Model Question and Answers for APSC | Examine critically the various facets of economic policies of the British in India from the mid-eighteenth century till independence.
Examine critically the various facets of economic policies of the British in India from the mid-eighteenth century till independence.
Ans: The Battle of Plassey (23 June 1757) was the turning point in the economic history of British India. After this war, the Britishers started to intervene in the economic policies of the country.
The Economic Policies of the British in India changed as per phases of Colonialism:
- Mercantilist phase (1757-1813): The trade was entirely monopolized by the East India They began to plunder India’s wealth by manipulating the low prices of India’s finished goods for exports to Europe and England.
- Mercantile capitalism phase (1813-1858): India was converted into a one-way free market. British mercantile class took away the raw materials. It brought back manufactured goods for being marketed in India, and Export from India came to be confined to raw materials and food grain.
- Finance capitalism phase (1858-1947): In the Finance capitalism phase, for augmentation in the investment of British goods in India, the construction of railways, banking, post and telegraph services, were developed, and to preserve control over Indian capital, the system of management agency was adopted.
Various facets of the economic policies of the British in India:
- The British exported to Britain part of India’s wealth and resources for which India got no adequate economic or material return. This ‘economic drain‘ was peculiar to British Britishers spent a large part of the taxes and income not in India but in Britain.
- Exploitative Land Revenue Policies: Due to the very high taxes, farmers grew cash crops instead of food crops and this led to food insecurity and starvation.
- Railways to secure frontiers of the empire and further economic colonization of India
- Commercialization of Agriculture: The peasants became subjects to all the ills of the national and international market and were forced to depend on the middleman to sell their products
- Deindustrialization: It was held mainly agrarian by the Britishers to secure cheap raw material for British industries and to use a ready market in India for industrially produced goods of Britain.
As a consequence of British rule, India's share of the world economy declined from 24.4% in 1700 down to 4.2% in 1950. India's GDP (PPP) per capita was stagnant during the Mughal Empire and began to decline prior to the onset of British rule. India's share of global industrial output declined from 25% in 1750 down to 2% in 1900.