"While the bonded labour system (debt bondage) is formally abolished and
criminalised, recent research indicates that bonded labour is still
prevalent in India. A 2016 report found that in the state of Tamil
Nadu, 351 of 743 spinning mills use bonded labour schemes, otherwise
known as Sumangali schemes. Fraudulent
recruiters reportedly target families in economically disadvantaged
rural areas of India and persuade the parents to send their
daughters to spinning mills with promises of good working conditions
and the payment of a lump sum at the end of their three-year
contracts that might help contribute to dowry costs. In these mills,
young women are subject to exploitative labour practices, including
restriction of movement, removal of mobile phones, and withholding
wages and other payments, in return for the prospect of a lump sum
of money. They
work 60 hours per week year-round and cannot refuse overtime. Workers
are therefore bound to their employer as changing employers would
mean losing their promised lump sum. However,
many women under those schemes never receive the lump sum payment
they are promised because they leave early, often due to illness.
Similarly, in granite quarries, wage advances and loans with an interest ranging from 24 percent to 36 percent are used to bond workers to the quarry. According to a study on bonded labour practices in sandstone quarries in Rajasthan, workers become caught in lifelong debt bondage as they owe large sums of money to their employers or contractors and have to work for little or no pay until this is repaid. In some instances this may result in intergenerational transfer of debt as it is common for immediate kin to replace workers who retire due to old age or occupation-related illnesses and to take on their debt. Situations of debt bondage are often aggravated by the need to raise emergency funds or take on loans for health crises. Debt bondage is also used as a form of control in forced sexual exploitation. Survivor interviews revealed managers requested compensation for the money allegedly paid to purchase the victim. With little or no payment given to victims for their work, repaying the debt is almost impossible, trapping them in an indefinite cycle of debt bondage and exploitation.
The agricultural sector accounts for 62.7 percent of India’s rural employment, but changing environmental patterns in the eastern state of Odisha, such as irregular rainfall, frequent droughts, and deforestation, have resulted in destruction of traditional livelihoods. The lack of employment opportunities and the need to seek alternative sources of income force people to migrate to other states within India in search of work. Seeking work in brick kilns across the country has become a common phenomenon for people from Odisha. This often involves labour agents who use a system of advance payment where workers are paid a lump sum upfront which they then need to pay off through the bricks they make, consequently trapping them in bonded labour until they have paid off their debt. It is reported that in certain brick kilns accepting a wage advance from a contractor, who acts as an intermediary between the kiln owner and the worker, is seen as a mandatory step to accepting a job, as shown by a study in Punjab in 2014 where 94 percent of those interviewed had taken an advance. The advance system makes it obligatory for the worker to remain in the kiln, and with advances and payments reportedly made via a contractor, there is little scope for workers to seek out other employment opportunities.
Instances of forced labour exist among local and migrant domestic workers both within India and overseas who find themselves coerced into hard physical labour and experience conditions of ill treatment, and confinement. Domestic workers are particularly vulnerable as they work in private homes and depend on their employers for basic needs such as food and shelter. This is highlighted in the recent case of a Bangladeshi migrant domestic worker who was held hostage and physically abused by a family in Noida, Uttar Pradesh, after asking for her unpaid salary. Most female domestic workers migrate from India’s least developed regions, such as Jharkhand, West Bengal, and Assam, to urban areas where a growing middle class has created demand for domestic help."