What is the caste based reservation system in India?

Caste based reservation system is an affirmative action program for protecting the oppressed castes of India from caste based discrimination. It is important to understand the background of the caste system to understand what it is and why it is required in the form it is now.
History of Indian caste system 
Indian caste system is one of oldest surviving form of segregation present in the world. This system is claimed to be a fallout of the Aryan invasion of India.  In Sanskrit it is called the  Chatur (four) varna (color)system. It literally means four color system. The colors refers to the skin color of the Aryans (white) and Dravidians (dark skinned). Since there was intermixing between these races in the past, there were more shades. 

The Chaturvarna system divided people in to 4 + 1 categories and Brahmins (clergy), Kshatriyas (kings/warriors), Vaishyas (traders/landowners), Shudras (workers) and outcastes (tribals). The top 3 - Brahmins, Kshatriyas and Vaishaya were the 'purer' ones called the twice-born castes. Only the 'purer' ones who were allowed to learn to read/write and prosper. Much of Indian history and mythology describes the life and times of the twice-borns.

The Shudras were sort of like bonded laborers.  The caste system assigned 'jobs' to castes by birth.  They were not allowed to change their jobs. Their jobs were usually the 'dirty jobs' to clean dead animals, manual scavenging, farm labor. They were considered dirty and impure because of their karma (sins) of in their past birth. These were the untouchables - ReferUntouchability

Shudras were not allowed own land, own money or learn to read and write. Shudras were not allowed enter the cities, villages where upper-castes live. Shudras lived at the out skirts of the city or village. 

Demographics
Upper-castes (GC/FC)- (Brahmins, Kshtriyas, Vaishyas) Forward Castes (FC) or General Category (GC) are the wealthiest, educated, politcally powerful in India. They are about 31% of Indian population but represent about 95% of India in any non-governmental organization. They dominate any where between 60-75% of government positions.

Scheduled Tribes (ST)- About 9% of population - amongst the poorest Indians living in remote tribal areas with practically no modern facilities like electricity are available. Their tribal land are of interest for their mineral wealth.

Scheduled Castes (SC)- These are the untouchable class - they are the landless people - socially segregated, illiterate, ignorant and poor pepole of India. They are about 19% of Indian population.

Note: SC/STs are also known as Dalits (meaning the oppressed).

Other backward classes (OBC) - These people were the Shudras who in some parts of the country allowed to farm on leased land. Eventually they were allowed to own the land they tilled.  They occupy about 41% of Indian population. These people were educationally, economically and socially backward people but were not segregated as much.
 Is this right systems...???

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