Background
A Constitution Bench of the Supreme Court, in a 3:2 majority decision, upheld the validity of the 103rd Constitutional Amendment, which provides 10% reservation in government jobs and educational institutions to the Economically Weaker Sections (EWS) of society but excludes the “poorest of poor” among Scheduled Castes (SC), Scheduled Tribes (ST), Socially and Educationally Backward Classes (SEBC) and Other Backward Classes (OBC) from its scope.
A Constitution Bench of the Supreme Court, in a 3:2 majority decision, upheld the validity of the 103rd Constitutional Amendment, which provides 10% reservation in government jobs and educational institutions to the Economically Weaker Sections (EWS) of society but excludes the “poorest of poor” among Scheduled Castes (SC), Scheduled Tribes (ST), Socially and Educationally Backward Classes (SEBC) and Other Backward Classes (OBC) from its scope.
On whether such a reservation on the sole basis of economic criterion violated the Basic Structure of the Constitution, Dinesh Justice Maheshwari took the expansive view that reservation was an “instrument of affirmative action by the state” and should not be confined to the SCs, STs, SEBCs, and the non-creamy layer of the OBCs but also include “any class or sections so disadvantaged as to answer the description of ‘weaker section’”.
Views by Judges
The three judges in the majority held that reservation on economic criterion alone did not violate the Basic Structure of the Constitution.
In their minority view, Justice Bhat and Chief Justice Lalit held that though quota on the basis of economic deprivation, destitution and poverty was “per se permissible/valid” and even “constitutionally indefeasible”, the “othering” of socially and educationally disadvantaged classes, including the SC/ST/OBC/SEBC communities, on the ground that they already enjoy the benefits of a pre-existing 50% reservation on the basis of their caste and class origins, would amount to heaping injustice based on their past disability.
He said such an exclusion was simply “Orwellian” as the government’s statistics itself showed that the “bulk of economic deprived section of the society belonged to SC/ST/SEBC/OBC”.
He said the SCs make up 38% of the population, STs 48.4%, and OBCs 13.86% of the 31.7 crore people living below the poverty line. Forward castes or the unreserved category make up only 5.85%.
The petitioners had argued that the exclusion of SC/ST/SEBC/OBC had left only the “middle class” among the forward castes drawing less than ₹8 lakh as annual family income to reap the benefits of the EWS quota.
Justice Bhat said the exclusion from the EWS quota based on social or identity origins struck at the essence of the “non-discriminatory rule” and destroyed the equality code of the Constitution.
It amounted to a “hostile discrimination” of the poorest members of society, who were already socially and educationally backward and subjected to caste discrimination.
Justice Bhat said the poorest of poor among SC/ST/OBC/SEBC had been kept out of EWS quota on the delusion that they benefit from the existing 50% reservation and were thus “somehow more fortunate”. The government, Justice Bhat said, believed that including SC/ST/OBC/SEBC members in the EWS quota would bestow them a “double benefit”.
Existing reservation should not be seen as a “free pass to equal opportunity” for these backward classes, he noted, but as a reparative and compensatory mechanism to level the field for those crippled by social stigmatisation.
But Justice Trivedi countered that the 103rd Amendment only created “a separate class of EWS without affecting the special right of reservation provided to SEBCs, STs, SCs and OBCs”.
Even the SC/ST/SEBC/OBC members had been treated as a separate category for the purpose of the 50% reservation. Now, they cannot be treated at par with citizens belonging to the general or unreserved category, Justice Trivedi said.
“The amendment certainly cannot be termed as a shocking, unscrupulous travesty of equal justice. Just as equals cannot be treated as unequals, unequals cannot be treated equally. Treating unequals as equals will offend the doctrine of equality in Article 14,” Justice Trivedi reasoned.
Justice Maheshwari dismissed the argument that the 10% EWS quota would breach the ceiling limit of 50% on reservation. He said the 50% rule formed by the Supreme Court in the Indira Sawhney judgment in 1992 was “not inflexible”. Further, it had applied only to SC/ST/SEBC/OBC communities and not the general category.
In his spirited dissent, Justice Bhat responded that permitting the breach of 50% ceiling limit would become “a gateway for further infractions and result in compartmentalisation”. He kept the issue open.
Three judges on the Constitution Bench, in views which formed both the majority and minority opinions, said the policy of reservation in education and employment cannot continue for an indefinite period.
