(Photo: Bloomberg)
(Photo: Bloomberg)

Why minorities in India support free trade

Minorities in India are more supportive of trade liberalization than other groups, suggests a new study

Indian trade policy is a contentious issue. However, even as economists and analysts debate the merits of trade liberalization, less is known about how different groups in India feel about trade policy. New research suggests that India’s minorities -- Scheduled Castes (SCs), Scheduled Tribes (STs) and Muslims -- are more supportive of trade liberalization than other groups.

In the study, Nikhar Gaikwad and Pavithra Suryanarayan analyze data on trade preferences from the National Election Studies post-poll surveys conducted after the 1999, 2004, and 2009 general elections. Specifically, they focus on responses from upper castes, other backwards castes (OBCs), SCs, STs and Muslims. The authors reveal that SC, STs and Muslims support free trade more than upper castes and OBCs. These preferences are in part driven by economic status. These groups tend to be low-skilled and face systematic hurdles in accessing domestic labour markets - which they believe trade liberalization could address.

Interestingly, caste and communal considerations could also explain the preference for trade liberalization among minorities. The authors reveal that even high-skilled SCs, STs and Muslims are in favour of trade liberalization. They suggest that marginalized groups develop group-wise solidarity when considering the impact of trade. To show this, they conduct a nationwide experimental survey with 4,200 respondents where respondents were provided with information about groups that win and lose from trade. The results revealed that it was only the SC, ST, and Muslim respondents who changed their responses if their group benefited or lost out from trade.

According to the authors, these results suggest that since the lower-skilled are more supportive of trade liberalization, open trade policy could have broad-based support in an economy where a significant proportion of the electorate is low-skilled. Specifically for upper-caste Hindu politicians, advocating for free trade could be a profitable electoral tool to attract the votes of SCs, STs and Muslims.

Also read: Attitudes Toward Globalization in Ranked Ethnic Societies

Snap Fact features new and interesting reads from the world of research

Close