Maid in India

Maid in India
2. Labour practices in the Tamil Nadu textile
and garment industry
The textile and garment industry is of vital importance to the Indian economy. It is a large provider
of foreign currency and it is a source of employment, generating work for more than 35 million
people. After China 6 , India is the largest exporter of textile yarn. When it comes to exports of
apparel items, India holds third place, after China and Bangladesh. 7
India is a producer of natural raw materials such as cotton, jute, silk and wool. Synthetic fibres are
also produced in India, but the Indian garment industry is predominantly cotton based. Major export
destinations are Europe and the United States.
2.1. The cotton garment supply chain
Over the last decades, large retailers and brand companies have played pivotal roles in setting up
decentralised production networks in a variety of exporting countries. Typically, most export
countries are developing countries. Brands and retailers set the terms for contractors that make the
finished goods. The brands and retailers generally do the designing, branding and marketing but
they do not make the products they sell. Profits come from combinations of high-value research,
design, sales, marketing and financial services that allow the retailers, designers and marketers to
act as strategic brokers in linking overseas factories and traders with product niches in their main
consumer markets. 8
The sales part of the value chain is characterised by high entry barriers for new brand companies
and retailers. Entry barriers for manufacturers, by contrast, are low. The relative ease of setting up
manufacturing companies has led to an unparalleled diversity of garment exporters in developing
countries who are facing immense competition and low returns. 9 This contributes to power
imbalances between the retailers/brands and manufacturers.
Retailers and brand companies concentrate on selling garments while transferring, as much as
possible, the rest of the production activities to their manufacturing suppliers. It is in the interest of
the suppliers to offer a ‘full package’ service, including upstream and downstream activities.
Upstream, meaning taking responsibility for sourcing fabric and trim. Downstream, meaning
organising the logistics and transportation, and delivering the items to the retailer’s warehouse or
even stores in a ‘ready-for-sale’ packaged state. 10
6
7
8
9
10
Including Hong Kong.
Based on data from: United Nations Conference on Trade and Development, ‘UNCTAD Handbook of Statistics 2011’,
United Nations, New York and Geneva, 2011.
Based on McCormick, D. (2001), Gereffi, G. et al. (2003) The Global Apparel Value Chain: What Prospects for
Upgrading by Developing Countries? UNIDO: Vienna and Pan, J. (2008) Global Cotton and Textile Product Chains:
Identifying challenges and opportunities for China through a global commodity chain sustainability analysis. International
Institute for Sustainable Development (IISD): Manitoba; Devaraja, T.S., Indian Textile and Garment Industry – An
Overview (Hassan, India: University of Mysore, May 2011).
Ibid.
The International Bank for Reconstruction and Development, 2008.
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