Terms of Trade | Why India’s affirmative action system is broken - Hindustan Times
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Terms of Trade | Why India’s affirmative action system is broken

Jun 19, 2023 09:44 PM IST

The real problem is the skewed balance of power and opportunities between State and private capital

The Supreme Court, in a 3:2 verdict, ratified the constitutional amendment enabling reservations for Economically Weaker Sections (EWS) among social groups who were hitherto not entitled to these benefits on November 7. Without prejudice to the merits of the judgment, the decision is likely to generate tailwinds for politics around reservations in India.

An OBC reservations rally at Azad Maidan in 2019. (HT File Photo)
An OBC reservations rally at Azad Maidan in 2019. (HT File Photo)

First the political backdrop.

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Even before the latest judgment, there has been a widespread demand for conducting a caste census in the country. This demand, to be sure, is not driven by some benign academic curiosity. Various survey based estimates put the share of other backward classes (OBCs) in India’s population at over 40%.

While reservations for Scheduled Caste (SC) and Scheduled Tribe (ST) are roughly commensurate with their population share, the 27% OBC quota clearly falls short of the population share of OBCs. Political parties asking for a caste census believe that it will solidify the grounds for making a pitch to increase reservations for OBCs as well.

Where the latest EWS verdict will come in handy for the sections demanding an increase in OBC reservations is the fact that the Supreme Court has left enough grounds to argue that the existing 50% cap on reservations fixed by an earlier judgment of the court is not sacrosanct anymore.

Different reservations, different responses

In this political and judicial backdrop, what should be one’s attitude to such a demand?

Any discussion on reservations must begin with an acknowledgement of the fact that the caste-based prejudice is still a reality in India and it does play a role in shaping the political attitude to reservations.

An examination of various models of reservation and the response to it is instructive.

In 2006, there was the enactment of reservations for OBCs in central educational institutions in 2006 (popularly known as Mandal 2.0). Mandal 2.0 triggered a sharp upper caste backlash. Images of medical college students sweeping roads or polishing shoes – it was meant to denigrate social groups which had to undertake such jobs in the caste-system – defined the protest.

The social unrest which erupted when the VP Singh government implemented OBC reservations in government jobs for the first time in 1990 was even more violent and reactionary in nature. There was also the clichéd but rabid defence of the logic of merit being compromised due to admitting students who scored lower marks than their unreserved category peers during both Mandal 1.0 and 2.0.

No such protests erupted when the EWS quota was announced in 2019. In fact, the government did not even need to announcement a concomitant seat increase like in the case of Mandal 2.0 (the idea was to protect the number of unreserved category seats).

All this is clear proof that a large section of the anti-reservation (upper caste) constituency only has problems with reservations for the socially disadvantaged groups.

But a caveat is important here. It will be a travesty if the bigoted and reactionary protests against OBC reservations are used to dismiss the nuanced criticism of OBC reservations in both the judicial and academic realms and proponents of such arguments have to suffer ad-hominem attacks.

The politics of proportional OBC reservation

To come back to the point, is there something fundamentally wrong with the demand of asking for proportionate reservations for all three category of socially disadvantaged groups in India?

Merit per se, or lack of it, due to such a policy cannot be an answer to this question. There is enough academic and anecdotal evidence to suggest that merit or efficiency (especially in the long-term) is not a casualty of reservations.

In many southern states, cut-offs for reserved category applicants are as high as unreserved category. A 2014 paper by economists Ashwini Deshpande and Thomas E. Weisskopf found that implementation of reservations in Indian railways might have improved rather than brought down efficiency levels. Does this mean that one should necessarily endorse the idea of increasing reservations for OBCs to their share in population?

A contrarian argument can be made by using two arguments.

The first is based on (in this author’s view) the very genuine argument that the entire OBC population cannot be treated as a homogenous bloc. OBCs, to begin with, were a very varied lot in terms of not just share in population but also differences in property endowments. Once democracy really took roots in India, numerically stronger and relatively well-off OBCs groups made bigger political gains than their non-dominant peers. These dominant OBCs have since then utilised the political upward mobility to improve their economic fortunes and accumulate significant power. In fact, it will not be an exaggeration to say that in many parts of the country, dominant OBC groups have replaced the upper castes in unleashing political violence against the socially weaker sections in the society.

Because there is no comprehensive database on these metrics at the sub-caste level – to be sure, limited surveys and anecdotal evidence does exist – it is difficult to prove or disprove this thesis conclusively.

