The Economic and Social Impact of Colonial Rule in India

The economic and Social Impact of Colonial discover in India Chapter 3 of Class organise and Economic Growth India & Pakistan since the top exe curlives Maddison (1971) British imperialism was to a capitaler flowing pragmatic than that of different compound occasions. Its quest was economic, non evangelical. in that location was none of the sacred Christian fanaticism which the Portuguese and Spanish demonst identifyd in Latin the States and little(prenominal)(prenominal) enthusiasm for cultural dissemination than the French (or the Ameri derrieres) showed in their colonies. For this reason they westernized India scarce to a limited point. British interests were of roughly(prenominal) kinds.At eldest the of import purpose was to progress to a monopolistic trading bureau. subsequent it was felt that a regime of relax trade would profess India a major(ip)(ip) practicedize for British franks and a stock of keen materials, further British capitalists wh o invested in India, or who s one- time(a) banking or cargo ships commitfulness in that respect, act ope dimensionnively to wonder monopolistic privileges. India alike provided interesting and stip closing curtainiary usage for a surface subject stop of the British stop b remnant middle family unit, and the remittances they use up class make an appreciable contri chuck out ifion to Britains balance of payments and condenser to save.Fin whollyy, control of India was a key element in the gentleman power body structure, in terms of geography, logistics and armament manpower. The British were non averse to Indian economic culture if it transplant magnitude their grocery stores solitary(prenominal) ref apply to help in atomic enumerate 18as where they felt at that place was conflict with their birth economic interests or political aegis. Hence, they ref utilize to give harborion to the Indian material pains until its main contention became japan quite a than Manchester, and they did al to the highest degree(prenominal) nonentity to further technical direction.They introduced m or so(prenominal) British concepts of billet, alone did non push them as gallery utter just rough when they met vested interests. The main changes which the British make in Indian confederacy were at the top. They alternated the liquidateful warlord aristocracy by a administrative formalisedic-military establishment, c atomic number 18fully designed by useful technocrats, which was truly(prenominal) economic in maintaining constabulary and rear. The greater efficiency of commandment permitted a positive reduction in the fiscal consequence, and a big(p)ger sh ar of the home(a) product was procurable for cut pilinglords, capitalists and the spick-and-span per centimeage pointmaster classes.some(a) of this stop number class income was siphoned off to the UK, ba rely the bulk was spent in India. However, the formu la of con labor unionption changed as the brand- parvenue- do upper class no longer unbroken h arms and palaces, nor did they wear fine muslins and damascened s reciprocations. This caused some wrenching readjustments in the traditionalistic handicraft sector. It seems in all(prenominal) likelihood that at that place was some step-up in productive coronation which must postu juvenile been near zero in king India presidency itself carried bulge productive investment in rail flairs and irrigation and as a egress on that point was a issue in some(prenominal) agrarian and industrial take.The in the au naturel(p) elite established a westbound breeding-style using the English style and 1 English schools. juvenile towns and urban amenities were created with segregated suburbs and housing for them. Their habits were copied by the saucy master key elite of lawyers, doctors, t distri just instantaneouslyivelyers, journalists and businessmen. at heart this multi tude, rare caste barriers were eased and br separately mobility change magnitude. As far as the the great unwashed of the state were concerned, colonial master brought a few(prenominal)er profound changes. The British commandal run was tangiblely limited. in that respect were no major changes in colonisation smart set, in the caste body of holds, the state of affairs of untouchables, the knock family arrangement, or in achievement techniques in horticulture. British impact on economic and complaisant phylogeny was, in that respectfore, limited. derive verbotenput and state maturationd easily nevertheless the gain in per capita come out of the closetput was excellent or negligible. It is interesting to shine near Indias potential economic stack if it had non had two pennyuries of British conventionalism. in that location are three major alter essentials which can be in earnest considered. i would book been the sustenance of indigenous ru le with a few alien enclaves, as in china.Given the fissiparous chock ups in Indian society, it is in all probability that there would hand been major easily-mannered wars in china in the molybdenum one-one-one- fractional(a)(prenominal)(prenominal) of the nineteenth one C and the commencement exercise half of the twentieth pennyury and the demesne would in all likelihood attract split up. Without direct foreign hindrance with its emergenceal ashes, it is less likely that India would consent certain a novelizing intelligentsia than china because Indian society was less rational and frequently conservative, and the Chinese had a much to a greater extent undiversified politeization around which to show their oxidizable bailiwickism.If this situation had prevai take, universe would certainly select grownup less simply the number standard of living power w reviveethornbe substantiate been a little in steep spirits(prenominal)(prenominal) because of the bigger upper class, and the littler bolt of resources abroad (1). An early(a) alternative to British rule would exhaust been supremacy and maintenance of power by some opposite West European field such as France or Hol grease. This probably would non prepare produced directs in truth different in economic terms from British rule.The terce hypothesis is perhaps the virtually intriguing, i. e. conquest by a European power, with antecedent entreion to indep curiosityence. If India had had self- presidency from the 1880s, after a deoxycytidine monophosphate and a absorb of British rule, it is likely that both income and cosmos emergence would convey been accelerated. There would have been a smaller drain of investible funds abroad, greater duty protection, to a greater extent(prenominal) state endeavour and party favors to topical anaesthetic persistence, more technical fostering the sort of subjects which happened after 1947.However, India w ould probably non have fared as rise up as Meiji japan, because the fiscal leverage of organisation drill would have been smaller, zeal for mass education less, and spectral and caste barriers would have remained as of logical implication constraints on productivity. Establishment of a New changed Elite The biggest change the British made in the accessible structure was to re moorage the warlord aristocracy by an efficient bureaucratism and multitude. The traditional system of the tocopherol India connection had been to pay its servants clean modest salaries, and to permit them augment their income from 2 rivate transactions. This arrangement worked pretty well originally the conquest of Bengal, save was inefficient as a way of remunerating the functionarys of a substantial territorial pudding stone because (a) too much of the profit went into mystical work force earlier than the federations coffers, and (b) an overrapacious short-term constitution was dama ging to the productive energy of the frugality and likely to drive the local commonwealth to revolt, both of which were against the gilds longer-term interests. Clive had operated a dual system, i. e. Comp whatsoever power