Economic Impact Of British Colonial Rule

Answer : The British needed the land revenue to pay for purchase of Indian handicrafts, to meet the cost of conque3st of whole of India, to pay for employment of thousands of Englishmen in superior administrative services and to meet the costs of economic and administrative charges. To meet the revenue requirements, the British introduced different types of land tenures in India.

Under the Permanent Settlement, the zamindars and revenue collectors was converted into the many landlords. They were not only to act as agents of the Government in collecting land revenue from the royal, but also to become the owners of entire land in their zamindaris. Their right by ownership wax made hereditary and transferable. On the other hand, the cultivators were reduced to the status of mere tenants and were deprived of long-standing rights to the soil and other customary rights.

Several major factors were responsible in shaping the British Land Revenue Policy in India. Financial factors were one set of factors. The permanent settlement and other settlements seemed a fixed and stable income for the state and the state could depend upon that income.

Further, it saved the Government the expenses that had to be spent in making collections and arrestments. Economically, it was claimed that the land tenures would encourage agricultural enterprise and prosperity.

It was thought that waste land would be reclaimed and the soil under cultivation would be improved. The zamindars would introduce new methods of cultivation like better rotation of crops, use of manures etc. Thus, the settlements would create conditions for the development of the fullest power of the soil. This in turn would create a contented and resourceful peasantry.

The another major consideration was that the Permanent Settlement would create a class of loyal zamindars who would be prepared to defend the company at all costs because their rights were guaranteed by the British.

Thus, the Permanent Settlement secured for the Government the support of an influential class in the same way as the Bank of England had for William III. The zamindars of Bengal stood loyal to British divining the great rebellion of 1857. Further, it was hoped that under the Permanent Settlement, the zamindars would act as the natural leaders of the ryots and show their turbid spirit in helping the spread of education and other charitable activities.

Further, under the Permanent Settlement, the company was a financial loser in the long run. This is because the revenue to be paid by the zamindar was fixed in perpetuity. So, when the British conquered South India and Northern and Western India, they went for periodic settlements. They adopted the Ryotwari and the Mahalwari system of land revenues in which settlements were made directly with the ryots or the village community subject to they paying that requisite amount in revenue for the British.

The overall impact of the British Land Revenue Policy and the excessive demand coaled with the new judicial and administrative set up was that it turned India rural economy upside down with the village panchayats deprived of their two main functions – land settlements and judicial and executive functions- and the Patel acting merely as a Government official charged with the duty of revenue collection, the old politico-economic-social framework of village communities broke down.

The introduction of private property in land turned land into a market commodity. Changes came in social relationship. New Social Classes like the landlord, trader the moneylender and the landed gentry shot into importance.

The class of rural proletarian the poor peasant proprietor, the sub tenant, and the agricultural labour multiplied in number. The climate of cooperation gradually gave place to the system of competition and individualism. The prerequisites of the capitalist development of agriculture were created. Further, new modes of production, introduction of money economy, commercialization of agriculture, better means of transport and hostage with the work market added a new dimension to Indian agriculture and rural economy.

Further, the British land Revenue Policy led to improvement of the peasantry. The peasant was progressively improvised. Although he was now free from internal wars, his material condition deteriorated and he steadily sank into poverty. The British policy of extorting the largest possible land revenue had led to such devastation that one-third of Bengal, obsessed Cornwallis had been transformed into a jungle inhabited by only wild beasts. In both the permanently settled areas, and the areas of ryotwari settlements, the lot of peasants was unenviable.

They were left to the mercies of the zamindars who raised rents to unbearable limits, compelled them to pay illegal dues and to perform forced labour and oppressed them in devise other ways. In the areas of roytwari and mahalwari settlement, the Government took the place of the zamindars and raised excessive land revenue. The extreme poverty of the overwhelming

Majority of peasants left them without any resources with which to improve agriculture by using better cattle and seeds, more man wise and fertilizers and improved techniques of production. Nor did the cultivator sack rented by the Government or the zamindar had any incentive to do so. The overall impact of the all this was steady stagnation and deterioration of agriculture. The poverty of the people found expression in a series of famines which merged all parts of India in the record half of the 19^th century.

Answer : The British rule had pronounced and profound economic impact on India. The various economic policies followed by the British led to the rapid transformation of India’s economy into a colonial economy whose nature and structure were determined by needs of the British economy. One important aspect of British economic policy was commercialization of agriculture.

The commercialization of agriculture means that the agricultural crops and goods are produced by the peasants for sale in the market and not for their own consumption. Commercialization of agriculture in India began during the British rule. The commercialization of Indian Agriculture took place not to feed the industries of India because India was far behind in industrial development as compared to Britain, France, Belgium and many other European countries of eighteenth century.

The commercialization of Indian Agriculture was done primarily to feed the British industries that it was taken up and achieved only in cases of those agricultural products which were either needed by the British industries or could fetch cash commercial gain to the British in the European or American market. For example, several efforts were made to increase the production of cotton in India to provide r4aw and good quality cotton to the cotton-textile industries of Britain which were growing fast after the Industrial Revolution in Britain. Therefore, cotton growing area increase in India and its production increased manifold with gradual lapse of time. Indigo and more than that, tea and coffee plantation were encouraged in India because these could get commercial market abroad.

Most of the plantations for commercial crops were controlled by the English. Jute was another product that received attention of the English company because the jute made products got a ready market in America and Europe. The commercialization of India agriculture was initiated in India by the British through their direct and indirect policies and activities. Firstly, the new land tenure system introduced in form of permanent settlement and Ryotwari Settlement had made agricultural land a freely exchangeable commodity. The Permanent settlement by giving ownership right to the zamindars created a class of wealthy landlords, they could make use of this ownership right by sale or purchase of land. Further, the agriculture which had been way of life rather than a business enterprise now began to be practiced for sale in national and international market. Moreover, crops like cotton, jute, sugarcane, ground nuts, tobacco etc. which had a high demand in the market were increasingly cultivated. The beginning of the plantation crops like Tea, coffee, rubber, indigo etc heralded a new era in agricultural practices in India. These were essentially meant for markets and thus commercialization of agriculture took to new heights with the expansion of the British rule.

A large number of factors encouraged and facilitated commercialization of Indian agriculture. The political unity established by the British and the resultant rise of the unified national market was an important factor. Further, the spread of money economy replaced the barter and agricultural goods became market items. Further, the replacement of custom and tradition by competition and contract also led to the commercialization of Indian agriculture was also aided by the expansion of means of transportation and communication. The laying of railway lines and expansion of rail and road transport enabled the transportation of agricultural products from production centres to markets.

Another boosting factor for commercialization of agriculture in India was the gaining of speed of Industrial Revolution in England. This led to factor in commercialization as more and more agricultural goods were produced to satisfy the demand for raw materials by the British industries. The enlargement and expansion of international trade and the entry of British finance capital also belted commercialization of agriculture. This was especially so in cotton as the civil war disrupted the supplies of cotton from America and thereby increased demand for Indian cotton. Further, the British policy of one way free trade also acted as sufficient encouraging factor for commercialization as the manufactured items in textile, jute etc could find free entry in Indian markets, where as the manufactured goods did not have similar free access to European markets. The commercialization of agriculture was a forced and artificial process for the majority of Indian peasants. It was introduced under coercion of the British and not out of the incentive of peasantry at large. The peasantry went for cultivation of commercial crops under duress.

He had to pay the land revenue due to the British government in time. Moreover, he had to grow commercial crop on a specified tract of his land under the oppression of planters. The peasants also went in for growing commercial crops to pay back the interests due to money lenders in time.

