The New Deal

THE OXFORD LEARNER’S DICTIONARY describes a beneficiary as someone who “gains as a result of something”. Of the many, often similar meanings of the word offered by leading dictionar­ies, this seems the most direct and accurate. A per­son may benefit or receive an advantage by way of money due to the action of someone else. These actions can spring from an individual act, such as willing property to a successor or decisions of the state across a range or domains like tax rates, affirmative action, and welfare schemes. State action is, in some way or the other, intended to empower individuals or a class of society. Putting more money in the hands of people through a tax cut or providing increased ac­cess to education and jobs, are actions that improve options for individuals and certain social classes. For long, tax relief has been associated with the middle class (read as salaried classes) while quotas and reservations were for the socially disadvantaged who, as a corollary to their social status, were also poor. There is validity to the linkage between wealth, or the lack of it, and social background. The need to provide a leg-up to the deserving is the basis of reservation. But what happens when criteria such as gender, eligibility for pro-poor schemes, land-holding limits and income are applied in ad­dition to just caste? And what happens when rising incomes begin to blur caste and class lines?

On a visit to Ayodhya ahead of the opening of the Ram temple to pilgrims, Prime Minister Narendra Modi met Meera Manjhi, recipient of the 10th crore Ujjwala cooking gas connection. During the interaction, Meera and her family said they were also “beneficiaries” of the government’s housing scheme, had got a power connection, and recently water supply as well. The family was also receiving free foodgrains under the public distribution system (PDS). A survey of the performance of welfare schemes could be conducted by way of a caste-weighted sample based on demographics. Another way is to slot districts as per development parameters and conduct stratified random sampling with respondents selected as per criteria like gender, age, occupation, and income. The People Research on India’s Consumer Economy (PRICE)-ICE360 2014, 2016 and 2021 chose the latter route. Though the survey did not specifically provide weightage for caste or religion in terms of share of population, the results showed that Other Backward Classes (OBC) households were well represented in beneficiary groups as were Scheduled Castes (SC) and Scheduled Tribes (ST). Religious minorities, too, were recipients of welfare benefits and, more encouragingly, were reporting higher growth in incomes. Out of every `100 disbursed under the PM Kisan Samman Nidhi (`6,000 a year per farmer as per eligibility) in 2020-21, `54 was going to OBC households, `21 to the general category (forward classes), `20 to SCs and `5 to tribals. The share of OBCs in the PM Jan Dhan cash transfers was 49 per cent in 2020-21 and 32 per cent for SCs. In the senior citizen, widows and differently-abled categories, 49 per cent of beneficiaries were OBCs. Under the Mahatma Gan­dhi National Rural Employment Guarantee Act (MGNREGA) and Ayushman Bharat health insurance categories, too, OBCs were 38 per cent and 53 per cent of the beneficiaries. The share of OBCs among beneficiaries of farm-linked schemes is ample reflection of their land holdings as compared with other caste groups. In the MGNREGA payouts, OBCs were closely followed by SCs, who receive 35 per cent of the payouts—again reflecting a higher presence of Dalits in labour work. If the representation of different caste groups is seen in terms of economic well-being, education and incomes, we get to see more interesting results. If the middle three quintiles (essentially the middle class) are ex­amined, the representation of various caste groups is fairly even. The caste diversity in salaried respondents shows that while the general category leads, OBCs, SCs and STs are not all that far be­hind. On educational parameters and in the non-agricultural labour segments, it can be seen that SCs and STs still have some catching-up to do. This is not to say that education levels are not rising. Just 13 per cent of SC households are headed by people who had studied till at least higher secondary in 2004-05 and this rose to 32 per cent in 2020-21. It is evident the assumption that there is a one-to-one co-relation between poverty and so-called ‘lower’ castes may require to be re-examined.