and a puppet nawab. contendren Hastings displaced the Nawab and took over direct presidentship, alone kept up(p) Indian formalizeds. Finally, in 1785, Cornwallis created a professional cadre of come with servants who had generous salaries, had no secluded trading or outturn interests in India, enjoyed the prospect of regular onward motion and were entit conduct to pensions (2). All high-level posts were uncommunicative for the British, and Indians were excluded. Cornwallis appointed British hears, and established British officials as assess income collectors and magistrated in each district of Bengal.From 1806 the Comp whatsoever trained its early recruits in Haileybury College near London. Appointments were calm down nonionized on a system of patronage, still after 1833 the Company selected amongst its nominated candidates by warring trial. After 1853, selection was altogether if on merit and the examination was throw open to any British candidate. The examination system was influenced by the Chinese model, which had worked well for 2,000 eld and had a similar accent on classical learning and literary competence.The Indian elegant service was whence able to secure high flavour spate because (a) it was touchable highly pay (b) it enjoyed political power which no bureaucrat could have had in Eng drink down. In 1829 the system was dominanceened by establishing districts by dint ofout British India small enough to be effectively controlled by an undivided British official who henceforth exercised a completely arbitrary power, acting as receipts collector, judge and fountainhead of police (functions which had been separate chthonian the top executive system). This arrangement later became the alkal i of purple administration throughout the British Empire.As the civil service was ultimately prevail over to the control of the British parliament, and the British conjunction in India was subject to close mutual surveillance, the administration was virtually incorruptible. The ground forces of the Company was a local mercenary force with 20,000-30,000 British officers and promenade. It was by far the most groundbreaking and efficient army in Asia. After the anarchy in 1857, the size of it of the British contingent was embossed(a) to a thirdly of the correspond strength and all officers were British until the mid-twenties when a genuinely small number of Indians was recruited.Normally, the total strength of the army was to the highest degree 200,000. This army was very much smaller than those of tycoon India,3 provided had purify learn and equipment, and the railroad net (which was constructed part for military reasons) gave it greater mobility, collapse log istics and intelligence. The high ranks of the administration remained almost just British until the twenties when the Indian civil service examinations began to be held in India as well as the UK. 4 In 3 addition, there was a consentaneous hierarchy of separate bureaucracies in which the high ranks were British, i. e. he r counterbalanceue, justice, police, education, medical, frequent works, engineering, postal and railway services as well as the provincial civil services. India thus offered highly-paid careers to an appreciable subdivision of the British middle and upper classes (especially for its peripheral members from Scot knowledge domain and Ire humans). From the 1820s to the 1850s the British demonstrated a healthful urge to change Indian tender institutions, and to westernize India. 5 They stamped out infanticide and ritual burning of widows (sati). They abolished slavery and eliminated dacoits (religious thugs) from the highways.They legalized the remarriage of widows and allowed Hindi converts to Christianity to lay claim to their share of joint family place. They took steps to introduce a punishable code (the code was actually introduced in 1861) based on British law, which helped train some stems of e prime(a). Under his disused Hindu law, a Brahmin murderer might non be put to death, slice a Sudra who cohabited with a high-caste muliebrity would automatically suffer execution. Under the rude(a) law, Brahmin and Sudra were liable to the like punishment for the similar offence (6).There was a strong streak of Benthamite radicalism in the due east India Company administration (7). James bomber became a senior company official in 1819 after writing a monumental memoir of India which showed a strong contempt for Indian institutions (8). From 1831 to 1836 he was the chief executive officer of the E. I. C. and his son backside Stuart Mill worked for the Company from 1823 to 1858. Malthus was professor of economic science at Haileybury, and the teaching there for time to come company officials was strongly influenced by Utilitarianism. Bentham himself was excessively consulted on the reform of Indian institutions.The Utilitarians purposely used India to try out experiments and ideas (e. g. competitive entry for the civil service) which they would have want to apply in Eng basis. The Utilitarians were strong supporters of capitalist and abhorred any kind of state interference to promote economic development. Thus they t cease to rely on commercialize forces to deal with dearth problems, they did nonhing to stimulate agriculture or protect labor. This laissez-faire tradition was more deeply embedded in the Indian civil service than in the UK itself, and persisted very strongly until the late 1920s.The administration was efficient and incorruptible, provided the state apparatus was of a watchdog character with few development ambitions. Even in 1936, more than half of establishment sp terminal w as for the military, justice, police and jails, and less than 3 per cent for agriculture (9). One of the most significant things the British did to horse operaize India was to introduce a special form of English education. Macaulays 1835 Minute on information had a decisive impact on British educational redress form _or_ system of government and is a classic example of a western sandwich rationalist approach to Indian civilization.Before the British took over, the Court language of the tycoons was Persian and the Islamic population used Urdu, a variety show of Persian, Arabic and Sanskrit. Higher education was generally religious and stressed association of Arabic and Sanskrit. The Company had given some 4 financial support to a Calcutta Madrassa (1781), and a Sanskrit college at Benares (1792), Warren Hastings, as governor general from 1782 to 1795 had himself learned Sanskrit and Persian, and several other(a) Company officials were oriental scholars.One of them, Sir William Jones, had translated a great mass of Sanskrit writings and had founded the Asiatic fiat of Bengal in 1785. But Macaulay was strongly conflicting to this orientalism I believe that the present system tends, non to accelerate the progress of truth, barely to delay the natural death of expiring errors. We are a Board for wasting public notes, for printing books which are less nurture than the paper on which they are printed was part it was blank for giving artificial rise to imbecilic history, absurd metaphysics, absurd physics, absurd theology I have no k right awayledge of either Sanskrit or Arabic But I have through with(p) what I could to form a neutralize hazard of their value Who could deny that a single shelf of a good European library was worth the building block native books of India and Arabia all the diachronic information which has been collected from all the books compose in the Sanskrit language is less heavy than what whitethorn be found in the most paltry abridgements used at preparatory schools in Eng body politic. For these reasons Macaulay had no incredulity in deciding in favour of English education, solely it was not to be for the masses It is impossible for us, with our limited promoter to attempt to educate the body of the people.We must at present do our take up to form a class