The commercialization of Indian agriculture started post 1813 when the industrial revolution in England gained pace. The commercialization of agriculture had many results. It was beneficial to the British planters, traders and manufacturers, who were provided with opportunity to make huge profits by getting the commercialized agricultural products at throw away prices.

The commercialization of Indian agriculture also partly benefited Indian traders and money lenders who made huge fortunes by working as middlemen for the British. This regard they acted as conduits delivering the products from peasants to the British company from where it was taken abroad. Moreover, Indian money lenders advanced cash advances to the farmers to cultivate the commercial crops and if the peasants failed to pay him back in time, the land of peasants came under ownership of moneylenders.

However, most of the Indian people suffered miserably due to the British policy of commercialization of Indian agriculture. It resulted in reduced area under cultivation of food crops. The net result of this change was that Indian failed to produce even that much food crops which could provide even two square meals a day to its population.

The misery was further enhanced became the population of India was increasing every year, fragmentation of land was taking place because of the increasing pressure on land and modern techniques of agricultural production were not introduced in India. It affected adversely the poor people of India, it became difficult for them to get even sufficient food.

This becomes ample from the fact that in 1880 India had a surplus of foodstuffs to the extent of five million tons and by 1945 it had a deficit of 10 million tons. The consumption of food was then estimated at one and a half lb per individual and in 1945 it was 1 lb. Nearly thirty percent of the Indian population was estimated to be suffering from chronic malnutrition and under nutrition.

Thus, the commercialization of agriculture in India by the British was also one of the important causes of the impoverishment of the Indian people.

The poor peasant was forced to sell his produce just after harvest at whatever prices he could get as he had to meet in time the demands of the government, the landlord, the money lender and his family members’ requirements. This placed him at the money of the grain merchant, who was in a position to dictate terms and who purchased his produced at much less than the market price. Thus, a large share of the benefit of the growing trade in agricultural products was reaped by the merchant, who was very often also the village money lender.

The net result of the commercialization of Indian agriculture was that most of Indian farmers failed to produce even that much food crops which could provide them even two square meals a day. Most importantly the life of the Indian peasant was tied to the highly fluctuating national and international market. He was no longer a deciding factor in agricultural practices. Further, by making agricultural land a tradable commodity, the peasant lost his security feeling. High land revenue demand forced him to take loan from the money lender at high interest rates. Failure to pay debt in time meant loss of land to the money lender at high interest rates. It led to land alienation and increase in the number of agricultural labourers whose conditions especially in plantation industry was pathetic.

The commercialization of agriculture was a new phenomenon in Indian agriculture scene introduced by the British. While the upper class and British industries benefited from it, the Indian peasants’ life was tied to remote international market. The worst effect of commercialization was the oppression of Indian peasants at hands of European. This found expression in the famous Indigo revolt in 1859.Moreover, commercialization of Indian agriculture got manifested in series of famines which took a heavy toll of life.

Answer : Several attempts have been made to characterize the pre-British period Indian economy. One recurrent theme is that the Pre-British Indian economy was characterized by self-sufficient villages based on the union of agriculture and handicrafts.

The village economy was held to be self sufficient and self subsisting. The basic land relationships in the villages were governed by custom and usage. Another marked feature of the pre-British economy was the union of agriculture and basic crafts in the villages. The farmers carried on the task of cultivation and cultivated enough to feed themselves and the other sections dependent on them.

They carried the cultivation with plough fitted with iron hoe with the help of bullocks as the draught power. The peasant family undertook also to spinning and wearing. Besides, some specialized group of craftsmen provided for the handicrafts and implements needed by the villagers. In return for their products, they were remunerated in grain by the peasants.

Notwithstanding there features, the Indian peasants produced sufficient amount of food grains to sustain those living in urban centres. Further, the villages also paid the land revenue that was imposed on them by the rulers.

Moreover, the peasants in the villages enjoyed customary rights over the community properties like the village tank. Moreover, the villages had peasants cultivating the plots of land.

However, all this changed with the establishment of the British rule in India. Foremost they vested ownership of village land in zamindar under the permanent settlement. The peasant’s ownership over land was insecure under Ryotwari Settlement. The villagers moreover lost their customary rights over community lands and were reduced to the status of semi-serfs of zamindars and money lenders. Moreover, by introducing the concept of mortgage, sale and transferability of land, the British tampered with the basic stability of the villages. Also, the ruin of handicrafts industry ended the union of agriculture and handicrafts.

Answer : A major characteristic of British rule in India and the net result of the British economic policies was the prevalence of extreme poverty among its people. The poverty of the people found its expressions in series of famines which ravaged all parts of India in the second half of the 19^th century the fist of these famines occurred in Western UP in 1860-61 and cost over 2 lakhs of lives.

In 1865-66, a famine engulfed Orissa, Bengal, Bihar, and Madras and took a toll of nearly 20 lakhs of lives with Orissa alone loosing 10 lakh lives, since the famine was most severe in Orissa, it is called the Orissa famine.

The Government officers though forewarned took no steps to meet the calamity.

The Government adhered to the principles of free trade and the law of demand and supply, the Government did provide employment to the able booked men leaving the work of charitable relief to voluntary agency. But the famine proved a turning point in the history of Indian famines for it was followed by the appointment of a committee under the chairmanship of Sir George Champell. The old doctrine that the public was responsible for the relief of the helpless was abandoned. The Government was expected to borrow money in order to finance for building of Railways and canals. Further the district officers were made responsible for saving all preventable deaths.

The great famine of 1876-78 was perhaps the most grievous calamity experienced since the beginning of the 19^th century. It affected Madras, Bombay, Uttar Pradesh and the Punjab.

About five million people perished in a single year. The Government made half-hearted efforts to help the famine-stricken. The government famine machinery was inadequate and ineffective and the unwise policy was amply clear. In 1880, the Government of Lytton appointed a commission under Richard stretchy to formulate general principles and suggest particular measures of preventive or protective character. The Commission recommended the adoption of certain basic principles.

Firstly, employment on works must be ordered before the physical efficiency of applicants had been unpaired by privation. Wages paid should be adjusted from time to time to provide sufficient food for a labourer’s support. Secondly, it should be the duty of the state to provide gratuitous relief to the impotent poor and listed the category of persons entitled to receive it. The relief provided could be in form of supply of raw grain or money or cooked food, to be provided on condition of residence in poor-houses or relief camps.For distribution of relief, the distressed tracts should be divided into circles and each circle placed under a competent officer. Supplies of food in distressed areas should be carefully watched.

The commission also made suggestions in regard to suspensions and remissions of land revenue and rents. The cost of famine relief was to be borne by the provincial governments. However, central assistance was to be made available whenever necessary. In times of excessive drought, facilities should be provided for migration of cattle to grassy forests areas where abundant pasturage was available.

The Government accepted in general and commission’s recommendation and steps were taken to fund new resources for the creation of a famine fund.

In 1883 the provisional famine code was formulated which formed a guide to and basis for the provincial famine codes. The code provided for precautions to be taken in ordinary times, the instructions to be followed during relief campaign and the duties of all concerned when the famine actually began.

Closely following this came the famine of 1896-97. It affected almost every province though in varying degrees of intensity and the total population affected was estimated at 34 million. The relief measures were conducted with a fair degree of success.

Expensive relief operations were undertaken and in many parts of the country, people were relieved in their own homes.

A commission presided over by Sir James Lyall, ex-Lt Governor of Punjab, adhered to largely the views expressed by their predecessors in 1880 suggesting some alterations which were designed to impart greater flexibility to the maxims then adopted.

Following the famine of 1899-1900, the government of Lord Curzon appointed MacDonnell. It submitted its report in 1901 in which it summarised accepted principles of relief suggesting variations wherever necessary. The commission emphasised the benefits of a policy of moral strategy, early distribution of advances for purchase of seed and cattle and sinking of temporary wells.