Justice Bela M. Trivedi, who was part of the majority judgment, said the reservation policy must have a time span. “At the end of 75 years of our Independence, we need to revisit the system of reservation in the larger interest of the society as a whole, as a step forward towards transformative constitutionalism,” Justice Trivedi said.
She pointed out that quota for the Scheduled Castes and the Scheduled Tribes in the House of the People and in State Legislative Assemblies would cease 80 years from the commencement of the Constitution.
The representation of Anglo-Indian communities in Parliament and Assemblies has already stopped by virtue of the 104th Constitutional Amendment from January 25, 2020.
“Therefore, a similar time limit, if prescribed, for the special provisions in respect of the reservations and representations provided in Article 15 and Article 16 of the Constitution, it could be a way forward leading to an egalitarian, casteless and classless society,” Justice Trivedi observed.
Though not expressly said, Justice Trivedi’s view on stopping quota under Articles 15 and 16 would also encompass EWS reservation.
Justice P.B. Pardiwala said “reservation is not an end but a means — a means to secure social and economic justice. Reservation should not be allowed to become a vested interest. Real solution, however, lies in eliminating the causes that have led to the social, educational and economic backwardness of the weaker sections of the community”.
He said “long-standing development and the spread of education” had resulted in tapering the gap between the classes to a considerable extent. Large percentages of Backward Class members attain acceptable standards of education and employment. They should be removed from the Backward categories so that attention could be paid toward those genuinely in need of help.
“It is very much necessary to take into review the method of identification and the ways of determination of Backward Classes, and also, ascertain whether the criteria adopted or applied for the classification of Backward is relevant for today’s conditions,” Justice Pardiwala said.
In his minority view on the Bench, Justice S. Ravindra Bhat reminded Baba Saheb Ambedkar’s observations that reservations should be seen as temporary and exceptional “or else they would eat up the rule of equality”.
Reservation as a concept can’t be ruled out in private institutions
Justice Dinesh Maheshwari, who led the majority opinions on the five-judge Bench which upheld the Economically Weaker Section (EWS) quota on Monday, held that “the 103rd Constitution Amendment which permits the state to make special provisions cannot be said to breach the Basic Structure of the Constitution”.
Justice Maheshwari was addressing the “impact” of the amendment, which introduced the EWS quota on admissions to private unaided institutions.
Justice S. Ravindra Bhat, who authored the minority opinion for himself and Chief Justice U.U. Lalit, also observed that “reservations in private institutions is not per se violative of the Basic Structure [of the Constitution]”.
Justice Bhat reasoned that reservations as a concept cannot be ruled out in private institutions where education is imparted. “Unaided private institutions, including those imparting professional education, cannot be seen as standing out of the national mainstream,” Justice Bhat observed.
Up to state to set norms to identify the beneficiaries of EWS quota
The majority judgment of the Constitution Bench held that the lack of guidelines to identify economic backwardness under the 10% EWS quota cannot be used to question the 103rd Amendment.
The judge left it to the state to set parameters to identify the beneficiaries of the EWS quota. “The question as to whether any particular section or person falls within the class of ‘economically weaker sections of citizens’ may be a question to be determined with reference to the parameters laid down and indicators taken into consideration by the state,” he observed.
Verdict may seal fate of challenge to T.N. quota law
Justice S. Ravindra Bhat, who authored the minority view on the five-judge Bench, said upholding the Economically Weaker Section (EWS) quota will run the danger of “sealing the fate” of a pending challenge to the 69% reservation in Tamil Nadu without the benefit of a hearing.
Sounding a “cautionary note” to fellow judges who formed the majority on the Bench, Justice Bhat and Chief Justice of India U.U. Lalit said the creation of 10% Economically Weaker Section reservation over and above the 50% existing quota has a “direct bearing” on the “likely outcome” of the litigation against the 69% reservation in Tamil Nadu.
The judge said the breach of the 50% limit is the principal ground of attack against the 76th Constitutional Amendment of 1994 which inserted, as Entry 257A, the Tamil Nadu Backward Classes, Scheduled Castes and Scheduled Tribes (Reservation of Seats in Educational Institutions and of Appointments or Posts in the Services under the State) Act, 1993 in the Ninth Schedule of the Constitution.