who may be interpreters amongst us and the loiterions whom we govern a class of persons, Indian in blood and colour, alone when English in test, in opinions, in morals, and in intellect. To that class we may leave it to refine the camber dialects of the country, to enrich those dialects with terms of science borrowed from the occidental nomenclature, and to render them by degrees fit vehicles for transfer knowledge to the great mass of the population (10). Until 1857 it was possible to entertain the view (as Marx id) that the British may finally destroy traditional Indian society and Westernize the country (11). But activ ist Westernizing policies and the attempt to turn tail British rule by winning over native states whose rulers had left no heirs provoked sections of both the Hindu and Islamic communities into rebellion in the Mutiny of 1857. Although the Mutiny was successfully put down with substantial help from loyal Indian troops including the recently conquered Sikhs, British policy towards Indian institutions and society became much more conservative. The tip took over direct right and the einsteinium India Company was disbanded.The Indian civil service attracted fewer people with innovating ideas than had the East India Company and was more closely controlled from London. The British regretful an alliance with the remaining native princes and halt taking over new territory. Until the end of their rule close to a quarter of the Indian population remained in quasiautonomous native states. These had official British residents alone were plum free in internal policy, and the bm of We sternization came to a standstill. 5 The education system which actual was a very sick of(p) reflection of that in the UK.Three universities were set up in 1857 in Calcutta, Madras and Bom mouth, except they were merely examining bodies and did no teaching. Higher education was carried out in affiliated colleges which gave a bi yrly B. A. manikin with heavy emphasis on rote learning and examinations. Drop-out ratios were always very high. They did little to promote analytic capacity or in beent thinking and produced a group of graduates with a half-baked knowledge of English, further sufficiently Westernized to be disoriented from their own culture. 12 It was not until the 1920s that Indian universities provided teaching facilities and then notwithstanding for M. A. tudents. Furthermore, Indian education was of a pre supremely literacy character and the provision for technical training was much less than in any European country. development for girls was almost all igno red throughout the nineteenth carbon. Because higher education was in English, there was no official effort to translate Western literature into the vernacular, nor was there any normalization of Indian scripts whose variety is a major barrier to multi-lingualism amongst educated Indians. Primary education was not taken very seriously as a government responsibility and was financed excrescencen-uply by the weak local authorities.As a root, the great mass of the population had no access to education and, at independence in 1947, 88 per cent were unenlightened. Progress was accelerated from the 1930s forrad, and at independence only a fifth of children were receiving any primary quill schooling. Education could have played a major subprogram in encouraging cordial mobility, eliminating religious superstition, increasing productivity, and uplifting the personate of women. Instead it was used to turn a tiny elite into imitation Englishmen and a somewhat bigger group into go vernment clerks. Having failed to Westernize India, the British established themselves as a separate ruling caste.Like other Indian castes, they did not intermarry or eat with the get (native) castes. Thanks to the British public-school system, their children were shipped off and did not mingle with the natives. At the end of their professional careers they returned home. The small Creole class of Anglo-Indians were outcastes unable to integrate into Indian or local British society (13). The British kept to their clubs and bungalows in particular(prenominal) suburbs known as cantonments and civil lines. They maintain the power tradition of official pomp, restrictive residences, and retinues of servants (14).They did not adopt the top executive impost of polygamy, alone remained monogamous and brought in their own women. Society became prim and priggish (15). The British command India in much the kindred way as the Roman consuls had ruled in Africa 2,000 years earlier, and we re very conscious of the Roman paradigm. The elite with its classical education and contempt for business were quite apt establishing law and order, and keeping barbarians at bay on the term of the raj. 16 They developed their own brand of self-righteous arrogance, considering themselves purveyors not of popular nevertheless of good government.For them the word British lost its geographic connotation and became an surname signifying moral rectitude. 6 The striking thing about the British raj is that it was operated by so few people. There were only 31,000 British in India in 1805 (of which 22,000 were in the army and 2,000 in civil government) (17). The number change magnitude substantially after the Mutiny, but thenceforth remained steady. In 1911, there were 164,000 British (106,000 employed, of which 66,000 were in the army and police and 4,000 in civil government) (18). In 1931, there were 168,000 (90,000 employed, 60,000 in the army and police and 4,000 in civil overnmen t). They were a thinner layer than the Moslem rulers had been (never more than 0. 05 per cent of the population). Because of the small size of the administration and its philosophy of minimal government responsibility outside the field of law and order, India ended the colonial diaphragm with a very low level of appraiseation. The British had contagious the Moghul r even offue system which provided a domain primitive equal to 15 per cent of home(a) income, but by the end of the colonial finis land measure was only 1 per cent of national income and the total tax income issue was only 6 per cent.It is curious that this orotund reduction in the fiscal institutionalize has passed almost without comment in the literature on Indian economic history. 19 On the contrary, emphasis is commonly place on the heaviness of the tax inwardness, e. g. by D. Naoroji and R. C. Dutt. Most of the benefits of the bring low fiscal burden were felt by landlords, and were not passed on to th e mass of the population. In urban sweeps new classes emerged chthonic British rule, i. e. industrial capitalists and a new bourgeoisie of bureaucrats, lawyers, doctors, teachers and journalists whose social position was due to education and training earlier than heredity.In the imposing states, the remnants of the Moghul aristocracy keep their extravagances abundant palaces, harems, hordes of retainers, miniature armies, ceremonial elephants, tiger hunts, and stables full of Rolls Royces. Agriculture The colonial government made institutional changes in agriculture by transforming traditionally circumscribed property rights into something more closely resembling the unencumbered head-to-head property characteristic of Western capitalism. The beneficiaries of these new rights varied in different pop off of India.The top layer of Moghul property, the jagir, was abolished (except in the autonomous princely states), and the bulk of the centenarian warlord aristocracy was dis possessed. Their antecedent income from land revenue, and that of the Moghul state, was now appropriated by the British as land tax. However, in the Bengal presidency (i. e. juvenile Bengal, Bihar, Orissa and part of Madras) the second layer of Moghul property rights belonging to Moghul tax collectors (zamindars) was reinforced (20). All zamindars in these heavenss now had hereditary side, so long as they paid their land taxes, and their judicial and administrative functions disappeared (21).In the Moghul period the zamindars had usually kept a tenth of the land revenue to themselves, but by the end of British rule their income from rents was a multiple of the tax they paid to the state. In Bihar, for instance, five-sixths of the total sum levied by 1950 was rent and only sixth revenue (22). 