Recasting India (20 page)

He concluded, “It is with industries ruined … over-taxed, with productivity too low to bear high taxes, with few avenues for display of native capacities, the people of India passed from the rule of the Company to the rule of the Crown.”
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Yet, it is the native capacity today's Dalit entrepreneurs believe they are reviving. Saroj told me, “I had always been told that one could only get something in life if there was a quota [a reservation] for Dalits in that job or that education. That was my basic understanding—one needs quotas. All I wanted was a small, decently paying job—that would have made me happy. But I realized that Ambedkar wanted more for us.”

And there is opportunity waiting to be tapped. Research done by the Harvard Business School shows that scheduled castes accounted for around 16.4 percent of the population (2001 census) but owned only 9.8 percent of all enterprises before 2005. The only nuance here is that while the numbers of enterprises may have grown, many of them are still one- or two-person projects. These are enterprises of desperation—due to the lack of job opportunities anywhere else—rather than entrepreneurship by choice.

But then, in a way, Kalpana Saroj also began as an entrepreneur of desperation—she would have been happy with a job in nursing or the police. She says it is not a distinction she makes. “I learnt from Ambedkar that opportunities are blessings for Dalits—it does not matter how they have come.” It is a lesson that illuminates her life choices. By the time her first real estate project was completed and her sugar mill built, Saroj had received several death threats and had acquired her gun license. She says she was determined that if she was going to die, she would at least fire back.

Then came her big breakthrough—in 2006, employees of the once grand but by then ruined company Kamani Tubes approached her to buy out the company. There were 170 cases against the nonferrous metal tubes and pipes maker and a debt of Rs 116 crores ($19 million). The Kamani family, whose name before independence was as big as the biggest business houses, like the Tatas and the Birlas, and whose founder once associated closely with Mahatma Gandhi, had given up control of the company to employees in 1997 after many years of labor trouble and family infighting.

When the company came to Saroj, she was astounded by its illustrious past. The founder, Ramjibhai Kamani, was the pioneer in electric power transmission in India and in the production of industrial materials like arsenical copper plates, cupronickel sheets and the manufacture of zinc oxide and lead oxide. In 1945, the Kamani Engineering Corporation (KEC) became the first electric power transmission company not just in India but in the whole of Asia; and in 1950 it built the transmission towers for the Bhakra Nangal dam project, one of the dream projects of Jawaharlal Nehru, who called big dams the temples of modern India. By the mid-1960s, KEC was making the majority of the transmission towers in India. The company also produced a special road roller that could be swiftly transported in trucks and used in mountain areas. By the 1970s, the Kamani Group had expanded from metals to rubber to chemicals and jewel bearings; 80 percent of its $13 million turnover was coming from exports, and it had become the world's second largest maker of transmission towers, behind only Italy's SAE. But the oil crisis in 1973 brought massive debt to KEC that was worsened by the energy crisis in 1979. By the mid-1980s, racked by infighting, the family was losing control. In the 1990s, when the employees tried to take over and run it, they succeeded only in running it further into the ground.

The company then came under the Board of Industrial and Financial Reconstruction (BIFR), which handles the rehabilitation of sick industrial units, who approached Saroj and asked her to present a plan for reviving the company to the BIFR. “Once again this was something I had never done before, a business that I really did not understand,” says Saroj.

Over the years, the debt has been wiped out, the workers' dues cleared and the son of Ramjibhai has been given Rs 51 lakh as a settlement of old pension dues. One of the things Saroj got with this deal was a building in Ballard Estate, the toniest and most old-world business district in India. A hop and a skip away from Saroj's office—which is on a street named after Ramjibhai Kamani—is Tata House, home to the venerable House of Tatas, India's biggest business conglomerate. Nearby also is Maker Chambers and the office of India's most powerful man in business, the billionaire Mukesh Ambani, head of Reliance Industries, the country's biggest privately owned company.

Sitting in that four-story office, Saroj's daughter Seema told me that her proudest moment was in 2013 when her mother was awarded the Padma Shri, one of India's highest civilian awards.

“I don't think of myself in caste terms, but I know how that feels,” Seema Saroj told me. She had lived with her mother in a large slum until she was in Class 10. Even today she lives in a three-bedroom apartment not far from her mother in the distant suburb of Ulhasnagar. They have the money to buy homes in south Bombay, where real estate is some of the most expensive in the world, but Kalpana refuses to do so and prefers the three-hour drive one way to her office. Sometimes she uses her Mercedes, sometimes the Toyota Fortuner. “My mother says her people are there in Ulhasnagar, they are the ones who have been there for her all these years. They turn to my mother whenever they need something. She can't leave them. They can't come looking for her in south Mumbai [Bombay].”

Seema Saroj is married to her college sweetheart, a Brahmin, who now works in the company. Was there trouble when they got married? A little bit, said Seema, from her husband's side. But when I later asked Kalpana Saroj this, she just laughed it off and said, “The journey to honor is a long one. I am happy that my son-in-law now works with me.”

Sometimes, though, things don't fall into place. For instance, Kalpana Saroj just financed a film on the horrific Khairlanji murders of 2006 when a four-member Dalit family, the Bhotmanges, was butchered by upper-caste Hindus over a land dispute. As is almost always the case, the women were paraded naked in the village before being murdered. There was only one survivor, Bhaiyalal Bhotmange. Before the film was shown, Bhaiyalal signed a document saying he had no objections. But after he saw the film, he decided to go to court—because the film shows him consuming alcohol.

