Reservation in India: Time to Shift from Caste to Economic Criteria


Author: Radhika Menon, The Kerala Law Academy Law College, Trivandrum

To The Point

India’s reservation policy was created to promote social justice by supporting historically oppressed castes and reducing long-standing inequality. Over time, this caste-based system has become firmly embedded in the country’s social and political landscape. However, as socio-economic conditions change, many are concerned that the existing model does not meet the needs of economically disadvantaged people from non-reserved categories. Poverty, lack of access to education, and limited job opportunities now affect individuals across caste lines, regardless of their social identity.


The introduction of the 10% EWS (Economically Weaker Sections) quota in 2019 for poor upper-caste individuals has ignited an important debate. Should economic factors replace or work alongside caste in deciding who qualifies for reservations? While caste-based oppression still occurs, the case for economic-based reservations focuses on individual merit and current hardships rather than inherited disadvantages.


By this article, I want to highlight that reservation based on economic hardship is better than caste-based reservation. Caste-based reservation was important in the early years of independent India to address serious historical injustices, but it does not fully reflect the current realities of socio-economic inequality. Today, economic struggles affect people across all communities, not just one caste. As a result, many individuals from unreserved categories who face financial and educational challenges do not receive support. On the other hand, an economic reservation system ensures that help goes to those who truly need it, regardless of their caste. This change would promote a fairer and more merit-based society, aligning with the evolving goals of equality and fairness in our Constitution.

Use of Legal Jargon


In the discussion of reservation policies in India, several legal terms are essential for shaping public conversation and understanding the Constitution. One key term is“affirmative action,” which means proactive policies by the state to promote the welfare and representation of historically disadvantaged groups. In India, this is known as “positive discrimination.” This principle allows the state to lawfully provide certain benefits to underprivileged groups to achieve real equality.

Beneficiaries of the reservation system are usually classified based on constitutionally recognized categories such as Scheduled Castes (SCs), Scheduled Tribes (STs),and Other Backward Classes (OBCs).These groups have been identified under Articles 341 and 342 of the Constitution and through various government orders as socially and educationally backward classes that need special protection and representation.


With the 103rd Constitutional Amendment, a new category called Economically Weaker Sections (EWS) was created. This marked a significant change, allowing reservations based on economic criteria. This amendment added clauses 15(6) and 16(6) to the Constitution, legitimizing a 10% quota in education and public employment for economically backward individuals from the general (unreserved) category, thus breaking the traditional connection between reservation and caste. Reasonable classification under Article 14 allows the state to treat different groups differently if there is a valid reason and a clear connection to the goal being pursued.


Finally, the idea of the “creamy layer,” introduced in Indra Sawhney v. Union of India (1992) is crucial for excluding more economically advanced individuals from backward classes to ensure that genuinely disadvantaged people benefit from the policy. The application of the creamy layer principle only to OBCs and not to SCs/STs has sparked legal and policy debates.

The Proof


The argument for moving from caste-based to economic-based reservation is based on both real-world evidence and changes in the Constitution. While caste is still a social reality in India, several studies, reports, and constitutional changes show that economic hardship is a more accurate and relevant indicator of disadvantage in modern India.


1. Economic Disparity Cuts Across Castes
Census and survey data from the National Sample Survey Office (NSSO) and the Socio-Economic and Caste Census (SECC) show that poverty and limited access to basic amenities are not limited to SC/ST, or Other Backward Classes. A large number of economically disadvantaged individuals belong to the general or unreserved category. The SECC 2011 reveals that many upper-caste families live below the poverty line and lack proper housing, education, and job opportunities. The ongoing exclusion of these individuals from reservation benefits highlights an unfair gap in our current affirmative action system.


2. Inefficiency of the Existing Caste-Based System
Years of caste-based reservation have often helped the better-off within the reserved communities. This has led to the creation of a “creamy layer.” These beneficiaries, who no longer face the same level of socio-economic challenges, continue to access reservation benefits. This situation has increased inequality within castes and redirected resources away from those who truly need them.


3. The 103rd Constitutional Amendment as Legal Validation
The passing of the 103rd Constitutional Amendment in 2019 was a pivotal moment. It granted 10% reservation to Economically Weaker Sections (EWS) among the general category. This amendment added Articles 15(6) and 16(6) to the Constitution, for the first time allowing economic status alone as a legitimate basis for reservation. The Supreme Court, in Janhit Abhiyan v. Union of India (2022), upheld this amendment, affirming that affirmative action could focus on economic hardship without violating the Constitution’s core principles. This ruling confirms that poverty is an acceptable reason for positive discrimination.