It also advocated the appointment of a famine commissioner in a province when relief operations were expected to be extensive. It also emphasised enlistment of non-official assistance on a larger scale and preference in particular circumstances of village works to large public works which had hitherto been the backbone of relief schemes.

The commission also stressed the deniability of better transport facilities, opening of agricultural banks, improvement of irrigation facilities, and vigorous measures to faster improved methods of agriculture. Most of the recommendations of the commission were accepted and before Curzon left India, he had taken various measures to prevent and combat famine.

With the enactment of the Montagu-Chelmsford Reforms, the famine relief measures and responsibility was entrusted to the provincial government in the year 1921. Though, the British took the above said measures, on famine they proved inadequate to provide relief to the millions.

The vastness of the country, diverse causes for famines and supervisory approach by the government failed to bring out desired results. And above all the basic culture of a colonial rule with its exploitation and extractive orientation prevented any whole-hearted effort in this sphere and failed to provide relief and easy recovery to the millions in India.

Answer : The British rule had pronounced and profound impact on India. There was hardly any section of society or corner of country which could escape the long arms of British colonialism. India being a country with predominance of agriculture, any impact of government on the people turned out to be essentially the impact of government on the village. One result of the British rule was the sudden and quick collapse of the urban handicrafts industry caused by the competition with the cheaper imported machine-goods from Britain. The building of railways and the oppression practiced by East India Company together with the gradual disappearance of Indian rulers and courts only served to accentuate and accelerate the process. The ruined artisans and craftsmen unable to find any alternative job began to come to villages and crowd into agriculture. This not only broke the union of agriculture overcrowding on land and destruction of self-sufficient rural economy. The peasant was also progressively impoverished under the British rule. The British policy of extracting the largest possible amount of land revenue ruined the peasants’ condition. In both the permanently settled areas and areas under Ryotwari settlement, the lot of peasants remained unenviable. They were left at the mercies of the zamindars who ransacked them, and compelled them to pay illegal dues and to perform forced labour. The high land revenue demand was accompanied by rigidity in collection, rise of new landed gentry, and intrusion of money lenders.

Moreover, the impacts of other administrative measures like railways, Law and order machinery was also felt in remote villages of India. Though, the railways served to verify India and brought the national consciousness, they served as the agents and areas of colonialism to drain off the valuable resources from India. A major impact of the British policies was its expression in poverty and farmers. These again found their most dire reflections in rural India. The tragedy also found manifestations in the stagnation and deterioration of agriculture and the transformation of India into an agricultural colony of the Great Britain.

Thus, the impact of the government on the people meant essentially the impact of government on the village.

Answer : The East India Company did conquer India single handedly but with the help of Indians who constituted some three fourth of their army. These Indian mercenaries were called ‘Sepoys’ by the British Company.

It was through Bengal that the British started their colonization.In 1757, a historic battle was fought at Polashi (Plassey, as spelled incorrectly) in which the British won Bengal, Bihar and Orissa. This was the battle that changed the course, not only of Bengal or India, but of western history as well. Vasco Da Gama’s discovery of the cape route around Africa was the first brick and this battle and subsequent conquest of Bengal was the foundation of today’s Europe. It would soon transform and catapult Britain to the centre stage as a world power over the centuries. This battle would be the begining of the fall of India and rise of the west, which had been backwaters until then. Robert Clive is noted as the hero (to the British) of this battle. It was Robert Clive who laid the foundation of British rule in India. Bengal was a strong Moghul province and it would have been quite hard to imagine conquering Bengal from the Moghuls, but Robert Clive did the impossible. At that time Nawab Sirajuddowla was the semi independent governor (Nawab) of Bengal under the Moghul Empire. He had many enemies and rivals within his family who wanted to be the Nawab. The British (Robert Clive) made alliance with these family rivals. The alliance changed the balance of power.

Mirzafar (Sirajuddowla’s uncle and general) and other generals were bribed and they betrayed Sirajuddowla in battle. A major part of Sirajuddowla’s army never took part in the battle at Plassey. With the mercenery army and using the internal dissention against the Nawab, the British had their biggest victory, the victory at Polashi. After the victory, Sirajuddowla was killed by Miran, son of Mirzafar. Mirzafar, the traitor, was made the Nawab of Bengal. He was but a puppet of the British. Soon the British made him abdicate in favour of his son in law, Mir Quasim who gave them the Zamindari (feudal lordship) of Burdwan, Midnapore and Chittagong districts. Once again the British used internal rivalry to their favour. For some time, the East India Company put up puppet rulers but power virtually lay in their hands. In 1763 Mir Quasim was defeated by the Company and Mirzafar (Mir Jafar) was restored.

The mercenery armies led by Major Hector Munro defeated the alliance of Mir Quasim, Nawab of Oudh and the Moghul emperor at the battle of Buxar. This was another significant victory for the British. After this battle, the East India Company virtually became master of half of North India. (Later this same army would be defeated by Haidar Ali.) These victories paved the way for the drain of wealth from Bengal.The Moghul emperor was captured and became a virtual prisoner of the British. Clive assumed governorship of Bengal after this in 1765 and in 1772, became bold enough to remove the Nawab completely and thus turning Bengal (Bengal, Bihar and Orissa) into a British colony, defacto. Of course, technically, it was still not part of the British Empire, since it was under the East India Company.The Company army at this point consisted of 1000 Europeans and 59, 000 mercenery sepoys (soldier). It was with Indian troops that the British defeated the Moghul emperor and took over Bengal. Bengal, Madras and Bombay continued as separate armies until 1895. The commander-in-chief of the whole was the commander of the Bengal army.

Historian R.C. Dutt notes, “The people of Bengal had been used to tyranny, but had never lived under an oppression so far reaching in its effects, extending to every village market and every manufacturer’s loom. They had been used to arbitrary acts from men in power, but had never suffered from a system which touched their trades, their occupations, their lives so closely. The springs of their industry were stopped, the sources of their wealth dried up”. The British Parliamentary Select Committee of 1812 was appointed to discover how they (Indian manufactures) could be replaced by British manufactures, and how British industries could be promoted at the expense of Indian industries. The British in Bengal collected tax without having any responsibility for the country. From the very beginning in 1757, when Sirajuddowla was defeated, the British plundered Bengal and this plunder directly contributed to the industrial revolution in England. The plunder from Bangla (Bengal) was invested in the new British industries while the loss of capital and fall of demand of Bangla goods combined and caused the final ruin of Bangla. In 1813, the British decided that India should no longer be an industrial nation (which it had been a leader since the earliest records) but an agricultural nation and colony of an industrialized England! British goods were sold in India and Indian goods were gradually replaced. The trade was made one way. Britain no longer wanted to import from India but only export to India.

To discourage Indian exports Indian goods were taxed heavily, tax of 67.5% was levied of Indian calicos and a tax of 37.5% was levied on muslins on entry into Britain. Over 300% import tax was placed Indian sugar. Possesion of Indian imported goods in England such as cotton items were fined heavily to further hurt the Indian industry. While massive industrialization began in Britain, Bengal (and the rest of India) was de-industrialized. Indian exports were slowly being stiffled, with that its economy. Bengal was hurt tremendously since it was an exporting nation. They took raw materials from Bangla and sold industrial products from Britain back to the Bengali people. The Muslin still caused a threat for sale of British fabric and so the weavers were forced to stop producing Muslin or passing on their skill to their children. To enforce these thumbs of the weavers were cut off.

