Rajasthan Board RBSE Class 8 Social Science Notes Chapter 20 Impact of British Rule in Indian Economy
India’s economic condition worsened as India became the British dominion, with the coming of East India Company in India.
Economic Condition of 15th and 16th Centuries India:
After the discovery of America the people of Spain severely plundered America in the 15th and 16th century. They brought gold and silver in great amount to their own country. It made Europe prosperous to purchase goods from India. By the middle of 15th century a Portuguese sailor named Vasco-De-Gama discovered sea route to India. Now more and more European traders started coming to India.
They formed trading companies and started trading in the remote areas. Portuguese established sea posts in the Arabian Sea and they took custom tax from each trader crossing from the posts. Those who did not gave the tax were attacked. It held continuously till the English took control over the sea on the basis of their naval power. By the early 18th century English Trading Company had become the biggest trading company which traded with India. Though the company had fight with the Mughals also from Surat port. Mughals defeated the company many times and on apologizing by the company officers they were released.
In 1717 the Mughal emperor Farukhsyar had ordered the company to give Rs. 3000 to the Mughal emperor annualy in exchange of trade with India. Without paying tax consequently the British company drove all European companies and established its supremacy over the trade in India. On the basis of power it forced the Mughal emperor and the Nawab of Bengal to flee.
Impact of the Company on the Indian Industry:
After the victory in the Battle of Plassey (1757), company was empowered. It gave raw material to the artisans at high rates and purchased their manufactured goods at less than 1/4th of the rate. As a result of that during the next 20 years the artisans give up their work. Their income become so low that they were reached to the edge of hunger. By the end of 18th century the Bengal textile industry had been ruined.
People even believed that company has cut the thumbs of the artisans who manufactured malmal sarees in Dhaka. It was famous for these artisans that saree manufactured by them was so fine that it could pass through a ring, but English exploited them so badly that no doubt these poor weavers had to face sufferings and exploitation up to a great extent in the hands of the British. The company exploited the weavers to the extent that they were forced to stop working.
Exploitation of the Indian Economy by the British:
The British adopted the following means to exploit the Indian economy
- Direct Loot: In the name of trade English directly plundered the company’s agents to the farmers, traders etc forcibly, to sold their own goods at five times more than the actual cost, and purchased their goods at 1 /4th of the total cost. Those who did not agree to their agents bargain were beaten with sticks or were arrested. Mir Qasim had objected to this practice through written memorandum to the Governor in 1762.
- Land Revenue: The company officers collected land revenue from the peasants arbitrarily. As a result the farmers gave up farming.
- Tariff: With the intention to ruin the Indian industry England adopted the tariff policy. The imports of British cloths in India were tax free whereas the imports in England of the Indian clothes were heavily taxed.
- Drain of Wealth: The British had been sending to their own country the taxes collected in India and other cash profits to benefit their own people. According to historians if this would not happened then Europe and America would not developed today or in other words destruction of India’s developed economic system held due to drain of wealth.
- Through Laws: In the end of 17th century cheap and quality cloth was imported in England in a great quantity. These cloth was in demand by the people that the producers of England severely feared off. Hence in 1700 and 1712 A.D. in Parliament import of cloths was completely banned.
- Anti-Industrialization Policy: The British capitalists were opposed to industrialization in India. They established only those industries in India for which they found the most suitable geographical conditions, like Jute. Raw material from India was exported to England and their manufactured goods were imported to India. Consequently the Indian industries were ruined as Indian Industrialists could not survive in competition. In the same view Jute Industry was set up in Bengal among the plantation industries-tea, cocoa and Indigo were developed.
Those regions where mineral wealth was present in great amount, industries were not established, instead the mineral wealth was taken to England. This could be done in a easier way so, internal parts of the nation and seaports linked with roads and railways. Effects of industrial revolution in 19th century Europe specially in England industrial revolution started. Machine made goods in England were of quality and cheaper compared to the goods produced in India by the artisans. With the fall in demand, the artisans and craftsman became unemployed. Many handicrafts lost their market in Bengal and other parts of India. This phase has been termed by the historians as De-industrialization or the process of destruction of traditional Indian cottage Industries started.