People who have an annual income less than Rs 8 lakh, own less than 5 acres of land and have a house smaller than 1,000 sq ft in a town will qualify for the proposed quota. According to reports, the quota will cover practically all of the population not already covered by reservations. Data from the I-T department as well as reports from the National Sample Survey Office (NSSO) show that at least 95 per cent of families will fall within this limit. The NSSO report on housing conditions in 2012 shows that at least 80 per cent of Indians don’t have houses with area over 1,000 sq ft.

It will need an amendment of Article 15 (which prohibits discrimination on grounds of religion, race, caste, sex, place of birth) and Article 16 (equality of opportunity for all citizens in matters relating to employment or appointment to any office under the state) of the Constitution. The amendment will have to be ratified in both the Lok Sabha and Rajya Sabha by at least two-thirds of the members present and voting. It also need to be ratified by at least 50 per cent of the state Assemblies.

Chances are high that the proposed quota will be challenged legally. Citing the Rao government’s effort to bring in 10 per cent reservation on the basis of economic criteria, Congress MP K.V. Thomas said in Parliament that it was struck down by the SC. However, Finance Minister Arun Jaitley asserted that the measure will stand legal scrutiny. Quoting an apex court judgment, he said, “We are also of the opinion that the rule of 50 per cent applies only to reservation in favour of backward classes made under Article 16(4).” Attempts were made earlier too by governments at the Centre and states to provide reservation on economic grounds but failed because they were done either through common statutory provisions or notifications, he said. Jaitley expressed the hope that the Bill will pass the test of the basic structure of the Constitution as it does not seek to alter that.

In September 1991, an office memo issued by the then P.V. Narasimha Rao government reserved 10 per cent of posts for “other economically backward sections”. This decision was struck down by the Supreme Court’s nine-judge Constitution Bench. In the judgment, the majority of the judges made it clear that backwardness cannot be determined exclusively with reference to economic criteria. In 2008, Kerala Chief Minister V.S. Achuthanandan decided to reserve 10 per cent seats in all graduation and post-graduation courses in government colleges and 7.5 per cent seats in universities for students belonging to the economically backward among ‘forward’ communities. The Kerala Muslim Jamaat Council challenged this and the case is pending in the apex court. In 2011, the then Uttar Pradesh CM, Mayawati, said she supported reservation for the poor and unemployed among the upper castes and wrote to the PM regarding this. In 2015, the Rajasthan Assembly passed a Bill to provide 14 per cent reservation to economically backward classes of unreserved categories.

The percentage of seats that can be reserved has long been an issue in courts.While passing a judgment in 1962, the SC enunciated the principle that “speaking generally and in a broad way, a special provision should be less than 50 per cent”. In its Mandal judgment (1992) and on several other occasions, the apex court had placed a cap of 50 per cent for reservation. In Tamil Nadu, the reservation stands at 69 per cent, which is protected from judicial review under the Ninth Schedule of the Constitution. However, in the I.R. Coelho case in 2007, the nine-judge bench upholded the judiciary’s authority to review any law that destroys or damages the basic structure as indicated in the fundamental rights, even if they have been put in the Ninth Schedule.

Electoral defeats in the Hindi heartland states of Rajasthan, Madhya Pradesh and Chhattisgarh are widely seen as having rattled the BJP. Also, Patidars in Gujarat, Jats in Rajasthan, Marathas in Maharashtra and Kapus in Andhra Pradesh have led agitations to demand reservations. With the Lok Sabha polls coming up in three months, the move will help the BJP-led National Democratic Alliance to consolidate the upper caste vote.