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Chinese workers fuel India's staggering infrastructure boom

By Rama Lakshmi
Sunday, October 24, 2010; A17

IN CHANDANKYARI, INDIA Perched precariously on scaffolding, several Chinese workers showed Indian laborers how to weld the shell of a blast stove at a steel plant construction. Step by step, the Indians absorbed the valuable skills needed to build a large, integrated factory from scratch in record time.

"I have worked on building four new steel plants in the last 10 years in China, and I am here to teach Indian workers to do the same," Hulai Xiong, 38, said about the construction site in the eastern Indian state of Jharkhand. "In China, we build very fast. Indian workers are slow and sometimes lazy. They are not familiar with modern industrial construction processes."

Clad in blue overalls, 1,600 Chinese supervisors, technicians and other laborers work at the 2,000-acre site. The $1.7 billion factory, which also relies on Chinese technology, employs 5,000 Indian workers.

Skilled Chinese workers are helping India expand its infrastructure at a frenetic pace, even as the two Asian giants compete for economic dominance.

Their presence in a nation of more than a billion people with staggering unemployment may appear incongruent. But the government says Indian workers lack the technical skilled needed to transform the country into a 21st-century economic powerhouse.

Until the gap is bridged, companies are relying on the expertise of Chinese workers to build mega infrastructure projects. Chinese workers have worked on ports, highways, power and steel plants in India. Chinese equipment and expertise have also been used in a crude oil refinery, a cable-supported bridge, the telecommunication networks and even the glass facade of the new airport terminal in New Delhi.

"India may be an IT superpower and producing thousands of doctors, lawyers and MBAs every year. But the biggest gap is in the availability of skilled electricians, carpenters, welders, mechanics and masons who can build mega infrastructure projects," said Raghav Gupta, president at Technopak, a consultancy that released a report on skill development last year. "Most of these workers have to be trained on the job. And that often delays the projects and makes it more expensive."

As the center of economic gravity shifts from the Atlantic to the Indian Ocean, analysts say, the world's two fastest growing economies will transfer even more technology and skills.

Fears of displacement

The Chinese workers in labor-surplus India prompted an outcry last year, and India clamped down by making visa rules stricter. About 25,000 workers had to leave dozens of projects midway and return to China because they were on business visas and not worker visas. Construction at 14 power plants was affected.

"We have no problems if . . . Chinese workers skilled in specialized functions come to India. We just don't want them to displace Indian workers by doing the jobs that Indians can do," said G. K. Pillai, India's home secretary, who said there are a little over 15,000 Chinese laborers in India now.

Diplomatic relations between the two nations, who have fought a war and have lingering territorial disputes, have remained testy. In recent years, Indian officials have expressed concerns about China's close ties with Pakistan, India's arch rival.

"We also do not want the Chinese in projects that are strategically sensitive or near our border areas," Pillai said, echoing these concerns.

Industry analysts say India's demand for steel is growing exponentially, and steel production, now at 70 million tons a year, will need to grow 12 percent every year to keep up. The Chandankyari plant will begin operations in June 2011 and is expected to produce 3 million tons a year.

"China is the only country in the world that has built so many new steel plants in the past decade, almost like assembly-line products, adding about 80 million tons of steel capacity each year.

So we decided to get their technology and manpower," said R.S. Singh, director of Electrosteel Steel Ltd., the company building the factory in Chandankyari.

"This factory is a classroom for Indian workers and we will create a benchmark for speed, quality and cost," Singh said.

The Indian workers earn slightly less than the Chinese, whose speed ultimately brings down the cost of the project, Singh said. The steel plant is expected to take 18 months, a rare feat in India. A government report last month said that more than half of 600 large infrastructure projects are delayed, resulting in 68 percent cost overruns.

"If I had just used Indian workers, it would have taken five years to construct," Singh said. "Can India afford the delay?"

New kind of teamwork

Before the Chandankyari steel plant hired him to weld, Babujaan Ansari made wooden furniture in his village.

"The Chinese make us work very hard, and we cannot speak their language," said Ansari, 27. "We rely mostly on gestures."

The Chinese workers have learned a few Hindi phrases such as "do work," "let's go" and "I love you."

The Chinese live in a row of air-conditioned pre-fab rooms and have Chinese cooks. Some say they find the Indian heat unbearable; others complain that the Internet speed is too slow for streaming Chinese movies. Sometimes, they go into the villages for an under-the-tree haircut or for the locally brewed toddy.

On their way back to their rooms after a hard day's work, many Chinese workers lined up at tiny shops to buy sachets of flavored betelnut powder, which has a mildly intoxicating effect and is popular here.

The Indian workers are learning a new work ethic from the Chinese and are now more punctual, not stopping work to take frequent tea-breaks or gossip, managers said.

There are subtle politically-tinged changes, too.

"The Chinese do not like it when Indian workers ask too many questions or argue," said Singh, the plant director. "But after working together, the Chinese are now learning to answer some of the questions, and the Indian are learning to ask fewer questions. The hare and the tortoise are learning to work together."

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