The Economist blog Feast and Famine: Demography and Development recently interviewed Siddharth Kara about his new book Bonded Labor: Tackling the System of Slavery in South Asia .
In the interview Kara explains how people become trapped and exploited in the system of bonded labor in a desperate attempt to get credit:
Bonded labour, or what’s often called debt-bondage, is a form of feudal servitude, where credit is exchanged for pledged labour. The class in power will often coercively extract and extort far more labour out of the debtor than the fair value of the credit they received. Sometimes an entire family can endlessly work off a meagre loan taken years before. More than half of the world’s slaves are bonded labourers and the products made by them permeate the global economy.
Bonded labor is a particular problem in South Asia where there are high rates of poverty and a caste system which allows the unfair system to persist. In addition to the caste system and poverty, bonded labor also continues to exist and grow because of corruption, social apathy, and the fact that it has become part of the global economy. In the following excerpt from the interview, Kara explains how bonded labor has become part of the global economy, though it is often hidden within its complex processes:
Q: Are there any sectors that seem particularly prone to use the products of bonded labour?
A: Well, yeah. Often times the supply chains for these products can be very complex, so sometimes a company that’s importing goods may not realise exactly what’s going on on the far side of their supply chain. The industries that have the highest prevalence included products like rice, tea, coffee, but also things like frozen shrimp and fish, granite for your counter tops, cubic zirconia, hand woven carpets, sporting goods, apparel, the list goes on and on. Construction is another one, including office buildings for international companies, or major road construction and infrastructure projects.
Q: To what extent does bonded labour a problem of globalisation?
A: The global economy is a powerful force [that creates] demand. A company can scour the globe for under-regulated labour markets in order to benefit from cheap wages. Labour is almost always the highest cost component in a business, so if you can minimise or virtually eliminate labour costs you are saving a lot of money. The global economy does look for and demand and feed on these systems, which stimulates their persistence.