Here is a new article The Impression of Indian Factories after the previous Delhi in the Eyes of a Business Visitor. In recent years, India has been vigorously constructing infrastructures, which has also promoted the development of its industry, or manufacturing exactly. Even Chinese businesses start to set foot in India to explore the local market. A friend of mine, say, who works for a well-known cellphone manufacturer in China, has been sent to India to assist and guide production localization. In view of the fact that China, the traditional manufacturing country, sees a continuous increase in labor cost and puts high levies on export to India and that India has enhanced the tariff policy of mutual benefit with many peripheral countries to improve its export competitiveness, the Indian industry promises rosy opportunities for development. India reported a disappointing GDP growth rate of 5.7% for the first quarter of 2017, which broad national and international comments attributed to Premier Modi’s abolishing large-denomination bills last year and the new policy of flat tax rate this year, but it is normal that each entity that is developing and transforming goes through difficulty. In the long run, the less an area develops, the more opportunities it possesses for development; moreover, India has as large population as China.
In the past 4 years, I paid business visits to 7 export-oriented manufacturing enterprises of building hardware located in several cities in India. Due to a lack of further investigation, I will only make factual statement of my experience and provide personal thoughts for reference.
Here is the basic information of these factories:
所拜访的这些印度工厂的工作时间基本以09:00 – 17:30 为主，中间30分钟吃饭，外加上午15分钟的茶歇和下午15分钟的茶歇，所谓的茶歇就是打铃休息，有人说东南亚的一些工厂员工难以管理，“他们中间要拜神”，其实说的就是茶歇时间，既然是休息时间，当然员工可以自由利用。
These factories have a working time that mostly falls in between 9:00 and 17:30, with a 30-minute interval for meal and a 15-minute tea break both in the morning and in the afternoon. A tea break is when the workers have a rest. Some hold that southeast Asian workers are hard to manage, saying “they have to worship gods during work.” This is what takes place in the tea break, which, being a time for rest, can be definitely used by the workers freely.
Lunch usually begins at 13:30 and ends at 14:00, to which I was not accustomed the first time I visited a local branch. I supposed lunch at 12:00 but it was not until 30 minutes later that I was informed by a colleague of the lunch in another 30 minutes. The branch office was sited in a commercial district in Gurgaon. Downstairs is a privately contracted canteen where food is served in a university way. Factories are not equipped with canteens, or at least microwaves, so the workers bring their meal to work or eat outside.
通常工厂在正常的工作日内会有2个小时的加班，而这也是法律许可的，在此之外，每周6天的工作制也是法律许可的。也就是说正常的下班时间是19:30，何况加班是常见现象，如果工厂是在大城市比如德里，那么绝大部分的员工都会是外地移民，如果员工不是住在工业区附近，由于德里常年不分时段交通堵塞，那么1-2小时的车程是肯定需要的， 9点钟左右到家才能吃上晚饭，所以11:00 到 12:00 才能上床睡觉非常正常，这与我所理解的健康养生时间表相差太远了。甚至我认识的一个当地企业主每天晚上要看2-3部好莱坞电影到凌晨3-4点钟，常年如此，真是让我不可思议。在大城市的工厂，对于普通员工来讲，大部分还是属于外来移民，就像国内背井离乡到大城市打工一样。在偏远一点的城市，工人以本地人为主，而所有印度工厂都是不配宿舍的，针对这点，当地企业主纷纷对中国企业配有宿舍表示好奇。这些外地移民就只有到附近村里或者搭乘公共汽车到远一点的地方租房居住，我想要是企业能配有宿舍给员工，那将真是一大福利会吸引不少优质员工。以德里为例，维基上说有1700万，而百度上说有2600万，而后者更加接近我当地朋友的数据，而这个数据里面70%是外地移民，可见每个首都都是淘金之地，得利益的是当地居民。
Usually, the factory will have 2 hours of overtime within normal working days, which is also permitted by law, and the 6 workingday/week is also permitted by law. That is to say the normal closing time is 19:30, taking into consideration that overtime is common. If the factory is in a big city like Delhi, then most of the employees are immigrants. If employees do not live near the industrial zone, 1-2 hours’ drive is certainly needed before arrive at home at around 9 o’clock due to perennial traffic jams in Delhi. So go to bed at 11:00 to 12:00 seems very normal. This is, however, far from what I know as a healthy living schedule. Even a local business owner I know watches 2-3 Hollywood movies every night till 3-4 in the morning, year in and year out, which is really incredible to me. The general staff in factories in big cities are mostly immigrants, just like those in remote villages in China crowding into big cities looking for a job. workers in far flung cities are mainly local residents. Indian factories are not equipped with dorms, local entrepreneurs are surprised about Chinese companies with dormitories. Those immigrants have rent a living place in a neighboring village or somewhere farther. if a business can provide accommodation to employees, it will help to attract many high-quality employees. In Delhi, for example, WIKi mentioned a population of 17 million workers while Baidu mentioned 26 million, but the latter is more close to the figure by my local friends. and of the figure, 70% are immigrants. Obviously, each capital is a place for gold rush, the benefit of which go to the local residents.
