In what ways has competition affected workers, Indian exporters and foreign MNCs in the garment industry?
Competition has severely affected workers in the garment industry. Their jobs are no longer secure as employers prefer 'flexible' employment. Workers are hired on a temporary basis instead of permanent, face long working hours and night shifts during peak season, receive low wages, and are denied benefits like health insurance and provident fund.
Indian exporters face intense competition to secure large orders from MNCs. Since cost of raw materials cannot be reduced, they try to cut labour costs by employing temporary workers to offer the cheapest goods.
Foreign MNCs benefit from this competition. They look for the cheapest goods to maximise their profits. Competition among Indian exporters has allowed MNCs to make large profits while workers are denied their fair share of benefits brought by globalisation.
Explanation
The textbook explains how globalisation and competition have differentially impacted three stakeholders in the garment industry. Workers bear the negative impact through insecure employment and denial of benefits. Indian exporters struggle to cut costs to compete for orders. Foreign MNCs are the beneficiaries, sourcing cheapest goods and making large profits from the competition among exporters.