India's human-hair trade at risk as 'rampant smuggling' to China via Bangladesh, Myanmar cuts into profits

For five hours a day, Hasina Bibi painstakingly untangles cast-off human hair, sorting it into strands and making "balls" with the pieces longer than six inches (15cm), throwing the rest into a bin. For untangling about 25kg of hair per month, she earns 7,500 rupees (US$92).

"I could never imagine that waste human hair could provide me a stable source of income," said Bibi, 35, who lives in Habi Chak village, some 100km southwest of Kolkata, capital of India's West Bengal state.

Many impoverished women like Bibi in the eastern state, which accounts for almost half of India's human hair exports, earn money as unskilled labourers in the nation's human-hair industry, which is worth roughly US$1 billion according to the Human Hair and Hair Products Manufacturers and Exporters' Association of India.

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Hair traders collect hair balls - popularly known as goli or chutti - from sorters like Bibi, then have them semi-processed at small workshops. The hair in the balls can range from four to 40 inches (10cm-101cm) in length and semi-processing them involves washing, splitting and arranging them by size before straightening them using strands of the same length and thickness from root to tip.

These double-drawn extensions are then legally exported to other countries - China, the US and countries in Europe are the largest buyers of Indian hair - which use them to make wigs and other hair products for the local and international markets.

In the past, Chinese firms would buy hair directly from Indian businesses for around US$200 per kilogram and use it to make wigs, extensions, eyelashes, paint brushes, and fake beards and moustaches for the global market.

But they now hire local agents, who buy the hair balls from Indian traders for anything from US$60 to US$70 per kilogram, which are then smuggled out of the country into neighbouring Bangladesh - almost 400kg was seized in 2021 alone, according to border forces - meaning India is losing out on vast amounts of tax income.

Once the hair balls are in Bangladesh, they are taken to local workshops to be processed before eventually turning up for sale in China, often having been delivered over land via Myanmar.

Sunil Eamani, a member of India's Human Hair & Hair Products Manufacturers and Exporters Association, said unscrupulous Chinese traders would opt to smuggle hair to avoid paying duties and taxes of around 30 per cent on the import value.

He said that human hair was being smuggled from India into Myanmar as early as 2012, but as Chinese importers had set up processing plants in Bangladesh using cheap local labour over the past five years, hair was also now being smuggled into the neighbouring South Asian nation.

Eamani said 561,000 Indians had lost their jobs over the last three years due to smuggling after numerous small hair-processing workshops shut down in West Bengal, New Delhi, Rajasthan, Telangana, Andhra Pradesh and Tamil Nadu.

Human-hair smuggling has become an additional headache for India's border forces, at a time when they are already grappling with the challenges of catching cattle, gold and narcotics traffickers that also operate along the 4,096km border with neighbouring Bangladesh.

A border security official in West Bengal, speaking on condition of anonymity, said 350kg of human hair had been seized on the border so far this year, while 1,104kg was impounded last year.

Although India - the world's largest exporter followed by Indonesia and China - had shipped human hair and related products worth US$607.8 million to China and the United States so far this year, Eamani said the country could earn US$3 billion annually if it could put a halt to the smuggling trade, which ate into legitimate profits and tax revenues.

Indian hair is preferred globally for wigs and hair extensions as it is lightweight, lustrous, wavy and bouncy. More than 5 per cent of India's exports are what is known as "remy hair" of the finest quality, collected from a single source with the cuticles still intact. It is gathered from temples in southern India where women shave their heads for religious reasons.

But the rest of what India exports is non-remy, leftover hair - often scavenged from the floors of beauty parlours and bought or bartered from poorer women in exchange for cash, utensils or trinkets.

Kolkata-based Nishibala Ari, 55, who carefully collects and brushes all of her own waste hair, sells it for 5,000 rupees (US$61) a kilogram to female hair collectors who regularly come to her door.

The rate was 2,000 rupees per kilogram in 2018, she said, but it increased as demand went up.

"I sell about 250 grams of waste hair every six months. This is extra income for me," said Ari, who works as a domestic helper.

Eamani said local traders often preferred to make deals with agents working for Chinese importers, who paid in cash or through the "hawala" network - an informal system for transferring money that has been outlawed in India.

He claimed this enabled local traders to smuggle drugs and gold into India. Indian exporters, meanwhile, could typically only pay via bank transfers for significant transactions, he said.

The global market for wigs and human hair is forecast to hit US$13.3 billion by 2026, according to a 2021 market research report by Arizton Advisory and Intelligence, but rampant trafficking means India is expected to see only a small portion of this fortune.

Hair exporter Sathish Gandhi, director of Chennai-based Allure Hair Products, said corrupt Chinese traders were selling Indian hair at more competitive prices globally than Indian exporters could because the former were saving money by evading tax.

Meanwhile, Bangladesh's official hair exports have shot up, even as Indian exporters have been incurring losses.

Wigs and human hair worth US$113 million were exported from Bangladesh between July 2022 and May this year, according to the country's Export Promotion Bureau, an increase from the US$95.5 million exported over the same period the year before.

Gandhi said it was the smaller Chinese importers who were most likely to get involved in hair smuggling to bypass taxes. Most larger importers were above board, he said, adding that China's hair trade would "not survive without India's supply".

But Eamani claimed that China was siphoning profits away from India by selling products made of Indian hair on the global market.

"Chinese companies use advanced machines to make wigs and hair extensions and therefore their [profit] margin is about US$300 per kilogram, whereas we could get only a margin of US$200 per kilo because our end products don't match their standards due to lack of technology and skill," he said.

But Benjamin Cherian, president of the Indian Human Hair and Hair Products Manufactures' and Exporters' Association, believes that using state-of-the-art technology and employing wig and extension experts from Europe and South Korea could give the industry a boost.

While India's government last year made it compulsory for all raw human-hair exporters to obtain a licence before trading, in a bid to crack down on smuggling, some traders with a poor track record on trafficking had nevertheless managed to get the paperwork they needed, Cherian said.

He said members of his association had called on the government to instruct all village councils to collect hair balls from households for sale to Indian exporters only, with the money to be used for local development and sanitation.

Until this was done, hair smuggling was likely to continue while border forces grappled with their own limitations, he said.

The border security force official who spoke to This Week in Asia said they had a zero-tolerance policy towards trafficking, but that border fences needed to be upgraded "with foolproof vigilance", including CCTV cameras, "to ensure that nobody escapes".

Meanwhile, back in Habi Chak, Bibi spends her hours patiently untangling piles of waste hair for a pittance, with no idea whose head it will eventually end up on - or how it will get there.

This article originally appeared on the South China Morning Post (SCMP).

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