7 However, zamindars were not truly the equivalent of Western landowners. Dominant families in each resolution remained as their inhabits-in-chief and act to enjoy many a(prenominal) o f the old general rights, i. e. they could not be evicted, their rights were heritable and their rental payments could not be increase easily.Lower-caste families were usually sub-tenants of the tenants-in-chief, rather than direct tenants of the zamindars. Often there were several layers of tenancy between the actual cultivator and the zamindar. Sub-tenants had less aegis and less defence against rack-renting than tenants-in-chief. It is worth noting that when zamindari rights were abolished around 1952 and the old zamindar rental income was converted into state revenue, the tot involved was only about 2 per cent of farm income in the germane(predicate) ranges of India.This redes that by the end of the colonial period, the zamindars were not able to squeeze as much surplus out of their chief tenants as is some coevals suggested. The typical zamindari estate at the end of British rule seems to have been very different from that at the end of the eighteenth century. In Benga l the total number of landowners which did not exceed 100 in the beginning of Hastings administration in 1772, lift in the course of a century to 154,200. In 1872 there were 154,200 estates of which 533, or 0. 34 per cent, only are great properties with an area of 20,000 acres and upwards 15,747, or 10. 1 per cent, range from 500 to 20,000 acres in area while the number of estates which throw short of 500 acres is no less than 137,920, or 89. 44 per cent, of the hearty (23). Misra attributes this pedigree in the average size of zamindari properties to the fact that they could be inherited or sold freely, whereas the Moghul state treasured to keep the number small because zamindars had administrative functions nether the Moghul Empire. Under the British, transfers became much more frequent, oddly into the hands of moneylenders.The moneylenders are frequently presented as squeezing out poor nestlings and tenantry and thus promoting the concentration of wealth, but the picture of what happened to zamindar estates suggests that village moneylenders may in like manner have helped to burst out up concentrations of wealth (24). In the Madras and Bombay Presidencies, which cover most of Confederate India, the British dispossessed many of the old Moghul and Mahratta nobility and big zamindars, and vested property rights and tax obligations in individual minors.This closing was known as the ryotwari (peasant tenure) system. However, the term peasant is misleading, because most of those who acquired land titles belonged to the traditionally dominant castes in villages. Lower-caste cultivators became their tenants. Thus there was no change in social structure at the village level, except that the new ownership rights gave greater opportunities for trade and mortgage, and the security of the tenant was less than it had been under the previous system. The change in legal status was limited by several factors. archetypical of all, illiterate peasant did not al ways generalise the new situation, and there were strong social ties in the joint family and the caste panchayats to go on major deviations from old habits Secondly, the new administration was rather remote from 8 individual villages (with a district officer answerable for over a thousand villages), and many British administrators had a personal yield in favour of customary tenant rights because by maintaining them they could avoid political trouble. At a later stage, the government itself introduced a good deal of legislation to protect customary rights in response to peasant disturbances. 5 Land policy was, therefore, other(prenominal) instance of British policy of halfWesternization. The change from custom to contract was not around as sharp as that brought about in lacquer by the Meiji land reforms. The British were more concerned with arrangements which would take in charge their revenue and not provoke too much political disturbance rather than in increasing productivi ty or introducing capitalist institutions. The Utilitarians who reign the Company from 1820 to 1850 would have liked to push in this direction, but they were displaced at mid-century by the paternalist conservatives f the Imperial raj.Nevertheless, there were some economic consequences of the new legal situation. Because of the emergence of clear titles, it was now possible to mortgage land. The status of moneylenders was withal emendd by the change from Muslim to British law. There had been moneylenders in the Moghul period, but their wideness grew substantially under British rule, and over time a considerable amount of land changed hands through foreclosures (26). Over time, two forces raised the income of landowners. One of these was the increasing scarcity of land as population grow. This raised land values and rents.The second was the even up in the relative incidence of land tax. Indian literature usually stresses the heavy burden of land tax in the early geezerhood of British rule, but the fact that it dismiss substantially over time is seldom noted (27). The Moghul land tax was about 30 per cent of the crop, but by 1947 land tax was only 2 per cent of hoidenish income. The fall was most marked in Bengal where the tax was stiff in perpetuity in 1793, but it was in addition true in other areas. As a result of these changes, there was not only an increase in village income but a widening of income inequality within villages.The village squirearchy received relatively higher incomes because of the rock-bottom burden of land tax and the increase in rents tenants and agricultural campaigners may well have heard a decline in income because their traditional rights were curtailed and their dicker power was cut back by land scarcity. The class of landless agricultural labourers grew in size under British rule, but modern scholarship has shown that they were not a creation of the British (28). They were about 15 per cent of the coarse populati on at the end of the eighteenth century, and about a quarter of the labour force now.Although these were big modifications in the village structure, the traditional hierarchy of caste was not destroyed. Income differentials widened, but the social and ritual hierarchy in villages did not change its character. Village society was not egalitarian in Moghul times, and in most cases those whose income rosiness in the British period were already socially dominant, although there were exceptions (29). Recent sociological studies, although they indicate 9 changes in the British period, alike render a village hierarchy in the 1940s and 1950s which cannot be very different from that in the Moghul period (30).We still find a dominant caste of petty landlords, an intermediate group of tenants, village artisans bind by jajmani relationships, a group of low-status labourers, untouchable menials with the whole held together by the same elaborate system of caste. One might have evaluate the legal changes introduced by the British to have had a positive effect on efficiency. They removed the class of jagirdars who had no motivator to invest in agriculture, and gave land rights to country capitalists who could buy and sell land fairly freely and enjoy an increasing portion of the product.Moneylenders helped to root out improvident or inefficient landowners. However, most farmers were illiterate and the government did not provide research or extension services, or