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Rema Nagarajan | TIMES INSIGHT GROUP
New Delhi: Political empowerment is finally translating into economic muscle for the country's most disadvantaged sections. Over half of all business establishments in the country - 51% to be precise - are today owned by the socially disadvantaged sections, mostly OBCs, with a slim contribution coming from SCs and STs.
This is the good news coming from an analysis of social ownership patterns of business establishments as presented by the latest Economic Census for 2005. But before you start cheering this empowerment story, here's a caveat.
A closer look at the data shows that the majority of businesses owned by OBCs/SCs/STs are establishments without any hired workers - that is, these are pa-andma ops, run by members of the household. They are possibly mainly efforts at self-employment.
The data shows that while people from these sections owned 45% of business establishments at the time of the last Economic Census in 1998, their share has registered a 6 percentage point increase since then. OBCs account for the largest chunk of this growth.
The OBC share in ownership of businesses has increased in all major states, barring Tamil Nadu, where they already owned a high 74% of all businesses, and Punjab, where a small decline in OBC ownership has been offset by a rise in SC-owned businesses.
In states like UP, the increase in OBC ownership has been significant, going up from 38% in the last census to nearly half of all businesses in the state by 2005. In Gujarat, the proportion of OBC-owned establishments has gone up by 13 percentage points to comprise almost a third of the state's businesses.
However, the status of the weakest among the reserved categories, the scheduled tribes (STs), seems to have remained virtually unchanged.
There has been a steady increase in ST-owned establishments in northeastern states but that has been offset by a decline in many other states including Orissa, Rajasthan and Madhya Pradesh.
The top 5 states in terms of business establishments owned by OBCs
OBC share in ownership of businesses up in most major states
DOWNER: Majority of businesses owned by bckward castes are own account establishments (OAE), or businesses without any hired workers
UPSIDE: Within every category, the proportion of hired worker establishments is growing However, status of STs virtually unchanged. Rise in ST-owned establishments in north-east offset by decline in states like Orissa, Rajasthan & MP
New Delhi: As many as 51% in India are today owned by the socially disadvantaged sections. Over three quarters of the establishments owned by SCs and STs are own account establishments (OAE) or establishments owned and run by the family members. The proportion of such establishments owned by OBCs is 71%. However, just over half (56%) of businesses owned by the general category are OAE establishments.
The positive sign is that within every category, the proportion of hired worker establishments is growing while OAEs are coming down. For instance, in Maharashtra, and Rajasthan the proportion of OBCowned establishments with hired workers grew from 18% to over a third of total OBCowned establishments.
For the reserved categories, especially STs and to some extent SCs too, their share in the total number of businesses with hired workers has remained small, although the situation has shown definite improvement between the last census and the latest one. For instance, in Bihar, the proportion of SCowned businesses with hired workers constitutes 31% of all businesses owned by SCs.
This is a significant jump from a mere 10% in 1998. Yet when you look at all the establishments that use hired workers in the state, the SC share is just 4% of this, although SCs constitute 16% of the state population. In most states, the bulk of businesses that hire workers continues to be owned by persons from the general category, except Tamil Nadu, where a much larger proportion of OBCs own establishments that hire workers (65%) than the general category (28%).
But within all categories in the state, especially among STs, there is decline in the proportion of establishments with hired workers. This seems to indicate that most of the growth in establishments in the state has happened due to persons seeking self employment.
In states where there has been political empowerment of the reserved categories especially OBCs and SCs, they seem to own much larger proportions of the hired worker establishments than in others.
In Bihar, UP and Kerala, 51%, 48% and 47% of establishments that use hired workers are owned by the reserved categories, with the bulk in the hands of the OBCs.
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