4. Disconnection Between Caste and Present-Day Privilege
As urbanization, social mobility, and education increase, many individuals from historically backward castes have gained significant economic and political power. Meanwhile, many general-category individuals remain stuck in poverty without access to reserved seats or government support. Basing reservations solely on caste ignores current realities and reinforces privileges within castes rather than reducing them.


5. Public Opinion and Fairness
Many public opinion surveys and academic discussions support including economic criteria in the reservation system. The demand for a fairer model that does not alienate citizens based solely on their birth is growing. People believe that affirmative action should evolve to reflect a merit-based and need-based approach instead of maintaining strict caste categories.


6. Need for Efficient Resource Allocation
Given India’s limited opportunities for education and employment, reservation policies should focus on maximizing impact. An economically based system would ensure that limited public resources go to those who are struggling financially, rather than relying solely on social identity. This approach also lessens the likelihood of resentment and social division arising from perceptions of unfair advantages based on caste.
In conclusion, the combination of constitutional recognition, economic data, judicial support, and changing social dynamics shows that economic criteria provide a more just, inclusive, and effective foundation for reservation in India today. The evidence lies in both the law and the lived experiences of millions who are disadvantaged, not by their birth, but by their financial situation.


Abstract


This article explores the urgent need to rethink reservation policies in India. It advocates for moving away from caste-based criteria and shifting to economic-based criteria. The Indian reservation system was originally introduced to correct centuries of social injustice, discrimination, and exclusion faced by Scheduled Castes (SCs), Scheduled Tribes (STs), and Other Backward Classes (OBCs). While it has helped uplift marginalized communities, it has also created new challenges. Economically disadvantaged individuals from the unreserved or general category continue to suffer due to poverty, illiteracy, and lack of opportunity.
As India advances economically and socially, the rigid structure of caste-based reservation seems outdated. Economic hardship, rather than caste, has become the main barrier to access and inclusion in today’s society. This article points out that financial deprivation affects people across all castes and communities, including many who do not qualify for affirmative action under the current caste-based system. The inclusion of the 10% Economically Weaker Sections (EWS) quota through the 103rd Constitutional Amendment is a positive step. It legally recognizes economic criteria for reservation. Moreover, court rulings, especially the Supreme Court’s decision in *Janhit Abhiyan v. Union of India (2022)*, support this change by stating that economic criteria alone can form the basis for affirmative action without violating the Constitution’s basic structure.


The article uses constitutional provisions, important case laws, policy developments, and socio-economic data to argue that economic-based reservation is more relevant today and is also fairer and more inclusive. It suggests adjusting the reservation system to focus on economic disadvantage while ensuring that the historical goals of social justice remain intact. The aim is to create a more balanced, merit-focused, and forward-looking approach that addresses current challenges and upholds constitutional values of equality and fairness.

Case Laws


1. Janhit Abhiyan v. Union of India (2022)
Citation: (2022) 10 SCC 321 
This important judgment confirmed the constitutional validity of the 103rd Constitutional Amendment, which added a 10% reservation for Economically Weaker Sections (EWS) in education and public jobs. A five-judge Constitution Bench, with a 3:2 majority, decided that giving reservation based only on economic factors does not go against the basic structure of the Constitution. The Court stated that affirmative action can grow to meet modern demands. It noted that excluding SCs, STs, and OBCs from the EWS quota does not count as discrimination since they already receive benefits from existing reservations. This judgment represented a significant change in Indian reservation law, recognizing that economic disadvantage is a valid reason for state support.

2. Indra Sawhney v. Union of India (1992)
Citation: AIR 1993 SC 477 
This important case, known as the Mandal Commission case, confirmed the legality of 27% reservation for OBCs but rejected the idea of reservation in promotions. The Court introduced the concept of the “creamy layer”, stating that wealthy individuals within OBCs should not benefit from reservations to ensure that the truly underprivileged are helped. The Court noted that economic criteria alone cannot justify reservation under Articles 15(4) and 16(4) at that time. It highlighted the need for regular reviews of the reservation policy. This decision set the stage for the later constitutional acceptance of economic backwardness, as seen in the 103rd Amendment.