Muslin was the softest fabric ever produced in human history. 20 meter length of Muslin fabric could be folded into a matchbox... today it survives in museums only. Muslin production began 3000 years ago or maybe has its roots in the Indus Civilization which is 5000 years old and survived various foreign invaders in Bangla. However, it did not survive the vengeful British colonial period. In Bangla a new fabric is now called Muslin, but is not the Muslin of history. One thing that can be said about the previous rulers of Bengal is that the people suffered relatively little. Under such barbaric conditions as imposed by the British, Bangla, once one of the richest, collapsed and is since one of the poorest nations in the world. By 1756 the English East India Company’s servants send home nearly 6 million pounds; this amount is more than four times the total land revenue collection of the Nawab of Bengal. By 1765-1770 the English East India Company sends out nearly 4 million pounds worth of goods or about 33 % of the net revenue of Bengal, in the form of the Company’s ‘Investments’. From 1766 to 1767 Nearly 5.7 million pounds are drained from Bengal to England. In the early 19th Century The drain of wealth from India to Britain in the form of the English East India Company’s ‘Investments’ constitutes nearly 9 % of India’s national income.

Answer : British imperialism was more pragmatic than that of other colonial powers. Its motivation was economic, not evangelical. There was none of the dedicated Christian fanaticism which the Portuguese and Spanish demonstrated in Latin America and less enthusiasm for cultural diffusion than the French (or the Americans) showed in their colonies. For this reason they westernized India only to a limited degree. British interests were of several kinds. At first the main purpose was to achieve a monopolistic trading position. Later it was felt that a regime of free trade would make India a major market for British goods and a source of raw materials, but British capitalists who invested in India, or who sold banking or shipping service there, continued effectively to enjoy monopolistic privileges.

The main changes which the British made in Indian society were at the top. They replaced the wasteful warlord aristocracy by a bureaucratic-military establishment, carefully designed by utilitarian technocrats, which was very efficient in maintaining law and order. The greater efficiency of government permitted a substantial reduction in the fiscal burden, and a bigger share of the national product was available for landlords, capitalists and the new professional classes. Some of this upper class income was siphoned off to the UK, but the bulk was spent in India. However, the pattern of consumption changed as the new upper class no longer kept harems and palaces, nor did they wear fine muslins and damascened swords.

This caused some painful readjustments in the traditional handicraft sector. It seems likely that there was some increase in productive investment which must have been near zero in Moghul India: government itself carried out productive investment in railways and irrigation and as a result there was a growth in both agricultural and industrial output. The new elite established a Western life-style using the English language and English schools. New towns and urban amenities were created with segregated suburbs and housing for them. Their habits were copied by the new professional elite of lawyers, doctors, teachers, journalists and businessmen. Within this group, old caste barriers were eased and social mobility increased.

As far as the mass of the population were concerned, colonial rule brought few significant changes. The British educational effort was very limited. There were no major changes in village society, in the caste system, the position of untouchables, the joint family system, or in production techniques in agriculture. British impact on economic and social development was, therefore, limited. Total output and population increased substantially but the gain in per capita output was small or negligible.

Establishment of a New Westernized Elite The biggest change the British made in the social structure was to replace the warlord aristocracy by an efficient bureaucracy and army. The traditional system of the East India Company had been to pay its servants fairly modest salaries, and to let them augment their income from private transactions. This arrangement worked reasonably well before the conquest of Bengal, but was inefficient as a way of remunerating the officials of a substantial territorial Empire because (a) too much of the profit went into private hands rather than the Company’s coffers, and (b) an overrapacious short-term policy was damaging to the productive capacity of the economy and likely to drive the local population to revolt, both of which were against the Company’s longer-term interests.

Clive had operated a ‘dual’ system, i.e. Company power and a puppet Nawab. Warren Hastings displaced the Nawab and took over direct administration, but retained Indian officials. Finally, in 1785, Cornwallis created a professional cadre of Company servants who had generous salaries, had no private trading or production interests in India, enjoyed the prospect of regular promotion and were entitled to pensions (2). All high-level posts were reserved for the British, and Indians were excluded.

From the 1820s to the 1850s the British demonstrated a strong urge to change Indian social 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 Hindu converts to Christianity to lay claim to their share of joint family property. They took steps to introduce a penal code (the code was actually introduced in 1861) based on British law, which helped inculcate some ideas of equality. ‘Under his old Hindu law, a Brahmin murderer might not be put to death, while a Sudra who cohabited with a high-caste woman would automatically suffer execution. Under the new law, Brahmin and Sudra were liable to the same punishment for the same offence (6). There was a strong streak of Benthamite radicalism in the East India Company administration (7). James Mill became a senior company official in 1819 after writing a monumental history of India which showed a strong contempt for Indian institutions.

One of the most significant things the British did to Westernize India was to introduce a modified version of English education. Macaulay’s 1835 Minute on Education had a decisive impact on British educational policy and is a classic example of a Western rationalist approach to Indian civilization. For these reasons Macaulay had no hesitation in deciding in favour of English education, but it was not to be for the masses: “It is impossible for us, with our limited means to attempt to educate the body of the people. We must at present do our best to form a class who may be interpreters between us and the millions whom we govern; a class of persons, Indian in blood and colour, but English in taste, in opinions, in morals, and in intellect. To that class we may leave it to refine the vernacular dialects of the country, to enrich those dialects with terms of science borrowed from the Western nomenclature, and to render them by degrees fit vehicles for conveying knowledge to the great mass of the population”.

Until 1857 it was possible to entertain the view (as Marx did) that the British may eventually destroy traditional Indian society and westernize the country. But activist Westernizing policies and the attempt to extend British rule by taking over native states whose rulers had left no heirs provoked sections of both the Hindu and Muslim 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. Furthermore, Indian education was of a predominantly literacy character and the provision for technical training was much less than in any European country. Education for girls was almost totally ignored throughout the nineteenth century.

Because higher education was in English, there was no official effort to translate Western literature into the vernacular, nor was there any standardization 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 obligation and was financed largely by the weak local authorities. As a result, the great mass of the population had no access to education and, at independence in 1947, 88 per cent were illiterateThe elite with its classical education and contempt for business were quite happy establishing law and order, and keeping ‘barbarians’ at bay on the frontier of the raj. They developed their own brand of self-righteous arrogance, considering themselves purveyors not of popular but of good government. For them the word ‘British’ lost its geographic connotation and became an epithet signifying moral rectitude.

Answer : The Permanent Settlement also known as the Cornwallis Code or Permanent Settlement of Bengal was an agreement between the East India Company and Bengali landlords, with far-reaching consequences for both agricultural methods and productivity in the entire Empire and the political realities of the Indian countryside. It was concluded in 1793, by the Company administration headed by Lord Cornwallis. The East India Company, on being awarded the diwani or overlordship of Bengal by the empire following the Battle of Buxar in 1764, found itself short of trained administrators, especially those familiar with local custom and law. As a result, landholders found themselves unsupervised or reporting to corrupt and indolent officials; consequently the extraction of revenue proceeded unchecked by any regard for future income or local welfare.

In 1790 the Court of Directors issued a ten year (Decennial) settlement to the zamindars, which was later made permanent in 1800. The question of incentivisation now being understood to be central, the security of tenure of landlords was guaranteed; in short, the former landholders and revenue intermediaries were granted proprietorial rights (effective ownership) to the land they held. In addition, the land tax was fixed in perpetuity, so as to minimise the tendency by British administrators to amass a small fortune in sluiced-away revenue. Smallholders were no longer permitted to sell their land, though they could not be expropriated by their new landlords.