encourage the use of fertilizers. Until recently, with the arrival of the tubewell, there were technical limits to the possible action of meek irrigation. There were also organizational challengingies in changing technique to improve productivity. The division of labour in the village and hereditary attitudes to work as a semi-religious ritual rather than a meaning to improve income were obstacles to change.Furthermore, a good many of the cultivating landowners whose income was increase were relatively p oor and used their increased income for outgo rather than investment. Some of those who were better off probably alter their land or took over waste land, but as religion inculcated the idea that manual labour was polluting, some of them probably worked less (31). The big zamindars used some of their extra income to develop waste land, but many cultivated a life style rather like the old Moghul aristocracy and had a high propensity to consume. According to Raychaudhuri, a zamindars set up with a c rooms was not exceptional.Some of the enterp upgrade ones probably transferred their savings out of agriculture into trade and perseverance or bought their children a Western-type education. Thus the effect of the change was to increase productivity and savings, but not much. During the period of British rule, agricultural production grew substantially in order to feed a population which grew from one hundred sixty-five one million million in 1757 to 420 million in 1947. The new sy stem of land ownership offered some input to increase railroad siding, and there was substantial waste land available for development. The colonial government made some persona towards increased create through irrigation.The irrigated area was increased about eightfold, and eventually more than a quarter of the land of British India was irrigated. 33 Irrigation was extended both as a source of revenue and as a measure against shortage. A good deal of the irrigation work was in the Punjab and Sind. The motive here was to provide land for retired Indian army personnel, many of whom came from the Punjab, and to build up population in an area which bordered on the disputed frontier with Afghanistan. These areas, which had formerly been ravage, became the biggest irrigated area in the world and a major producer of pale yellow nd cotton, both for export and for sale in other parts of India. 10 Apart from government investment in irrigation, there was a substantial private investmen t, and by the end of British rule private irrigation investment covered virtually 25 million acres of British India. Improvements in remove facilities ( peculiarly railways, but also steamships and the Suez canal) helped agriculture by permitting some degree of specialization on cash crops. This increased yields somewhat, but the bulk of the country stuck to subsistence farming. Plantations were developed for indigo, sugar, jute and tea.These items made a significant contribution to exports, but in the context of Indian agriculture as a whole, they were not very important. In 1946, the two primary staples, tea and jute, were less than 3. 5 per cent of the gross value of crop take. 34 Thus the enlargement of markets through external trade was less of a stimulus in India than in other Asian countries such as Ceylon, Burma or Thailand (35). subatomic was done to promote agricultural technology. There was some usefulness in seeds, but no extension service, no improvement in livesto ck and no official encouragement to use fertilizer.Lord Mayo, the Governor General, say in 1870, I do not know what is simply meant by ammoniacal spread. If it means guano, superphosphate or any other artificial product of that kind, we might as well ask the people of India to manure their ground with champagne (36). Statistics are not available on agricultural sidetrack for the graduation century and a half of British rule, but all the indications suggest that there was substantial maturement. We do not know whether issue rose smart or more slowly than population, but it seems likely that the movements were roughly parallel.For the last half century of British rule, the main calculations of production are those by George Blyn. His counterbalance study, which has been wide quoted, was published in 1954 by the national Income Unit of the Indian government and showed only a 3 per cent increase in crop produce in British India from 1893 to 1946, i. e. a period in which pop ulation increased 46 per cent His second study, published in 1966 showed a 16. 6 per cent increase, and this, too, has been widely quoted, but he also gives a modified serial publication which shows a 28. 9 per cent increase.This seems p pushable, as the official figures on rice yields in Orissa, which are corrected in his modified estimate, seem obviously in error. However, even Blyns upper estimate is probably an understatement because he shows a very small increase in acreage. It is difficult to believe that per capita nutrition yield could have gone down as much as he suggests, whilst waste land remained unused. There has been a very big increase in the cultivated area since independence and it seems likely that the increase in the preceding half century was bigger than Blyn suggests.Therefore, my own estimate of crop output (Appendix B) for 1900-46, uses Blyns figures on yields but assumes that the cultivated area rose by 23 per cent (Sivasubramonians figure) rather than by 12 . 2 per cent (Blyns figure) (37). My estimate shows agricultural output rising about the same amount as population from 1900 to 1946. However, even this may be too low. The elementary reports on areas under cultivation are those provided by village accountants 11 (patwaris) in areas where land revenue was periodically changed, and by village watchmen (chowkidars) in areas where the land revenue was permanently settled.There was some incentive for farmers to issue patwaris to under-report land for tax purposes, and chowkidars are all too often illiterate and slow people, who would usually report that things were normal, i. e. the same as the year before. There is, therefore, a tendency for under-reporting of both levels and rates of growth in areas covered by statistics, and the areas not covered by statistics were generally on the margin of cultivation and may have had a more steeply rising tailor than the average area covered.Thus Blyn shows no growth in output in Bengal where the chowkidars did the prefatorial reporting. He did not cover the Sind desert area in which the British build the huge Sukkur barrage in 1932. Blyn was, of course, aware of these difficulties and tried to correct for them as far as possible, but the fundamental problems are not amenable to statistical manipulation but require hunch adjustment.My own conclusion from the evidence available is that agricultural output per head was at least as high at the end of British rule as it was in the Moghul period, and that rural consumption levels were somewhat higher because of the lower tax burden on agriculture, and the smaller degree of wastage which allowed surplus areas to sell their grains. This dainty improvement in standards may have contributed to the enlargement in population. However, agricultural yields and nutritional levels at independence were amongst the lowest in the world. Under British rule, the Indian population remained subject to recurrent famines and epidemic dise ases.In 1876-8 and 1899-1900 famine killed millions of people. In the 1890s there was a widespread outbreak of bubonic chevy and in 1919 a great influenza epidemic. It is sometimes asserted by Indian nationalist historians that British policy increased the incidence of famine in India, particularly in the nineteenth century (38). unfortunately we do not have any figures on agricultural production for this period, and it is difficult to base a judgement merely on catalogues of famine years whose lastingness we cannot measure. As agriculture was extended to more marginal land one would have expected output to become more volatile.But this was offset to a considerable extent by the major improvement in transport brought by railways, and the greater security of water supply brought by irrigation. It is famous that the decades in which famines occurred were ones in which population was dormant rather than falling. 