3. Ashoka Kumar Thakur v. Union of India (2008)
Citation: (2008) 6 SCC 1 
The Supreme Court supported the 93rd Constitutional Amendment and 27% OBC quota in educational institutions while reaffirming the need to apply the creamy layer test. Justice Bhandari, in his agreement, stressed that economic backwardness must be factored in when granting reservation. He suggested a gradual shift toward using economic criteria for all groups, pointing out that reservation based only on caste cannot last in a rapidly changing society.

4. State of Kerala v. N.M. Thomas (1976)
Citation: AIR 1976 SC 490 
Although this case focused on promotion rules for SC/ST candidates, Justice Krishna Iyer’s comments are noteworthy. He mentioned that affirmative action policies must be adaptable and responsive to changing ideas of equality. The ruling stressed that the concept of backwardness should not be fixed and that future generations may require different types of state intervention, possibly including economic measures.

5. M. Nagaraj v. Union of India (2006)
Citation: (2006) 8 SCC 212 
This case established the constitutional limits on granting reservation in promotions. While not directly linked to economic criteria, it highlighted the need for clear evidence to support affirmative action. It indicated that simply being part of a caste group is not enough the state must show that the group is indeed backward. This reasoning supports the view that current economic disadvantage should be a key factor for reservation.

6. P.A. Inamdar v. State of Maharashtra (2005)
Citation: (2005) 6 SCC 537 
Although mainly about minority education rights, the Court decided that social justice should not compromise academic merit in private institutions that do not receive government funding. It also noted that reservations cannot be extended without reason, and a balance is needed between affirmative action and efficiency. This ruling shows growing judicial concern about the unchecked increase of caste-based reservations and suggests that economic factors could provide a fairer basis for such policies.

Conclusion


India’s reservation policy, originally designed to uplift historically oppressed castes, needs to change to fit the realities of modern society. While caste-based discrimination does exist in some areas, today’s main issue is often economic, not purely social. A poor person, no matter their caste, faces challenges in education, employment, and upward movement. By granting reservations only based on caste, the system often overlooks those who truly need help and instead benefits those who have already improved their social and economic status.
This article argues that we must take economic hardship more seriously when designing and implementing affirmative action policies. Poverty, unemployment, lack of access to education, and limited healthcare affect millions across all castes. Therefore, a reservation policy that focuses on economic need instead of caste identity will be fairer, more effective, and align better with the constitution.
Additionally, before providing reservation benefits to individuals or groups under the SC/ST or other caste categories, the State must confirm that they truly face measurable disadvantages. This requires regular socio-economic audits, applying the creamy layer principle, and moving toward evidence-based policymaking. The goal of social justice should not be weakened by tokenism or political favors. It should aim to empower the economically weak, regardless of their background.
In the long run, a fair system that considers merit while rooted in economic realities will better fulfill the nation’s constitutional promise of equality, justice, and fraternity. It is time for India to make a significant change, transitioning from caste-based entitlement to need-based empowerment.

FAQS


Q1: Why was reservation based on caste introduced in the first place? 
A: It was introduced to tackle historical oppression and social exclusion of Scheduled Castes, Scheduled Tribes, and Other Backward Classes, as detailed in Articles 15(4) and 16(4) of the Constitution. 

Q2: Can reservation solely based on economic criteria be legally valid? 
A: Yes. The Supreme Court in the Janhit Abhiyan case (2022) confirmed that the EWS quota under the 103rd Constitutional Amendment is constitutional. 

Q3: Does caste-based inequality still exist? 
A: Yes, though it may look different now. Caste discrimination still occurs in rural areas, job markets, and access to justice and education. 

Q4: What is the creamy layer concept? 
A: It refers to excluding wealthier individuals within backward classes from reservation benefits to ensure that assistance goes to those who are truly disadvantaged. 

Q5: Will shifting to economic criteria impact SC/ST reservations? 
A: Not immediately. The EWS quota stands alone and does not change the current 50% limit for SC/ST/OBC reservations. However, a policy change could consider merging economic factors for all groups. 

Q6: Is the 103rd Amendment under judicial challenge? 
A: Although it was challenged, the Supreme Court upheld it in 2022, stating that economic-based reservation does not violate the basic structure doctrine. 

Q7: How can reservation policy be reformed for better equity? 
A: A multi-faceted approach that includes caste, economic status, regional backwardness, and gender can create a more fair and balanced system. 

Leave a Reply

Your email address will not be published. Required fields are marked *