The Cruel Economics of Human Trafficking in India

Impoverished women and girls constitute one of the most vulnerable populations to human trafficking. Image Source: Sean Ellis / Flickr (Creative Commons)


Human trafficking is often referred to as the modern day equivalent of slavery.  The comparison is apt in more ways than one. Not only are slavery and human trafficking both moral wrongs, they are also both perpetuated by an unfeeling economic system that treats humans as commodities, to be transported and traded for monetary gain.  This commodification of human life occurred in ancient times, it was common through much of modern history, and it continues in many parts of the world today.

India is one country where human trafficking is an especially acute problem, with an estimated 16 million people currently believed to be victims of sex trafficking in particular. The complexities of India’s sex trafficking industry are laid bare in a recent study by Dasra, a strategic philanthropy foundation. Dasra’s study takes an exhaustive look at both the supply and demand sides of sex trafficking in India, and its findings are at once unsettling and sobering:

The reason why sex trafficking persists is straightforward: immense profitability with minimal risk. A net profit margin of over 70 per cent makes sex trafficking one of the most profitable businesses in the world. It is becoming increasingly easy and inexpensive to procure, move and exploit vulnerable girls…Moreover, the average price of a sex act has been decreasing over time…These decreasing prices open up the market to consumers who could not previously afford the service.

Women and Girls as ‘Supply’ 

The overwhelming majority of sex trafficking victims in India are women and girls, and about 40% are adolescents. Over time, the average age of sex workers has dropped from 14 – 16 to 10 – 14 because young girls are believed to have a lower risk of carrying a sexually transmitted disease. However, as a result of this thinking, trafficking victims are now contracting diseases at even younger ages.

Most victims come from rural areas, over 70% are illiterate, and almost half reported that their families earned just about $1/day. Though poverty and a lack of education alone are not direct causes of trafficking, they do increase vulnerability. 78% of trafficked victims in the country are from West Bengal — one of the poorest areas in India.

Some trafficking victims have been priorly abused in other ways (such as through domestic violence or dowry harassment); some are sold into trafficking by family members or acquaintances; and some are tricked into exploitation, believing that they are heading towards a better employment opportunity when they are actually being transported to brothels. Natural disasters and military conflicts tend to increase the ‘supply’ of human trafficking, because traffickers can take advantage of chaotic situations to find more potential victims.

Levels of Demand

It can be tempting to reduce the demand side of human trafficking to the prurience of few depraved individuals, but the reality is much more complicated than that. According to Dasra, demand is fueled by three components:

1)   Men who purchase sexual acts.

These men constitute the first level of demand. They include “pedophilic tourists” from abroad as well as Indian nationals:

 [Rampant] growth in megacities such as Mumbai has seen an influx of migrant workers who have left their families to find work in the cities. This has resulted in a rapid escalation in the demand of cheap sex. Loneliness, coupled with the anonymity of the city, has made paying for sex an attractive option; a majority of migrant workers report that they have indulged.

2)   Profiteers of the sex industry.

Individuals that make up this second component have a more calculated view of human trafficking. They are the pimps, brothel owners, and corrupt government officials complicit in the trade.

3) Culture and gender norms that indirectly augment trafficking.

Certain aspects of Indian culture and society continue to devalue women and girls. This not only makes women and girls more vulnerable to trafficking, it also mitigates the moral harms of trafficking in the eyes of the public. So even when they don’t necessarily promote trafficking, cultural and social constructs can still enable it.

When Demand Exploits Supply

Demand from the first component is what keeps prostitution and commercial sex alive, but it’s really the second demand component that underscores how much of a modern business human trafficking has become. For instance, consider the operational structure of a brothel:

The hierarchy in a brothel is akin to that of a corporate. The malik is the owner of the brothel much like a founder/CEO in a corporate. He might own one or more brothels in the same vicinity. He frequents flesh markets and deals with individual agents and local pimps to acquire trafficked girls. Apart from that, he supervises the revenues and profitability of the brothel. The gharwali is the manager of the brothel. She is usually a victim of trafficking herself and would have had to spend 15 – 18 years as a commercial sex worker before she got promoted to being a gharwali. For a client visiting the brothel for the first time, she is the first point of contact.
structure of a brothel
(from the Dasra report)


And similar to modern business, sales are driven by perverse forms of ‘value’ addition and market analysis. Prior to transporting a girl to her final brothel, a trafficker often beats and abuses a girl because he can command “a 20% premium for a girl who has been ‘broken in,’ making this brutal initiation a cold and calculated business decision. Additionally, the trafficker uses this time to make market assessments regarding which ethnicity is in demand at which brothels, so he can determine the most lucrative destination.” Furthermore, like a tax burden or transfer cost, “paying bribes is common and 2 to 5 percent of the final price of the slave goes toward paying border security forces.”

(from the Dasra report)

As in almost any another business, traffickers in India will continue to look for more women and girls to entrap so long as the revenues of trafficking exceed the costs.

Getting to Zero Traffic

If sex trafficking can be framed in terms of economic principles, then economic principles can also be applied to curbing sex trafficking. Dismantling supply chains, creating punitive measures that act as disincentives, and imposing harsh financial penalties that drive up the cost of doing business can force brothels to shutdown. However, market intervention alone won’t be enough to put a definitive end to human sex trafficking. This is why Dasra calls for a holistic human rights approach to ending trafficking, as well as a strategy based on the 4 P’s—prevention, protection, prosecution, and partnership.

The human rights approach would give greater voice to victims and vulnerable populations in crafting policies and programs that affect their lives, and it holds governments more accountable when rights are violated. Meanwhile, the 4P strategy encourages joint action from actors of all segments of society. Prevention targets vulnerable women and girls through education and livelihood training, but also focuses on gender sensitivity education for boys and men. Protection includes rehabilitating past victims, undertaking rescue operations, and collecting evidence in trials against traffickers. Prosecution encourages community policing and strict law enforcement, addressing issues on both the supply and demand sides of trafficking. Partnerships bind all efforts together, because none of these actions can be sustained if done in isolation.

Philanthropy can have a catalytic role in putting an end to trafficking in India too. By supporting high-impact anti-sex trafficking initiatives, particularly those in West Bengal (a source area) and Maharashtra (a frequent destination), philanthropy can empower the vulnerable and promote the good. Then perhaps one day, we will no longer speak of humans in terms of supply and demand, but recognize each individual for the value they inherently have.

You can read the full Dasra report with additional insights and recommendations on anti-sex trafficking in India here.