In contrast to Vietnam, few Indian women choose to work. In India only one third of women have a formal job whereas in Vietnam women account for 25% of private enterprise bosses. In one of the Indian factories I once visited, male workers take up 90% while female, 10%. They despise women, a truth they don’t speak out. After all, thanks to the fast spread of information, knowledge and civilization, people have updated their recognition of many unreasonable phenomena, but are not able to make a quick shift of mind due to historical and cultural factors.
Take the industry where I am as an example. There are many manufacturing businesses in India, most of which produce single parts with a few being able to cover both the production and assembly of a complicated product. Of course, there are still several rich enterprises locally owned or run by foreign capitalists, which produce motorcycles, automobiles, trucks, air conditioners and so on. As for the reasons, I conclude them as follows:
Lack of infrastructure. An old Chinese saying—if you want to get rich, build the road first—manifests the importance of infrastructure in the development of enterprises and local economy. Yet in my opinion,the infrastructure in India, however, equals to that of China in 1990s. In Delhi as an example, land transportation of goods from Delhi to Mumbai follows an above-20-hour route of 1,100 kilometers. During the time when I visited a company in the NOIDA industrial zone in September, 2017, power blackout recurred as many as 5 times every day. So the enterprises had to be equipped with emergency generator sets to sustain production. This, however, has greatly hampered their development, and is where they have made great efforts to improve in recent years.
Weak international competitiveness resulted from the lack of infrastructure. The local Indian market has been penetrated by low-end products from China which developed in a low-cost yet fast way. In India where the overall consumption ability remains low, you will find many goods made in China. China’s mass low-cost manufacturing directly suppressed the confidence of the local Indian enterprises in playing in the low-end market. In terms of the high- and middle-end market, India is inadequate in no matter talent, technology, equipment or supply chain. For those enterprises which I saw having a relatively completed supply chain after 10 to 20 years’ development, they choose not to outsource many producton processes but do them on their own for fear that supply shortage or quality problems that may otherwise occur to prevent timely delivery of goods to European customers. In India, few of the world’s top 500 companies have made investment, but in China, 480 of them have already invested there for factories, R & D institutions, or representative offices. This has also imposed a negative effect on investment and purchasing in India from other countries.
（2016年德里的一个普通集市，大部分商品中国货A common fair in Delhi, 2016, most commodities made in China.）
The Indian religious culture. Enormous sects (India is said to have 300 million gods) and a large religious population plus the caste system that has lasted for 2000 years has greatly limited the Indian people’s desire and courage to break through the traditional outlook on life: people at the bottom of the pyramid take it for granted that there is no way for them to be rich, be it in this turn of life or a next one. Therefore, they are easy to be satisfied and make no progress, losing the courage and insight to go off the existing dogmas,the breach of which is, actually not supported by the society.This partially accouts for the huge gap between reich and poor. But it is not the minority and state-owned enterprises which hold the vast majority of the society’s resources that drive the social economic development, but a large number of small and medium-sized enterprises.
