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May 02, 2022

What Does the Caste Wealth Gap Look Like in India?

A recent research paper examining consumption expenditure and landholdings in Uttar Pradesh sheds new light.
Photo: Daniel Mennerich/Flickr CC BY-NC-ND 2.0

Mumbai: For years, researchers and academics have studied how wealth and income inequality in India is, more often than not, split along caste lines, with upper castes cornering a larger piece of the pie.

However, the measure of their enrichment and the consequent impoverishment and exclusion of Muslim Dalits and Hindu Dalits has received less attention. A recent research article that estimates poverty, wealth inequality and financial inclusion at the sub-caste level in Uttar Pradesh shows that consumption expenditure for Hindu Dalits and Dalit Muslims is lowest compared to other sub-castes.

In the same vein, it is Muslim OBCs and Muslim Dalits followed by Hindu Dalits (Paasi and Chamar) that are the most common landless households in UP. Lastly, both the categories also register one of the highest poverty levels.

Alternatively, and perhaps not surprisingly, Brahmins, Thakurs and other Hindu general castes have higher wealth accumulation, lower poverty and lesser exclusion from formal financial services than Dalits. Additionally, within-group income inequalities among upper castes are strikingly less compared to within-group income inequalities observed amongst Hindu and Muslim OBCs and Dalits.

The research article, titled “Poverty, wealth inequality and financial inclusion among castes in Hindu and Muslim communities in Uttar Pradesh, India”, is authored by Chhavi Tiwari of the Institut National d’études Démographiques (INED), Paris; Srinivas Goli, a Australia–India Institute NGN Scholar; Mohammad Zahid Siddiqui of the Centre for the Study of Regional Development under JNU; and Pradeep S. Salve of the International Institute for Population Sciences.

The study uses data from a unique primary survey collected by the Giri Institute of Development Studies (GIDS) to assess the social and educational Status of OBCs and Dalit Muslims in Uttar Pradesh during 2014–2015.

It has broadly categorised the economic and social status of a household into four broad domains, that is, deprivation of lifestyle, historical deprivation, household condition and wealth and deprivation in financial inclusion.

Deprivation in lifestyle: poverty and expenditure

The study measured the mean per capita expenditure and poverty prevalence across caste and sub-caste levels. The study found that mean per capita expenditure showed a much wider disparity by caste distribution. 

  • Brahmins and Thakurs spend much more than the Other Hindu General and much higher than the OBCs and Dalits regardless of religion. 
  • Jaats, which fall under the OBC caste—have the highest mean per capita expenditure versus Brahmins and Thakurs.
  • Paasi is far behind and has the lowest mean per capita expenditure compared to other castes. This signifies that the deep-rooted caste-based supremacy in social and economic activity is still present in some form or other.

The study also highlights how caste-based social stratification continues to undergird poverty levels in India. The study provides estimates of rural poverty on a caste basis:

  • Muslim Dalits (52.5%), Hindu Dalits (51.9%), Muslim OBCs (38.2%), Hindu OBCs (38.0%), and Muslim General (31.3%). These are much higher compared to the Hindu General (14.4%). 
  • At the sub-caste level, the lowest poverty levels were among the Thakur (9%), followed by Brahmins (15.9%) and Other General caste groups (20%). Jaats (15.3%) from Hindu OBCs has less poverty than Brahmins and Other Caste groups but higher than Thakurs.
  • In urban areas, the highest per capita expenditure was found among Thakurs, Other Hindu General, Brahmins, Kurmis and Jaats
  • Urban poverty is significantly lower in Other Hindu General, Brahmins and Thakurs. Furthermore, the Kurmis and Jaats had less poverty than the other Hindu OBCs, Muslim OBCs, Hindu Dalits, and Muslim Dalits. 
  • The study found evidence to strengthen the argument that Dalits and Adivasis were susceptible to living in persistent poverty.

Land ownership and historical deprivation

Cultivable or non-cultivable land ownership plays an important role in terms of propagating wealth inequality. Dominant land-owning agricultural castes hold key positions in society using their economic, political, and social capital. Further dominance in politics continues the cycle of wealth accumulation. This becomes even more complex in the case of a village (rural) economy where access and ownership of land are the primary means and instruments of economic position and power relations between different sub-caste groups.

