Child labour issue at Som Distilleries & Breweries raised concerns about India’s supply chains

Last week, 58 children with burned hands were rescued from a liquor factory owned by Som Distilleries & Breweries (SDBL) in Bhopal, marking the first time a listed company has been caught engaging in child labour. SDBL, which has a market cap of approximately Rs 2,400 crore, clarified to the stock exchanges that the issue pertained to an associate private limited company where a contractor might have failed to verify the ages of the workers.

On Tuesday, SDBL’s stock opened 16% lower and closed at Rs 116.80, down 6.4%. Dhananjay Tingal, Executive Director of Bachpan Bachao Andolan, which aided the rescue, stated this is the first instance of child labour in such a large, organised setup.

Listed companies are rarely found directly involved in child labour, though their supply chains can be linked to it. Child labour is prevalent in smaller, unorganised sectors like textiles, carpets, mining, firecrackers, and agriculture, where supply chains are complex and hard to monitor.

Addressing child labour in India is complicated by poverty, according to industry insiders. Despite SDBL’s reported compliance with child labour regulations, the issue persists, with United Spirits and Carlsberg also having faced related complaints, according to a report in the Economic Times.

Child labour remains a global concern, with efforts aimed at its elimination under the United Nations’ sustainable development goals. A report by the Kailash Satyarthi Children’s Foundation projects 7.43 million child labourers in India by 2025, with Uttar Pradesh having the highest population.