Elite education. The educational planning is obviously problematic. The government spends roughly the same amount of money on higher education and basic education, and adopts a binary system in the education policy. This sort of policy now prove troublesome.
For example, the higher education has its own particularity. Under the strict selection system in Indian education, people able to receive a higher education is actually small in number and higher in accuracy, which is characterized by elitism. The education policy and funding of this type of education are obviously required to be treated in a special way; it is not suitable to regard it as equal to the basic education.
But the true problem underlies the basic education. The basic education is oriented to a larger population, spread in a wider range, and takes the responsibility of reducing the illiteracy rate and improving the national educational level. The Indian basic education is divided into two kinds, one being the public school and the other the private — the common western education classification. The public school undertakes much more responsibilities of basic education. Although the compulsory education has been written into the law in 2001,education quality is poor, leaving a high failure rate.
印度政府还是做了一些努力，比如在2001年的Sarva Shiksha Abhiyan，或称为全体教育激励计划，很大的提高了入学率。 但是”入学率”虽然提高，但是毕业率变得更差。 同时在这种经费也一刀切情况下，老师的雇员数不够用，给老师的待遇不可能很高，也招不到很高素质的老师 私学虽然可以办到这一点，但是高昂的教育费用必然只能提供给高阶层人士，而且数目不多，涵盖不广，也承担不起”改善国民素质“的社会责任。
The Indian government has still made some efforts, such as the Sarva Shiksha Abhiyan in 2001, or the whole education incentive scheme, which has greatly increased enrolment.But the enrollment rate increases at the cost of decreasing graduation rate.Meanwhile, the expenditure being divided equally among the basic and higher education, teachers are not adequate and the treatment of teachers can not be high. As a result, high-qualitied teachers are deficient.Although the private school may make up the above shortage, it requires large amounts of fees so it can be only afforded by people of higher class. Besides, the number of the private schools are relatively small and the orientation is not wide, so it cannot take the social responsibility of “improving the national quality”
The above reasons add up to the fact that the illiterate rate is up to 33%. The literate rate of India in 2011 was not even as high as that of China in 1990.In 2013, the average years of an Indian adult for school education was equal to that of China in 1985.For more political, cultural and systematic comments on the poor Indian manufacturing, refer to those on the Internet, for example, “Why India falls behind China in economy development?” (Source: https://www.zhihu.com/question/20992832)
There is nothing for India to boost about its efficiency, neither in factory production nor in daily life.In factories,the workers are regulated to do a routine job, with no need for thought or consideration for improvement. The quality yield of an Indian company which produces door hinges is lower than that of the domestic peers in double digits. Employees and even business owners don’t take production efficiency and tempo into consideration, resulting in erratic delivery. A common impression of India is that words are more said than done, which is supposed to have something to do with the multi-party government. You can see many people chatting on the street, having no idea what they are actually talking about. Just in one hotel lobby, I found 4 people hanging around doing nothing, including one busy looking for and slapping at flies. (This does not include those responsible for hotel check-in and check-out.)
Indian goods are also exported to Europe and America. But as far as I can remember, these goods contain only handicraft products and a few high-end manufacturing ones. The local market is in a large demand for mid- and low-end products. For example, even TATA,the largest car maker of the country, mainly sells cars that cost within 100,000 RMB. In my industry in India, there is no testing conditions to verify the reliability of the products purchased there; production quantity is far more smaller than that of China, which also hampers the scale of economy and quality control. Due to the lack of supply chain management which is implemented only in car industry, the material supply is unsecured. Take a hardware item processing enterprise with which I am familiar as an example. In processing stainless steel rods, the factory measures the size and sends each batch of materials to external inspection, but the hardness won’t be stable, and the products are always deburred or unstable in size. And there is no device of hardness test. Even if it is in position, it will change nothing because steel factories are usually large enterprises, a small customers can only buy from it, with no rights to it. As for the most basic testing tool caliper, I found that there is indeed calibration, but a simple visual inspection can show obviously that the quality of it not as good as that produced in China.