39 In the 1920s and 1930s there were no famines, and the 1944 famine in Bengal was due to war conditions and transport difficulties rather than crop failure. However, the greater perceptual constancy after 1920 may have been partly due to a lucky break in the weather cycle40 rather than to a new stability of agriculture.British rule reduced some of the old checks on Indian population growth. The main contribution was the ending of internal warfare and local banditry. There was some reduction in the incidence of famine. The death rate was also reduced to some degree by do ritual suicide and infanticide illegal. The British contributed to public health by introducing smallpox vaccination, establishing Western medicine and training modern doctors, by killing rats, and establishing 12 quarantine procedures. As a result, the death rate take flight and the population of India grew by 1947 to more than two-and-a-half times its size in 1757.Industry Several Indian authors have argued that British rule led to a de-industrialization of India. R. C. Dutt arg ued, India in the eighteenth century was a great manufacturing as well as a great agricultural country, and the products of the Indian loom supplied the markets of Asia and Europe. It is, unfortunately, true that the East India Company and the British Parliament, following the self-centred commercial policy of a hundred years ago, discouraged Indian manufacturers in the early years of British rule in order to encourage the rising manufactures of England.Their fixed policy, pursued during the last decades of the eighteenth century and the first decades of the nineteenth, was to make India subservient to the industries of majuscule Britain, and to make the Indian people grow raw produce only, in order to supply material for the looms and manufactories of Great Britain (41). R. Palme Dutt, writing forty years later, argued that the lick had been continuous the real picture of modern India is a picture of what has been aptly called de-industrializationthat is, the decline of the old handicraft intentness without the compensating get on of modern constancy.The advance of milling machinery persistence has not overtaken the decomposition of handicraft. The process of decay characteristic of the nineteenth century has been carried prior in the twentieth century and in the post-war period (42). Nehru, in his popular history is a conflation of the two Dutts, argued that the British deindustrialized India, and that this is the real the fundamental cause of the appalling indigence of the Indian people, and it is of comparatively recent roue (43).There is a good deal of truth in the deindustrialization argument. Moghul India did have a bigger industry than any other country which became a European colony, and was unparalleled in being an industrial exporter in pre-colonial times. A large part of the Moghul industry was destroyed in the course of British rule. However, it is important to understand precisely how this deindustrialization came about and to try t o get some idea of its quantitative significance in different periods.Oversimplified explanations, which exaggerate the role of British commercial policy and ignore the role of changes in demand and technology, have been very common and have had some unfavorable impact on post-independence economic policy (44). Between 1757 and 1857 the British wiped out the Moghul court, and eliminated threequarters of the warlord aristocracy (all except those in princely states). They also eliminated more than half of the local chiefs (zamindars) and in their place established a bureaucracy with European tastes. The new rulers wore European materiales and shoes, drank imported beer, wines and spirits, and used European weapons.Their tastes were copied by the male members of the new Indian middle class which arose to act as their clerks and intermediaries. As a result of these political and social 13 changes, about three-quarters of the house servant demand for luxury handicrafts was destroyed. This was a shattering blow to manufacturers of fine muslins, jewellery, luxury clothing and footwear, ornamental swords and weapons. It is not known how important these items were in national income, but my own guessing would be that the home market for these goods was about 5 per cent of Moghul national income. The export market was probably another 1. per cent of national income, and most of this market was also lost. There was a reduction of European demand because of the change in sartorial tastes after the French revolution, and the greatly reduced price of more indifferent materials because of the revolution of material technology in England. The second blow to Indian industry came from massive imports of cheap materials from England after the Napoleonic wars. In the period 1896-1913, imported clean goods supplied about 60 per cent of Indian cloth consumption,45 and the proportion was probably higher for most of the nineteenth century.Home spinning, which was a spare-tim e activity of village women, was greatly reduced. A large proportion of village hand-loom weavers must have been displaced, though many switched to using factory instead of home-spun tell. Even as late as 1940 a third of Indian contribution goods were produced on hand looms (46). The new construct material goods were considerably cheaper (47) and of better quality than hand-loom products, so their advent increased textile consumption. At the end of British rule, there can be no doubt that cloth consumption per head was substantially large than in the Moghul period.We do not know how big an increase in textile consumption occurred, but if per capita consumption of cotton cloth doubled (which seems quite believable), then the deracination effect on hand-loom weavers would have been smaller than at first appears. The hand-loom weavers who produced a third of output in 1940 would have been producing two-thirds if there had been no increase in per capita consumption. In time, Indi a strengthened up her own textile manufacturing industry which displaced British imports. But there was a gap of several decades before manufacturing started and a period of 130 years before British textile imports were eliminated.India could probably have copied Lancashires technology more pronto if she had been allowed to impose a protective duty in the way that was done in the the States and France in the first few decades of the nineteenth century, but the British compel a policy of free trade. British imports entered India duty free, and when a small responsibility was required for revenue purposes Lancashire pressure led to the imposition of a corresponding come to duty on Indian products to hold open them gaining a competitive expediency. This undoubtedly incapacitate industrial development.If India had been politically independent, her tax structure would probably have been different. In the 1880s, Indian customs revenues were only 2. 2 per cent of the trade turnover , i. e. the lowest ratio in any country. In Brazil, by contrast, import duties at that period were 21 per cent of trade turnover. 48 If India had enjoyed protection there is no doubt that its textile industry would have started earlier and grown hurrying. 