The Hidden Truth Behind Sweatshop Business in India Research Paper

The Hidden Truth Behind Sweatshop Business in India - Research Paper Example Gap which is a successful and high street brand which has sweatshop factories operating in India depicts the hidden truth and true prevailing conditions of the sweatshop business in India. Globalization has allowed multinational corporations to lower their costs by outsourcing as many functions as possible to low-wage countries (Ross 2010). It has also allowed these low-cost countries which are mostly located in Asia to attract these corporations for investment and employment. As long as these corporations bring in the required investment and provide for employment, the governments of these nations are willing to amend their laws for the benefit of these companies. One of the main reasons that these brands select a particular country for outsourcing is either because of favorable labor laws or an inefficient system for imposing these labor laws. In the case of China, the labor law bans trade unions and strikes which favor many companies. On the other hand, in the case of India an ine fficient system and corrupt law enforcement favors corporations to shift their production to benefit from child labor, low wages and exploitation of working conditions (Winston 2005, Ross 2010). The Indian government cannot afford to interfere with the operations of these multinational apparel brands since there is a chance that these companies may move their production to other competitive countries, like China, Cambodia, Bangladesh and Vietnam, where the laws and regulations are lax (Ross 2010). According to an estimate provided by United Nations, India employs around 55 million children, under the age of 14 years, and producing around 20% of India’s GDP (Foster 2007). India, along with Bangladesh, China, Vietnam, and Indonesia, is part of a low-wage, Big Asia bloc exporters of apparels to the United States and Europe. These countries account for 55 percent of the U.S. import market, which amounts to 95 percent of the U.S. apparel market (Ross 2010). The increasing trend of customers demanding low-cost, high-quality apparel has forced large apparel brands to outsource their production facilities to low-cost countries to stay competitive in terms of pricing, without compromising on profits. Companies such as Gap, Nike, Marks & Spencer, Primark, Next, Mothercare and Wal-Mart have been found involved in the exploitation of the workforce (Mail Online 2007, Winston 2005, Chamberlain 2010). The management of these large brands lobbies with powerful economic and political forces of their nations to promote imports from lower-cost countries by lifting import quotas on apparel (Winston 2005). Large brands like Gap have been found exploiting the Indian workforce more than once. The first case of exploitation was discovered in 2007 after which Gap had promised to put in extra effort to rid their factories of forced labor and exploitation. In 2010, however, Gap was again found involved in child-labor and exploitation activities in India (Foster 2007, Chamberlain 2010). Exploitation of workforce is only possible when both parties in an employment contract agree to the wage levels and working conditions. It is important to appreciate that poverty in India is widespread. According to a study, almost half of all children in India are malnourished (Foster 2007). This extreme poverty forces parents, living in poor localities, to either sell their children to contractors for work, in return for a better life and