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Introduction
The epoch of British colonialism in India was characterized by considerable changes that influenced Indian life and still echo nowadays. Todays Indian economy is the result of a complicated period, where traditional order mixed with the British one and dissolved in it forever. The problem of the impact of British colonialism on the Indian economy inspired this research paper. The paper is based upon results of research in this question, statistic data, and economic indices analysis that help to understand the problem profoundly.
The British conquest policy dictated its rules in the Indian economic sphere. The traditional Indian economy could not but adapt to British rule. Its modification was long-term and painful for the countrys population. It is impossible to reveal the colonial impact on the Indian economy without an overview of the industrial revolution that changed the worlds way of life. Of course, the British Empires colonial policy had its advantages and disadvantages for India. Hence, the research paper intends to reveal the problem of British colonialism in the Indian economy from different points of view.
There has been much research on the issue of British impact on the Indian economy, and it offers a valuable contribution to the economic history of India, and peculiarities of Indian economic life in the XIX-XX centuries. The period of British raj was a challenge for the traditional Indian economy, based on hand-loomed weaving, jari, brassware, and other industries. New economic policy relied on basic Indian industries: cotton textile industry and the agricultural sector. They became the main source of the British Empires enrichment. Indian textile and agricultural products were intended to be exported, mainly. Raw cotton, rice, tea, jute, etc. were cultivated in India. Indian cloth was an essential element of the Indian market. The products of textile and agricultural industries brought large profit for the British Empire; it made the most exploited Indian population poor and famished debtors.
Therefore, there is much material on which the present research paper will rely in making observations and inferences about the true impact of British colonialism on the Indian economy on the whole, and on particular fields of industry such as the cotton textile industry and the agricultural area of work.
There is much research in the field of the colonial period of the Indian existence, implying the agile interest to the exploration of Indian-British relations, especially in the period of the British reign in India. For example, Jayapalan (2008) dedicated his book to Indian economic history and outlined its peculiarities throughout the centuries.1 Tomlinson (1996) investigated the Indian economy in general within the limit of the period, when India was one of the British colonies.2 Roy (1999) was interested to examine the traces of Indian traditional industry in its economy of the colonial period. 3Watterson (1985) proved the success of British international policy and showed its essence for the developing countries.4 Thus, the present topic is quite relevant for studies in the history of world economies, and the works of these authors, alongside a much wider body of literature, will give a deeper insight into the present research field.
Background and Purpose
The background of the problem is connected with the researched fields of the study and the nature of the problem itself. The problem of British colonial policy in the Indian economy has been in the scope of scientific interest for a long time. The intervention of the British Empire cannot be imagined without the implementation of a new policy in the colonized country. For this reason, the Indian economy faced changes that influenced the countrys life till nowadays.
The researchers investigated this question profoundly. Roy (2006) described the Indian economy during 1857-1947.5 In the book, he divided the countrys economy into two periods: before and after 1857 that was the starting point for the modern Indian economy. Rothermund (1993) examined Indian economic life starting from the pre-colonial period till the end of the XX century and proved the essence of traditional Indian industries for its future development. Kohli (2001) was interested in the connection between the Indian past and its modern democratic success and founded that the period of British raj was one of the notable periods for the Indian economy. 6 It is a widely-known fact that the historical context of a country predetermines its future condition. The Indian way to independence was long and challenging.
Since India became one of the British colonies, its way to economic progress has been complicated. The cruel policy of the colonizing country led to the populations disappointment and revolts. It means the high level of resistance of the old way of life toward another one. Under the British Crown, India experienced positive and negative aspects of a new way of life, where the traditions played an essential role. As Roy noted Indian pre-colonial economy had an agricultural character; also, Indian society cultivated certain traditional crafts that enriched the local economy. 7 Consequently, the adaptation to the British economy presupposed the mixture of traditions and innovations. Some researchers believed that the advantages of the global industrial revolution proved the British successful impact on the Indian economy. 8
India was attractive to the British crown by its spices and handicrafts, the authentic industries that historically developed on its territory. The colonizer-countries always took advantage of the labor and skills of the population, and the countrys natural resources for enrichment. The colonial policy of the British crown turned India into the raw-material appendage of the metropolis, and the market for its industrial products. It was evident that the British increased their capital; nevertheless, the unfair policy toward the exploited local population exhausted their patience. For this reason, the waves of the national liberation movement were a natural reaction of the pinched Indian nation.
