its 400 direct suppliers and shares best shopfloor practices, including those related to safety and working conditions.

Ford India and Hyundai, which manufacture cars in the southern state of Tamil Nadu, far from the Manesar hub, did not respond to an email seeking comment.

LACK OF TRAINING, INSPECTIONS

A report by non-profit organisations Agrasar and Safe in India on safeguarding workers in the auto hub of Gurgaon and Manesar, outside Delhi, said most accidents occurred due to lack of training and safety inspections and poor machine maintenance.

The region – some 50 km (31 miles) south of the capital and home to top car maker Maruti Suzuki along with hundreds of small factories – employs 80,000 workers, but there are only about 35 to 40 inspectors in total to monitor all industries in the area.

A senior official in the state labour department said inspections happened once a year, or when a worker reported an accident – the leading cause of which was violations of safety rules such as having sensors or guards on machines, he said.

Every year, more than 1,000 workers in the auto hub, most below 23 years of age, are injured seriously and lose their livelihoods, the report said.

“Factory owners train people for a day or two and get them to operate machines. It is all about meeting targets,” said Prerit Rana, founder of Agrasar, that helps rehabilitate injured workers.

POOR WORKING CONDITIONS

The village of Mujesar in Faridabad, south of Delhi, is a labyrinth of auto part workshops, many operating in residential areas where most manufacturing is banned. In one of the hole-in-the-wall workshops, made up of two small rooms with a window the size of a computer screen for ventilation, Reet Lal coats metal parts with anti-rust chemicals, earning him 8,500 rupees ($125) a month.

With a glove only in one hand and no mask, Lal endures nauseating smells for 12 hours a day to complete work outsourced by a firm whose website says it makes parts for Maruti, Tata Motors and GM.

A Tata Motors spokeswoman said it no longer sources from the supplier due to poor quality of products. GM India said it did not source parts from that supplier.

Kamala, a 30-year-old worker at another small workshop inFaridabad, spends hours on a wooden stool labouring over a rusted drilling machine.

“My life is hell,” said Kamala, a mother-of-two who spends part of about $2.50 she earns a day to treat chronic backache. “I hope my children don’t have to go through the same.”

($1 = 68.0102 rupees)

— Phuket Gazette Editors

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Economy

Vietnam’s booming manufacturing sector reduced to a trickle as world pandemic kills demand

The Thaiger

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Vietnam’s booming manufacturing sector reduced to a trickle as world pandemic kills demand | The Thaiger

Vietnamese finance officials are downgrading expectations for a recovery of the south east Asian nation’s economy in 2021. The normally fast-growing gross domestic product in 2020 has stalled due to a huge drop in local and global demand, and the absence of international tourism. The booming economy, growing at an average of 6% per year since 2012, will struggle to reach a growth rate of 2% this year.

Fuelled by manufactured exports, the Vietnam economy has dropped back to a trickle. The Asian Development Bank estimates that this year’s GDP growth could be as low as 1.8%. The Vietnamese factories, that usually crank out shoes, garments, furniture and cheap electronics, are seeing dropping demand as the world’s consumer confidence drops dramatically.

Stay-at-home rules in Europe and America are keeping are keeping people away from retail stores. And despite the acceleration of online retail, many of the consumers are emerging from the Covid Spring and Summer with vastly reduced spending power.

The headaches of 2020 are also challenging Vietnam to maintain its reputation as south east Asia’s manufacturing hotspot. Rising costs and xenophobic foreign policy have put China ‘on the nose’ with some governments, complicating factory work in China, whilst other south east Asian countries lack infrastructure and are incurring higher wage costs.

One Vietnamese factory operated by Taiwan-based Pou Chen Group, which produces footwear for top international brands, has laid off 150 workers earlier this year. There are hundreds more examples of the impact of falling demand in the bustling Vietnamese manufacturing economy.

Vietnam’s border closure is also preventing investors from making trips, setting up meetings and pushing projects forward. Those projects in turn create jobs, fostering Vietnam’s growing middle class. Tourism has also been badly affected by the restrictions on travel. “International tourism is dead,” says Jack Nguyen, a partner at Mazars in Ho Chi Minh City.

“Inbound tourism usually makes up 6% of the economy.”

“Things will only pick up only when the borders are open and there’s no quarantine requirements. Who knows when that’s going to be.”

A mid-year COVID-19 outbreak in the coastal resort city Danang followed by the start of the school year has reduced domestic travel, analysts say. Some of the country’s hotels are up for sale as a result.

“Recovery could take 4 years.”

The Vietnamese Ministry of Planning and Investment is now warning that global post-pandemic recovery could take as long as 4 years, perhaps more.

Not that foreign investors in the country are pulling out. Indeed, many are tainge a long-term view that Vietnam’s underlying strengths will outlive Covid-19. Vietnam reports just 1,069 coronavirus cases overall.

SOURCE: VOA News

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Business

Singapore’s population contracts along with its GDP

The Thaiger

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Singapore’s population contracts along with its GDP | The Thaiger

The little south east Asian island nation of Singapore, which has always punched way above its weight, with the fourth largest economy, but the biggest GDP per capita in the region, is getting smaller. Both its economy and population. The population of the Republic of Singapore is shrinking for the first time since 2003. Border closures and, mostly, job losses, are forcing 10s of 1000s of foreign workers back to their home countries.

