![COLONIALISM
• Colonialism refers to a system of political and social relation between two
countries, of which one is the ruler and the other is its colony.
• The ruling country not only has political control over the colony, but it
also determines the economic policies of the dominated country.
• In case of India, the unequal relationship between the colony[India] and
the ruling country [Britain]
resulted in underdevelopment of India.](https://image.slidesharecdn.com/indianeconomyoneveofindependenceppt-241204005840-b812d02b/85/Indian-economy-on-eve-of-independence-PPT-pptx-5-320.jpg)
Indian economy on eve of independence PPT.pptx
- 1. INDIAN ECONOMY ON EVE OF INDEPENDENCE
- 2. India had, an independent, self-reliant and prosperous economy • The Indian economy of the 18th century was primarily an agricultural economy. • India was also known for its developed handicraft industries. • The prominent handicraft industries which gave prime place to India in the world market were cotton and silk textile, metal industries, precious stone work, gold and silver jewellery, masonry, tannery, perfumery etc., INTRODUCTION
- 3. TOPICS TO BE COVERED Low level of Economic Development under the Colonial Rule. • Agricultural Sector • Industrial Sector • Foreign Trade • Demographic Condition • Occupational Structure • Infrastructure
- 4. The primary objective of British Colonial rule in India was to turn India – As a supplier of raw material and – As a consumer of finished goods
- 5. COLONIALISM • Colonialism refers to a system of political and social relation between two countries, of which one is the ruler and the other is its colony. • The ruling country not only has political control over the colony, but it also determines the economic policies of the dominated country. • In case of India, the unequal relationship between the colony[India] and the ruling country [Britain] resulted in underdevelopment of India.
- 6. ECONOMIC DEVELOPMENT BEFORE BRITISH RULE India was well known for its handicrafts industries in the fields of cotton and silk textile metal precious stone works etc. These products enjoyed a world wide market based on the reputation of fine quality of material used and the high standards of craftsmanship seen in all imports from India.
- 7. LOW LEVEL OF ECONOMIC DEVELOPMENT DURING BRITISH RULE • The economic policies pursued by the colonial government in India were concerned more with the protection and promotion of the economic interest of their home country than with the development of the Indian economy. • Such policies brought about a fundamental change in the structure of the Indian economy – Transforming the country into a net supplier of raw materials and – Consumer of finished industrial products from Britain. • The country's growth rate during the first half of the twentieth century was less than 2% and growth rate of per capita output was only 0.5%.
- 8. LOW LEVEL OF ECONOMIC DEVELOPMENT DURING BRITISH RULE • No systematic and sincere attempts were made by the British government to estimate India national income • William Digby • Findlay Shirras • Dadabhai Naoroji • Waldia and joshi • Dr.V.K.R.V.Rao and • R.C. Desai all these estimates produced conflicting and inconsistent results. • Dr.Rao were significant different estimates show that the level of national income and per capita was vey low during colonial period.
- 9. Indian agriculture became backward, stagnant and non-vibrant under the British rule. 1.Weak productive accumulation. 2.Unemployment and underemployment 3.Low levels of production and productivity. 4.Subdivision of landholdings. Indian agriculture was primitive and stagnant. The main causes of stagnation of agriculture sector was as follows: 1.Land Tenure system 2.Zamindari system 3.Mahalwari system and 4.Ryotwari system 5.Commercialization of agriculture 6.Partition of the country AGRICULTURE SECTOR
- 10. Agriculture plays an important part in economic development. It provides the food security to the country. Also, it’s a backbone for many industries. At the time of independence, almost 85% of the total population was depended on the agriculture. India’s agriculture sector saw no growth during the colonial period. Productivity was stagnant. In fact, it was deteriorating. The total output increased by just 0.5% per annum before independence. Farm output from year 1891 to 1947 was not more than 0.11%.
- 11. Many reasons were behind that. But prominent were the land settlement and exploitation of Indian farming by the British for their benefit. In the Zamidari system the real benefits of the agriculture went straight in the hands of Zamindaris. Farmers end up getting nothing, even after toiling hard for it. Lack of fertilizers, inferior quality of seeds and less use of modern technology were also responsible for the murky state of agriculture. Adding fuel on that was the commercialization of it.
- 12. COMMERCIALISATION OF AGRICULTURE – The British industrialists were always in the need of raw materials like cotton, indigo, jute, groundnut, sugarcane, etc. to keep their factories running; – By offering higher prices, the Indian peasants were attracted to production of commercial crops instead of food crops; – The extent of commercial agriculture went so far as to make many peasants purchase their food requirements from shops in towns; – This fall in production of food crops was responsible for frequent famines in India during the British days. – Growing of cash crops instead of food crops is called Commercialisation of Agriculture.
- 13. • Neither the Britishers nor the Zamindaris did any thing for the farmers or farming. • Their main interest was only to collect taxes. • Even in the conditions of drought, Famine or floods there was no mercy upon farmers. • Further jolt happened to agriculture because of the partition. • Highly irrigated land went to Pakistan. • On the western front Punjab, which was rich in producing wheat and East Pakistan (now Bangladesh) known for jute production, went to divided nation. • Thus, Indian jute industry suffered heavily. In a sense contribution from agriculture sector to Indian economy was nil at the time of independence.
- 14. INDUSTRIAL SECTOR Indian Industrial sector was also crying off for the development in the colonial rule. Like agriculture. No importance was given for the development of Industries. No commercial modern industrial base was allowed to come up. This sector needed modernisation, diversification and increased investment. To see India growing industrially was against British rule. There were two reasons for keeping India away from modern Industries. One was to keep India reduced to just as an exporter of prime raw materials for the major Industries in Britain. Two, it was to turn the domestic market of India into a prime consumer of finished British goods. And industrialization of India could have weighed down both the prospects of British India.
