By Zachary Latif

As India & Indians (and the rest of South Asians but to an arguably lesser degree) ruminate on caste, which has taken on new life in the “quotas” system and the electorate (separate electorates for backward castes) means that one of the most controversial institutions of Indian society needs to be actively rethought.

Reform and not revolution should be the mantra going forward; reform probably needs to think about how to broaden the “Old Boys Network”, which at the moment seems to be staffed most by upper caste Hindus. Also as endogamy tends to become less prevalent in urban South Asia (through college & the work place) it seems a shift away from Congress “Big Capitalists patronage” (ironic but not surprising for a socialist party) towards a more devolutionary and autonomous economic model will probably be the best step forward. The Indian government has so far had excellent intentions in attempting to dismantle caste and communal considerations however if it were to limit its role preventing upper caste aggression towards lower castes (which seems to be a particular problem in Bihar) and encourage a more entrepreneurial society rather than a professional one (as experience has shown even in Britain that it is always the vested elite who benefit most from loopholes and entrances to high education, some silly figure like private schools students 55 times more likely than state school students to go to Oxbridge). To neutralise caste as an economic hindrance and social barrier it is best to move from a technocratic-bureaucratic society (British Raj Nehruvian legacy) to a more autonomous-capitalist-entrepreneurial society. It seems much of the vaunted Indian economic growth is only creating the formation of super-oligarchs and a hope & prayer that trickle down economics means that eventually the rest of the Indian population will benefit. From an excellent speech on whether “Is there a threat of Oligarchy to India“.

To see where, let me digress a little. My former classmate from IIT, Jayant Sinha, recently sent me a spreadsheet he had compiled. It lists the number of billionaires per trillion dollars of GDP for the major countries of the world. Guess which country tops the list? It is Russia, with 87 billionaires for the 1.3 trillion dollars of GDP it generates. “Of course!”, you will say – these are the oligarchs who stole the country’s mineral resources, who participated in the Loan for Votes scheme, etc. But guess which country comes second? It is India with 55 billionaires for the $1.1 trillion it generates.  

Some comparisons might be useful to convey to you how extraordinary this number is. Remember, our per capita GDP is tiny, even compared to Russia’s. So we are really an outlier in terms of the wealth of the extraordinarily wealthy relative to per capita income. Brazil, which is thought to have extreme inequality of income distribution, has only 18 billionaires despite a greater GDP than India. And Germany, with three times India’s GDP and a per capita income forty time India’s has the same number of billionaires.  You might think these are the software billionaires. But there are not that many among India’s billionaires. Indeed, three factors – land, natural resources, and government contracts or licenses – are the predominant sources of the wealth of our billionaires. And all of these factors come from the government. 

Why should this be a source of concern? We should certainly welcome it if businessmen make money legitimately. People like Narayanamurthy, Azim Premji, and Ratan Tata are widely respected in this country, and deservedly so. I also do not want to say that every government license or contract should prima facie be suspect. We have extremely efficient private banks and telecom companies that obtained their start from a government contract or license. But I do want to argue that the numbers are alarming – too many people have gotten too rich based on their proximity to the government. If Russia is an oligarchy, how long can we resist calling India one?

The Persistence & Endurance of ethnicity in a globalising world

We are conditioned to think that in the advent of globalisation that somehow the traditional markers of religion, caste, creed and ethnicity will simply disappear. Now if we note that most ethnicities are known by the language they speak (reinforcing Von Mises’s thesis that language and nationality are correlated) and that English is probably going to only gain in importance owing to the internet and other related factors as lingua franca. That does mean that eventually many ethnicities will switch to English as their mode of communication, hastening the already dramatic decline in languages around the world.

However ethnicity is a very adaptable and fluid construct and not always correlated to race or language as we imagine it to be. Instead individual and communal identity is very contextual and related to socio-economic factors. Amy Chua’s book “World on fire” probably highlights best that in a globalised society ethnicity will correlate to socio-economic status (the Chinese in South East Asia particularly in Thailand where the entire upper segments seem to have some form of Chinese ancestry; also that native Thai who marry Chinese actually have “Chinese” not Thai children though they speak Thai). In a very crude way Britain itself is divided into “different ethnic groups” with Anglo-Normans forming the mainstay of the upper classes, the base population Anglo-Saxons and the monarchy Germanic. Of course centuries of inter-marriages have completely blended the categories but these divisions persist in a subliminal form.

It seems likely that only the very elite of society will have a universalistic approach, and possibly be more sceptical and secular than the rest of society, whereas the other classes will cling on and reinterpret/reinvent other forms of identity as an anchor in an increasingly enlarged global order.