笔者观察发现印度的企业有20%的设备采购是欧美的，20%钟意台湾的，30% – 40% 是中国产，还有20% – 30% 是本地设备，而往往那些设备都陈旧缺少保养。印度的企业主大都受过良好的教育，还是具有一定视野的，自动化设备也在一些企业开始实施，但是毕竟范围并不是那么广泛。欧美设备精度高，但是价格昂贵，而台湾的设备其实在全球市场都颇受欢迎，因为性价比适中，中国产设备近些年抓住出口的春风发展的也不错，而印度本地的设备仅供一些普通的加工。当地企业主十分满意中国产数控机床CNC，笔者细看发现是大连机床厂生产，并不是说大连机床厂的质量不好，而是国内更加喜欢欧美产的设备。
I found that in India, 20% companies procure equipment from Europe and the United States, 20% from Taiwan, 30%-40% from mainland China and 20%-30% from the local market.their equipment are often lack of maintenance and old. Most Indian business owners are well-educated and have a broad horizon, and have begun to carry out equipment automation—on a primarily small scale. European and American equipment boosts of high preciseness, but are expensive. Taiwan’s devices are actually popular around the world because of its high performance-price ratio. Chinese equipment also develops well in recent years thanks to the encouraging export policies. Yet Indian equipment is only available for some common processings. The local business owners are quite fond of the CNC machine tools made in China, most of which I find are from Dalian Machine Tool Group. In China, however, European and American devices are preferred by the domestic enterprises.
The legal wage level in India and the actual wage level as I know through the payroll sheet are as follows. For the white-collar workers, I visited a business owner in 2013, who pointed to the roadside ADOBE office building and proudly told me his son worked there with a monthly salary in 10 thousand yuan, and that such a salary ranked top among white-collar workers of the same age. The average wage level in India:
1： 取工厂五金开料工人为例 Hardware cutting workers as an example
3：杂工，以女性为主Handyman, women mainly
According to the Indian Factory Act in 1948, if the workers work more than 9 hours a day, or more than 48 hours a week, business owners need to pay for the extra working hours twice the normal salary to the workers, with no exception of working days, weekends and holidays. But the real situation is that few companies can meet this regulation, the same with China. It is apparent that capitalists are the same everywhere.
2017年笔者再同其他的当地企业主私底下聊谈得知15,000 INR 每月应该是德里NOIDA工业区的平均水平，这个金额以当前的汇率计算为1,533 人民币，这也是包含加班费在内的员工月工资。如果不考虑工作效率，相比目前珠三角2,500 – 3,500 人民币每月的普工工资水平还是蛮有竞争力的。
In 2017, I learned in a casual chat with local business owners that the average salary in NOIDA industrial area, Delhi is about 15,000 INR per month, which equals to 1,533 RMB at the current exchange rate. Pay for extra working is also included in. Leaving work efficiency apart, such a salary is competitive in comparison with the current level of 2,500 to 3,500 RMB per month in pearl river delta.
Although India, a developing country with a GDP per capita of $1678 (2016), established a number of laws and regulations as China do, there is a long way to go for these enterprises to play within regulations. Just like its Chinese peers, Indian factories have many problems, but some of which I have only seen in some companies in remote cities in China.
（2016年Rajasthan某企业的铜铸造工序Copper casting in a enterprise in Rajasthan, 2016）
In order to encourage the development of local enterprises, the government turns a blind eye to their behaviors against regulations. Most enterprises choose to conform to the regulations not because of initiative consideration of the development of itself, but is force by the customer and market demand and competition pressure.
Just like China, India has a New Year and a shortage season of workers.Since their day of New Year—DIWALI, is in October, with only 3 days off, the worker shortage season doesn’t fall in between. The shortage season takes place in April or May every year when many workers ask for days-off to go back home harvesting crops. Meanwhile, it is also a period of time preferred by Indian young people for wedding. My company was once tortured during the period of delivery. So it is a suggestion that if you have any trade partners in India, the goods for delivery should be prepared beforehand.
Special acknowledge goes to Ms. Wang Qian (Claire) from Guangdong University of Foreign Studies for translation.