Discrimination rife in Indian economy

Jo Johnson in New Delhi

Male graduates applying for private sector jobs in India are far more likely to progress to the next round if they have high-caste Hindu names than if they have surnames associated with dalit (formerly untouchable) or Muslim origins, new research has found.
Far from being a hangover from the past found only at the margins of a newly meritocratic society, such discrimination is rife in the most dynamic sectors of the Indian economy, according to a joint study undertaken by academics from Princeton University and the Indian Institute for Dalit Studies.
Making use of techniques pioneered in the US to measure discrimination against blacks and other minorities, researchers made 4,808 job applications to 548 graduate level openings advertised in newspapers by blue chip Indian and multinational companies, changing only the names of identically qualified candidates.

Appropriately qualified applicants with a dalit name had odds of progressing to the next stage of the recruitment process that were two thirds of those of an equivalently qualified candidate with a high caste Hindu name, while those of an equally qualified Muslim candidate were only around a third as good.
The findings, published in India's Economic and Political Weekly, have been released at a politically sensitive time, with the government threatening to extend a system of quotas to the private sector unless businesses voluntarily boost the number of recruits from disadvantaged social groups.
The private sector has argued that the under-representation of dalits, tribes people and Muslims should be solved by improving the public education system - on the grounds that these communities attend inferior schools - rather than through quotas that would crimp freedom to hire and fire.

The studies, however, cast some doubt on whether, without government intervention, the self-interest of theoretically economically "rational" recruiters, who would want to minimise wage bills by recruiting from the widest possible pool of qualified talent, would be sufficient to correct the problem.
"Reaching the pinnacle of what the Indian education system has to offer is not sufficient to create full and open opportunity," wrote Sukhadeo Thorat, founder of the Indian Institute of Dalit Studies, and Katherine Newman, a sociologist and director of Princeton University's Institute for International and Regional Studies, two of the academics involved with the project.
"Far from fading as India modernises, the problem of discrimination remains a serious one, even at the very top of the human capital hierarchy," the authors said, arguing that recruiters in major companies continued to "subject low caste applicants to negative stereotypes that may overwhelm their formal accomplishments".
Business groups have argued that mandatory extension of quotas to the private sector would hit productivity. They say the organised private sector, which accounts for less than 5 per cent of the workforce, is already suffering from labour market rigidities, such as the need to secure government approval to fire employees.
Manmohan Singh recently became the first sitting Indian prime minister to acknowledge openly the parallel between "untouchability" and apartheid, describing the latter as a "blot on humanity". His government is poised to establish an Equal Opportunity Commission, whose powers have yet to be defined.