18 Asia The EconomistJuly 25th 2020
2 sport a moustache, ride a horse or, worst of
all, woo someone above their station.
The persistence of discrimination is not
limited to Hindus. An estimated 65% of In-
dia’s 20m Catholics are former Dalits
whose forebears converted in part to es-
cape caste oppression. Yet according to the
Indian church’s most recent published re-
cord, out of 27,000 priests only 5% were of
Dalit origin, and not a single one of its six
cardinals and 30 archbishops. Among In-
dia’s 14% Muslim minority a similar un-
spoken distinction persists, separating
families that converted in the distant past,
or were associated with ruling Muslim dy-
nasties, from the larger mass imputed to
have converted as a way of erasing their
previous, presumably lowly, caste status.
And although reservations have se-cured plum posts for some, lower-caste up-
lift has been limited. Accelerated economic
growth from 1990 to 2010 pulled tens of
millions out of poverty, including many of
lower caste, but overall inequality between
rich and poor, including within caste
groups, has grown. Moreover, in the gov-
ernment as in the private sector, the high-
est positions remain a near-monopoly for
the three top tiers or varnasof the broader
caste pyramid: the brahmins or priestly
class, the kshatriyasor warrior class and the
vaishyasor merchant class, who between
them account for perhaps 20% of India’s
1.3bn people. It is not just the 220m Dalits,
or the 190m Muslims, or the 110m from
“scheduled tribes” who are under-repre-
sented, but also the 40-50% of Hindus who
come from the widest tier of the pyramid,the shudrasor labouring castes, known as
Other Backwards Classes (obcs).
Out of the 89 highest-ranked civil ser-
vants in the central government, according
to a recent survey, just four are not upper-
caste Hindus, and not one is an obc. Two-
thirds of the Supreme Court’s 31 judges and
more than half of all state governors are
high-caste Hindus. When the home minis-
try recently formed a panel to revise the
criminal code, its five experts were all men,
all from north India and all from upper
castes. The trend is just as stark outside of
government. A study published last year of
the mainstream Hindi and English press
revealed that out of 121 people in senior
jobs, such as editors, all but 15 were upper
caste. Not a single one was a Dalit.
Just as positive discrimination was sup-
posed to equalise workplaces, it was hoped
that demographic change, such as migra-
tion from villages to cities, would break
down caste rigidities. Optimists pointed to
greater mixing as people of multiple castes
were often obliged by circumstance to
share the same city wards. Stubbornly,
however, statistics have shown that inter-
marriage between castes remains rare: just
6% of all couples at the most recent count.
An analysis of housing by a team led by
Naveen Bharathi of Harvard University has
revealed a striking persistence and, in
some cases, an intensification of caste seg-
regation. Using census data for 147 cities at
the level of blocks rather than wards, and
accounting not just for broad caste catego-
ries but for jati, which is to say the 5,000-
odd subcaste “communities” that tend to
marry among themselves, Mr Bharathi’s
team found that segregation by caste in In-
dian cities is comparable to that by race in
American ones. Whereas 60% of blocks in
Ahmedabad, the biggest city in Gujarat,
housed not a single Dalit, some 80% of Da-
lits lived in just 10% of the city. Inequality
in Ahmedabad as measured by the Gini co-
efficient was more extreme than in Johan-
nesburg, the most unequal city in South Af-
rica, the world’s most unequal country.
Yet amid seeming stasis, Mr Bharathi
also found a great deal of churn. “Barriers
are breaking in cities, but it’s not the big
barriers between castes,” he says. “It is the
subcastes that are dissolving.” As the asso-
ciation of family names with traditional
professions, which evoked some memo-
ries in villages, makes ever less sense in cit-
ies, there is less of a taboo around marrying
into adjacent jatiswithin the same broader
caste. At the same time, says Mr Bharathi,
class differences are growing stronger. “If
you zoom in on a Dalit slum, you will find
that poorer Dalits don’t intermix with Da-
lits of slightly higher status living right
next door.” Ambedkar, who assumed that
the positive discrimination he prescribed
in the constitution would end millennia of
caste oppression, would be perplexed. 7I
n march prospectsforthePhilippine
economy were darkening. The coun-
try’s combustible president, Rodrigo
Duterte, had announced an immediate
quarantine for the main island of Luzon
and its 55m people. Bangko Sentral ng
Pilipinas (bsp), the central bank, warned
that the outlook was the worst since the
Asian financial crisis of 1997-98. The
currencies of other countries in the
region were sinking as the world econ-
omy listed. But the peso barely budged
(see chart). It is one of a handful of
emerging-market currencies to have
strengthened against the dollar this year.
Its steadfastness says a lot about the
resilience of the Philippine economy.
It helped that the oil price was plung-
ing (and consumption within the coun-
try was falling), dramatically cutting the
Philippines’ import bill. The bspdid cut
interest rates to keep credit flowing,
which in normal times might havecausedthepesotoweaken.ButNicholas
Mapa of ing, a bank, thinks foreign
investors held on to Philippine assets
because interest rates remain higher
than in rich countries, yet the Philip-
pines is seen as a safer bet than most
other emerging markets.
In part that is because remittances,
which keep the economy afloat, have
held up quite well so far. They fell by only
3% in the first four months of 2020.
Inflows can even increase during periods
of domestic economic weakness, as the
diaspora responds to distress calls from
home. Gareth Leather of Capital Econom-
ics, a consultancy, points out that lots of
Filipino expatriates work in health care,
and so are likely to retain their jobs even
as migrants working in construction,
say, lose theirs.
The public finances have also been
prudently managed in recent years.
Fairly thrifty budgets combined with
rapid economic growth have brought
down the ratio of public debt to gdpfrom
more than 70% in the mid-2000s to less
than 40% in 2019. Relative to the size of
the economy, foreign debts are lower
than in Malaysia, Indonesia or Thailand.
The bsphas built up $93bn of foreign-
exchange reserves—a record stash.
But the Philippines’ relative eco-
nomic stability, and the buoyancy it has
bestowed on the peso, are not unalloyed
benefits. The peso’s strength makes
Philippine exports more expensive and
remittances less valuable. And if the
world economy is heading down the
tubes, it is scant comfort that other
emerging markets are descending faster.A milder infection
The Philippine economyThe strength of the peso suggests investors are keeping faithA steady peso
Currencies against the $
Jan 1st 2020=Source: Datastream from Refinitiv10510095908580
Jan Feb Mar Apr May JulJunIndian rupeeIndonesian rupiahThai bahtPhilippine peso