Sunday, 22 June 2008

Aid to India (2)

Tim W highlights this heart-rending article.

My mantra has always been "Trade not aid!" but it might be useful to crunch some numbers:

Taking a round mid-figure of 100 million child workers in India (nearly ten per cent of the total population of India), and assuming that they can all earn 40 rupees/60 pence a day, assuming the poor little buggers work 7 days a week, that gives them an income of about £200 a year. The article does not make clear how much they have to pay for accommodation, but let's assume they're not being ripped off by their landlords, so 100 million children x £200 = £20 billion.

(A typical sort of salary for India seems to be £900 a year, so the claim in the article that children earn one-fifth as much as adults seems correct. So £200 a year is nowhere near as bad as it sounds, even though the working conditions are awful.)

The article says rather vaguely "The Indian textile industry is now worth hundreds of billions of pounds", which would appear to be complete and utter bollocks. According to this, the total value is £25 billion and exports are £10 billion; textile exports account for 20 per cent of total exports, so that makes total exports of £50 billion.

Of course, of those 100 million child workers, we don't know how many manufacture goods for export, let's guess one-fifth, so out of £50 billion going into the Indian economy, child workers earn £4 billion. Which doesn't seem too terrible.

(Next point, child labour was perfectly common in England until the end of the 19th century. India is a long way behind us in terms of economic development, but I doubt it will take more than 50 years from now for child labour to be unheard of.)

So we've looked at the "trade" side.

I looked at the "aid" side in this earlier post , it appears that India has got plenty of money to spend on other crap, so "aid" can't be the way either.

I also love the way that the article kicks off with "we reveal the brutal reality of a supply chain that sees children as young as 11 sewing T-shirts which cost shoppers just a few pounds to buy on high streets across Britain". Would the Guardianista be happier if Primark had bigger mark-ups?


Anonymous said...

"Would the Guardianista be happier if Primark had bigger mark-ups?"

Absolutely. They can afford to shop elsewhere, and think people who shop at Primark are wrong, so raising prices would encourage them to shop where they should...

Mark Wadsworth said...

True, I forgot about their 'anti-poverty' agenda being an 'anti-poor-people' agenda.

Bill Quango MP said...

But if these children are not sewing on sequins on T/shirts because no one is buying them then what will the children do?
And wouldn't the textile manufacturer fire the more expensive adult worker first?

Well, guess we'll find out soon as the downturn bites a little harder.

Anonymous said...

Thanks Mark. I just posted along similar lines on this story on my blog, but even though I was (hopefully) presenting a logical argument I was left feeling a little heartless.
It's reassuring to discover that I'm not alone wondering if all the concern shown in the west for child labour might have negative consequencies for the kids in the third world.

Anonymous said...

This story has featured in the BBC news bulletins for the last 3 days and will, I suppose, feature until at least the broadcasting of the Panorama programme this evening.

The story had some initial news interest but was not a "developing" story. I believe the only change in the story came with Primark's denial that they knew it was happening. The fact is that the constant retailing of the story is no more than an extended commercial for Panorama. The story is no longer "news" and was no longer "news" after Primark (a victim of the story) responded. The real victims are, of course, the poor children who labour in India: they will be out of a job and then what? Prostitution? Starvation? I don't know and the BBC couldn't care less. Nick Ross said over the weekend (on BBC Radio 4 - the last time, I suspect, he'll be invited back) that he doubted that there'll be another investigation in 6 months time detailing the effects on the child labourers of this revelation.