The privatisation of Israel’s Haifa Port brings many opportunities for India’s port tycoon, Gautam Adani, but it may also entail many tests when dealing with the local lords of the ports.
For decades, Israel’s labour unions and dockworkers were stronger than any government and it seemed like nothing could stop them. But when the unions reached their crescendo under their charismatic leaders, the government managed to overwhelm them and brought global players into the field.
The story of dockworkers largely echoes the story of Israel. Their protests reflect the political, economic, and social transformation that Israel has gone through, from a socialist state to a welfare state to a first-class libertarian capitalist state. But at the same time, it portrayed the battles between the right and left wings, the bureaucrats against the common people and in some way the rift between the first and second Israel.
Over the years, the Israeli public with the help of the media has created a problematic image of dockworkers, establishing them as militant or violent. But if there is anyone to blame, it is the ones who created the labour agreements—specifically, the Secretary of the Histadrut, Israel’s General Federation of Labour, and labour leader Yitzhak Ben Aharon.
According to the collective agreement signed in 1966, any changes in the work methods will require the approval of the ‘manufacturing committee’. The agreement gave dockworkers a unique status in the day-to-day management of the port, similar to the status of the shareholders. Any streamlining of port work won’t be the sole discretion of port authorities but would be subject to the dockworkers’ veto rights. Over the years, though, the dockworkers’ expertise in using the veto power to improve their wages and working conditions has become uncontrollable and an insatiable behaviour.
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Politics, source of power
One of the premier sources of the dockworkers’ power is their deep foot in Israeli politics. In the early 2000s, the unions could sense the direction of the wind and encouraged members to register with prominent political parties to increase their influence on politicians. In August 2008, this turned out to be a constructive step when the ministry of finance presented a proposal to the government, bringing Israel one step closer to the long-awaited privatisation demand.
The resolution results from an inter-ministerial team of the Ministry of Transportation and The Budgets Department, part of the Ministry of Finance. The purpose of the proposal was to regulate the set of authorities and the required processes for the operation of the future port by a private international entity.
Aware of the aspiration of transportation minister Shaul Mofaz, the unions decided to shut down all ports on 25 August 2008 in response to what they saw as a unilateral move by the government. Mofaz, who had been focused on his plan to capture the Kadima party leadership, was surprised by the iron fist of the Histadrut and the dockworkers. He turned to the cabinet secretariat and demanded to withdraw the already approved proposed resolution.
The unions also fuelled the rivalry between the ministry of transportation and the ministry of finance, and initiated a wild strike against all protocols. They declared a strike in September 2008 without announcing a labour dispute first, as required under the law. The Histadrut, which usually follows the rules, protected the workers’ right to strike, calling it a ‘spontaneous strike’. The unions set an ultimatum and announced that they will continue to cease port operations until the decision is revoked.
This is just one drop in the ocean. From its founding days, Israel’s ports were a focal point of strikes, sanctions, labour disputes, and a constant battlefront between the government and the Manufacturers’ Association of Israel (MAI). The success story of the Israeli economy depends on its ports and the lords of the ports also know that. Lacking a land route with its hostile neighbours, ‘the land of milk and honey’ is an island economy. Even for local production, the Israelis rely on materials transferred by sea. A slowdown in the activity or shutdown of the ports dramatically affects the country’s economic activity. The 2011 strikes at sea ports resulted in an estimated 2 billion worth of damages within a week. The government had to compensate exporters and importers at the expense of diverting funds from other services that should have been provided to the citizens.
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Labour unions under Adani
One would think that the monopoly of Israel’s sea ports has ended with privatisation and that the Israelis are marching towards a new age of manpower efficiency. But the reality is a bit more complex than that. A few days after the Adani Group took over the Haifa Port, the dockworkers were embroiled in internal battles, with each group trying to grab a large share of the privatisation grant. If this wasn’t enough, in January 2023, it was reported that 51 retirees, who missed the completion of the sale to Adani, lost hundreds of thousands of shekels and demanded their money back.
In recent years, dockworkers have abused their right to strike, but strikes can also occur under private ownership. The operation of a port by a private entity does not guarantee a weakening of labour unions or the suppression of organised labour. Privatising Israel’s ports has expropriated Israel’s national assets from the sphere of internal politics and turned it into a matter of international relations and national image. Even with the successful change of ownership, the new owner will not be able to streamline operations and violate the labour agreements signed by the state. These agreements will remain the new owner’s dowry. But who else can deal better with the most ancient practice than the Indians?
Dr Oshrit Birvadker is an Indian-origin member of the Bene Israel community, based in Tel Aviv. She is a leading analyst of India’s foreign policy in Israel, a senior researcher at the Jerusalem Institute for Strategy and Security (JISS), a business development expert, and an entrepreneur. She tweets @birvadker. Views are personal.
(Edited by Ratan Priya)