“Government welfare schemes are making the playing field more even and promoting equity. We can see that OBCs are well represented among beneficiaries. But we are also see­ing that implementation and quality of governance matter a lot as also the level of economic development. For example, OBCs in Gujarat are doing better than the general category in Bihar,” Rajesh Shukla, managing director and CEO of PRICE, tells Open. The point he is making, supported by the data generated by PRICE-ICE360 surveys, is that a large number of people from groups like SCs, STs and MBCs (Most Backward Classes), at the lower end of the socio-economic spectrum, are languishing in low-income states where the forwards are doing better but not spectacularly so. States with a higher percentage of OBC popula­tion include Tamil Nadu (68 per cent), Uttar Pradesh (51 per cent), Bihar (64 per cent), Rajasthan (46 per cent), Madhya Pradesh (42 per cent), and Gujarat and Karnataka with 39 per cent each. The distribution of households in the self-employed agriculture sector (SC 15 per cent, ST 22 per cent, OBC 20 per cent, general 22 per cent), in self-employed non-agricultural (SC 15 per cent, ST 10 per cent, OBC 20 per cent, general 24 per cent) and agricultural labour (SC 10 per cent, ST 9 per cent, OBC 5 per cent and general 5 per cent) shows an even spread, indicating that it may not be easy to identity a certain activity predominantly with a caste group. Indeed, the proportion of SCs, STs and OBCs is higher in non-agricultural labour at 34 per cent, 34 per cent and 25 per cent, and this is also a reason why several Central schemes target this section which is largely eligible for free rations under PDS, hous­ing and Ayushman Bharat. The distribution of OBC households across all five income quintiles ranges from 18-22 per cent and is significantly behind the general category only among the top 20 per cent earners, indicating the rapid strides of this section of society that has gained political representation after making social and economic progress.

THE CASTE-WISE DISTRIBUTION of welfare benefits and a narrowing of gaps in the distribution of social groups in education and incomes reflect the targeting of government benefits as well as a recovery in the economy post-Covid. The higher representation of SCs, STs and OBCs in non-traditional occupations and in the middle classes shows that empowerment is delivering in terms of improved social and economic status while the rising tide of the economy, even while accounting for sectoral variations, was providing employment and steady incomes. When the VP Singh government announced its deci­sion to implement the Mandal reservations, the Bharatiya Janata Party (BJP) countered the caste-mobilisation with the Somnath to Ayodhya yatra. At the time in the early 1990s, BJP’s appeal among OBCs was limited and, after the boost provided by the Ram temple movement, ebbed in the mid-1990s as the party found it challenging to take on caste titans like Mulayam Singh and Mayawati in Uttar Pradesh (UP) and Lalu Prasad in Bihar. The party’s decision to project Modi as its prime ministerial candidate in 2014 coincided with a peaking of the appeal of the Mandal parties, partly because of the dissatisfaction of non-dominant OBCs who felt excluded under Samajwadi Party (SP) or Rashtriya Janata Dal (RJD) raj. There was also a rallying of forward castes towards BJP as they saw Modi as a viable choice and decided to abandon their occasional endorsement of Mandal leaders that was at least in part due to the saffron party’s decline. The welfare schemes pursued by Modi after he assumed office do not exclude any social group while ensuring sections like SCs and STs contin­ued to receive due attention. The diffusion of benefits, which are not promoted as pro-caste, is reaching SCs, STs and OBCs because they self-select as beneficiaries given the inclusion-exclusion criteria. It is also not a surprise that there is a sizeable representa­tion of Muslim women among Ujjwala cooking gas beneficiaries given the community’s historical social and economic lags. The tangible delivery of benefits helped BJP counter incumbency and build support in its favour in Madhya Pradesh last year where it has been in office since December 2003, barring a short inter­val. Voters from the OBC and other socially disadvantaged communi­ties were unimpressed by Congress’ promise of a caste census when they could see benefits dropping into their bank accounts. BJP failed to re­turn to power in Karnataka earlier in 2023 because it was unable to create awareness about its initiatives, indif­ferent governance, and the impact of higher inflation post the Ukraine war. Congress mistakenly con­cluded that its win was due to hyper populism and sought to repeat the formula in the Madhya Pradesh, Ra­jasthan, and Chhattisgarh elections and ended second-best by big margins in all three states. Having won mandates through a shrewd mix of governance and welfare schemes—without taking recourse to promises like loan waiv­ers or unrealistic doles—BJP is now banking on the beneficiaries of its schemes to make it past the finishing line in the Lok Sabha polls due a few months from now. To that extent, it will truly be the year of the beneficiary with voters from deprived sections re­ceiving something like cradle-to-grave assistance, ranging from free school uniforms to old-age pensions.