Incentivisation of zamindars in this case was intended to encourage improvements of the land, such as drainage, irrigation and the construction of roads and bridges; such infrastructure had been insufficient through much of Bengal. With a fixed land tax, zamindars could securely invest in increasing their income without any fear of having the increase taxed away by the Company. The immediate consequence of the Permanent Settlement was both very sudden and dramatic, and one which nobody had apparently foreseen. By ensuring that zamindars’ lands were held in perpetuity and with a fixed tax burden, they became a very desirable commodity. In addition the government tax demand was inflexible and the British East India Company’s collectors refused to make allowances for times of drought, flood or other natural disaster. As a result many zamindars immediately fell into arrears. The Company’s policy of auction of any zamindari lands deemed to be in arrears created a market for land which previously did not exist.

Many of the new purchasers of this land were Indian officials within the East India Company’s government. These bureaucrats were ideally placed to purchase lands which they knew to be underassessed, and therefore profitable. In addition their position as officials gave them opportunity to quickly acquire the wealth necessary to purchase land through bribery and corruption. They could also manipulate the system to bring to sale land that they specifically wanted. The new landlords were different in their outlook; “often they were absentee landlords who managed their land through managers and who had little attachment to their land”.The Company hoped that the zamindar class would not only be a revenue-generating instrument but serve as intermediaries for the more political aspects of their rule, preserving local custom and protecting rural life from the possibly rapacious influences of its own representatives.

Answer : The British imperial ruler of India unleashed far-reaching changes in Indian agrarian structure. New land tenure, new land ownership concepts, tenancy changes and heavier state demand for land revenue triggered of far-reaching changes in rural economy and social relationship. Early British administrators of the East India Company considered India as a vast estate and acted on the principle that the company was entitled to the entire economic rent, leaving to the cultivators merely the expenses of cultivation and wages of their labour village communities were disregarded. In most part of the North India, the early administrators resorted to the ‘farming’ of land revenues. Excessive land revenue demands proved counter-productive. Agriculture began to languish, large areas went out of cultivation and famines stared the people in the face.

Broadly speaking, the English adopted three types of land tenure in North India, viz, the Zamindari tenure, the Ryotwari tenure and the Mahalwari tenure. Permanent zamindari settlements were made in Bengal, Bihar, Orissa, Banaras Division of the U.P. The Mahalwari tenure was introduced in major portions of the U.P., the Punjab. The Ryotwari settlements were made in major portions of Bombay and Madras presidencies, in Assam and some other parts of British India.

Under the zamindari settlements, old tax farmers, revenue collectors, and zamindars were turned into private landlords possessing some, but not all, of the right of private property in land. For one, the bulk of the rent they derived from the tenants was to be turned over to the government. At the same time, they were made complete master of the village communities. The zamindar was recognized as the owner who could mortgage, bequeath and sell the land. The state held the zamindar responsible for the payment of land revenue and in default thereof, the land could be confiscated and sold out. A snag in the permanent settlement of Bengal was that while the state’s land revenue demand was fixed, the rent to be realized by the landlords from the cultivators, was left unsettled and unspecified. This resulted in rack-creating and frequent ejections of tenants from their traditional holdings.

Under the Mahalwari system, the unit for revenue settlement is the village or the Mahal (i.e., the estate). The village land belongs jointly to the village community, technically called, ‘The body of co-shares’. The body of co-shares are jointly responsible for payment of land revenue, though individual responsibility is also there. If any co-shares abandons his land it is taken over by the village community as a whole. The village community is the owner of village ‘common land’ including the forest land, pastures etc.

Whatever the name of the system, it was the peasant cultivators who suffered most. They were forced to pay very high rent and for all practical purposes functioned as tenant-at-will. They were compelled to pay many illegal dues and cesses and were often required to perform forced labour or begar. What is more important, whatever the name or nature of revenue system in effect the government came to occupy the position of the landlord.

Moneylenders emerged as an influential economic and political force in the country. Because of the high revenue rates demanded and the rigid manner of collection, the peasant cultivators had often to borrow money to pay taxes. In addition to paying exorbitant interest, when his crops were ready he was invariably forced to sell his produce cheap. The chronic poverty of the peasant compelled him to take recourse to the moneylender especially in times of droughts, floods and famines. The moneylenders, on the other hand, could manipulate the new judicial system and the administrative machinery to his advantage. In this regard the government, in fact, actually helped him, because without him the land revenue could not be collected in time, nor could the agricultural produce be brought to the ports for export. Even to get the commercial crops for export produced in the first instance, the government depended on the moneylenders to persuade the cultivators by offering to finance him through loans. It is not surprising, therefore, that in course of time the moneylender began to occupy a dominant position in the rural economy. In both the Zamindari and Mahalwari areas there occurred a large-scale transfer of land from the hands of the actual cultivators to the hands of the moneylenders, merchant, officials and rich peasants. This led to landlordism becoming the dominant feature of land relationship in North India.

Intermediate rent-receivers also grew. This process is referred to as sub-infeudation. The new landlords and zamindar had even less of a link with land than the old zamindars. Instead of taking the trouble to organize a machinery for rent collection, they merely subject their rights to intermediate receivers.

The impact of British rule thus led to the evolution of a new structure of agrarian relations that was extremely regressive. The new system did not at all permit the development of agriculture. New social classes appeared at the top as well as at the bottom of the social scale. There arose landlords, intermediaries, and moneylenders at the top and tenants-at-will, share-croppers and agricultural labourers at the bottom. The new pattern was neither capitalism nor feudalism, nor was it a continuation of the old Mughal arrangement. It was a new structure that colonialism evolved. It was a semi-feudal and semi colonial in character.

Answer : In Bengal the revenue had previously been collected through hereditary Zamindars. The Zamindars of Bengal were really the rural agents of government. Below the Zamindars came the cultivating peasants. They were exposed to the rods of the Zamindars as the Zamindars were liable to the rods of the government officers, but like the Zamindars themselves they had a traditional hereditary right and were rarely dispossessed. But in British period every right had been confiscated.

The great difficulty of the company was to know how much the countryside could safely pay. This was the Zamindar’s secret which they were disinclined to share since their living depended on its exploitation. At first the company’s demand together with its servants’ derangment of the local economy led to over collection. Hastings made several attempts to regularize the situation but he never succeeded in penetrating the Zamindars’ secret. Due to this settlements were made with the Zamindars for a term of years, fixed at ten in 1789 and finally made permanent. The Zamindars were looked as the landlords. In England the central feagure in agriculture at the time was the landlord and the British officials made the mistake of thinking that the Zamindars were their Indian counterpart. The landlord in Britain was the owner of the land not only in relation to the tenants but also in relation to the state. But in Bengal while the zamindars were landlord over the tenants, he was himself subordinated to the state. Infact he was reduced virtually to the status of a tenant of the East India Company.

The Zamindar was to make a fixed annual payment to the government, retaining one tenth of his collection as his fee. But at first the rates were high and prices did not rise, so that he could not even squeeze the peasant. Then he was sold up instead of being beaten up but left where he was in the Mughal way. The result was a big change in Zamindari personnel and the appearance of new men from Calcutta who bought estates as financial speculations. The new landlords were often absentees with no local connections. The Bengal peasantry became a rustic proletariat.

Answer : A major characteristic of British rule in India, and the net result of British economic policies was the prevalence of extreme poverty among its people.