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Steve Ovett, the famous British middle-distance athlete, won the 800-metres gold medal at the Moscow Olympics of 1980. Just a few days later, he was about to win a 5,000-metres race at London’s Crystal Palace. Known for his burst of acceleration on the home stretch, he had supreme confidence in his ability to out-sprint rivals. With the final 100 metres remaining,
[wptelegram-join-channel link=”https://t.me/s/upsctree” text=”Join @upsctree on Telegram”]Ovett waved to the crowd and raised a hand in triumph. But he had celebrated a bit too early. At the finishing line, Ireland’s John Treacy edged past Ovett. For those few moments, Ovett had lost his sense of reality and ignored the possibility of a negative event.
This analogy works well for the India story and our policy failures , including during the ongoing covid pandemic. While we have never been as well prepared or had significant successes in terms of growth stability as Ovett did in his illustrious running career, we tend to celebrate too early. Indeed, we have done so many times before.
It is as if we’re convinced that India is destined for greater heights, come what may, and so we never run through the finish line. Do we and our policymakers suffer from a collective optimism bias, which, as the Nobel Prize winner Daniel Kahneman once wrote, “may well be the most significant of the cognitive biases”? The optimism bias arises from mistaken beliefs which form expectations that are better than the reality. It makes us underestimate chances of a negative outcome and ignore warnings repeatedly.
The Indian economy had a dream run for five years from 2003-04 to 2007-08, with an average annual growth rate of around 9%. Many believed that India was on its way to clocking consistent double-digit growth and comparisons with China were rife. It was conveniently overlooked that this output expansion had come mainly came from a few sectors: automobiles, telecom and business services.
Indians were made to believe that we could sprint without high-quality education, healthcare, infrastructure or banking sectors, which form the backbone of any stable economy. The plan was to build them as we went along, but then in the euphoria of short-term success, it got lost.
India’s exports of goods grew from $20 billion in 1990-91 to over $310 billion in 2019-20. Looking at these absolute figures it would seem as if India has arrived on the world stage. However, India’s share of global trade has moved up only marginally. Even now, the country accounts for less than 2% of the world’s goods exports.
More importantly, hidden behind this performance was the role played by one sector that should have never made it to India’s list of exports—refined petroleum. The share of refined petroleum exports in India’s goods exports increased from 1.4% in 1996-97 to over 18% in 2011-12.
An import-intensive sector with low labour intensity, exports of refined petroleum zoomed because of the then policy regime of a retail price ceiling on petroleum products in the domestic market. While we have done well in the export of services, our share is still less than 4% of world exports.
India seemed to emerge from the 2008 global financial crisis relatively unscathed. But, a temporary demand push had played a role in the revival—the incomes of many households, both rural and urban, had shot up. Fiscal stimulus to the rural economy and implementation of the Sixth Pay Commission scales had led to the salaries of around 20% of organized-sector employees jumping up. We celebrated, but once again, neither did we resolve the crisis brewing elsewhere in India’s banking sector, nor did we improve our capacity for healthcare or quality education.
Employment saw little economy-wide growth in our boom years. Manufacturing jobs, if anything, shrank. But we continued to celebrate. Youth flocked to low-productivity service-sector jobs, such as those in hotels and restaurants, security and other services. The dependence on such jobs on one hand and high-skilled services on the other was bound to make Indian society more unequal.
And then, there is agriculture, an elephant in the room. If and when farm-sector reforms get implemented, celebrations would once again be premature. The vast majority of India’s farmers have small plots of land, and though these farms are at least as productive as larger ones, net absolute incomes from small plots can only be meagre.
A further rise in farm productivity and consequent increase in supply, if not matched by a demand rise, especially with access to export markets, would result in downward pressure on market prices for farm produce and a further decline in the net incomes of small farmers.
We should learn from what John Treacy did right. He didn’t give up, and pushed for the finish line like it was his only chance at winning. Treacy had years of long-distance practice. The same goes for our economy. A long grind is required to build up its base before we can win and celebrate. And Ovett did not blame anyone for his loss. We play the blame game. Everyone else, right from China and the US to ‘greedy corporates’, seems to be responsible for our failures.
We have lowered absolute poverty levels and had technology-based successes like Aadhaar and digital access to public services. But there are no short cuts to good quality and adequate healthcare and education services. We must remain optimistic but stay firmly away from the optimism bias.
In the end, it is not about how we start, but how we finish. The disastrous second wave of covid and our inability to manage it is a ghastly reminder of this fact.