Academic validation or lack of it notwithstanding, politics in India has evolved to exploit this reality. The backlash to this dominant OBC one-upmanship has been a critical factor in the Bharatiya Janata Party’s (BJP) success in putting together a coalition of non-dominant OBCs in large parts of the Hindi belt against Mandal based parties. The fact that the Narendra Modi government has set up the Justice Rohini Commission to re-stratify OBC reservations – it will most likely cap the reservation benefits available to dominant OBCs – is yet another proof that the BJP intends to exploit the inherent fault lines in OBC politics even further.

Almost the entire pro-Mandal intellectual spectrum has maintained a tacit silence on the issue of sub-stratification of OBC reservations. In fact, one can argue that the renewed demand for doing away with the 27% quota on OBC reservations is nothing but a pre-emptive move against any such policy decision.

The State-private capital balance

The second argument will require a brief digression to be developed fully. Nobody can deny the fact that upper caste Hindus dominate the ranks of socio-economic elite in India. However, it can be argued that for the present generation of upper caste elites, their socio-economic endowment and network advantage rather than active caste oppression (which was the cornerstone of their economic dominance under a feudal economy) of historically oppressed social groups has played a bigger role in their upward mobility.

Of course, this is not to argue that such people might not have caste bias. In fact, the post-reform period has arguably seen a worsening of caste-based inequality and weakening of affirmative action policies because the best opportunities have shifted from the public to the private sector. There is no reservation whatsoever in the latter.

Academic research by economists such as Sukhdeo Thorat has shown that caste-based discrimination is a reality when it comes to hiring in the private sector. While the demand is yet to find mainstream traction, there have been voices demanding reservations in private sector as well. What then explains this reluctance on part of the Mandal based political parties to limit their demand for reservations in the public sector?

The experience of some state governments implementing reservations in private sector for local residents is useful here. States (such as Haryana) which have announced such policies have left the high-paying private sector jobs outside the purview of these policies and reservation has been kept confined to payment bands which will only include blue-collar work. The reason for such ambivalence around private capital is not very difficult to understand. Private business, especially of the big-ticket variety, can actually dictate terms to governments, more so at the state level, a far as conditions it wants to work under is concerned.

While nothing in the law forces a government to do so, private capital can always threaten to relocate in case these demands are not met. Securing private sector projects has pretty much become the hallmark of a development oriented government. Such concessions include tax holidays, land acquisition at cheaper rates and dilution of labour regulations or any potential constraints on freedom of corporations to do as they please in their functioning (which a reservation policy will impede on).

In fact, it is ironical that India has seen a greater democratisation in politics on the social front in the same period when the state has lost ground when it comes to balance of power between private capital and the state. To be sure, India is not the only country where big business has increased its bargaining power vis-à-vis the state. This holds true for the entire world in the neoliberal world order, which came into being after the demise of Keynesian demand management age of capitalism.

The real resolution

The future of economic inequality in India will depend on the interplay of relations between state and private capital rather than so-called upper and backward castes. Fixing this problem for better requires changing the nature and trajectory of economic development by renegotiating the state-capital contract rather than expanding the remit of reservations in the public sector, or even expanding them to the private sector which at best can only provide slightly more representation rather than deliver equality.

If caste were the only factor driving economic inequality, inequality would not be a global problem given the fact that caste is at best a social phenomenon in the Indian subcontinent.

It is unlikely that the political parties in India – almost all of them use reservations as a political demand now – do not understand this fact. However, taking up the cause of renegotiating the state-capital contract to extract more concessions from the later will require a complete decoupling with the current consensus on economic reforms, and, as a logical corollary, losing access to political funding from big business in the country.

There is more than enough ground to argue that almost entire political spectrum in the country is reconciled to a TINA (there is no alternative) factor as far as the model of economic development is concerned. The competitive politics around reservations, when seen in this backdrop, is more an alibi for inequality rather than a promise of eradicating economic inequality.

It is on this count, and not the prejudiced rants of reservation being anti-merit, that the current resurrection of reservation politics generates pessimism about the future.

In lieu of a postscript, the first generation of politicians who argued for reservations can be given a benefit of doubt on this question. The state and therefore reservations were indeed an important if not a primary driver of economic fortunes until the late 1950s and 1960s when OBC politics around reservations really came into being. The current generation of Mandal politicians are driven more in pursuit of cynical political gains than any genuine passion for social transformation.

Every Friday, HT’s data and political economy editor, Roshan Kishore, combines his commitment to data and passion for qualitative analysis in a column for HT Premium, Terms of Trade. With a focus on one big number and one big issue, he will go behind the headlines to ask a question and address political economy issues and social puzzles facing contemporary India

The views expressed are personal

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  • ABOUT THE AUTHOR
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    Roshan Kishore is the Data and Political Economy Editor at Hindustan Times. His weekly column for HT Premium Terms of Trade appears every Friday.

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