Friday, June 18, 2010

[ZESTCaste] The business of caste in India

Posted: Mon, Jun 14 2010. 9:23 PM IST
Economy and Politics

The business of caste in India

Globalization has given new opportunities to some castes while it's
been less kind to others. But caste stays relevant as an economic

Priyanka P. Narain & Pallavi Singh

Mumbai/New Delhi: Images of adventure reside in their collective
memory—journeys into the cobbled streets of Antwerp to compete with
powerful Hasidic Jew merchants for grubby stones, which, when polished
and cut, would sparkle and dazzle. The journey that transformed the
Palanpuri Jains from cloth and perfume traders into moguls of the
diamond empire was challenging: The language of Antwerp was strange to
their ears and its exotic meats forbidden to their vegetarian palates.
But during those days of mercantile entrepreneurship, this community
coped with challenges together and forged ties of kinship that "have
survived till today and have provided the basis on which we have built
this industry in India," says Rajiv Mehta, chief executive officer of
Dimexon Diamonds Ltd.

Far from the wealth and sparkle of Antwerp, for the community of Oriya
plumbers (mostly scheduled castes) living in the National Capital
Region, globalization has meant opportunities where there were none.
Hectic construction has created brand new suburbs of Gurgaon,
Ghaziabad and Noida, and helped Oriyas bring jobless kinsmen from home
villages, teach them the skills of the trade and offer them to a
construction industry that is booming around Delhi. Today, around 90%
of the city's plumbing business is run by Oriyas.

But to the Bunts of Karnataka—former warriors and landowners who
created the famous Udipi restaurant chains, established restaurants,
hotels and resorts—globalization has not been so kind. Raghu Shetty,
who set up the first catering business in Mumbai in the late 1970s,
says the community is unable to keep up with new Indian tastes. "The
culture of five-star weddings, glamorous family and business
events…and our job is not very rewarding. The children don't want to
run restaurants at street corners…you see all our old Udipis shutting
down. No one needs them any more."

These stories reflect the fact that there is no clear answer to the
question: How have community businesses adapted to India's growth in a
globalized world? There is little data to go by and anecdotal evidence
meanders in all directions.

Business legacy: Diamond merchant Pankaj Shah (wearing a garland)
leaving for his first trip to Antwerp in 1972. He had relatives in
Antwerp who ran brokerage firms through which he could buy the rough
diamonds he would select. Abhijit Bhatlekar/Mint

But as the country debates the idea of a caste-based census and
policymakers grapple with the possible political ramifications of such
data-gathering, the relevance of caste as an economic entity remains
intact, says Tirthankar Roy, professor at the London School of
Economics and the author of Company of Kinsmen, a book that examines
how enterprise and entrepreneurial communities adapted to

Claiming that economic cooperation was the basis of defining caste,
Roy says that "these (caste-based) groups are protecting access of
outsiders to assets—be it skills, people, capital…sometimes
successfully, sometimes not. They are guilds, rooted in blood, rather
than rules. The ties run so deep that if anyone breaks a business
rule, they can be excommunicated from the community."

And because of the efficiency of this economic model, many communities
have drawn inspiration from this idea over the ages, "and that is
unlikely to change. I see no reason why world markets would not help
caste-based community business to expand their business and strengthen
their ties. Of course, some communities will prosper, others may not.
For instance, the Marwaris—who had prospered in the last century as
the manufacturing community—did not do so well after. But I believe
the idea will endure," said Roy.

Also Read previous stories in the series

Diamonds are forever

Among the Palanpuris, diamonds have created a mutual dependence that
has not only endured but also thrived in a globalized world.

"Thirty years ago, when I was growing up, we were trained to think
that one day, we will also play with these shiny stones," says Mehta,
splaying imaginary diamonds on the table as he speaks. "You cannot
underestimate how much power that knowledge gives—you become a risk
taker, you are willing to put yourself out on a limb if it will expand
the business for your sons who are there with you. That kind of quick,
risky, urgent decision making can never happen in a corporate setup,"
explains Mehta.

Over the last 50 years, they have trained their sons in the art of
identifying diamonds among stones in the diamond bazaars of Antwerp.
Pankaj Shah, a diamond merchant, remembers his Antwerp trip of
1972—the time he began to choose rough diamonds that held most promise
of dazzling when polished.

