The chapter “A Shirt in the Market” traces the journey of a shirt from cotton production to its sale in a U.S. store . It highlights a chain of markets linking cotton producers to shirt buyers, with buying and selling at each step . The chapter questions whether everyone benefits equally in this chain, revealing disparities in earnings . Small farmers and weavers earn little despite hard work, while businesspersons and exporters make significant profits . It also explores the exploitation of the poor due to their dependence on the rich for loans, raw materials and employment . The chapter suggests cooperatives and strict law enforcement as ways to overcome market inequalities
A Cotton Farmer in Kurnool
- Swapna is a small farmer in Kurnool, Andhra Pradesh, who grows cotton on her little plot of land.
- She works hard for days to pick cotton bolls, which open slowly, and spends a lot on fertilizers and pesticides.
- Swapna borrows ₹2,500 from a local trader with high interest to buy seeds and other farming needs.
- The trader forces her to sell all her cotton to him instead of letting her go to the Kurnool market.
- She gets ₹1,500 per quintal, earning ₹6,000, but after loan repayment of ₹3,000, she’s left with just ₹3,000.
- The trader says cotton prices are low, but Swapna knows it’s worth more and feels cheated after months of effort.
- Small farmers like her rely on traders for loans, not just for farming but also for emergencies like sickness.
The Cloth Market of Erode
- Erode in Tamil Nadu has a huge bi-weekly cloth market, one of the biggest in the world.
- Weavers from nearby villages bring all kinds of cloth to sell at this busy market.
- Cloth merchants with offices near the market buy this cloth to supply factories and exporters.
- Traders from South Indian towns visit Erode to purchase cloth for their businesses.
- Merchants tell weavers what kind of cloth to make and provide them with yarn to weave it.
Putting-Out System
- In the putting-out system, merchants give yarn to weavers and ask for specific cloth to be made at home.
- Weavers don’t need to buy yarn or find buyers, which seems helpful at first.
- But weavers depend heavily on merchants for materials and sales, giving merchants control.
- Merchants pay very low prices, and weavers don’t know who buys their cloth or its final cost.
- Weavers spend their own money or loans to buy looms costing ₹20,000 each and earn about ₹3,500 monthly.
Weaver’s Cooperative
- A cooperative is when weavers join together to help each other and earn more money.
- They buy yarn as a group and sell their cloth without depending on merchants.
- This teamwork reduces merchant power and gives weavers a better price for their work.
- The Tamil Nadu government buys cloth from cooperatives for school uniforms and sells it in Co-optex stores.
Garment Exporting Factory Near Delhi
- A factory near Delhi turns Erode cloth into shirts for buyers in the US and Europe.
- Foreign buyers demand low prices, top quality, and fast delivery from the factory.
- The factory cuts costs by paying workers low wages, like ₹3,000 monthly for tailors.
- Most of the 70 workers are women, hired temporarily, doing jobs like thread cutting for ₹1,500 monthly.
- The factory sells shirts for ₹300 each, spending ₹100 on cloth, ₹25 on wages, and ₹25 on expenses, making ₹150 profit.
The Shirt in the United States
- In the US, a big store sells the shirt for $26, which is about ₹1,800 in Indian money.
- The US buyer pays ₹300 per shirt to the factory but spends ₹400 on ads and ₹200 on storage.
- After costs of ₹900, the buyer earns ₹900 profit per shirt, much more than the factory’s ₹150.
- Advertising and selling many shirts help the US buyer make a big profit compared to others.
Who Gains in the Market?
- Foreign buyers in the US and Europe earn the most, turning ₹300 shirts into ₹1,800 with huge profits.
- Garment exporters in Delhi make a decent profit of ₹150 per shirt after paying for cloth and workers.
- Merchants who buy from weavers earn more than weavers but less than exporters.
- Small farmers like Swapna earn very little, barely ₹3,000 after loans, despite hard work.
- Weavers get low pay from merchants and struggle with long hours for ₹3,500 monthly.
- Factory workers, especially women, earn tiny wages like ₹1,500 monthly for tough jobs.
Markets and Equality
- Markets don’t treat everyone fairly, with some earning a lot and others getting very little.
- Rich buyers and exporters make big profits, while farmers and workers struggle to survive.
- Poor people depend on the rich for loans, materials, and jobs, which leads to unfair treatment.
- Powerful factory owners and traders benefit most because they control money and land.
- Democracy means fair wages, but many can’t feel equal without enough earnings.
- Cooperatives help weavers and farmers earn more by cutting out middlemen, with government support.
Sustainable Development Goal (SDG)
- The United Nations’ SDG aims for fair wages and less inequality, as seen at www.in.undp.org.
- Helping farmers, weavers, and workers with cooperatives and laws supports this goal for a better life.
Questions and Answers
- What made Swapna sell the cotton to the trader instead of selling at the Kurnool cotton market? Swapna sold her cotton to the local trader because she had borrowed ₹2,500 from him at a high-interest rate to buy seeds, fertilizers, and pesticides at the beginning of the cropping season. The trader had made it a condition that she would sell all her cotton to him.
- Describe the conditions of employment as well as the wages of workers in the garment exporting factory. Do you think the workers get a fair deal?
- Employment Conditions: Most workers in the Impex garment factory are women employed on a temporary basis, meaning they can be asked to leave whenever the employer deems them unnecessary.
- Wages: Wages are fixed according to skills. Tailors are the highest paid, earning around ₹3,000 per month. Women employed as helpers for thread cutting, buttoning, ironing, and packaging receive the lowest wages.
- Fair Deal: The source suggests the workers do not get a fair deal, as their earnings are barely enough to cover their day-to-day needs, and they are vulnerable due to the temporary nature of their employment. The garment exporting factories try to cut costs by maximizing work from workers at the lowest possible wages.
- Think of something common that we use. It could be sugar, tea, milk, pen, paper, pencil, etc. Discuss through what chain of markets this reaches you. Can you think of the people that help in the production or trade? The source text uses the example of a shirt to illustrate the chain of markets.
- Cotton Production: Small farmers like Swapna grow cotton, often taking loans to afford the necessary inputs.
- Ginning Mill: The trader sells the cotton to a ginning mill, where seeds are removed, and the cotton is pressed into bales.
- Spinning Mill: The spinning mill buys cotton and sells yarn to yarn dealers.
- Weaving: Yarn dealers or merchants provide yarn to weavers. Weavers produce cloth, often under a putting-out system where they depend on merchants for raw materials and markets. Weaver’s cooperatives can reduce dependence on merchants.
- Garment Exporting Factory: The cloth is supplied to a garment exporting factory where shirts are made.
- Export and Retail: The shirts are exported to foreign buyers, such as businesspersons from the US and Europe, who sell them in their stores.
- Consumers: Customers buy the shirts in supermarkets.
- Arrange the statements given alongside in the correct order and then fill in the numbers in the cotton bolls accordingly. Here is the correct order of the statements, according to the source:
- Swapna sells the cotton to the trader. (1)
- Trader sells cotton to the Ginning Mill. (3)
- Ginning mill cleans the cotton and makes it into bales. (9)
- Spinning mill buys the cotton and sells yarn to the yarn dealers. (7)
- Yarn dealers or merchants give the yarn to the weavers. (5)
- Weavers return with the cloth. (8)
- Garment exporters buy the cloth from merchants for making shirts. (4)
- The exporter sells shirts to the businessperson from the USA. (6)
- Customers buy these shirts in a supermarket. (2)
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