The poverty of the people found its culmination in a series of famines which ravaged all parts of India in the second half of the 19th century. The first of these famines occurred in western UP in 1960-61 and cost over 2 lakh of lives. In 1865-66 a famine engulfed Orissa, Bengal, Bihar and Madras and took a fall of nearly 20 lakhs of lives, Orissa alone losing 10 lakhs of people. More than 14 lakhs of persons died in the famine of 1868-70 in western U.P., Bombay and Punjab. Many states of Rajputana, another affected area, lost one-fourth to one-third of their population. Perhaps the worst famine in Indian history till then occurred in 1876-78 in Madras, Mysore, Hyderabad, Maharashtra, Western U.P., and the Punjab. Maharashtra cost 8 lakhs people, Madras nearly 35 lakhs. Mysore nearly 20% of its population and UP over 12 lakhs. Drought led to a countrywide famine in 1896-97 which affected over 9.5 crores of people of whom nearly 45 lakhs died. The famine of 1899-1900 followed quickly and caused widespread distress. In spite of official efforts to save lives through provision of famine relief, over 25 lakhs people died.

Apart from these major famines, many other local famines and searcities occurred. William Digby, a British writer has calculated that, in all, over 28,825,000 people died during famines from 1854 to 1901. India’s economic backwardness and poverty were not due to the niggardliness of nature. They were abundant and capable of yielding, if properly utilized, a high degree of prosperity to the people. But as a result of foreign rule and exploitation, and of a backward agrarian and industrial economic structure—in fact as the total outcome of its historical and social development—India presented the paradox of a poor people living in a rich country.

Answer : India has frequently been subjected to horrors of famine. From 1858 to the end of the 19th century, more than twenty famines occurred in India. A major characteristic of British rule in India, and the net result of British economic policies, was the prevalence of extreme poverty among its people. While historian disagree on the question whether India was getting poorer or not under British rule, there is no disagreement on the fact that throughout the period of British rule most Indians always lived on the verge of starvation.

British economic exploitation, the decay of indigenous industries, the failure of modern industries to replace them, high taxation, the drain of wealth to Britain and a backward agrarian structure leading to the stagnation of agriculture and the exploitation of the poor peasants by the zamindars, landlords, princes, moneylenders, merchants and the state gradually reduced the Indian people to extreme poverty and prevented them from progressing. Indian economic backwardness and poverty were not due to the niggardliness of nature. They were man made. The natural resources of India were abundant and capable of yielding if properly utilised, a high degree of prosperity to the people. But, as a result of foreign rule and exploitation, and of a backward agrarian and industrial economic structure in fact as the total outcome of its historical and social development, India presented the paradox of a poor living in a rich country.

In the early days of British administration, there was a tendency to push up land revenue demand to a high level. Moreover, the British collected the revenue with greater rigour than was customary in pre-British days. They also refused to reduce revenue as a concession to farmers in a bad season. This inflexibility of revenue policy was certainly a major cause of the famines. English traders and their agents activities might have contributed to the intensity of famines in some cases. In the early 19th century the forced cultivation of commercial crops for export in place of foodgrains may have been a factor. The neglect of the British to maintain or expand the pre-British irrigation works, in the territories that came under their rule, exposed agriculturists to their old enemy, drought. It may be concluded that the achievement of British rule in that regard was no better than that of previous unenlightened administrations.

In 1866-67 a severe famine broke out in Orissa. This has been regarded as the turning point in the history of Indian famines, for it led to the appointment of a Commission of Inquiry by Sir G. Campbell. The commission reported that timely measures had not been taken to meet the terrible emergency. It made certain recommendations regarding measures to be adopted for prevention of famine disasters in future. Lord Lytton decided to formulate general principals of famine relief. He appointed a Commission under Sir R. Strachy. The Commission recognised the duty of the state to offer relief to the needy in times of famine. After the famines of 1896-97 and 1899-1900, other famine commission were appointed to tackle the situation. Apart from these major famines and scarcities many other local famines and scarcities occurred. Many English officials in India recognised the grim reality of India’s poverty during the 19th century.

The poverty of India was not a product of its geography or of the lack of natural resources or of some inherent defect in the character and capabilities of the people. It was mainly a product of the history of the last two centuries. Before that, India was no more backward than the countries of Western Europe. Precisely during the period the countries of the West-developed and prospered, India was subjected to modern colonialism and was prevented from developing. The basic fact is that the some social, political and economic processes that produced industrial development and social and cultural progress in Britain, also produced and then maintained economic underdevelopment and social and cultural backwardness in India. The reason for this is obvious. Britain subordinated the Indian economy to its own economy and determined the basic social trends in India according to her own needs. The result was stagnation of India’s agriculture and industries, exploitation of peasants and workers, the spread of poverty, disease and semi-starvation leading to severe famines.

Answer : In the south and south-west India, there were no zamindars with large estates with whom the settlement could be made by the company. Many British officials believed that the Permanent Settlement put the company to a financial loss as it could not raise the demand of revenue. Some of them also argued that the Permanent Settlement was oppressive to cultivator as they were left to the mercy of the zamindar A few held that a direct settlement with the cultivators would mean continuation of the affairs that had existed in the past. But, the primary consideration to devise a settlement directly with the cultivator was the motive behind the system. The system was introduced in parts of Madras and Bombay Presidencies.

Under the Ryotwari system every ‘registered’ holder of land is recognised as the proprietor of land and is held responsible for direct payment of land revenue to the State. He has the right to sublet his land holdings, to transfer, mortgage or sell it. He is not evicted from his holdings by the Government so long as he pays the State demand of land revenue. The cultivator was to be recognised as the owner of his plot of land subject to the payment of land revenue. The settlement and the Ryotwari system was not made permanent. It was revised periodically after 20 to 30 years when the revenue demand was usually raised.

The Ryotwari system protected neither the rights of the cultivators nor put them to any financial gain. The system could not introduce peasant ownership. The state remained the owner of the land. The cultivator had to pay regular revenue otherwise they could be dispossessed of their lands any time. The demand for revenue by the government remained very high. Besides, it had the right to enhance the revenue as it pleased. The cultivators were, thus, not sure of greater advantage for their better produce. The purpose of the Ryotwari System was to save the cultivators from the oppression of the zamindars. Though they were no more on the mercy of the zamindars but the system did not satisfy the aspirations of the peasantry. In fact, it caused widespread oppression and agricultural distress. The large number of zamindars had been replaced by one giant zamindar - the state, which only knew to squeeze as much from the peasant as possible. This did not bring into existence a system of peasant ownership. Later the government openly claimed that land revenue was a rent and not a tax.

The ryot’s rights of ownership of his land were also negated by three other factors: (i) In most areas the land revenue fixed was exorbitant; the ryot was hardly left with bare maintenance even in the best of seasons. For instance, in Madras, the Government claim was fixed as high as 45 to 55% of gross production in the earlier settlement. The situation was nearly as bad in Bombay. (ii) The Government retained the right to enhance land revenue at will. (iii) The ryot had to pay revenue even when his produce was partially or wholly destroyed by drought or floods.

The peasantry sank deeper in poverty. He fell in the clutches of the chetty (moneylender) for payment of land revenue. The machinery of collection was very oppressive and torture was normally resorted to for collection of state dues. In the British Parliament members asked questions about the practice of torture which included preventing a defaultor from taking his meals or attending to calls of nature, tying a man down in a bend position etc.

The deccan witnessed agrarian riots in 1875 to protest the oppressive Ryotwari System. The Government responded by the enactment of the Deccan Agriculturists Relief Act, 1879. It provided relief against the moneylenders, but did nothing to restrain the excessive State demand—the root of all evils. The two great evils of the Ryotwari system in Bombay were over assessment and uncertainty. Further, there was no provision for an appeal to the court of law against over assessment. The collector informed the cultivator of the rate at which his land had been assessed in future with the warning that if he chose to retain it on the new terms, he could; if he did not choose, he could throw it up.

Thus, the revenue policy and the different system introduced in India by the British for collecting the revenue were not in the interest of the cultivators. The demand of the state always went on increasing while the intermediaries or the government officials oppressed the tillers of the soil The British policy proved advantageous only to the government or a privileged section of the society at the cost of the cultivators who were the rightful owners of their lands and claimant of the large share of the produce.

