Feasibility Study for Setting Standards in Natural Stone Sector in Rajasthan Centre for Education and Communication (CEC) , New Delhi In collaboration with terre des hommes , Germany Centre for Education and Communication 173-A, Khirki Village, Malviya Nagar New Delhi – 110017 Email: [email protected] ; Website: www.cec-india.org terre des hommes 781, Reggie House 1st Floor, Pandita Ramabai Road Padmajee Park Pune – 411001, Maharashtra © Centre for Education and Communication, 2009 © Terre des Hommes, 2009 January 2009 ISBN: 978-81-904564-6-3 Report Prepared by Dr S Gunasekaran and G Manicandan The Information and Feature Trust B-107 (basement), Shivalik, Malviya Nagar, New Delhi – 110017 Tel: +91 11 26692402 / 26693024 Email: [email protected] ; Website: www.labourfile.org Contents Acknowledgements........................................................................................................5 Preface ...........................................................................................................................6 Chapter 1: Introduction..................................................................................................9 Chapter 2: Global Trends and Indian Stone Industry ..................................................17 2.1. Introduction.......................................................................................................17 2.2. Market Segmentation........................................................................................17 2.3. Trends in International Production and Consumption of Natural Stone and Products ...................................................................................................................18 2.4. Trends in EU Market: More Consumption and Less Production .....................20 2.5. Trends in German Stone Industry..................................................................... 22 2.6. Trends in Indian Stone Industry ....................................................................... 25 2.7. Trade Channel for the Indian Exporters – A Case of EU Countries ................28 Chapter 3: Natural Stone in Rajasthan: Structure and Functions ................................30 3.1. The Natural Stone Industry in Rajasthan.......................................................... 30 3.2. Mining and Processing of Natural Stone in Rajasthan .....................................31 3.3. Size and Structure of Quarries/Mines............................................................... 32 3.4. Diverse Working Conditions ............................................................................ 32 3.5. Employment......................................................................................................33 3.6. Law and Government Policies.......................................................................... 34 3.7. Bureaucratic Structure ......................................................................................34 3.8. Supply Chain ....................................................................................................35 3.9. Supply Chain of Indian Stone Industry ............................................................ 35 Chapter 4: Mines, People and Issues: Perspectives from the Ground .........................37 I. Socio-economic Issues .........................................................................................37 II. Labour Issues ......................................................................................................46 III. Environmental Issues.........................................................................................62 Chapter 5: Role and Characteristics of Stakeholders ..................................................65 5.1. Introduction.......................................................................................................65 5.2. Characteristics of Stakeholders and Feasible Intervention Options .................65 Chapter 6: Standards Setting Feasibility and Sustainability........................................71 6.1. Introduction.......................................................................................................71 6.2. Baseline Requirement for Creating a Standard ................................................71 6.3. Components of Standards and Constraints.......................................................72 6.4. Feasibility of Multi-stakeholder Initiative (MSI) .............................................73 6.5. Feasibility of Certification................................................................................75 6.6. The Indian Civil Society and Initiatives by the Government ...........................75 6.7. Strategy and Role of Key Partners for Implementing and Sustaining Standards .................................................................................................................................76 6.8. Business Case in Implementing Standards.......................................................78 6.9. Implementation and Monitoring....................................................................... 78 6.10. Potential Risks ................................................................................................79 6.11. Conclusion ......................................................................................................80 Chapter 7: Conclusion and Suggestions for further Research .....................................81 List of Stakeholders .....................................................................................................84 List of Tables ...............................................................................................................86 List of Figures..............................................................................................................87 Abbreviations...............................................................................................................88 Acknowledgements Efforts of many persons at various stages made the study feasible. We benefited immensely from the discussion with various stakeholders. We are highly indebted to the workers, quarry owners, cooperative leaders, social activists, trade unionists, village sarpanchs and bureaucrats -- who gave us their valuable time and discussed about various issues. We like to thank Barbara Kueppers (terre des hommes), whose concept note provided an excellent starting point. Ramanath Nayak and Pallavi Mansingh coordinated the research and extended valuable suggestions in different points. We are grateful to them for their genuine concern and steadfast companionship. The assistance provided by Surendra Singh Tanwar had been a great help. We acknowledge his support. We acknowledge with deep sense of gratitude the help extended by Sharat Joshi. Rana Sengupta helped in organizing stakeholder’s consultations. We acknowledge his support and express our sincere thanks. We owe a great deal to our colleagues Alet Mathew, Jyoti Gupta and Meena Sharma for their assistance. Preface Standard setting programmes are different from corporate social responsibility (CSR) initiatives in form, though there are similarities in their content. The latter consists of enterprise-driven principles and values that the companies themselves define, unilaterally and voluntarily, on social and environmental policies. These principles and values will have implications for both internal public (workers, shareholders, investors) and external public (institutions of public governance, community, civil society organisations and other enterprises) stakeholders. The standard setting programmes, while using the social and environmental standards as market incentives for enterprises, are premised more as a collaborative exercise among various stakeholders, and have a wider outreach. However, both encourage managements to observe laws above the minimum level required, implement laws that are considered difficult to implement, and devise methods where none exist. The standard setting, at least in theory, anticipates the involvement of stakeholders other than the business to be part of standard setting and, later, its monitoring. Pressure by the consumers on the social and environmental conditions of production and the consumers' engagement with the producers are considered precursors to the 'standard setting' process. There could be many reasons for consumers to be interested in the conditions of production. Mass consumption goods that involve labour- intensive production processes, as in the case of garments, where intensification of work and reduction in labour cost are used as measures to bring down overall production cost, attract consumer interest. The extractive industries, which are known to have substantial economic, social, political, and environmental impacts, have also attracted significant consumer interest. The natural-stone industry is an extractive industry. Natural-stone products are being used in public buildings, commercial places, and parks, as pathways, and also for funerary requirements. In 2005, the European Union (EU) imported 15,228 thousand tonnes of natural stone worth 3,242 million Euros. The increasing domestic demand has another side to it; Europe is reducing its production and processing of natural stone. Germany is one of the top five importers of natural-stone products, accounting for 16 per cent of total EU imports for the year 2005. About twenty-seven per cent of the natural-stone products in the international market are from India, with Rajasthan