Uzbek Activists File Complaint Against Better Cotton Partner
Human rights activists have filed a complaint against one of Uzbekistan’s largest cotton producers, accusing it of “land grabbing,” union busting and other human rights violations.
The Uzbek Forum for Human Rights told the independent project accountability mechanism of the European Bank for Reconstruction and Development (EBRD) last month that Indorama Agro has violated Uzbekistan’s labor code and other legal norms through its “destructive activities,” as Umida Niyazova, the nonprofit’s founder and director, described it.
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“Indorama has been operating with complete impunity…despite the fact that a state labor inspection conducted in February found many violations,” she said of the Singapore-headquartered firm, which has been the recipient of $70 million in financing from the EBRD with the goal of introducing advanced cotton farming techniques to the Central Asian nation.
Niyazova said that her organization has amassed copious evidence over the years about Indorama Agro’s alleged harm to local communities in the Syrdarya and Kashkadarya regions, where it received 49,000 hectares of land via government decree in 2018 with neither the farmers’ “prior, informed” consent nor their compensation.
The idea behind the move was a well-intentioned one: privatize Uzbekistan’s cotton sector, create so-called “cotton textile clusters” that co-mingle production, processing and manufacturing, and generate at least 1,500 jobs to produce cotton according to Better Cotton’s tenets of sustainability and decent work.
What followed, however, fell short of that promise, said Niyazova, who spoke to farmers who complained of delayed payments and exploitative contracts with no minimum prices for their crops. Some said they were being forced to use expired fertilizers.
“This transfer of agricultural land turned out to be a huge loss of income for the local population,” she said. “Instead of creating good jobs, we saw that Indorama Agro hired field workers on short-term civil law agreements without any social guarantees.”
In March 2021, the workers rallied together to form a trade union, the country’s first democratically created organization of its kind. Last December, Indorama Agro announced mass layoffs, reclassifying nearly 400 of its 2,000-plus farmers from employees to “service providers” and rendering them no longer eligible for union membership. The following month, 40 “active” union members submitted a complaint to the Uzbek civil court, only to face “unprecedented pressure” by local police and security forces to withdraw their filing, which they did, Niyazova said.
Nina Lesikhina, policy officer at Bankwatch, a non-governmental organization that monitors international institutions in Central and Eastern Europe, helped the Uzbek Forum file its complaint. She said that the EBRD not only failed to do its due diligence but also ignored all the red flags when they emerged. Bankwatch’s own efforts to engage with the bank also proved less than successful.
“It’s a last resort because we tried all the other advocacy opportunities,” she said.
Indorama Agro has called the allegations “flawed, misleading and biased.”
“Indorama Agro works closely with international lenders and institutions and diligently follows processes mandated by them in accordance to their required performance standards,” a spokesperson said. “We are co-operating with [the] EBRD wholeheartedly on this issue.”
The EBRD said that it isn’t able to comment until the dispute process is concluded. Even at an expedited rate, this could take a year, Lesikhina noted.
Better Cotton, which included Indorama Agro in its burgeoning Uzbek growers’ program early this year, is “fully aware” of the company’s reported issues, Niyazova said. While the organization did not respond to a request for comment, it previously said that it’s in “regular dialogue” with various stakeholders as it “responds to relevant complaints.”
“It is important to note that because there have been historic issues of systemic forced labor in Uzbekistan, our approach there includes enhanced assurance activities that are geared to the local context,” a spokesperson told Sourcing Journal in February. “All farms receive additional decent work monitoring visits that focus on extensive worker and community interviews, along with management interviews and documentation reviews.”
Uzbekistan, once synonymous with state-sponsored forced labor, is itself in a state of flux. It was only last February that the International Labour Organization declared that government-led reforms were working and that the nation’s cotton fields were broadly free of systematic child and forced labor. Shortly after, the Cotton Campaign, a coalition whose members include Anti-Slavery International, Human Rights Watch and the Responsible Sourcing Network, ended its decade-long boycott of Uzbek cotton.
But the Indorama complaint underscores the fact that serious labor rights risks still persist in the Uzbek cotton sector and that further reforms are still necessary to create an “enabling environment” for labor rights and responsible sourcing, said Raluca Dumitrescu, coordinator for the Cotton Campaign, which coaxed more than 330 brands and retailers, including Adidas, Gap, H&M and Zara owner Inditex to sign its Uzbek Cotton Pledge Against Forced Labor.
“Development banks, donor agencies and multi-stakeholder initiatives play a critical role in working with the Uzbek government and industry to expand the space for labor rights in the cotton industry,” she told Sourcing Journal. “The banks must ensure that their investments in Uzbekistan’s cotton sector help increase compliance with international supply chain standards for labor rights.”
Niyazova said that it isn’t just the Uzbek Forum that has been sounding the alarm on Indorama Agro. Farmers have also been speaking to local media or grousing on social networks.
“This is not something [that is] very difficult to find out,” she said. “But I don’t know the reason why they just ignored all these problems, which, for us, are very obvious.”
