The Hazaribagh, or “Thousand Gardens,” neighborhood in Bangladesh’s capital city of Dhaka has no trees or flowers. Instead, the industrial area is saturated with toxic chemicals from more than 200 leather tanneries polluting the air, water, and soil. The stench of animal hides, garbage dumps, and furnace smoke is so foul, some locals wear face masks. “It’s a shameful way to live,” says Gul Dulali, 27, a mother of two living in a one-room shack next to a bubbling gray stream.

Bangladesh’s leather exports are a $1 billion-a-year industry, according to the Bangladesh Export Promotion Bureau. Competitive prices and improved quality have attracted an increasing number of importers from Asia and Europe. Almost all of the country’s leather production, 80 percent, is exported. As with Bangladesh’s notorious ready-made garment industry, there’s a huge local cost. According to the government, an estimated 22,000 cubic meters of environmentally hazardous liquid waste, including hexavalent chromium, is dumped daily into the Buriganga River, Dhaka’s main waterway. Skin and respiratory ailments are common among Hazaribagh’s 160,000-plus residents. A November 2013 report by the New York-based Blacksmith Institute ranked the neighborhood among the 10 most polluted places on earth. “Once you are inside Hazaribagh, you are in a chamber of pollutants,” says Philip Gain, director of the Society for Environment and Human Development (SEHD), a Dhaka-based nonprofit.

The worst conditions are endured by 8,000 to 12,000 tannery workers, who toil 12 to 14 hours a day, seven days a week for less than $2 a day, according to the local Tannery Workers Union. Abdul Kalam Azad, head of the union, says even experienced workers with 10 or more years on the job rarely earn more than $150 a month.

In one factory, which supplies black leather to wholesalers in Hong Kong, Korea, and Italy, hides are churned in giant wooden drums filled with toxic chemicals such as chromium sulfate and arsenic, which are used to soften them. Many workers handle the barrels without gloves and walk barefoot on floors covered in acid. “They are working in those conditions with little or no protective equipment and little or no concern for their health care from the tannery owners,” says Richard Pearshouse, who investigated factory conditions in 2012 for Human Rights Watch. Prolonged exposure to these chemicals has been known to cause cancer.

Nur Mohammad, 35, a veteran worker, has severe chemical burns on his hands and feet. “I’m always in pain,” he says. Workers risk being fired if they take time off to seek medical treatment, he says. “Sure, I would like to find a different job, but I have six children to support.” A factory manager, who declined to give his name for fear of retribution, says his tannery provides first aid and a medical stipend of as much as $20 a month. He concedes that while allowances are made for longtime employees to take leave, an excess of cheap labor ensures workers can easily be replaced.

Human Rights Watch found no attempt by authorities to crack down on pollution, calling Hazaribagh “an enforcement-free zone” in its 2012 report. The group says that apart from paying the occasional fine amounting to several hundred dollars, politically connected owners continue to flout the country’s environmental codes without consequence, Pearshouse says. “They almost have no monitoring and inspection of the tanneries, and when they do go into tanneries, they told me that they give advance notice of their visits.”

Mohammad Abu Taher, a factory owner and chairman of the Bangladesh Finished Leather, Leathergoods, and Footwear Exporters’ Association, says limited space and rapid economic growth are responsible for the conditions in Hazaribagh. Owners, he says, have been hampered by a lack of knowledge and lax enforcement, while Western buyers, especially in Europe, have avoided responsibility by ordering wholesale from middlemen.

One proposed solution has been a government-backed scheme to relocate the tanneries to the suburb of Savar. A group of 150 owners agreed to do so in 2003, but a series of deadlines have been missed over disputes about who should foot the bill. Relocation may only shift the problem out of the city center, Pearshouse says. Conditions will only improve with pressure from foreign governments and international buyers. Bangladesh’s government has cited threats from the European Union to stop importing leather from the country altogether if progress isn’t made on relocating the tanneries and building an effluent treatment plant. But some observers are skeptical there’s any real prospect of such EU action.

Some owners say a move in the near term is likely. The central bank has just announced an incentive package that includes lower-interest loans. “This time next year, tanneries will be running here,” Taher says as he surveys the Savar site. “Hazaribagh will be closed.”

Still, many workers who depend on the tanneries for their livelihoods are anxious. Savar is more than an hour’s drive from Hazaribagh, and there are no plans yet for facilities to transfer employees. Owners say workers can commute; labor leaders counter more infrastructure is needed for a fair transition.

For some residents, the talk of an imminent move is just that. “The government and owners have been making and breaking promises for longer than I can remember. And look—we still live in filth,” says Abdul Majid, 30, a rickshaw puller. “So long as the tanneries are making lots of money here, nothing will change.”