Livability of wages in the Indian export apparel industry post MFA quota abolition

Abstract

Textiles and apparel have been major items of export for India because of the labor intensive nature of apparel production and competitive labor costs. The quotas by MFA until recently had been restricting low cost countries like India from expanding their exports. Even after MFA quota abolition, non-quantitative barriers in India were anticipated. One such area of concern was ensuring fair and livable labor wages. The purpose of this study was to assess wages in export units and estimate their livability for workers in India. Primary data on wages were collected through telephone interviews with managers of 17 export units in India. It was found that, not only do companies pay a minimum wage to workers, but most of them also provide additional benefits which contribute towards a living wage. However, the size of the export unit seemed to have an effect on the level of benefits provided to workers.