Scheduled Caste entrepreneurs and millionaires: India
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Capitalism’s erosion of the caste system
Cato Institute, July 21, 2015
By Swaminathan S. Anklesaria Aiyar
Capitalism’s Assault on the Indian Caste System
How Economic Liberalization Spawned Low-caste Dalit Millionaires
Dalits—once called untouchables—con-stitute one-sixth of India’s population. They traditionally occupied the bottom of the caste hierarchy, in the filthiest occupations—cleaning toilets, cremating the dead, and handling dead animals. These jobs ensured rampant disease and early death. Touching the dalits was taboo for the upper castes. When India became independent in 1947, its liberal constitution banned caste discrimination and reserved seats for dalits in the legislatures, government services, and some educational institutions. These reservations created a thin upper crust of dalits in politics and govern-ment services. But caste discrimination remained wide-spread and savage, especially in rural India. However, major changes were sparked by economic reforms in 1991, opening up a once-closed economy. Dalits have increasingly managed to get out of their his-torical occupations and move into new ones. One district survey in Uttar Pradesh shows the proportion of dalits owning brick houses up from 38 percent to 94 percent, the proportion running their own businesses up from 6 percent to 36.7 percent, and the proportion owning cell phones up from zero to one-third. The Dalit Indian Chamber of Commerce and Industry now boasts of over 3,000 member-millionaires. The former serfs have now become bosses hiring upper-caste workers. The arrival of the competitive market and its creative destruction broke old caste bonds and facilitated the shift of dalits to new occupations. India’s socialist poli-cies achieved only 3.5 percent annual growth for decades. Licences and permits were required for all economic ac-tivity. Upper-caste networks monopolized these and kept dalits out. But the 1991 economic reforms dismantled controls, accelerating growth and competition. Fierce competition soon ensured that the price of a supplier mattered more than his caste. This created openings for dalit entrepreneurs, who were able to crack traditional upper-caste monopolies. The dalit revolution is still in its early stages, but is unstoppable.
INTRODUCTION: DALITS AND THE CASTE SYSTEM Hindus constitute four-fifths of India’s 1.2 billion people. They have historically had a caste hierarchy attributed to the ancient Hindu law-giver Manu. This system divided society into four major divisions or varnas—the brah-mins (priests/intellectuals), kshatriyas (war-riors/ landowners), vaishyas (businessfolk), and shudras (farmers and laborers of all sorts). Each varna, in turn, consisted of hundreds of jatis, usually members of a specific occupation (such as fishing or metal working). Both varnas and jatis are called castes. Below this four-fold hierarchy, seemingly like dirt below true humans, lay a fifth group—the untouchables. They now have a more politically correct name—dalits, meaning “the oppressed.” Traditionally, the various dalit castes did the filthiest jobs—cleaning toilets, handling dead animals, flaying and tanning skins, cremating the dead. They also did agricultural work and anything else demanded by their upper-caste masters. Their filthy occupations were hotbeds of germs, condemning them to disease and early death. Because disease seemed to follow them everywhere, it became taboo for the up-per castes to have any contact with them, espe-cially in regard to food or drink, and so they were called untouchables. In some areas, a Brahmin was obliged to have a bath if touched even by the shadow of an untouchable. Dalits were usually not allowed to enter Hindu temples: they had to pray from outside. The Hindu theory of karma held that those who had committed truly evil deeds in their last life were reborn into deservedly terrible condi-tions, such as untouchable households. Hence, Hindu society did not aim at ameliorating their living conditions, which were rationalized as just punishment for earlier sins. Untouchables had no rights, could be ordered around at will by the upper castes, and could be assaulted with impunity. They were often bound by debt or tradition to upper-caste masters. The Rama-yana, Hinduism’s famous epic, has an episode where the death of a Brahmin child is declared by priests to be the result of a terrible sacrilege by somebody. The villain is identified as an un-touchable, Shambuka, who had the gall to at-tempt brahminical ascetic rituals, and he is duly beheaded for this cardinal sin. This story truly sums up historical upper-caste attitudes. The untouchables lived in segregated parts of a village, forbidden to draw water from wells and tanks used by upper castes, forbidden to get education, and forbidden to sit or eat with the upper castes at village festivals and wed- dings (they would be fed in a separate place). This was Indian-style apartheid.
THE GRADUAL EMANCIPATION OF DALITS
Historically the caste system was not en-tirely rigid: some movement in and out of castes was possible. Anybody wielding a sword could become a warrior, and a few untouch-able warriors even became kings (such as the Gaekwad dynasty of Baroda state). Some, like Valmiki and Ravidas, became famous religious leaders. But, overwhelmingly, they remained dirt poor and oppressed. In the 19th century, a number of Hindu re-formers began to question the caste system and the morality of untouchability. Mohandas Karamchand Gandhi, who led India’s move-ment for independence from British rule, was a social reformer seeking to end untouchability long before he became a political agitator. He won the support of a Westernized upper crust of Hindus in the independence movement, including Jawaharlal Nehru, who would later be India’s first Prime Minister from 1947 to 1964. While many traditional Hindus regarded untouchables as being outside Hindu society proper, Gandhi was determined to integrate them into the Hindu system with honor.2
He sought to replace the word “untouch-able” with “harijan,” which means “children of God.” This became the standard political us-age in India after independence. However, in legal-bureaucratic terms, the various untouch-able castes were called Scheduled Castes, from being identified in a schedule in the constitution. In the 1970s, radicals among u
