India - 51% of businesses owned by SC/ST/OBCs

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-and-ma 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 north-eastern states but that has been offset by a decline in many other states including Orissa, Rajasthan and Madhya Pradesh.