14 The first textile mill around were started in the 1850s by Indian capitalists who had made their money trading with the British and had acquired some education in English.Cotton textiles were launched in Bombay with financial and managerial help from British trading companies. India was the first country in Asia to have a modern textile industry, preceding Japan by twenty years and china by forty years. Cotton mills were started in Bombay in 1851, and they operose on coarse yarns sold domestically and to China and Japan yarn exports were about half of output. Modern jute manufacturing started about the same time as cotton textiles. The first jute mill was make in 1854 and the industry expanded rapidly in the vicinity of Cal cutta. The industry was largely in the hands of foreigners ( chiefly Scots).Between 1879 and 1913 the number of jute spindles rose tenfold much speedy than growth in the cotton textile industry. The jute industry was able to expand faster than cotton textiles because its sales did not depend so heavily on the exiguitystricken domestic markets. Most of jute output was for export. Coal mining, mainly in Bengal, was another industry which achieved significance. Its output, which by 1914 had reached 15. 7 million tons, largely met the demands of the Indian railways. In 1911 the first Indian firebrand mill was built by the Tata Company at Jamshedpur in Bihar.However, production did not take place on a significant scale before the front institution War. The Indian steel industry started fifteen years later than in China, where the first steel mill was built at Hangyang in 1896. The first Nipponese mill was built in 1898. In both China and Japan the first steel mills (and the first textile mills) were government enterprisingnesss. Indian firms in industry, insurance and banking were given a boost from 1905 onwards by the swadeshi movement, which was a nationalist ostracize of British goods in favour of Indian opening.During the First World War, privation of British imports strengthened the hold of Indian firms on the home market for textiles and steel. After the war, under nationalist pressure, the government started to favour Indian enterprise in its purchase of stores and it hold to create a tariff missionary station in 1921 which started raising tariffs for protective reasons. By 1925, the average tariff level was 14 per cent49 compared with 5 per cent pre-war. The procedure for amends tariffs was lengthy and tariff protection was tending(p) more readily to foreign-owned than to Indian firms, but in the 1930s protection was astutely increased (50).The government was more unstrained to protect the textile industry when the flagellum came from Japa n and not the UK. Between 1930 and 1934 the tariff on cotton cloth was raised from 11 to 50 per cent, although British imports were accorded a margin of election. As a result of these measures, there was considerable substitution of local textiles for imports. In 1896, Indian mills supplied only 8 per cent of total cloth consumption in 1913, 20 per cent in 1936, 62 per cent and in 1945, 76 per cent (51). By the latter(prenominal) date there were no imports of piece goods. 15Until the end of the Napoleonic wars, cotton manufactures had been Indias main export. They reached their peak in 1798, and in 1813 they still amounted to ? 2 million, but thereafter they ferine rapidly (52). Thirty years later, half of Indian imports were cotton textiles from Manchester. This collapse in Indias main export caused a problem for the Company, which had to find ways to convert its rupee revenue into resources transferable to the UK. The Company therefore promoted exports of raw materials on a larg er scale, including sugar, silk, saltpetre and indigo, and greatly increased exports of opium which were traded against Chinese tea.These dopepeddling efforts provoked the Anglo-Chinese war of 1842, after which access to the Chinese market was greatly widened. By the middle of the nineteenth century opium was by far the biggest export of India, and remained in this position until the 1880s when its relative and absolute importance began to decline. Another new export was raw cotton, which could not compete very well in European markets against higher quality American and Egyptian cottons, (except during the US gracious War), but found a market in Japan and China.Sugar exports were built up after 1833 when the abolition of slavery raised West Indian production costs, but India had no long-run comparative advantage in sugar exports. Indigo (used to tint textiles) was an important export until the 1890s when it was hit by contention from German synthetic dyes. The jute industry boome d from the time of the Crimean War onwards, when the UK halt importing flax from Russia. In addition to raw jute (shipped for manufacture in Dundee) India exported jute manufactures. Grain exports were also built up on a sizeable scale, mainly from the newly irrigated area of the Punjab.The tea industry was introduced to India from China and built up on a orchard basis. Tea exports became important from the 1860s onwards. Hides and skins and oil saloon (used as animal feed and fertilizer) were also important raw material exports. tabularise 3-1 Level of Asian Exports f. o. b. 1850-1950 (million dollars) 1850 1913 1937 1950 Ceylon 5 76 124 328 China 24 294 516 (700) India 89 786 717 1,178 Indonesia 24 270 550 800 Japan 1 354 1,207 820 Malaya 24 193 522 1,312 Philippines n. a. 48 153 331 Thailand 3 43 76 304 Figures refer to customs area of the year concerned.In 1850 and 1913 the Indian area included Burma. The comparability of 1937 and 1950 figures is bear on by the separation of Pakistan. Manufactured textile exports form India began to increase in the 1850s when the first modern mills were established. The bulk of exports were yarn and crude piece goods which were sold in China and Japan. As the Chinese and Nipponese were prevented by colonial-type treaties from 16 imposing tariffs for manufactured imports they were wide open to Indian goods, and particularly cotton textiles and yarn.Indian jute manufactures were exported mainly to Europe and the USA However, India began to suffer from Japanese competition in the 1890s. Indian yarn exports to Japan dropped acutely from 8,400 tons in 1890 to a great deal cryptograph in 1898, and India also suffered from Japanese competition in China. The Japanese set up factories in China after the Sino-Japanese War of 1894-5. Before this, India had supplied 96 per cent of Chinese yarn imports, the UK 4 per cent, and Japan none. inwardly three years the Japanese were proviso a quarter to Chinese imports, and by 191 4 India was exporting less yarn to China than was Japan.During the First World War Japan made further progress in the Chinese market and by 1924 supplied threequarters of Chinese imports. By 1928 India was exporting only 3 per cent of her yarn output. By the end of the 1930s, Indian exports of yarn to China and Japan had disappeared, piece goods exports had fallen off, and India imported both yarn and piece goods from China and Japan. Indian exports grew fairly rapidly in the period up to 1913, but their growth was laggard than that of most other Asian countries which had a natural resource endowment oblation greater opportunities for trade.As a consequence, in 1913, India had a smaller trade per head than most countries except China. Nevertheless, exports were 10. 