A new study has revealed that Dalit business owners in India face a significant income gap of 16.9%, compared to other marginalised groups. The research, published in the journal PLOS One on Wednesday, August 7, was conducted by Prateek Raj of the Indian Institute of Management Bangalore (IIMB), along with Thomas J Roulet from the University of Cambridge and Hari Bapuji from the University of Melbourne.

The study titled "It’s not who you know, but who you are: Explaining income gaps of stigmatised-caste business owners in India," analysed data from the 2011 India Human Development Survey. It found that even after accounting for factors like education, land ownership, and location, Dalit business owners continue to earn 16.9% less compared to other marginalised communities like Other Backward Classes (OBC), Scheduled Tribes (ST), and religious minorities like Muslims.

The research highlights the impact of "institutional stigma" faced by Dalits, which hinders their ability to leverage social connections and business opportunities. While education benefits both Dalits and other marginalised groups equally, the study emphasises the need for targeted interventions to address the unique challenges faced by Dalit entrepreneurs.

The research also highlighted the limitations of existing government initiatives, calling for a re-evaluation of policies to address the specific needs of Dalit communities. “The Indian government has developed several initiatives for the mobility of Dalits and other disadvantaged communities, who number a billion in India alone. These initiatives take a similar form for all communities, but our study indicates that [Dalits and other historically disadvantaged groups] face different social processes, which need to be considered in designing initiatives to reduce inequalities.”

The authors said that the study results can “partially explain the limited impact of such traditional initiatives for Dalits and underscore the need to rethink development strategies involving human capital and social capital”. They also said that the study’s findings can help understand the sources of inequalities and form strategies for reducing them for Dalits.