Saturday, May 22, 2010

[ZESTCaste] Dishonesty in Caste Census (Opinion)

Surjit S Bhalla: Dishonesty in Caste Census

The Congress party needs to prove to the doubters that it has some
values, that there are some lines that it will draw
Surjit S Bhalla / New Delhi May 22, 2010, 0:16 IST

On the grounds that more information is always good, or at least
cannot hurt, the Indian government is about to embark on a new social
experiment — caste will be included as a question in the forthcoming
2011 Census. This will be a first in independent India; the last time
caste was included as a question, and the only time, was in 1931. At
that time, several castes petitioned the government to classify them
as a caste higher to one they actually were. Census 2011, if it does
include caste, is likely to show a race to the bottom, with at least
20 percent of the Hindu population declaring themselves as Other
Backward Castes (OBCs) when they actually belong to an upper caste.
The question the social engineers in the political parties have to
answer is whether gathering of this false information serves any

Most of the arguments over the inclusion of caste in the census,
whether made by politicians or the so-called liberals and/or so-called
intellectuals supporting this crass exercise, centre on the following
two propositions. First, the government targets a large segment of the
population for redistribution of income. The government has, over the
last 60 years and starting with our fundamentally flawed Constitution,
allowed for reservations in access to education, jobs, etc. for the
Scheduled Castes (SCs) and Scheduled Tribes (STs). Note that our
flawed Constitution did not talk about the need for affirmative action
to tackle the justifiable cause of redressing inequality; no, the
social engineering objective then, as it is today, was to mandate
equality via quotas. In the 1990s, an additional quota was added — a
quota for the OBCs. Together with the SCs/STs, the quotas corner at
least 60 per cent of the population (approximately 27 per cent SCs/STs
and 36 per cent OBCs).
India OBC
Population in 1999-00 (millions) 1,000 360
Population in 2004-05 (millions) 1,080 440
Growth in population over 5 years (millions) 80 80
Growth in population (millions per year) 16 16
Avg % change in population per year 1.60% 4.40%
Increase in OBC population if avg rate of
growth (millions per year) 1.6*
360/100= 6

Excess growth in OBC population
(millions per year) 16-6 = 10

[A] Known fertility rate for Indian women 2.5
[B] Number of women in age group 20-40 (child-bearing age) as % of
total population 30%
[C] Estimated fertility rate for OBC women assuming [B] is same for OBC 2.5*
(4.4/1.6) = 6.9

From [A] and [C] each woman bears a child every 8 years
3 years

Note: Data are from NSS surveys of 1999-00 and 2004-05

The second proposition follows from the first — if you are targeting
more than 60 per cent of the population on the basis of caste, then
does it not make sense to count the caste accurately? Of course, it
does. So the liberal intellectual, and the opportunistic politician,
rests her case — we must include caste in the census.

The Indian politician has always refused to acknowledge the red blood
of its citizenry. She believes she can mandate and legislate and the
desired results will follow. No amount of evidence will convince her
that people act according to incentives. When this fact is pointed
out, she knowingly retorts: yes, people acted according to incentives
and look where it got the world in 2008?! That the retort is a non
sequitur totally escapes such learned intellectuals.

That people do act according to incentives is revealed by the
following "natural experiment". In 1999-2000, the large-scale NSS
survey asked the caste question for the first time and found out that
approximately 36 percent of the population was OBC (this includes
about 4 per cent Muslim OBCs). When the same survey was repeated five
years later in 2004-05, the share of the OBC population had shot up to
41 per cent. The question one needs to answer is whether such an
increase could come about due to "natural" forces. The table
illustrates the simple incentive math behind the increase. About 50
million people raced to the bottom in classifying themselves as OBCs
when they most likely were not. Given that the Hindu population is
about 55 per cent of the total, about two in every 10 non-OBC Hindu
lied to the NSS. Perhaps lying is a bit extreme accusation — it could
be that the OBCs, knowing that they were now eligible to have more
benefits for their kids, went out and celebrated by producing more

That might be a bigger lie. As the table shows, for the celebration to
be realistic, the OBC women would have had to have catapulted
themselves from a national average fertility rate of 2.5 to an 18th
century level of 6.9! Or, phrased differently, in 1999-2000, the
approximately 110 million OBC women in the age group of 20-40 started
producing one kid every three years versus the one kid every eight
years they produced prior to the incentive effects of the OBC quotas.

There is one additional aspect of the incentive effect that I don't
understand. And that is the attitude of the Dalits towards the
introduction of the quotas for the OBCs. The natural Dalit argument
should be — look, quotas were introduced for SCs/STs as at best a
partial compensation for the centuries of discrimination practised by
Hindus, both OBCs and non-OBCs. How dare the OBCs now demand
compensation at our expense. There is no question that the real losers
from the OBC quotas, and inflated OBCs in census, will be the Dalits
and the STs. Their status as recipients of government compensation
gets diluted when others are also given a special status. Today the
OBCs, and tomorrow justifiably the Muslims, and the day after,
justifiably, the poor Indian citizen, and the day after, women. Pretty
soon, from being a special status of a quarter of the population, the
Dalit will become a non-special 90 per cent of the population.

A final point — history, philosophy, religion, all teach us the value
and importance of drawing a line, a Laxman Rekha, which should not be
crossed no matter what the (evil) temptation. If the Congress accepts
caste as part of the census, it will prove to all the doubters that it
is a valueless party, a party now reaching its nadir. It is a party
for sale to the highest bidder. How can they then claim that red blood
does not flow in our veins?

The author is chairman of Oxus Investments, an emerging market
advisory and fund management firm. Please visit for an archive of articles et al. Comments
welcome at:


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