The caste system has exercised a profound influence on the economic activities of the people of India.
There were four original functional castes, which followed different occupations, namely – the Brahmins (the priestly class), the Kshatriyas (the fighting caste), the Vaisyas (the trading class) and the Sudras (the serfs).
However, in course of time, these castes have lost their rigidity and many sub-castes have come into existence. Such caste divisions have had a far-reaching effect on the forms of socio-economic activities pursued in the country.
Positive effects: In older times, there were few advantages of the caste system. The positive impacts of caste system are summarized as follows:
- Fixed occupation: The caste system has promoted contentment and the stability of Indian society. The birth of a man fixes his career for him and thus he has not to worry about the choice of an occupation.
- Preservation of hereditary skill: It preserves the advantages of hereditary skill. The son in early life picks up the trade of his farther and becomes skilled.
- Trade guilds: The caste organizations served as Trade Guilds. They regulated production and prices and settled trade disputes.
Negative effects: However, in modern times, caste system has negatively affected the Indian society. The defects maybe summarized as follows:
- Caste system prevents the choice of occupations according to one’s personal taste and ability.
- Since change of occupations is debarred by the caste system, mobility of labor is not possible.
- Caste system hinders the growth of large-scale enterprises. In large-scale enterprises intellect, capital and labor require to be brought together; but since the caste system allocates these two different castes, any large-scale enterprise is out of the question.
- The rigidity of caste distinctions is responsible for the tendency of higher classes to look down upon certain forms of labor. This lack of the sense of dignity of labor is inimical to economic progress.
The effects of all these have been that no large-scale economic activities have been possible and new improvements based on modern inventions have also been very slow. In consequence, cottage and small-scale industries predominated until the beginning of modern industrialization.
Present situation: The spread of education and the modern modes of thinking and living have caused a general laxity of caste rules and distinctions in India. Boys and girls of different castes read in the same schools. In trains, buses, and steamers, men of different castes ride together. In hotels and restaurants, it is obviously impossible to observe the caste rules prohibiting inter-dining. In the factories and trade unions, the workers feel their unity as workers much more keenly than their caste and religious diversities.
Conclusion: Caste has ceased to be an inseparable barrier to economic progress though its evil effects are still considerable. The rigidity of these sub-divisions according to specific occupations is also gradually breaking down.