Economy Before the British Rule
Our great country was once called – The Golden Bird. This is not a Hyperbole, it is the truth. Do you know that India contributed to more than 30% of World’s GDP once? This is why the other countries had their eyes set on our wealth. Most of this wealth was accumulated by selling Spices, Herbs, Cotton and Textiles to western countries. So what happened to this great nation of fine craftsmen and wonderful textile producers? Well, we can say that the East India Company happened. The EIC came here to conduct business but then they noticed how easy it was to rule us. We were divided by caste, creed, color and cultural differences. Their minds started weaving plans about turning their dreams into reality. Slowly, they turned us into their slaves and we were forced to work for them. They destroyed our identity and snatched everything we had. From a country which produced the finest spices, cotton, silk and textiles in the world, we became the suppliers to Britain’s own Industries. While India’s Handicraft industries suffered, British industries thrived. They fed on our sweat and blood while we perished and died. They ravaged our industries and their wealth increased thousandfold. Soon, the control was transferred from Company to Crown but nothing changed.
Economy During British Rule
India’s economy was mostly Agrarian during the British rule. 80-85% of the Economic activities were related to agriculture since most of the population was living in small towns and villages. The literacy rate was very low and it was the biggest reason people were associated with it. Despite having so many farmers, the Agricultural growth was very low. There were many reasons and one of those was an evil law called the Zamindari system. The profit generated from Agricultural activities was used to fatten the Zamindar (Who owned land) instead of the skinny cultivators who were dying of thirst and scarcity of food. They were deprived of everything they needed and well deserved. The revenue to the Zamindars were fixed so they did not bother about improving the condition of the cultivators. Some farmers though of producing cash crops instead of food crops but it resulted in Britishers getting richer since these crops were used by them in their British industries. To add more to the misery, the partition happened and India had to give away a huge chunk of highly fertile land to Pakistan. Most of India’s Jute production took place in East Pakistan (Bangladesh) so that was a big setback for India.
Industrial sector was not in a good position either. Our Textile and handicraft industry was once considered the finest in the world. But the British destroyed it with their meagre policies. Industrialization did not take place because the British did not let us produce anything. Our industries collapsed and thousands of people were suddenly unemployed. During the second half of 1900s, some Industries started to evolve in India. TISCO was formed and so were some other companies but still there were no Capital Goods Industries so the contribution of Industrial sector in the GDP was still very less.
During the British rule, our Foreign Trade also suffered. India was once one of the biggest exporters in the world and exported to many countries via EIC but when we became their slaves; the Britishers enjoyed full monopoly and restricted most of the exports to Britain so that they could get raw materials like Milk products, Jute, Sugar, Wool, Indigo, handicrafts etc at a low price and sell the final goods back to us. It was a double-edged sword and hurt India’s economy very badly. We became the Importers of the finished goods. Suez Canal made it easier for the British to export and import stuff. At one point India’s exports to Britain were so high that there was an export surplus. It hurt us because there was scarcity of these products in the domestic markets and the prices were very high. The money earned by the high exports did not help either. Becaues the Britishers used the money in improving the condition of their offices and setting up new Infrastructure instead of using it in a frugal way.
If there was one thing that the Britishers did good, it was the introduction of Railways in India. Although they did not do it for the ease of indians. They had hidden motives behind it. The Railways cut down the cost of transportation and made it easier for them to transfer goods. It fostered commercialisation of Agriculture, as with the help of Railways, it was now easier to supply goods to distant parts of India. They also built sea lanes and waterways but the Railways proved to be cheaper and better option.
The Britishers ruled India for around two centuries and when they left, we were on our knees-bruised and broken. Most of the economy was still agrarian, our manufacturing sector was almost non-existent and Foreign Trade was restricted to Britain. So, we had so much to plan and needed a good government which could deliver. That is when Jawaharlal Nehru took over and the rest is history.