There are limits to how much welfare schemes will lift the fortunes of the masses. In any case, the success of welfarism rests on efficient governance and a healthy economy resulting in rising revenues. The annual average household income at 2011-12 prices for rural areas increased by 10 per cent in 2016-21, which included a decline during Covid, and rose by 16 per cent in 2021-23. For urban households, the rise in incomes was more muted, 8 per cent in the 2016-21 period and 7 per cent in 2021-23. Looking at the distribution of households in various occupa­tions, the PRICE survey found for self-employed agriculture that it was 20 per cent in 2015-16, 20 per cent again in 2020-21, and 23 per cent in 2022-23. For the self-employed non-agricul­ture category, it was 22 per cent, 15 per cent and 18 per cent for the same reference years. The changes in the salaried category are the most arresting, with the percentage of households grow­ing from 22 per cent in 2015-16 and 23 per cent in 2020-21 to 39 per cent in 2022-23. In 2022-23, the percentages of households engaged in agricultural labour and non-agricultural labour were 8 per cent and 9 per cent respectively. Growth in average household incomes is impressive for OBC households at 17 per cent for 2020-21. The trend is positive for other social groups as well though the rate of growth declined sharply for STs, the rea­sons for which are not immediately clear. Interestingly, the an­nual average household incomes for Muslims have risen from 6 per cent in 2015-16 to 21 per cent in 2020-21. All these data sets point to a churn in India’s social segments where stratification is weakening, mobility is increasing and the pace of change accelerating. As has been pointed out by several economists, poor governance scores are depriving more people in states that are developmental laggards. The promise of a caste census as a magic wand that will suddenly make developmental deficits vanish is a chimera, and those below the poverty line as well as the newly emergent middle class seem to instinctively grasp the pitfalls of such pledges. There is a native common sense at work that carefully weighs the credibil­ity of competing manifestoes.

The distribution of beneficiary households by caste shows that OBCs comprise between 38 to 63 per cent of recipients of cash trans­fers and payments under schemes like PM Kisan Samman, Jan Dhan, support for seniors, widows and Divyang, MGNREGA and Ayushman Bharat. This number is tangible and provides an answer to the question whether caste census and similar political slogans can work. The access of SCs, STs and OBCs to benefits that translate into solid assets like houses, vendor carts or shops binds them to BJP and Modi who has recognised the utility of personalising his message through the ‘Modi ki Guar­antee’ slogan that is a progression of the ‘Modi hai to mumkin hai’ formulation. The prime minister enjoys a high level of credibility with the socially disadvantaged, the aspiring classes as well as a large section of the middle classes that see in him the possibil­ity of economic progress and cultural rejuvenation. For his op­ponents, the challenge lies not only in the possibility that caste appeals fail to move the targeted section of voters but also that caste-income-deprivation faultlines are becoming less distinct than has been the case. The dual movement of caste groups on developmental and income parameters is opening the doors to more diverse growth. This might be a more fruitful area of study than the traditional measurement of inequality which, while not irrelevant, needs to be supplemented with a wider inquiry as otherwise important social changes and their implications will be missed. The agenda for the 2024 General Election was set months in advance. The results to the Assembly elections at the end of 2023 brought to the survey the social and political ferment that lay just below the surface. It was not invisible to a discerning eye but just a little obscured by competing noises in the political bazaar.

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