- 15. The primary motive behind this policy of deindustrialization was: – To reduce India to the status of mere exporter of important raw materials for the upcoming modem industries in Britain. – To turn India into a market for the finished products manufactured by industries in Britain. – The rate of growth of the industrial sector was low as no help was being provided to these industries by the colonial government. – Colonial Government enforced discriminatory tariff policy, which allowed free export of raw materials from India and free import of final goods from British industry to India. – The decline of the traditional handicraft industries created massive unemployment in India. – The fall in supply of locally made goods created a demand for the import of British goods much to their advantage.
- 16. Two main drawback of the industrial sector • The growth rate of industrial sector and its contribution to GDP was very small. • There was very limited area of operation of the public sector in the country. Public sector in those days was confined only to the railways, power generation, communication, ports and a few departmental undertakings.
- 17. FOREIGN TRADE • India has been an important trading nation since ancient time. • But the restrictive policies pursued by the Colonial Government adversely affected the structure, composition and volume of India’s foreign trade.
- 18. Composition of India's Trade India became an exporter of primary products such as raw silk, cotton, wool, sugar, indigo, jute, etc and an importer of finished consumer goods like cotton, silk and woollen clothes and capital goods like light machinery. • Volume India's exports were more than its imports so there was a large export surplus Direction. This refers to the countries we are trading with Britain maintained a monopoly over India's exports and imports • More than half of India's foreign trade was restricted to Britain while the rest was allowed with a few countries like China, Ceylon (Sri Lanka) and Persia (Iran) • Suez Canal was opened in 1869 • It reduced the cost and time of transportation and made access to the Indian market easier. • In other words, exploitation of Indian market was now easier.
- 19. DEMOGRAPHIC PROFILE The demographic conditions during the British rule suggested all the features of a backward economy. Various details about the population was first collected through a census in 1881. Before, 1921, India was in first stage of demographic transition. The second stage of transition started after 1921. However, neither the total population of India nor the rate of Population growth at this stage was very high. The year 1921 is described as the “Year of Great Divide”. It is because after 1921 population grew continuously and rapidly.
- 20. The demographic conditions were as under:- – The overall literacy level was less than 16%. – Female literacy was 7%. – Overall mortality rate was high – Infant mortality rate was 218 per thousand (Present rate is 44/1000) – Life expectancy was also very low-32 years (Present 68 years) – Extensive poverty was present – Public health facilities were either unavailable to large chunks of population or were highly inadequate when available. – Water and air borne diseases were rampant.
- 22. There are two important features of India’s occupational structure during the British period:- i) 70% to 75% of India’s working population was involved with agricultural sector.10% were engaged with manufacturing sector and 15% to 20% were with service sector. ii)Growing regional variation.
- 23. • The occupational structure, i.e. the distribution of working people across different industries and sectors showed very little sign of change during the British rule. • The largest workforce was in agricultural sector accounting for about 70-75% of the working people. • The manufacturing sector had 10% while the service sector accounted for about 15- 20% of the working population. • A main feature was the growing regional variation. • Areas of the then madras presidency (today's Tamil Nadu, Karnataka, Andhra Pradesh, and Kerala), Maharashtra and west Bengal saw a decline of the workforce in agriculture with a parallel increase in the manufacturing and services sector. • During the same time, there was an increase in the workforce in the agriculture sectors in Orissa, Rajasthan and Punjab.
- 24. INFRASTRUCTURE
- 25. • The state of infrastructure facilities especially in the field of transport, communication and energy was very poor in India during the British rule in India. • However some efforts were made to develop basic infrastructure like roads, railways, ports, water transport, and post by the Britishers The British rulers introduced railways in 1850 and Indian railways begun operations in 1853. – The roads were built for mobilizing the army within India and for drawing out raw, materials from the countryside to the nearest railway station or the port to send these to England or other foreign lands. –– The introduction of the expensive system of electric telegraph in India, similarly served the purpose of maintaining law and order.
- 26. -The Railways helped in commercialization of Indian agriculture which adversely affected the comparative self- sufficiency of the village economies in India. The development and the construction of railways by the British rulers had affected the Indian economy in the following ways:- i)It provided cheap and rapid transport system especially for distant travel. ii)It broke geographical barriers and thus promoted national unity and understanding iii)It created new employment opportunities iv)It helped in controlling famines v)It promoted foreign trade but benefited British more than Indians vi)It encouraged the process of industrialization
- 27. The main reason of British rulers behind the beginning of railways in India were as following:- i) To have effective control and administration over the vast country. In view of this British tried to link important administrative and military canter's through railway. ii) Earning profit
- 28. Policies of British rulers that led to exploitation of Indian economy NEGATIVE IMPACT • British rulers grossly neglected irrigation facilities and technological upgradation in India's agriculture. • British rulers forced the Indian farmers to pay more attention to the production of cash crops than food crops • Deliberate policy measures were adopted to destroy the handicraft industries of India. • No protection was provided to India's infant industries for a quite long time. • Heavy import duties were imposed on the use of Indian ships for trading between England and India
- 29. • Financial and banking institution were not promoted in the country. • Discriminatory trade policy was adopted under which British traders were given government protection and help while Indian traders had to bear various types of restrictions. Because of this, India was reduced to an exporter of primary products and importer of British manufactured goods. • British capital was invested mainly in those industries which could serve British interest rather than India's interest. • Hence foreign capital investment in India during colonial period gave birth to the distorted economic pattern.
- 30. Positive contribution of British rule • Effective administration • Infrastructure development • Commercialization of agriculture • Monetary system of exchange POSITIVE IMPACT
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