Child Labour in Your Supply Chain Is Now Your Legal Problem. Here’s What You Must Do.
There is a question that almost no Indian business owner has formally asked about their supply chain.
“Am I certain that no one under the age of 18 is working anywhere in the chain that produces my product — including the sub-contracted parts, the home-based work, the informal assembly units?”
For most of India’s manufacturing sector, the honest answer is: “I don’t know.”
That answer, which was uncomfortable before, has become legally and commercially dangerous.
The EU’s Corporate Sustainability Due Diligence Directive (CSDDD), entered into force in 2024, requires European companies to identify, prevent, and address adverse human rights impacts — including child labour — across their full global supply chains. The financial penalties for non-compliance can reach 5% of global turnover. And European companies are not going to absorb that liability: they are passing the due diligence obligation, contractually and practically, to their Indian suppliers.
This guide explains the scale of child labour in India’s manufacturing supply chains, the regulatory framework that is changing, and the concrete steps every business must take to assess and address their exposure.
The Scale of the Problem
India’s 2011 Census — the last complete national enumeration — recorded 10.1 million working children. UNICEF and the International Labour Organisation jointly estimate India’s current child labour numbers at 12–14 million when accounting for population growth and pandemic-related economic shocks.
The geographic concentration spans Uttar Pradesh and Bihar (carpet weaving, brick kilns, bidi manufacture), Tamil Nadu (textile weaving, particularly power loom units), Rajasthan and Gujarat (gemstone polishing, embroidery, glass bangle manufacture), and pan-India construction and domestic work.
The sectoral concentration in manufacturing includes carpet weaving (an estimated 100,000–300,000 child weavers in Uttar Pradesh’s carpet belt), bidi manufacture (home-based production extensively using children), garment finishing (embroidery and sequin work sub-contracted to home-based workers), and brick kilns (migratory labour forces including child workers).
The Legal Framework: Domestic
India’s Child Labour (Prohibition and Regulation) Amendment Act, 2016, is clear and comprehensive:
Complete prohibition: No child below 14 years may be employed in any occupation or process. This applies without exception — including family businesses and home-based work.
Hazardous occupations prohibition: No adolescent (14–18 years) may be employed in hazardous occupations and processes. The list covers mining, explosives manufacturing, chemical processing, construction, and various other categories.
Penalties: Imprisonment of 6 months to 2 years plus fine of ₹20,000–50,000 for the employer. Repeat offenders: imprisonment up to 3 years.
The International Legal Framework: CSDDD
The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) represents the most significant expansion of corporate liability for supply chain human rights violations in the history of international trade.
EU companies above specified thresholds must map their full supply chain for human rights and environmental risks, implement risk-based due diligence, prevent or mitigate identified risks through supplier contracts and audits, establish grievance mechanisms for affected persons, and monitor and report on due diligence processes. Fines reach up to 5% of global net turnover for non-compliance.
Phase-in timeline: Companies with 5,000+ employees and €1.5B+ turnover from 2027; companies with 3,000+ employees and €900M+ turnover from 2028; companies with 1,000+ employees and €450M+ turnover from 2029.
The largest European buyers of Indian goods — H&M, IKEA, Bosch, Siemens, Inditex, Decathlon — began formal supply chain human rights due diligence programmes for their Indian vendor base before CSDDD came into force.
The Questionnaires That Are Already Arriving
European fashion brands have sent supplier questionnaires asking for: written child labour prohibition policy, audit coverage of sub-suppliers and home workers, evidence of worker age verification, and corrective action procedures. European automotive OEMs have sent supply chain risk assessments asking for child labour policy, supplier code of conduct, audit methodology, and complaint mechanisms. IKEA and similar companies have established supplier codes of conduct that include age verification and anti-child-labour clauses.
Understanding Your Supply Chain Risk
Child labour risk in Indian supply chains is concentrated in three areas:
Home-based production: Work sub-contracted from factories to home-based workers — embroidery, assembly, bidi rolling, garment finishing — is done in domestic settings where children may work alongside adults. Supply chain auditors cannot access homes. This is the hardest risk to see and the most common to find.
Informal subcontracting layers: The chain from a tier-1 exporter to a tier-4 informal workshop can involve three or four intermediaries, none of whom appear on an official vendor list. Each layer of informality increases the probability of labour standard violations.
Migrant and seasonal labour: Child workers in brick kilns and agricultural processing often travel with migratory parents. Their presence is seasonal and mobile — making them nearly invisible to standard audit methodologies that sample a factory at a single point in time.
The 4-Level Action Plan
Personal (this week): Ask yourself, honestly, the question at the beginning of this guide. Write a one-page Child Labour Prohibition Statement for your company. Commit to zero tolerance for child labour in operations and direct suppliers. Have it signed by the proprietor or MD. This document does not require a lawyer or a consultant. It requires a decision.
Professional (this month): Brief your procurement team. Every new vendor onboarding should include a child labour declaration — a signed commitment that the vendor employs no one below 14 in any capacity, and no one below 18 in hazardous work. Conduct a desk review of your existing supplier list identifying high-risk sectors and geographies.
Company-level (this quarter): Implement a formal Supplier Code of Conduct that includes human rights provisions. Have all significant suppliers sign it. Where your supply chain includes home-based production or multi-layer sub-contracting, commission a social audit of your highest-risk supplier relationships. Build a grievance mechanism: a way for workers in your supply chain to report concerns without fear of retaliation.
Policy-level: Push for: full implementation of the Right to Education Act with quality assurance; expansion of the National Child Labour Rehabilitation programme; mandatory child labour due diligence as a condition of GeM portal registration; and trade union capacity building in MSME clusters.
The Honest Conclusion
Twelve million Indian children who should be in school are working instead — in factories, homes, kilns, and fields that supply the products Indian and global consumers buy.
The supply chain due diligence movement is making the invisible visible. And visibility is the necessary first step.
The businesses that engage seriously with supply chain human rights due diligence — that ask the hard questions, document the answers, and fix what they find — are building supply chains that are more resilient, more trusted, and more defensible in a world where transparency is becoming mandatory.
Resources
- EU CSDDD official text: eur-lex.europa.eu
- ILO child labour data and resources: ilo.org/childlabour
- National Child Labour Project (India): labour.gov.in/NCLP
- UNGP Reporting Framework: ungpreporting.org
- Social audit standards (SA8000): sa-intl.org
Amit Saha is the founder of Pro India. If your company needs help building a supplier code of conduct or understanding CSDDD compliance requirements, write to info@proindia.net.
