Economy

Threadbare Demonetisation: The Cycle of Life Stops in Modi’s India

Demonetisation has disrupted every stage of the processes that keep India’s large cotton and silk production-based economies churning.

An Indian cotton mill. Credit: Lau Rey/Flickr, (CC BY-NC 2.0

A cotton mill. Credit: Lau Rey/Flickr, CC BY-NC 2.0

We build a social fabric. We snap a thread. We weave a magnificent dream. We disrupt the weave. Indian weaves and fabrics have been the stuff of our dreams, the shades of our imagination. We wear bright colours, we weave multi-colours and our silks and cottons are part of our national identity.

India is the second largest producer of cotton in the world and our textile industry the second largest employer in the country after agriculture. There is a step by step process before the shirt lands on our backs, before the saree is draped round our bodies. Demonetisation has disrupted every stage of that process.

The weavers of Meerut

The Hashimpura locality of Meerut in western Uttar Pradesh is famous for producing beautiful cotton textiles. Within the narrow lanes and bylanes, there are weavers who have gone on to become entrepreneurs of sorts as over generations they have come to own anything from two to 20 or more looms. This is all part of the informal sector that produces 60% of Indian textiles. These master weavers have design samples and they weave the threads on the maze of the loom to produce intricate patterns or a riot of colours, elegant borders and so on. There are almost 70,000 weavers in Meerut.

Gujarat cotton belt

But these little ghettos are part of a cycle of life and livelihood that goes both east and west in the mosaic that is India. The thread that lands up on the looms in Meerut comes in trucks from Surat in Gujarat. The western Indian state is one of the largest producers of the cotton crop that looks like a puff of cloud on a stem when it is in season. In the cotton growing belt of Gujarat, one would see mountains of cotton collected in godowns from where it would be transported to factories that make the thread. The journey of the cotton cloth begins on a farm, before moving from a factory onto a truck that takes it hundreds of miles away where there is a loom.

That journey has stopped. The raw material cannot move.

Bihari labour

The labour that comes and works on the Meerut looms also needs to make a journey east, to Darbhanga district of Bihar from where they mostly come. There’s an interesting detail I discover while talking to the labour: they have been travelling to the textile centres such as those in Uttar Pradesh for generations now as the rates for farm labour have always been low in Bihar. MNREGA rates are better but still low while the workers on the Meerut loom get Rs 3500-4000 each week. But that was before they became collateral damage in the so-called war against black money.

Badruddin Qureshi owns 16 power looms in Hashimpura and employs ten workers from Bihar. The looms have shut down but there is a relationship with the workers who have to be paid a lump sum so that they can return to their villages in Bihar. That is the immediate challenge before Qureshi and other master weavers like him who have had labour coming from a particular village or family for generations. The next challenge would, of course, be the consequence of no income generation but the full scale of the disaster is yet to unfold.

What of the weavers? They can probably become farm labour in Bihar and get paid in kind for some months since cash is reportedly very hard to come by in villages now. Qureshi says that like him other owners of looms are collecting money and sending workers home. He says that there is no point working the looms. There is no market left. The workers are queuing up at banks to change money so that they can return to their village. They are being refused because their Aadhaar cards are registered in Bihar so they head off the next day to another bank. In the small community of textile workers in Meerut the story of one, 50-year-old Aziz, dying while in a queue has only added to their sense of dislocation and fear for the future.

Silk weaving. Credit: Jamis Loveday/Flickr, CC BY 2.0

Silk weaving. Credit: Jamis Loveday/Flickr, CC BY 2.0

Khandak Bazar merchants

The next stage of the tragedy can be found in the wholesale cloth market in Meerut known as Khandak Bazar. Shopkeepers are sitting in empty stores with bales of cloth that no one is buying. Business in this peak season is down 75%. There are no new buyers and the only sales are pending orders says Harsh Lal, owner of a wholesale shop in the market.

His distress is particularly acute as he stocks the checked cloth that is used to make cheap mattresses that sell across north India, particularly as the cold sets in. This is the peak season for that market and clearly, it’s gone bust. Across the road from him, another shop sells salwar suit material that has not been picked up by the usual markets in Mumbai, Ahmedabad, Delhi. The owner is a staunch supporter of the BJP and Prime Minister Narendra Modi. He believes there must be a plan to replace currency quickly otherwise “we are all finished”.

Aditya Prakash Sharma, a big handloom wholesale trader in Meerut, tells distress tales of other markets. In Ludhiana the woollens are not being picked up, in Meerut his cotton won’t move. He says that pending orders can’t be met as truckers cannot be sent on a journey without cash for their own survival. Besides, the orders for weddings, woollens, mattresses, are slowly being cancelled.

Varanasi silk

Another disaster is brewing in Varanasi, the prime minister’s constituency, where a large community of weavers makes the famous silk sarees. This is all done on handloom as opposed to the power looms in a cotton-producing centre like Meerut. Production has stopped as the silk thread that comes from distant parts of India and foreign shores cannot be procured, orders for saris have been cancelled, the wholesaler cannot procure them. India is also the second largest producer of silk in the world.

At every stage of the circle of life and production, the human being will suffer and the economy will contract. Frankly, let’s get prepared to go from bad to worse as the textile sector is left threadbare.

  • Mandy S

    I wonder how weavers and looms in a southern state like TN affected? A data point down south would have been good.

  • K SHESHU BABU

    The whole chain of life cycle changed with the decision. Not only Weaver’s, lives,even farmers are effected. The producers are unable to send their raw materials due to resources crunch at every stage.