Role of Caste in Economic transformation of India


    In Context 

    Recently it has been observed that there is a link between economic transformation and caste in India.

    What is the caste system?

    • The caste system is a distinct Indian social institution that legitimises and enforces practices of discrimination against people born into particular castes.
    • These practices of discrimination are humiliating, exclusionary and exploitative.
    • Historically, the caste system classified people by their occupation and status.
      • Every caste was associated with an occupation, which meant that persons born into a particular caste were also ‘born into’ the occupation associated with their caste – they had no choice

    How Caste impedes economic transformation in India?

    • There are three ways in which caste impedes the economic transformation in India: 
      • Ownership and land inequality related to productivity failure within the farm sector
      • Elite bias in higher education and historical neglect of mass education
      • Caste-based entry barriers and exclusive networks in the modern sector.
    • Caste through its rigid social control and networks facilitates economic mobility for some and erects barriers for others by mounting disadvantages on them
    • Caste also shapes the ownership pattern of land and capital and simultaneously regulates access to political, social, and economic capital too.

    Major Factors 

    • Land ownership, productivity
      • India has one of the highest land inequalities in the world today.
      • Unequal distribution of land was perpetuated by British colonial intervention that legalised a traditional disparity.
      • Some castes were assigned land ownership at the expense of others by the British for its administrative practices. 
      • The British inscribed caste in land governance categories and procedures that still underpin post-colonial land ownership pattern in India. 
        • They made an artificial distinction between proper cultivators who belong to certain castes and those labourers — lower caste subjects who cultivated granted/gifted lands (Panchami, etc.) that have institutionalised caste within the land revenue bureaucracy. 
        • The prescribed categories and practices have entrenched caste inequality in land ownership. 
        • Even the subsequent land reform that took place after India’s independence largely excluded Dalits and lower castes
        • It emboldened and empowered mainly intermediate castes at the expense of others in rural India.
    • Role of Green Revolution
      • The Green Revolution did not alter land inequality as it was mostly achieved through technological intervention
      • Castes that benefited from the Green Revolution tightened their social control over others in rural India. 
        • Land still defines social status and pride in many parts of rural India.
    • Economic Reforms
      • Those castes that had a stake in agriculture did not benefit from the economic reforms of the 1990s for two reasons — historical neglect of education and the entry barriers erected by the upper castes in modern sectors.
    • Neglect of education
    •  The Indian education system has been suffering from an elite bias since colonial times. 
    • British colonialists educated tiny groups of elites, largely from upper castes, for their own administrative purpose.
    • Although the Indian Constitution guaranteed free and compulsory education under its directive principles, it was hardly translated into practice. 
      • Instead, attention was given to higher education for the elites. 
    • Caste also worked in building social networks. Castes that were already in control of trading and industrial spaces resisted the entry of others. 

    Comparison with other countries 

    • In contrast, Chinese and other East Asian countries invested in basic education and gradually shifted towards higher education. 
    • Their success in manufacturing is a direct outcome of the investment in human capital
      • as South East Asia and China captured low-end manufacturing jobs, India largely concentrated in high-end technology jobs.
    • China taking over India in manufacturing is due to this neglect in human capital formation. 
    • Rural entrepreneurship in China  was able to grow out of the traditional agricultural sector on a massive scale
      • Rural India, in contrast, hampered by a poor endowment of human capital, could not start entrepreneurial ventures even remotely on the scale of the Chinese.

    Impact on economic transformation

    • India has been in a phase of jobless growth for at least two decades now, coupled with rising poverty and discontent in rural areas
      • The ongoing protests against the Agnipath programme, agitations against farm laws a year before, and agitation for reservation by agriculture castes are all arguably an outcome simmering discontent due to this jobless economic growth.
      • The recent agitations by the Jats in Haryana and Punjab, the Marathas in Maharashtra and the Patels in Gujarat, demanding, among other things, reservation for their castes in higher education and formal jobs exemplify this new trend.
    • Social inequalities have mounted barriers for economic transition
      • Agrarian capital could not move into modern sectors due to these roadblocks.
    • Inequality in access to education got translated into inequality in other economic domains including wage differentials in India. 

    Conclusion and Way Forward 

    • All the nations which succeeded in achieving inclusive growth in the Global South had land reforms combined with human capital, invested in infrastructure by promoting capitalism from below and began industrialisation in the rural sector. 
      • The structural factor that impedes economic transformation in India needs to be addressed .
        • India needs to learn it from the way most of the countries have done .
    • The strong growth in productivity within the farm sector is crucial for sustained economic growth, an educated workforce is equally necessary to move to the modern sectors. 
      • Therefore equal attention should be given to them.
    • Integrating social and cultural transformation with an economic alternative is critical for policy innovation to address market and non-market discrimination and to remove barriers, especially in the informal and private sector; and to ensure caste has its proper place in the global development policy debate.