India: Tata Tea in Assam

LATEST: Following release of World Bank Group investigation, complainants and supporters issue press release and launch www.accountabiliTEA.org to demand just wages and conditions.

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Accountability Counsel is supporting three local NGOs in Assam, India, in their efforts to end human rights abuses of tea plantation workers resulting from a project financed by the International Finance Corporation (IFC).

The International Finance Corporation, part of the World Bank Group, invested US$7.8 million in a project to enable the setting up of a company, Amalgamated Plantations Private Limited (APPL), to acquire and manage 24 tea plantations in northeast India.  The project included a sustainable “worker-shareholder” model, in which the management and employees would have a significant shareholding.  IFC owns approximately 20% of APPL, and Tata Global Beverages, a subsidiary of the Tata Group, owns just under 50% of the company.  Tata Global Beverages owns and markets the Tetley brand, making Tata Global Beverages the second largest player in the global tea market.

Click here for a 360-degree virtual tour of a typical tea garden in Assam, a tool developed by Nazdeek.

In February 2013, three local NGOs, filed a complaint to the World Bank Group’s Compliance Advisor/ Ombudsman (CAO), raising concerns about inhumane labor and working conditions on the plantations.  The Complaint cites long working hours, inadequate compensation, poor hygiene and health conditions, coercion and pressure of plantation workers, and lack of freedom of association, in violation of the IFC’s Performance Standard 2 (PS2). The Complaint to the CAO also raises concerns about the worker shareholder program.  Though the program is intended to provide workers with greater agency in the company, workers have instead been pressured into buying shares, often without information on what it means to be a shareholder or the risks of investment.

In August 2015, the CAO’s Compliance function conducted a field visit to Assam, which included meetings with workers, supporting organizations, and company representatives. The following video reveals abysmal living and working conditions on certain tea plantations in Assam, found by the BBC News-Radio 4 joint investigation released in September 2015.

In November 2016, the CAO released its investigation report. While noting that the IFC’s investment had potential for significant development impact, the CAO’s investigation identifies a number of non-compliances related to the IFC’s assessment and management of environmental and social risk associated with the investment. It found that given the vulnerable status of workers and APPL’s responsibility to provide a range of basic services to them, the IFC’s pre-investment review of the risks was insufficient. The CAO also found a number of non-compliance findings in relation to the IFC’s supervision of living and working conditions on the plantations, reported use of banned pesticides, information disclosure, consultation, and response to security incidents.

The IFC has released a public response to the CAO’s investigation report, which is limited in scope and fails to address all the findings. The complainants and their supporting organizations released campaign website (www.accountabiliTEA.org) to bring attention to the issues raised in the report.

The CAO will monitor the IFC’s actions in response to the investigation findings and will issue a monitoring report within a year. For the CAO’s status of the case, please visit its webpage.

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