FDI in retail may bring in growth, but will the Dalits benefit?

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There are several aspects to allowing FDI in multi-brand retail. Despite a marathon discussion on the impact of FDI in retail in the Parliament, none of the MPs said a word about how the move would affect the Dalits and tribals. The fact that most of the Dalit and tribal MPs have scant knowledge of economics could be the reason why they could not raise their voice in the House. In 1991, when the new economic policy was declared, it was thought that the existing trades and occupations, which are caste based, will disintegrate giving way to a free economy where caste and class wouldn’t be seen as barriers for people wanting to flourish.

Although people from upper castes could avail the opportunities to do well in trades traditionally held by Dalits and backward classes, the opposite, unfortunately, didn’t quite happen. So far the development of Dalits and tribals go, they stand to lose from privatisation and globalisation. The upper caste people, however, have considerably gained from privatisation and globalisation and goes without saying, will benefit from FDI in multi-brand retail now.

Several new opportunities have opened up as a result of privatisation and liberalisation, while Dalits and tribals have hardly gained anything from the burgeoning telecom, I.T., retail revolution, electronic media and the service sector. Can anybody give proof whether a single Dalit or adivasi has a share in any of these sectors? What does anyone say about their share in these areas when reservation appears to be on its way out?

In almost all government departments, employees and officers are retiring but no further recruitments are being made. In view of the increasing number of educated people among Dalits and tribals there should have been more recruitments in the government sector—one of the reasons why their progress has shown a dip. This situation can be understood better by an example of the situation in the Income Tax Department. While in 1997 there were about 62,000 employees and officers against the total number of tax payers of around 1.25 crore, at present when the total number of tax payers is more than 4 crore, the number of employees and officers in the department has gone down to around 45,000.

It is not that workload in the Income Tax Department has not increased, rather it has increased manifold, but it has been outsourced as a result of which both money and employment opportunities have gone into the hands of businessmen and the backward classes have suffered a setback. So far as Dalits and tribals are concerned, it can be said that privatisation and liberalisation are not in their interest. In Delhi, at Mohammadpur village, which is just behind the Bhikaji Cama Place, a survey of six salons was done and it emerged that the proprietors of all the six salons belonged to the upper castes. At one point of time, this profession was in the hands of barbers, but it has now gone into the hands of upper caste. Similarly, shoe manufacturing was traditionally a Dalit profession, but now big corporates are engaged in the business, thus displacing the Dalits. Similarly, washing clothes and dry cleaning, traditionally a Dalit job is now in the hands of upper caste people. All this has happened because of privatisation and globalisation. Management of all temples in the country lies in the hands of Brahmins. There are lakhs of temples in the country and crores of people depend upon the revenue generated by these temples. Accordingly in a free economy, Dalits and backward classes should also have got opportunities in this upper caste occupation. The approximate value of the Padmanabha Temple in Kerala is about Rs. 1 lakh crore, which lies exclusively with the Brahmins.

Without going into the merits and demerits of FDI in retail, it can be said with certainty that SC/STs are not going to be among those to be benefiting from it. With FDI, multi-brand retail will have two main aspects. One is the purchase and sale of products of small producers and famers i.e. producer and consumer. So far as Dalit consumers are concerned, their purchasing power is good in the case of those SC/STs who have benefited from reservation. Had there been producers among purchasers, then it could be argued that due to FDI in retail, higher prices have been obtained and as such their income and purchasing power have increased. Dalits and tribals are not big land-owners; they are, at best, small farmers. It is, therefore, not possible for them to benefit from the recent development in retail business.

So far traditional occupations go, participation of Dalits is already limited and will fall further due to liberalisation and FDI in multi-brand retail. It is being argued that in the wholesale business Dalits have no share, which is wrong. At the Azadpur Market in Delhi, it is often being said that there are no Dalit wholesalers which is also wrong. Even otherwise Delhi is not the whole of India. When a survey was conducted in the fruit and vegetable markets of Uttar Pradesh, it was found that Khatiks who belong to SC category have a big share in this business. In the two markets of Varanasi, Paharia and Chanua share of Khatik wholesalers (Adathis) stand at 65 percent. In Azamgarh vegetable market, the share of Khatiks is more than 60 percent. In Gorakhpur market, it is around 40 percent whereas in Deoria, the share of Khatik wholesalers is 25 percent. In Lucknow, Khatik wholesalers constitute approximately 50 percent. Wholesalers in the fruit and vegetable markets are middle-men and with the advent of FDI, it is being said that their business activities will suffer a heavy blow as businessmen will now purchase their products directly from producers. Under these circumstances, if the government does not come to the rescue of these wholesalers, their businesses will be severely affected by the new move.

FDI in multi-brand retail will not only expand their network through foreign companies, but the Indian capitalists will also play their role in it. Almost everyone in India is divided on caste lines. Somebody may be owner of a big corporate house but when it comes to giving employment to some people, the priority is given to persons of his own caste. Even the foreign companies will not be inclined to give jobs to Dalits, adivasis, minorities and backward classes because their administration will be mostly in the hands of upper caste people. It is well known that people who run big corporate houses are mostly from upper castes and are likely to show discrimination in employing Dalits, adivasis and backward classes.

One Dalit girl, who topped the list of successful candidates at IIM Ahmedabad, was refused a job at a campus interview after she revealed her caste identity. She was selected subsequently when she did not disclose her caste identity. Maybe, a large number of jobs will be created because of the introduction of FDI in multi-brand retail, but those from SC/STs are not likely to get those. They can, of course, get jobs by concealing their caste identities. It is also quite likely that FDI in retail chains will not purchase their products from Dalit and adivasi producers because nearly at every level, most of the officers or executives would be from upper castes.

In order to make things more viable for the backward classes, we will have to follow the reservation policy at work in America and other developed countries. In America, there is a free economy, but due to affirmative action and policy of diversity, blacks, hispanics and aborigines have inclusive participation in different fields. Now that the FDI vote has been won, the government should adopt affirmative action or reservation policy to ensure inclusive participation from these communities.

(Dr. Udit Raj is National President, Indian Justice Party, and National Chairman, All India Confederation of SC/ST Organisations)


  1. I am sure you would have put in a lot of effort in your analysis for this article, but you miserably fail to relate development of backward classes to the FDI in Retail or to make any other relevant point. You have expressed some very fragmented and irrational views here. Truly not worthy of this publication.

    As for the development of any particular sect, India is a free country and everyone has the liberty to choose and take advantage of the opportunities. It is time we abstain from the manner of thinking you have presented in your article. Dividing the society was never and will never be in the interest of the country.

  2. You didn’t even get comments this is the level of apathy of the indian intellengsia. The power centre in dalit constituency bargained her support in favour of sm short term benefits , but lost in the long run.The economics of pauperisatn needs a unfied response but we r too obssessed with the minutia of ideological debates. So gud luck to u , I see a hopeless future ahead where we wud hide our identities one we gain entry into elite world

  3. This is the saddest article i have ever came across.
    What is the point author wants to prove?
    is there any kind of humuor which i dont get or the author is too sick ?
    please help

  4. Discussing Dalits vs Upper castes in relation to Business and Commerce. Sounds like the author has a Huge Inferiority complex combined with a sense of entitlement.

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