The case is in court—and Saroj has agreed to pay for the prosecutor's fees too since Bhaiyalal is very poor. “It will be a long journey,” Seema Saroj echoed her mother. “But we are used to hurdles.”

T
HE JOURNEY MIGHT BE LONG
,
BUT USING ENTREPRENEURSHIP TO FIGHT
it is a more recent phenomenon. In 2010, the Indian Institute of Dalit Studies tried to understand enterprise in the community through a study done in the states of Uttar Pradesh and Haryana, in the towns of Saharanpur and Panipat.
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This seminal research is invaluable in understanding where Dalits come from, why they start businesses and why Dalit entrepreneurship is today one of the biggest weapons against caste in India.

It points out that people belonging to India's 16 percent Dalit population have traditionally never owned land or any other income-generating assets. With increasing mechanization, the need for farm labor, one of the traditional occupations for Dalits, is thinning and self-employment is on the rise. Uttar Pradesh and Haryana were chosen for the survey because both of these states have high Dalit populations, more than 19 percent and 21 percent, respectively.

In two towns, the study mapped 321 Dalit enterprises of varying sizes. In the towns selected, Panipat (in Haryana) had one Dalit business before 1950 and Saharanpur (in Uttar Pradesh) had none. Between 1951 and 1960 there was one business started in Panipat but none in Saharanpur, which, however, got three new businesses between 1961 and 1970. There were five new businesses started in these two areas between 1971 and 1980; then came the first signs of a quantum jump: there were 32 in the following decade, 118 in the ten years after that and 161 since 2000. The research shows that social mobility came to the communities only when they were able to “consolidate themselves economically, which happened in most parts of north India during the 1980s.” That's when “they developed the capacity to diversify into occupations other than those they had been traditionally employed in, except of course for the jobs in the government sector under the reservation quota.”
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This is what social researcher Chandra Bhan Prasad's work had also shown—liberalization gave the Dalit community economic wings.

What kind of businesses did the Dalits start?

Most of them were simple enterprises based in localities where they lived. These ranged from small shops, hotels, workshops, dealerships or franchises, small factories, medical clinics, and so on. Of the seven women mapped by the study, six had small grocery shops; workshops, like automotive mechanical outfits, were another favorite.

So who were these Dalit entrepreneurs? Most of them were men, and a very small number were women. Nearly 80 percent were relatively young, between 20 and 40 years of age, and most of them were married and had families with five or six members. The other interesting thing was that less than one-fourth lived in joint families (with their parents and other relatives). This was particularly interesting because this means that Dalits from small towns were mirroring the trend across India of smaller, nuclear families, led by the biggest urban centers like Delhi and Bombay. Curiously, most of them said they were Hindus—even though the Dalit identity comes from the active Ambedkarite rejection of Hinduism. For many of the people who participated in the survey, this Hindu tag was more of a social thing than a religious affirmation, though some did tell the surveyors, “Even after all the insults for centuries, we are still carrying the burden of Hinduism.”
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This simply means they felt discriminated against by upper-caste Hindus and often trapped by tradition and discrimination based on birth.

Almost all of them were first-generation entrepreneurs, and about three-fourths had fathers who had worked as laborers. Some were in government jobs, no doubt fueled by quotas. The fathers were mostly illiterate or had received very little primary education. Most of the poorest and lowest-strata Dalits actually said that their fathers had worked in jobs like manual scavenging of human excreta—traditionally done by the lowest among the untouchables.

Most of the Dalits who had started the entrepreneurial journey had been born in or lived in urban areas—reaffirming Ambedkar's famous advice to leave the village to break caste chains.

Most of the Dalits who started businesses had had basic schooling and at least a third had been to college. Nearly a fourth had some sort of technical education or had received a diploma or a degree. Nearly half said they acquired the technical skills required for the business by working with someone who was already in a similar business. Many of them did not start out as entrepreneurs. About a third started as wage labor, some in government jobs, and almost everyone had started with very little capital. Nearly 41 percent started their business with an investment of Rs 25,000 ($421) or less, another 22 percent had invested more than Rs 25,000 but less than Rs 50,000. Some were lucky to have had about Rs 100,000 to spare to start a business, but that seemed to be the upper limit. The money had come mostly from savings or from loans from friends and family. Less than 20 percent of the people had taken a loan from a formal institution like a bank, and barely that many had done so after they had started their business. Now here's the interesting part, which gives another insight into the Dalit entrepreneur's mind: even though at least half of the entrepreneurs surveyed knew about special government loans for Dalits, many of them “either did not approach a bank out of some kind of cynicism or were simply refused a loan for want of a good reference or an asset against which the loan could be approved. Their caste background played a role”
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in their reluctance to approach government agencies for funds for fear of humiliation.

So what motivated them to go into business? Some had no source of livelihood. Others saw a renewed sense of dignity in their new occupation. “It helped them move out of village and traditional caste based occupations.”
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One of the consistent responses in the survey was that it was better to do something on your own than to slave for someone else. They had been helped in the initial phases mostly by their families and friends—though at least a fourth claimed that they did not receive any help from anyone. Almost always their caste was the biggest barrier to getting started. Some could not find people who would rent them space; others could not find accommodation in or near the place where they wanted to start their business since most upper castes would not rent to them. This meant that most businesses were small in size and most of them were self-owned rather than partnerships. Half of the respondents owned the space where they started their business and the rest rented space. Half worked alone; others hired staff ranging from one person to more than 50.