Fellow outsider here. Got curious and did some searching; would love to hear from some real Indian folks to confirm or deny this line of reasoning.
As non-Indians, it seems we exist outside the system, which could be ambiguously interpreted to either have no connotation at all, or to exist at the bottom of the social strata. [1]
Anecdotally, the kind of treatment you'll get in practice depends a lot more on your race and national origin. [2]
Fellow outsider here. I worked in one of the FAGMAN in a group of about 50 Indians. It became clear rather quickly that I would never move up or get any serious promotion/raise. So at least this one group treated outsiders as lower-caste.
There were a couple Russians and Chinese in the group who seemed also permanently stuck at the bottom.
For the most part, if you wanted to move up, you left this group and moved into some other group in the company. I just left the company entirely.
So, assuming there is a hierarchy and Indian are not better than all other races, it seems the conclusion must be all societies have some kind of caste system, it's just we don't see it since we don't look for that sort of thing?
Prior to becoming hereditary, the caste system was employment based, so yes, in a sense every society has had some sort of caste system as someone responsible for say, cleaning shoes, was probably looked down upon in most societies compared to say, a king.
However, the key point of difference is that it was more deeply ingrained in Indian society and was made into a rather rigid hereditary system. While in other places the child of a shoe cleaner might end up marrying a trader or might end up working as a trader himself, doing so would have faced more resistance from society in India. This can still occasionally be seen in villages and sometimes even towns and cities, where individuals from different castes want to get married but are murdered instead, either by the community or even their own families.
This effectively forced those in 'lower' jobs like cleaning drains into that position for generations, inflicting a lot more unjust suffering upon them.
There were a couple Russians and Chinese in the group who seemed also permanently stuck at the bottom.
For the most part, if you wanted to move up, you left this group and moved into some other group in the company. I just left the company entirely.