Global Crises, Welfare Provision and Coping Strategies of Labour in Tiruppur

Even as state governments invest in social welfare measures, they are forced into constant competition with one another to attract private investments, offering a good “investment climate” that includes access to a low cost workforce and a physical infrastructure geared towards capital accumulation. The need to provision welfare within an accumulation regime premised on global competition, fiscal austerity and marketisation, and a simultaneous need to reduce labour costs and to ensure social security, to exclude and include labour appears paradoxical. Does this emphasis on social welfare by the local state imply resistance to or accommodation of the current growth paradigm? How does such welfare provisioning influence livelihood strategies of labour embedded in global production networks and subject to flexibilisation? What are the new spaces of mobilisations that the regulatory imperatives open up? This paper addresses these questions through a microlevel study of worker livelihoods and state regulation in Tiruppur in Tamil Nadu that has been integrated into global networks of commodity production through garment exports. Neo-liberal reforms in India tend to proceed by “stealth”, shaped by a range of mediating institutions (Jenkins 2000). Moves to curtail labour rights, for instance, can hardly be tracked by looking merely at formal policy shifts (Jenkins 2004). The shifts can however be tracked in the practices of the bureaucracy, firm management and the judiciary. Reforms in the public expenditure front too have not been easy. Scholars argue that in postcolonial societies, the state is forced to reverse some of the processes of deprivation and dispossession by investing in welfare measures as a means to govern such dispossessed populations (Sanyal 2007; Chatterjee 2008). As a result, despite the increasing emphasis on fiscal disciplining pedalled by the International Monetary Fund (IMF)-World Bank and built into the good governance agenda by the central government and several state governments, actual public expenditure continues to be above the levels suggestive of such “good” fiscal behaviour. This is, of course, not to deny the constant efforts, discursive and material, to render “fiscal discipline” critical to any government in power. Even as state governments invest in social welfare measures, they are forced into constant competition with one another to attract private investments, offering good “investment climate” that includes access to a low cost workforce and a physical infrastructure geared towards capital accumulation. This need to provision welfare within an accumulation regime premised on global competition, fiscal austerity, and marketisation, a simultaneous need to reduce labour costs and to ensure social security, to exclude and include labour appears paradoxical. Does this emphasis on social welfare by the local state imply resistance to or accommodation of the current growth paradigm? How does such welfare provisioning influence livelihood strategies of labour embedded in global production networks and subject to flexibilisation? Are we witnessing the emergence of a new phase of social regulation? What are the new spaces of mobilisations that such regulatory imperatives open up? I address these questions in this paper through a micro-level study of worker livelihoods and state regulation in Tiruppur, a town in Tamil Nadu (TN hereafter) that has been integrated into global networks of commodity production through garment exports particularly to the United States (US) and European Union (EU). The recent global economic crisis has opened up a window to examine how such “governmental” moves to provide welfare intersect with pressures of global competition to shape the effects of the crises on workers’ livelihoods and responses. I argue that just as (a) the crisis appear to have opened up new legitimising spaces for such measures even within mainstream policy discourse, (b) such welfare measures in conjunction with the need to produce a “cheap” workforce to compete for global markets has This paper is partly based on fieldwork undertaken for a larger Economic and Social Research Council-funded project on “Transforming Livelihoods: Work, Migration and Poverty in the Tiruppur Garment Cluster” and partly on fieldwork done for a report “Global Recession and Labour Impacts in the Indian Textiles and Clothing Sector: Observations from Tamil Nadu” prepared for the International Labour Organisation, New Delhi in September 2009. The former study was jointly carried out with Judith Heyer, Geert de Neve and Grace Carswell. Earlier versions of the paper were presented at conferences held at the Shenzhen Graduate School of Beijing University, the University of Sussex, Central University, Kasargod and the University of Delhi. I thank the ESRC project team members, Judith Heyer in particular, discussant Ben Rogaly and participants in the conferences for useful comments which helped me revise this paper. Anant Mariganti, M S S Pandian and Marleen Rueda offered valuable suggestions on earlier versions of this paper. R Sreenivasan’s insights on the fiscal situation in Tamil Nadu were very useful. M Shanmughapriya and T Veeraian provided invaluable research assistance. I am thankful to all of them.