Singapore’s overall population dropped by nearly 20,000 people, or 0.3% of the population at the endow 2019, to 5.69 million people.

There’s been a sharp drop in expats, down 2% to 1.64 million, and a smaller drop in permanent residents. At the same time, the Covid-19 pandemic has caused a number of citizens to return from overseas, swelling the numbers of locals slightly.

The annual report of Singapore’s demographics notes that the transitions are nearly entirely due to the coronavirus outbreak. The report also says that there has already been an economic decline officially estimated between 5%-7% for 2020.

“These trends were largely due to Covid-19 related challenges, brought about by weak demand and travel restrictions. The government has been raising barriers for foreign hiring to preserve jobs for locals.”

Singapore’s non-resident population has surged 200% over the last 2 decades, fuelling mega population growth in the city-state with one of the world’s lowest birth rates. If not for the influx of foreigners, Singapore would have been recording a net drop in population.

The rise of Singapore’s middle class, and the ‘trend’ to hire domestic help, has caused an influx of low-paid migrants to act as nannies, maids, cleaners, drivers and construction workers. Many of these have either voluntarily headed back to their countries, mostly the Philippines, or been sacked.

National University of Singapore sociologist Tan Ern Ser notes that the decline in non-resident population is mostly due to the departure of work permit holders, who take up jobs which Singaporeans avoid in the first place. He says the trend probably signals some sectors of the economy are not doing well.

“The issue of foreigners in our midst cannot be addressed simply by cutting down their numbers, without negative consequences for our economy.”

Meanwhile, Japan says it has made an agreement with SE Nations Singapore and Brunei to reopen their borders for newly arriving expats from next Wednesday and and other long-term residents from October 8.

Those eligible to travel will be allowed in on condition they self-quarantine for 14 days after arrival as a preventative measure against the spread of Covid-19.

Brunei and Singapore join 7 other ASEAN countries, including Vietnam and Thailand, with the new travel bubble with Japan. Japan still has a ban in place for the entry of travellers from 159 countries and regions. Japan’s foreign minister Toshimitsu Motegi says the government is seriously considering how to restart travel back to Japan, both for business and tourism.

“We see the resumption of new entries (of foreigners) to Japan as an extremely important issue.”

Japan already allows short-term business travellers from Singapore to enter the country without doing quarantine, on condition they take a test before they travel to Japan, then another when they arrive, can provide an itinerary of their stay and take preventative steps to actively socially distance during their visit.

SOURCE: trip.sg

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World

Richest 1% responsible for twice the amount of carbon emissions than the poorest 50%

Caitlin Ashworth

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Richest 1% responsible for twice the amount of carbon emissions than the poorest 50% | The Thaiger
PHOTO: Unsplash: Alexander Popov

The richest people in the world, who make up just 1% of the population, are responsible for a significant amount of carbon emissions. A study shows that the “1 percenters” make up twice as much carbon pollution than the poorest half of the world. Some say the poor are the least responsible for climate change, but have to deal with most of the negative consequences.

In a 25 year study led by Oxfam, researchers at the Stockholm Environment Institute found that wealthy countries were responsible for using up nearly a third of the Earth’s carbon budget. The study was conducted from 1990 to 2015, when annual emissions grew by 60%.

Oxfam is a confederation of 20 independent charitable organisations focusing on the alleviation of global poverty, founded in 1942 and led by Oxfam International. It is a major nonprofit group with an extensive collection of operations.

63 million people made up the richest 1% of the world. Since 1990, they have been responsible for 9% of the ‘carbon budget’. The carbon budget is the maximum amount of greenhouse gases that can go into the air before temperature rises to catastrophic levels. 3.1 billion people make up the poorest half of the world’s population. The carbon emissions growth rate of the rich 1% was 3 times more than the poorest half of the world.

There’s not just an economic inequality between the rich and the poor, according to the head of policy, advocacy and research, Tim Gore. He told AFP the research shows the world’s “carbon inequality.”

“It’s not just that extreme economic inequality is divisive in our societies, it’s not just that it slows the rate of poverty reduction …But there is also a third cost which is that it depletes the carbon budget solely for the purpose of the already affluent growing their consumption … And that of course has the worse impacts on the poorest and least responsible.”

Carbon emissions have decreased since the pandemic. But just a few months doesn’t take away the damage that has been done for years. Temperatures are still on track to rise several degrees this century. Although the 2015 Paris climate deal was set to keep the global temperature rise below 2 degrees Celsius above pre industrial levels, emissions have continued to increase.

“It’s clear that the carbon intensive and highly unequal model of economic growth over the last 20-30 years has not benefited the poorest half of humanity… It’s a false dichotomy to suggest that we have to choose between economic growth and fixing the climate crisis.”

Some say the global economy needs to prioritise “green growth.” If not, the decrease in pollution during the pandemic will have a very small and insignificant overall impact on climate change. Some say carbon emissions affect the poorest nations the most who don’t have enough resources to fight natural disasters possibly brought on by the rising temperatures, like wildfires and droughts.

SOURCE: Bangkok Post | AFP

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