Cultivable land ownership (in acres) by caste.

The results thrown up by the study vis-a-vis the ownership of cultivable lands by sub-caste painted a dismal picture.

  • The most common landless households are Muslim OBCs and Dalit Muslims, followed by Paasi and Chamars i.e Hindu Dalits. 
  • While the Hindu General castes accounted for 20% of the sampled household, they owned more than 30% of the total cultivable land. 
  • The intra-caste distribution of land showed alarming disparities. For instance, the share of land owned by Thakurs is 11% followed by Brahmins (15%),

Other Hindu castes (6%), Yadav (13%), Kurmis (4%) and Jaats (8%); however, the corresponding sampled population proportion is 7%, 10%, 4%, 10%, 3% and 5%, respectively. This indicates a large disparity within the Hindu OBCs category versus Hindu Dalits. Muslim OBCs and Dalits owned about 25% of the cultivable land as the rest of the sampled population. 

  • The study also estimated the average size of land for landholding households: Hindu General has 2.89 acres of land followed by Muslim General (2.07), Hindu OBCs (1.97), Hindu Dalits (1.28), Muslim OBCs (1.09) and Muslim Dalits (1.05). Kurmis (3.28), Thakurs (3.08), Jaats (2.94), Brahmins (2.8), and Yadav (2.45) owned much more land on average than the rest of the caste category. In sum, historically deprived castes showed a considerably lower share of agricultural land regardless of their population size. Hindu Dalits, Muslim Dalits, Muslim OBCs, and Hindu OBCs are more likely to be landless or small landholding. 
  • The statistics of land purchases in the last 5 years also show a significant proportion of Dalits have sold their land to other higher caste.

Deprivation in wealth accumulation, household conditions and amenities

India has been facing the issue of a graded caste system which perpetuates the historical disparity in access and accumulation of resources. Wealth inequality has been relatively less explored in the context of the caste hierarchy. The study examines the household wealth status among the different sub-caste groups using asset value information self-reported by respondents excluding agricultural land.

Economic status of the households by caste.

The results throw up some interesting findings:

  • A significantly higher proportion of Jaats (55%), Thakurs (43%), and Brahmin (38%), Other Hindu General (37%), and Yadav (31%) belong to the richest wealth quintile.
  • On the other hand, about 40% of households of Paasi, Dalit Muslims, Other Muslim OBCs, Other Hindu Dalits, Chamars, and Lodhs belong to the poorest wealth quintile. 

Levels of debt and financial inclusion

In the survey used in the study, households were first asked whether they took a loan or not in the past 3 years. Second, the reason for the borrowing, and the third is the source of the borrowing. This allows the researchers to construct direct measures of indebtedness and credit constraints of the households due to their caste status. 

According to the study, in contrast to the household wealth status, the proportion of households who took a loan during the last 3 years is highest among Jaats (43%), Thakurs, Kurmis, Chamars, Paasi, and Brahmins.

A majority of the upper castes took loans for agricultural activities. Nearly three-fourths of Thakurs took a loan for agricultural activities, followed by Jaats (66%), Brahmins (60%), Yadav (46%) and Kurmis (33%). The loan taken for marriage ceremonies were highest among Other Muslim OBCs (33%), Lodhs, Yadav, Other Hindu Dalit, Chamars and Other Hindu OBCs.

Socioeconomically suppressed castes like Paasi and Chamars were taking loans for health reasons, for marriage ceremonies and for meeting family obligations. The highest loan levels for education are seen in the Other Hindu General, followed by Lodhs and Chamars castes.

The socioeconomic position plays a pivotal role to determine the sources of the loans. The socioeconomically lower castes were mostly getting loans from friends, relatives, and local money lenders. For instance, according to the survey results, more than two-thirds of Ansari Muslims have taken a loan from their friends/relatives followed by Other Hindu Dalits (57.1%), Paasi (48.2%), Kurmis (48%), and Other Muslim OBCs (44.5%). Lodhs, O

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