On economic policy, India has been moving toward the international mainstream. On nuclear policy, it bucked international trends. In preferential politics, it offers salutary lessons to the rest of the world.

The motives underlying preferential policies are beyond reproach. But by institutionalizing affirmative action in favor of any one group, the government effectively discriminates against others, alienates them, feeds their sense of grievance and can contribute to a growing militancy - without necessarily helping the most needy.

Every affirmative action produces an equal and opposite sectarian reaction. If a government frames public policy in a group-conscious way, it cannot expect groups suffering relative deprivation to ignore group identity. For any one post filled on a quota, only one alternative person would have succeeded in a merit system, but hundreds can feel aggrieved for having lost out due to preferential policies.

Affirmative action programs are always described as temporary expedients, yet they often persist and proliferate. In India they were meant to have ended after 15 years in 1965, but they haven't. As group-based programs permeate the public institutions of a country, they end up institutionalizing the very divisions that they are meant to eradicate.

Policies of positive discrimination in India have trebled in scope, embracing additional measures for the same target group, extending favored treatment to other sectors of society, and incorporating additional target groups into the programs, legislative quotas for women being but the latest example.

Some state governments incorporate Muslims (who are outside the Hindu caste system) within job reservation schemes. Christian churches demand set-asides for converts to Christianity. Late last year, the central government decided to add another 126 castes and subcastes to the category known as ''Other Backward Castes'' eligible for 27 percent of jobs in the federal public sector. This is in addition to the 22.5 percent reserved for ''Backward'' castes and tribes. The government has also extended quotas to promotions.

After decades of constitutionally sanctioned efforts to protect and promote sectarian preferences, India is caught in an escalating cycle of increasing numbers of groups putting forth expanding claims to entitlements.

If membership in a particular group confers unequal privileges, and if job markets and prospects for upward mobility are stagnant or shrinking, then fraudulent claims of membership in the target groups will multiply. The spiraling cycle of preferential entitlements, and the need to ensure against fraudulent claims, leads to an expanding role for government at a time when India needs to reduce government intrusion into the economy and society.

Within ''disadvantaged'' groups receiving preferential treatment, benefits are captured by the better educated, more articulate and more politically skilled elite. With respect to the planned quota for women in Parliament, for example, many fear that the scheme will be hijacked by the ''bibi, beti and bahu'' brigade, meaning the wives, daughters and daughters-in-law of the elite.

Preferential policies are a political response to symbols of sectarian identity. They create and nurture vested interests. The programs are meant to reduce and eliminate intergroup disparities, but group leaders are dependent for their leadership positions on the perpetuation of perceived disparities.

A solution of ethnic or gender problems would deprive the leaders of a platform and a role. Upping the ante by raising ever expanding demands enlarges the role of group activists and gives them a bigger stage from which to manipulate more people.

Caste is now being used in India as a system for distributing political spoils. It is organized for capturing political power and the social and material benefits that flow from it, whether a government job, preferential entry into an educational institution, or a government licence. Where caste has led, will gender follow?

The most insidious consequence of affirmative action is the fact that it is so often counterproductive. Preferential policies foster the values of solidarity based on the cult of victimhood - instead of thrift, hard work, self-improvement and property ownership. They rest on the assumption of superiority in the nontarget groups, and reinforce the sense of inferiority in target groups.

State intervention can be as distorting in the cultural sphere as in the economy. Because such intervention promotes an artificial market, it seems destined to be as futile an effort as state economic planning.

In both cases, the proper role of the state is to provide the political, legal and administrative framework in which individuals and groups can compete freely on a level playing field. Laws and policies should be neutral between religious, caste and gender as well as economic competitors.

Not all preferential policies have to be abandoned. But when public policy shifts from equal opportunity to equality of outcome, individual and national interests are subordinated to the claims of special interest groups. Formulation and application of policies of positive discrimination require a sensitivity to potential pitfalls as well as to past injustices.

The writer, vice rector of the United Nations University in Tokyo and author of "The Government and Politics of India," contributed this personal comment to the International Herald Tribune.

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