"I was 20. My family thought it was time for me to learn. At that
time, relatives used to live in Antwerp and run brokerage firms. We
could select diamonds ourselves, but we could buy diamonds only
through a brokerage firm. So we stayed in homes of relatives. Since we
were Jains—there were no vegetarian restaurants in Antwerp at that
time—we ate in their homes. We simply selected the rough diamonds we
wanted to buy and the brokerage firm would complete the formalities
and export them to us." Those with no family lived in cheap,
hovel-like hotels, ate at common Jain kitchens and practised their

In an open world economy, Palanpuris have taken their business to
far-flung countries in Asia, Europe and the Americas and while "it's
hard to give exact figures in this industry, the Palanpuris have
retained 60-70% of the market…as long as the world needs diamonds and
succession remains intact, I think we will stay in the game," says

New opportunities

For the Oriyas, the last two decades have meant opportunity—to get a
job, to live in a city, to educate their children, to give them a
better life. Opportunities that they grabbed together, helping each
other along the way, each man pulling a few kinsmen out of a bleak

Like Niranjan Parida did.

On a January morning of 1993, a teenaged Parida boarded a Delhi-bound
train with a thousand rupees, without informing his family. He says he
ran away from his home to escape the purposelessness that had seeped
into his village, Ratnapur in Kendrapada district in Orissa, where the
only opportunity available was for daily wages. "That is not (what) I
wanted to do," says Parida.

His impulsive journey to the national Capital is not a lone migrant
story, but a chain of migrations of scheduled caste Oriyas who have
escaped the bleakness of Orissa's villages, curiously enough, for
plumbing jobs.

When Parida arrived, he knew no one and spoke little Hindi. He pounded
the streets for a job, slept on footpaths—till he happened to meet a
woman from his village. "Her husband was a contractor for plumbing
jobs in Delhi. She took me home and he trained me in plumbing," he

Within months, he began to land contracts. Seventeen years later, thin
and blackened from working in the unforgiving Delhi sun, he makes
Rs10,000-12,000 per month. He also does what he insists people of his
community have traditionally done—bring people from the village for
plumbing jobs. "I brought almost a dozen people from my village here.
I train them and get them employed," he says.

But plumbing is not the only job that the community does. Chandrakant
Sahu, who speaks better Hindi than Parida, explains how the community
also helps Oriya kinsmen become electricians. When Sahu migrated to
Delhi from Orissa's Betali village, a relative got him a job at an
electrical shop. Now, "Parida suggests my name for electrical fittings
in the house where he is working. His good at his work, his
recommendation matters," he says, referring to a system where they try
to secure contracts for kinsmen. "We have a human network (that) helps
each other since we are emotional about our roots," he says.

Changing with the times

And yet, for the Bunts—who created the chain of Udipi restaurants,
took over the Irani tea houses, bought hotels, established catering
businesses, highway eateries and dhabas in the city to escape the
bleak poverty of their villages—the changing world has not heralded
similar good news, but nor has it broken the spirit of collaboration
among kinsmen.

For many reasons, the Shettys are finding it hard to stay afloat.
Jairam Shetty explains, "First, so many other communities—Gujaratis,
Marwaris and Punjabis—have come in and taken away our market. We could
not cater to all those tastes nor compete with the money they brought
in. Secondly, in the last few years, international hotels have come to
India. They serve international cuisines and tastes have changed.
Also, marriages have become very fancy. Finally, succession is a
problem since business isn't glamorous and the children do not want to
take over. We are just waiting until they are settled."

For those who built the business from the ground up, the change is
bitter-sweet. "We are happy that our children have more opportunity
than we did. That is what we wanted when we came to Mumbai. Our
community is still very strongly interconnected, only now we are
focusing on education and social issues. This business has brought us
so far—now it might be time to slowly move to better things as a
community together, supporting each other," says Raghu Shetty, owner
of Santosh Catering, and the uncrowned grandfather of the Bunts in

Like many others, Shetty was a teenager when he left his ancestral
village near Mangalore for a better life in Mumbai. For 20 long years,
he worked in a little restaurant in Worli— washing dishes, cleaning
tables, then waiting at them and gradually, becoming a manager. "All
the while, I watched the chef. I learnt cooking, everything about it,
and when the time came, I started my own catering business in the
city," he says. Jairam Shetty, owner of Ajanta Caterers in Mumbai,
says: "This business is not very capital-intensive. We just needed a
supportive human network, and that we had."

That collaboration still exists, says 67-year-old Raghu Shetty. "We
want families of the community to do better with every generation. If
the catering work will not take us further, then it is time for us to
leave it behind and find another opportunity that will give our
children a better life," he smiles. "As long as the community supports
each other and stands as one, it will all be okay…"

This is the second of a five-part series on the changing role of caste
in a globalized India.

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