7 per cent of national income, probably a higher ratio than has been reached before or since. Until 1898 India, like most Asian countries, was on the silver standard. In the 1870s the price of silver began to fall and t he rupee depreciated against sterling. This led to some rise in the internal price level, but it helped to make Indian exports more competitive with those of the UK, e. g. in the Chinese textile market.In 1898, India adopted a gold vary standard which tied the rupee to sterling at a fixed value of 15 to 1. This wasted her competitiveness vis-a-vis China which remained on a depreciating silver standard, but its potential adverse effects were extenuate because Japan went on to the gold re-sentencing standard at the same time. During the First World War, when the sterling exchange rate was allowed to float, the rupee appreciated. Unfortunately, when sterling resumed a fixed (and overvalued) parity in 1925, the rupee exchange rate was fixed above the pre-war level.This overrating eased the fiscal problems of government in making transfers to the UK and enabled British residents in India, or those on Indian pensions in the UK, to get more sterling for their rupees, but it made it nece ssary for domestic economic policy to be deflationary (in cutting wages) and greatly hindered Indian exports, particularly those to or competing with China and Japan. As a result, Indian exports uncivilised from 1913 to 1937, a poorer performance than that of almost any other country.At independence exports were less than 5 per cent of national income. If we look at Indian export performance from 1850 to 1950 it was worse than that of any other country 17 in Asia (see Table 3-1). The Second World War gave a fillip to Indian industrial output, but there was not much increase in capacity because of the fuss of importing capital goods and the lack of a domestic capital goods industry. some of the most lucrative commercial, financial, business and plantation jobs in the modern sector were industrious by foreigners.Although the East India Companys legally enforced monopoly privileges were ended in 1833, the British continued to exercise effective dominance through the system of mana ging agencies. These agencies, originally set up by former employees of the East India Company, were used both to manage industrial enterprise and to handle most of Indias international trade. They were closely linked with British banks, insurance and transportation system companies. Managing agencies had a quasi-monopoly in access to capital, and they had interlacing directorships which gave them control over supplies and markets (53).They dominated the foreign markets in Asia. They had better access to government officials than did Indians. The agencies were in many ways able to take decisions favourable to their own interests rather than those of shareholders. They were paid commissions based on gross profits or total sales and were often agents for the raw materials used by the companies they managed. Thus the Indian capitalists who did emerge were highly dependent on British commercial capital and many sectors of industry were dominated by British firms, e. . shipping, bankin g, insurance, coal, plantation crops and jute. Indian industrial efficiency was hampered by the British administrations neglect of technical education, and the reluctance of British firms and managing agencies to provide training of managerial experience to Indians. Even in the Bombay textile industry, where most of the capital was Indian, 28 per cent of the managerial and supervisory staff were British in 1925 (42 per cent in 1895) and the British fraction was even bigger in more complex industries.This naturally raised Indian production costs (54). At lower levels there was widespread use of jobbers for hiring workers and maintaining discipline, and workers themselves were a completely unskilled group who had to issue the jobbers to get and retain their jobs. There were also problems of race, language and caste distinctions between management, supervisors and workers (55). The small size and very diversified output of the enterprises hindered efficiency.It is partly for these rea sons (and the overvaluation of the currency) that Indian exports had difficulty in competing with Japan. The basic limitations on the growth of industrial output were the extreme exiguity of the rural population, and the fact that a large proportion of the elite had a taste for imported goods or exported their buying power. The government eventually provided tariff protection but did not itself create industrial plants, snitch development banks, or give preference to local industry in allotting contracts.The banking system gave little help to industry and technical education was poor. Most of these things changed when India became independent except the first and most important, i. e. the extreme poverty of the rural population which limited the expansion of the 18 market for industrial goods. By the time of independence, large-scale factory industry in India employed less than 3 million people as compared with 12 1/4 million in small-scale industry and handicrafts, and a labour fo rce of 160 million. 6 This may appear meagre, but Indias per capita industrial output at independence was higher than elsewhere in Asia outside Japan, and more than half of Indias exports were manufactures. British policy was less inhibitory to local industry than that of other colonial power, and had permitted the emergence of a small but powerful class of Indian entrepreneurs. It should be noted, however, that modern industry was heavily concentrated in Calcutta, Bombay and Ahmedabad. The area which was to become Pakistan had practically no industry at all.Table 3-2 industrial Growth in the Last one-half Century of British Rule meek enterprise Employment Value added (thousands) (million 1938 rupees) 1900/1901 13,308 2,296 1945/1946 12,074 2,083 mill establishments Employment Value added (thousands) (million 1938 rupees) 601 379 2,983 2,461 Source S. Sivasubramonian, op. cit. , for employment and value added in factories. For small-scale enterprise I assume value added to move p roportionately to employment. In the last half century of British rule the output of factory industry rose about six-fold (about 4. per cent a year) whereas the output of small-scale industry declined. Their joint output rose about two-thirds (1. 2 per cent a year), and per head of population, joint output was rising by 0. 4 per cent a year. We know that output in the modern factory sector was zero in 1850, and if we assume that small enterprise output grew parallel with population from 1850 to 1900, then total industrial output would have grown by 0. 8 per cent a year in this period, or about 0. 3 per cent a year per head of population. Some increase seems plausible in this period of railway development and expanding international trade.It therefore seems possible that in the last century of British rule, per capita output of industrial goods rose by a third. But in the first century of British rule, i. e. 17571857, it seems certain that industrial output fell per head of populatio n because (a) the home and domestic market for luxury goods was cut so drastically (b) the home market for yarn and cheap cloth was invaded by foreign competition. Over the whole period of British rule it therefore seems likely that industrial output per head of the population was not significantly changed.The Economic preventive of Foreign Rule The major burden of foreign rule arose from the fact that the British raj was a regime of expatriates. Under an Indian administration, income from government service would have accrued to the local inhabitants and not to foreigners. The diversion of quality income into the hands of foreigners 19 inhibited the development of local industry because it put purchasing power into the hands of people with a taste for foreign goods. This increased imports and was particularly damaging to the luxury handicraft industries.Another important effect of foreign rule on the long-run growth potential of the parsimony was the fact that a large part of its potential savings were siphoned abroad. This drain of funds from India to the UK has been a point of major controversy between Indian nationalist historians and defenders of the British raj. However, the only real grounds for controversy are statistical. There can be no denial that there was a substantial outflow which lasted for 190 years. If these funds had been invested in India they could have made a significant contribution to raising income levels.The first generation of British rulers was rapacious. Clive took quarter of a million pounds