Round Table India
You Are Reading
Privatisation and Reservation for SCs and STs

Sabhavat Premkumar

Nowadays, the government is aggressively privatising public sector enterprises. Of course, efficiency may be the driving force behind the shift, but it comes with a slew of consequences. Protests by the general public and discussions in parliament have touched on that aspect. Yet, its impact on Scheduled Castes (SCs) and Scheduled Tribes (STs) has hardly ever been discussed on a public platform. In fact, privatisation has a large impact on SCs and STs. With this as a backdrop, the article tries to highlight that impact concisely.

In India, reservations in employment, education, and the politics around them have a long history. This country has suffered/suffers from the caste system, in which people from lower social strata were/are denied access to education and employment outside limits imposed by social institutions. In an attempt to address the historical injustices and prevalence of discrimination, the constitutional makers brought in reservations under articles 15 and 16 of the Indian constitution.

However, reservations in employment and education are limited to a small portion of the government and public sector Whereas the large private sector, which includes agriculture, industry, and services, and employs more than 80 per cent of SC and STs, is exempt from reservation. Therefore, the privatisation of the tiny public sector would be extremely harmful to the SCs and STs.

The pictures of discrimination in the private sector would provide a compelling case for this. According to studies conducted by Sukhdeo Thorat, an acclaimed scholar in Dalit research: in rural areas, untouchables are not hired in some kinds of jobs and occupations such as cooking in restaurants and in mid-day meal programmes for children or as waiters in hotels. Furthermore, untouchables face discrimination when buying agricultural land and urban rental housing markets. The businesses of SCs and STs have customers from their own communities, and none of the upper castes buy their goods.

 Similar to this, our study on tribes of the Adilabad district in Telangana reported that while tribal males are interested and capable of working in non-tribal enterprises, they are not preferred by non-tribals owing to their physical appearance and accent. Their business-like hotels and small retail shops do not attract customers from other communities due to the perception that tribals are not clean. On the other hand, their forest produce is in demand but at a reduced price. Even, the studies on displaced tribals’ occupations in the states of Odisha and others show that tribals are frequent victims of discrimination at the workplace based on caste and cultural traits.

Adding T.S Papola’s, an economist, study on 1000 randomly sampled factory workers in Ahmedabad, around 69 per cent of jobs held by workers got their jobs through personalised social networks. The recruitment process in factories depends on employers who prefer people mostly from their own communities. Moreover, other studies reveal that these communities face discrimination irrespective of their financial status since the people belonging to the higher castes do not make any distinction between the economically weak and the better off among the discriminated groups. So even the economically better-off need protection. Thus, this shows that there is evidence of discrimination based on caste.

In a way, the Indian government’s withdrawal from the public sector as a part of its privatisation policy creates the potential for passive discrimination against SCs and STs by reducing reservation space. The process of privatisation brings scope to the reduction in employment opportunities for the lower classes in two intertwined ways: first, because the reservation applies solely to public sector employment, it is now reduced; second, there is no reservation as such in the private sector.

As a result, the demand for non-privatisation of the public sector stems from the fact that government-held public sector enabled these marginalised and discriminated groups to participate in employment and labour markets. With privatisation, these groups would be increasingly excluded, and employment possibilities for Dalits and tribals would be severely limited.

Therefore, ensuring proper representation of these groups in employment requires either halting the privation process or bringing reservation to the private sector. If efficiency is the only reason for privatisation, the government can bring out proper strategies to rectify the situation. Though being a welfare state, if India continues to push privatization, it is prudent to introduce reservation in the private sector. Apart from that, SCs and STs in general need a bigger push, in the form of higher reservations and reservations in the private sector, to bring all the members of these communities on a level with other communities. Reservations equivalent to their population percentage in total would just add individuals to the employee composition rather than ensuring larger participation.


Sabhavat Premkumar hails from Hyderabad, Telangana. He has completed his Integrated MA in Economics at the University of Hyderabad and is currently pursuing a doctoral degree in economics at the Centre for Development Studies in Thiruvananthapuram, Kerala.

Leave a Reply