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Insights into Editorial: Karnataka’s dangerous new reservation policy



Insights into Editorial: Karnataka’s dangerous new reservation policy



In a move intended to appease local sentiments, the Karnataka government has released draft amendments to the Karnataka Industrial Employment (Standing Orders) Rules of 1961 that would implement 100% reservation for Kannadigas for blue-collar jobs in the private sector. This move by the Karnataka government has sparked off a debate with many questioning the 100% reservation proposed.  

Karnataka job reservation policy
Image Source: Economic Times

What is the Policy all about?

The policy gives 100% horizontal reservation for Kannadigas in all private industries, except the IT-BT sector, which secure concessions under the state industrial policy. If the industries don’t follow these guidelines, the government will cancel all concessions given.

  • According to the policy, industrial establishments shall not provide less than 5 % of employment to persons with disabilities.


What’s the basis for this move?

  • The first and most crucial fact is that this amendment has emanated from, and is largely centred around, Bangalore. With a GDP of $83 billion, it is the single largest contributor to Karnataka’s economy, and the biggest job magnet in the state. If one tracks the history of pro-Kannada agitations in the state over the last twenty years, it’s clear that an overwhelming majority of them have emerged primarily from Bangalore.
  • For at least over a decade, especially after Bangalore exploded on the national and global map as the most sought-after destination primarily for software development, it witnessed a huge population influx from all corners of India naturally upsetting the local and migrant balance and causing social friction primarily owing to economic reasons.
  • With not enough jobs being created—it is the lowest in seven years—and the poor spread of those that are getting created, the pressure on, and in, relatively better-performing states is growing. Thus, with a significant number of blue-collar workers from, say, Bihar in the fray for real-estate or warehouse-operations work in Bangalore, Kannadiga workers of comparable capability find the competition getting much tougher.


However, this demand for full or significant reservations for Kannadigas in the private sector is not new. Its roots lie in the Sarojini Mahishi report submitted to the Government as far back as 1986. Key recommendations of this report include:

  • 100% reservation for Kannadigas in all state government departments and PSUs.
  • 100% reservation for Kannadigas for Group C and D jobs in Central government departments and PSUs.
  • All jobs in the private sector to be reserved for Kannadigas barring, if necessary, senior/skilled positions.


Issues associated with this policy:

  • By arm-twisting the private sector into forcibly hiring Kannadigas irrespective of merit or qualification, the indirect assumption seems to be that Kannadigas are incapable of finding jobs on their own merit or hard work.
  • Equally, the definition of a Kannadiga as “Local people (Kannadiga) means any person born in the state of Karnataka or who has lived in Karnataka for not less than 15 years and knows to read, write, speak and understand Kannada” ignores reality. There are also non-locals who’ve lived here for nearly a generation and don’t know the language.
  • Even as the move will benefit the Kannadiga population, with 100% reservation, the private sector could suffer a setback as it would hinder choosing the best candidates, irrespective of the linguistic background or domicile of the person, to comply with the rule.
  • Also, once it is enforced, there is no stopping other states from coming up with similar populist policies, even for white-collar jobs where merit is paramount for productivity. Besides, with the migrant blue-collar labour out of the picture, wages are likely to get uncompetitive. This could mean greater informalisation of labour, which in turn means greater insecurity for the same workers whose interests the Karnataka government is purportedly protecting with the move.
  • The amendment, if adopted, will also violate the landmark Indra Sawhney judgment of the Supreme Court which caps reservation “of any manner” at 50%.
  • The end result of industry loss of confidence and business moving elsewhere would, of course, be a decline in the economic well-being of the Kannadiga blue-collar workers the policy is supposed to protect.


What can be done?

Rather than cancelling all concessions to private sector companies for employing workers from other states in blue-collar jobs, Karnataka should increase incentives to companies that promote employment of locals.

The State must also ponder over the fallout that the move would inevitably have over investment coming into Karnataka from other states. Instead of such 100% reservation, the government must think constructively to impart skills training to local blue-collar job seekers so that they excel others in an open job market.


Way ahead:

It’s nobody’s contention that genuine grievances of Kannadigas in Bangalore and elsewhere in the state don’t exist or that they shouldn’t be addressed. But trying to address them by coercing private businesses to hire someone for no other merit than the fact that he or she belongs to a certain linguistic group is to kill enterprise and thereby the economy. It offers no incentive to the employee to work; on the contrary, it offers every incentive to the employee to blackmail or harass the employer.

More fundamentally, the seventy-year history of reservations shows that it has failed as a policy to uplift disadvantaged people. It has only created a vast class of permanent victims — irrespective of caste or community — clamouring for ever-escalating demands from the state to disastrous consequences for the nation.



Demand for job quotas is a symptom of governance failure. A good education is the single most empowering endowment an individual can get and one which governments across India have failed to deliver. Karnataka government is now trying to offset this failure with a dangerous short cut. This short cut will jeopardise the state’s industrial policy which aimed to generate an industrial growth rate of 12% and enhance the contribution of the manufacturing sector to the state economy from about 17% to 20%. Potential investments in Karnataka will be diverted if an onerous new condition such as 100% job reservation for locals kicks in. If the government wants to boost local employability further, it can do so by improving skills and education in the state to a high level. Blocking migrant labour will broaden access to employment only in the short term. The sustainable method of doing so, conversely, is by enabling the native population on multiple fronts—education, health, social safety net. Karnataka has done better on this front than most other states. It is a pity it is attempting to change course now.