Answer : ‘The British Industrial policy in the 19th century ruined the Indian handicrafts’.The British Industrial policy destroyed the handicrafts and the cottage Industries of India which were the primary sources of its foreign trade and wealth. It began in Bengal. Bengal wasfamous for cotton textiles and silk. The servants of the company after assuming political influence in Bengal, exploited the craftsmen in Bengal mercilessly. They gave them raw products on high prices and asked them to manufacture a fixed quantity and quality of goods and paid them arbitrarily so that handicraft profession no more remained profitable.

Therefore, thousands of craftsmen left their ancestral profession. Gradually, the exploitation of India in trade increased. In 1813, East India company’s monopoly of trade with India was abolished. All trading companies of Britain, therefore were left free to trade with India. The British also pursued the policy of protective tariffs in Britain as well as in India much against the trading interests of India. While in Britain, heavy duties were charged on Indian goods entering Britain, the English goods entering India were charged only nominal duties.

Thetrade discrimination went on increasing till the Indians failed in competing with the machine-made goods of England. When Industrial Revolution took place in England, Britain needed raw materials from India and a wide market for its machine-made goods in India. Therefore, in 1833, Indian goverment virtually accepted the policy of free trade with a view to provide cheap raw materials to Britain and cheap manufactured goods in the Indian market. Thus the policies of the government, on the one hand, handicapped Indian trade and thereby its manufactures on the other hand provided good market to manufactures in India. The construction of the railways in India further helped this process. The British goods reached even the rural markets of India.

It all resulted in the destruction of the Indian handicrafts which were the basis of its foreign trade and thereby its prosperity.

Answer : Commercial Policy : From 1600 to 1757 the East India company's role in India was that of a trading corporation which brought goods or precious metals into India and exchanged them for Indian goods like textiles and spices, which it sold abroad. Its profits came primarily from the sale of Indian goods abroad. After the Battle of Plassey in 1757, the pattern of the company's commercial relations with India underwent a qualitative change. Now the company could use its political control over Bengal to acquire monopolistic control over Indian trade and production and to push its Indian trade. Moroever, it utilised the revenues of Bengal to finances its export of Indian goods. The activity of the company should have encouraged Indian manufacturers, for Indian exports to Britain went up from £ 1.5 million in 1750-51 to £5.8 million in 1797-98, but this was not so. the company used its political power to dictate terms to the weavers of Bengal who were forced to sell their products at a cheaper and dictated price, even at a loss. Moreover, their labour was no longer free. Many of them were compelled to work for the company for low wages and were forbidden to work for Indian merchants. The company eliminated its rival traders, both Indian and foreign, and prevented them from offering higher wages or prices to the Bengal handicraftsmen. The servants of the company monoplised the sale of raw cotton and made the Bengal weaver pay exorbitant prices for it.

Thus, the weaver lost both ways, as buyer as well as seller. At the same time, Indian textiles had to pay heavy duties on entering England. The British Government was determined to protect its rising machine industry whose products could still not compete with the cheaper and better Indian goods. Even so Indian products held some of their ground. The real blow to Indian handicrafts fell after 1813, when they lost not only their foreign markets but, what was of much greater importance, their market in India itself.

The Industrial Revolution in Britain completely transformed Britain's economy and its economic relations with India. During the second half of the 18th century and the first few decades of the 19th century, Britain underwent profound social and economic transformation, and British industry developed and expanded rapidly on the basis of modern machines, the factory system, and capitalism. In 1769 the British industrialists compelled the company by law to export every year British manufactures amounting to over £ 380,000 even though it suffered a loss on the transaction. In 1793, they forced the company to grant them the use of 3,000 tons of its shipping every year to carry their goods.

Exports of British cotton goods to the East, mostly to India, increased from £ 156 in 1794 to nearly £110,000 in 1813, that is, by nearly 700 times. But this inbcrease was not enough to satisfy the wild hopes of the Lancashire manufacturers who began to actively search for ways and means of promoting the export of their products to India. As R.C. Dutt pointed out later in 1901 in his famous work, the Economic History of India, the effort of the Parliamentary Select committee of 1812 was 'to discover how they (Indian manufactures) could be replaced by British manufactures, and how British industries could be promoted at the expenses of Indian industries'.

Indian hand-made goods were unable to compete against the much cheaper products of British mills which had been rapidly by using inventions and a wider use of steam power. Not only were Indian industries not protected by the foreign rulers but foreign good were given free entry. Foreign imports rose rapidly. Imports of British cotton goods alone increased from £ 1,100,000 in 1813 to £ 6,300,000 in 1856. The free trade imposed on India was, however, one sided. While the doors of India were thus thrown wide open to foreign goods. Indian products which could still complete with British products were subjected to heavy import duties on entry into Britain. The British would not take in Indian goods on fair and equal terms even at this stage when their industries had achieved technological superiority over Indian handicrafts. Duties in Britain on several categories of Indian goods continued to be high till their export to Britain virtually ceased. For example, in 1824, a duty of 67.5 per cnt on Indian muslims. Indian sugar had to pay on entry into Britain a duty that was over three times its cost prices. In some cases duties in England went up as high as 400 per cent. As a result of such prohibitive import duties and development of machine industries, Indian exports to foreign countries fell rapidly.

The Drain of Wealth : The British exported to Britain part of India's wealth and resources for which India got no adequate economic or material return. The drain of wealth from Bengal began in 1757 when the company's servants began to carry home immense fortunes extorted from Indian rulers, Zamindars, merchants and the common people. They sent home nearly £6 million between 1758 and 1765. This amount was more than four times the total land revenue collection of the Nawab of Bengal in 1765. This amount of drain did not include the trading profits of the company which were often no less illegally derived. In 1765 the company acquired the Diwani of Bengal and thus gained control over its revenues. The company, even more than its servants, soon directly organised the drain. It began to purchase Indian goods out of the revenue of Bengal and to export them. These purcahses were known as 'Investments'. Thus, through 'Investments', Bengal's revenue was sent to England. For example, from 1765 to 1770, the company sent out nearly £ 4 million worth of goods or about 33 per cent of the net revenue of Bengal. By the end of the 18th century, the drain costituted nearly 9 per cent of India's national income. The actual drain was even more, as a large part of the salaries and other incomes of English officials and the trading fortunes of English merchants also found their way into England.

The drain took the form of an excess of India's exports over its imports, for which India got no return. While the exact amount of the annual drain has not been calculated so far and historians differ on its quantum, the fact of the drain, at least from 1757 to 1857, was widely accepted by British officials. Thus, for example, Lord Ellenborough Chairman of the Select Committee of the House of Lords, and later Governor-General of India, admitted in 1840 that India was 'required to transmit annually to this country (Britain), without any return except in the small value of military stores, a sum amounting to between two and three million sterling.' And John Sullivan, President of the Board of Revenue, Madras, remarked : 'Our system acts very much like a sponge, drawing up all the good things from the banks of the Ganges, and squeezing them down on the banks of the Thames'.

The drain went on increasing after 1858, though the British administrators and imperialists writers now began to deny its existence. By the end of the 19th century it constituted nearly 6 per cent of India's national income and one-third of its national savings. The wealth drained out of India played on important part in financing Britain's capitalist development, especially during the 18th century and the beginning of the 19th century, that is during the period of Britain's early industrialisation. It has been estimated that it constituted nearly two per cent of Britain's national income during that period. The figure assumes importance if it is kept in view that Britain was at that time investing in industry and agriculture about seven per cent of its national income.

Answer : In 1765, the East India Company acquired the Diwani, or control over the revenue, of Bengal, Bihar and Orissa. Initially, it made an attempt to continue the old system of revenue collection though it increased the amount. In 1773, it decided to manage the land revenues directly. Warren Hastings auctioned the right to collect revenue to the highest bidders. But his experiment did not succeed. This introduced instability in the company's revenue at a time when the company was hard pressed for money.

Moreover, neither the ryot nor the zamindar would do anything to improve cultivation when they did not know what the next year's assessment would be or who would be the next year's revenue collector. The Permanent Settlement was introduced in Bengal and Bihar in 1793 by Lord Cornwallis. It had two special features. Firstly, the Zamindars and revenue collectors were converted into so many landlords. They were not only to act as agents of the Government in collecting land revenue from the ryot but also to become the owners of the entire land in their zamindars.

Secondly, the zamindars were to give 10/11th of the rental they derived from the peasantry to the state, keeping only 1/11th for themselves. But the sums to be paid by them as land revenue were fixed in perpetuity. At the same time, the zamindar had to pay his revenue rigidly on the due date even if the crop had failled for some reason; otherwise his lands were to be sold. Historians think that the decision to recognise the zamindars as the proprietors of land was basically determined by political, financial and administrative expediency. Here the guiding fctors were three. The first arose out of clever statement : the need to create political allies. The British officials realised that as they were foreigners in India, their rule would be unstable unless they acquired local supporters who would act as a buffer between them and the people of India.

Second, and perhaps the predominant motive, was that of financial security. The Permanent Settlement guaranteed stability of income. The newly created property of the Zamindars acted as a security of this. Thirdly, the Permanent Settlement was expected to increase agricultural production. Since the land revenue would not be increased in future even if the Zamindar's income went up, the latter would be inspired to extend cultivation and improve agricultural productivity as was being done in Britain by its landlords.

Answer : The British conquest had a pronounced and profound economic impact on India. The economic policies followed by the British led to the rapied transformation of India's economy into a colonial economy whose nature and structure were determined by the needs of the British economy. In this respect the British conquest differed from all previous foreign con-quests. The previous conquerors had overthrown Indian political powers but had made no basic changes in the country's economic structure; they had gradually becomea part of Indian life, political as well as economic. The peasant, the artisan, and the trader had continued to lead the same type of existence as before. The basic economic pattern, that of the self-sufficient rural economy, had been perpetuated. Change of rulers had merely meant change in the the personnel of those who appopriated the peasant's surplus. But the British conquerous were entirely different. They totally disrupted the traditional structure of the Indian economy.

There was a sudden and quick collapse of the urban handicrafts industry which had for centuries made India's name a byword in the markets of the entire civilised world. This collapse was caused largely by competition with the cheaperimported machine-goods from Britain. The ruin of Indian industries, particularly rural artisan industries, proceeded even more raidly once the railways were built. The railways enabled British manufactures to reach and uproot the traditional industries in the remotest villages of the country. As the American writer, D.H. Buchanan, has put it, 'The armour of the isolated self-sufficient village was pierced by the steel rail, and its life blood ebbed away.'

The cotton-weaving and spinning industries were the worst hit. Silk and woollen textiles fared no better and a similar fate overtook the iron, pottery, glass, paper, metals, guns, shipping, oil-pressing, tanning and dyeing industries. Thus British conquest led to the de-industrialisation of the country and increased dependence of the people on agriculture. No figures for the earlier period are available but, according to census Reports, between 1901 and 1941 alone the percentageof population dependent on agriculture increased from 63.7 per cent to 70 per cent. This increasing pressure on agriculture was one of the major causes of the extreme poverty of India under the British rule. In the very beginning of British rule in Bengal, the policy of Clive and Warren Hastings of extracting the largest possible land revenue had led to such devastation that even Cornwallis complained that one-third of Bengal had been transformed into 'a jungle inhabited only by wild beasts.' Nort did improvement occur later. In both the Permanently and the Temporarily settled Zamindari areas, the lot of the peasants remained unenviable.

They were left to the mercies of the zamindars who raised rents to unbearable limits, compelled them to pay illegal dues and to perform forced labour or begar, and ooppressed them in diverse other ways. The condition of the cultivators in the Ryotwari and Mohalwari areas was no better. Here the Government took the place of the zamindars and levied excessive land revenue which was in the beginning fixed as high as one-third to one-half of the produce. Heavy assessment of land was one of the main causes of the growth of poverty and thedeterioration of agriculture in the 19th century. The evil of high revenue demand was made worse because the peasant got little economic return for it. The Government spent very little on improving agriculture. It devoted almost its entire income to meeting the needs of British-Indian administration making the payments of direct and indirect tribute to England and serving the interests of British trade and industry. Even the maintenance of law and order tended to benefit the merchant and the money-lender rather than the peasant.

The harmful effects of an excessive land revenue demand were further heightened by the right manner of its collection. Land revenue had to be paid promptly on the fixed dates even if the harvest had been below normal or had failed completely. But in bad years the peasant found it difficult to meet the revenue demand even if he had been able to do so in good years whenever the peasant failed to pay land revenue, the Government put up his land on sale to collect the arears of revenue. But in most cases the peasant himself took this step and sold part of his land to meet in the government demand. In either case he lost his land. The money-lender was greatly helped by the new legal system and the new revenue policy.

Gradually the cultivators in the Ryotwari and Mahalwari areas sank deeper and deeper into debt and more and more land passed into the hands of money-lenders, merchants, rich peasants and other moneyed classes. The process was repeated in the Zamindari areas where the tenants lost their tenancy rights and were ejected from the land on became subtenants of the money-lender. The process of transfer of land from cultivators was intensified during periods of scarcity and famines. The Indian peasant hardly had any savings for critical times and whenever crops failed he fell back upon the money lender not only to pay land revenue but also to feed himself and his family. By the end of the 19th century, the money-lender had become a major curse of the countryside and an important cause of the growing poverty of the rural people. In 1911 the total rural debt was estimated at Rs. 300 crores. By 1937 it amounted to Rs. 1800 crores. The entire process became a vicious cricle. The pressure of taxation and growing poverty pushed the cultivatiors into debt which in turn increased their poverty. In fact, the cultivators often failed to understand that the money-lender was an inevitable cog in the mechanism of imperialist exploitation and turned their anger against him as he appeared to be the visible cause of their impoverishnment. For instance, during the Revolt of 1857, wherever the peasantry rose in revolt, quite often its first target of attack was the money-lender and his account books. Such peasant actions soon became a common occurrence.

The growing commercialisation of agriculture also helped the money-lendercuna-merchant to exploit the cultivator. The poor peasant was forced to sell his produce just after the harvest and at whatever price he could get as he had to meet in time the demands of the Government, the landlord, and the money-lender. This placed him at the mercy of the grain merchant, who was in a position to dictate terms and who purchased his produce at much less than the market price. Thus a large share of the benefit of the growing trade in agricultural products was reaped by the merchant, who was very often also the village money-lender.

The loss of land and the over-crowding ofland caused by de-industrialisation and lack of modern industry compelled the landless peasants and ruined artisans and handicraftsmen to become either tenants of the money-lenders and zamindars by paying rack-rent or agricultural labourers at starvation wages. Thus the peasantry was crushed under the triple burden of the Government, the zamindar or landlord, and the money-lender. After these three had taken their share not much was left for the cultivator and his family to subsist on. It has been calculated that in 1950-51 land rent and money-lenders' interest amounted to Rs. 1400 crores or roughly equal to one-third of the total agricultural produce for the year. The result was that the improvishment of the peasantry continued as also an increase in the incidence of famines. People died in millions whenever droughts or floods caused failure of crops and produced scarcity.