However, it is impossible to let aside the progress and advancement of the Indian economy that the British rule brought about to the country. Although the predatory policy of the colonizer-country was obvious, the colonial period gave a powerful impulse to the Indian economy and speeded up its development. Besides, one can agree that the exploitation of the Indian colony was one of the main sources of the industrial revolution in England.
The present research paper possesses a certain scientific value; the collected statistical data and some figures show the territory of India under British rule, and Indian products and industries. Hence, it will allow revealing the key to British economic success that was achieved with Indian hard labor. Since the purpose of this paper is to take a deeper insight into a certain period of the Indian economic development, namely the times of the British rule, the research findings are intended to serve as a sufficient basis for understanding all economy-related, industry-specific implications of the British intrusion in the Indian economic development.
Problem Statement
It is impossible to say for sure, whether British rule led to positive or negative consequences for India. The economic life of feudal India was characterized by the development of its agriculture and traditional handicrafts. Exactly the farming industry was the countrys economic base. When the British came, India proved its incapability to resist colonization. The new policy influenced all spheres of Indian life, especially the economy. Thus, one may believe that British colonialism affected the Indian economy negatively.
In the past, India attracted European colonizers, who extensively exploited its hard labor, natural resources, and traditional industries for capital formation. India took an essential part in the trade companies of some countries that were ready to struggle for it. Its trade roots were known to the entire world. Naturally, British colonial policy led to the inevitable changes in the Indian economy, which were not always bad, but very often progressive and positive. Therefore, it seems vital to explore a wide range of implications of the British rule in India and its impact on the development of colonial India, the Indian economy on the whole, and some dominant industries (such as cotton textile and agriculture) in particular to be able to produce a set of relevant conclusions on the true contribution of Imperial Britain on the Indian economic development.
Research Questions and Hypotheses
The problem statement needs the corresponding research questions and hypotheses. The purpose of the paper can be realized if some questions will be answered and some developed hypothesis will be verified. This research paper is focused on the following research questions and null and alternative research hypotheses:
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RQ 1: What industries were affected the most by British-led economic reforms?
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RQ 2: What changes were visible in the field of cotton textile?
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RQ 3: What reforms could be observed in the area of agriculture?
Importance of the Study
The study is important because the topic of this research paper is of broad scientific interest. It contains not only the general information about the Indian traditional economy and the colonial policy of the British crown in the country but the information about its influence on the Indian economy as well. As the research paper raises many additional problems (national liberation movement of the Indian population, cultural elements that could not be destroyed by the British rajs policy, etc.), this study may open the directions for further, more comprehensive, wider, and more profound research in the field. The results of the paper may serve for the overall scientific benefit. Also, it may serve as the basis for the elaboration of possible economic strategies intended to overcome the current weak aspect of the Indian economy, conditioned by the historical past of the country.
Limitations
The present research paper contains a set of limitations that may hinder the generalizability of its findings and results. Primarily, it is necessary to remember that the research paper examines the period of British colonization in India. Some researchers agreed that the period from 1857 till 1947 may show the limits of British raj in Indian colonies (Roy, 2006). 9
More than that, the presented statistical information is based on the collected data for a certain period. This research paper contains veracious information about the assortment of Indian-produced goods and industries that enriched the global market (especially, the British one) during the period of 1857-1947. Thus, the presented economic indices can be considered adequate if the problem is examined within this limited period.
Scope of the Study
As the paper on economic history requires data collection concerning the problem under research, the economic data for 1857-1947 are presented here. To achieve the purpose of the paper and prove its hypotheses, the concept of British colonial policy is explored. The period of the British rule in India is the focus of the research, grasping the significant economic and industrial changes in India from 1857 to 1947.
Literature Review
It seems to be necessary to examine some key points in Indian history and economy to achieve the purpose of the research paper. The researchers results about the traditional economy of India, British raj, and its economic policy in India will be discussed. It will allow using this base for further analysis of the problem.
Traditional Economy of India
Before the research paper proceeds to the period of British rule (1857-947), it is essential to deepen into the background that will allow understanding of the Indian traditional economy. For centuries, India has followed its traditions in the economy. The traditional economy comprises the following elements: traditional industries agriculture and cattle breeding. Roy (1999) believes that in its economy, India is based on handloom weaving, brassware (see Appendices, fig. 1), jari (gold thread weaving), carpets, and leather (see Appendices, fig. 2). The author thinks that traditional industries of India combine three main features: tool-based technology, non-corporate organization, and pre-colonial origin . 10 Proceeding from the book, one may see that the main Indian industries were the result of a skillful and crafty population. When the British Empire turned the country into its colony, these local industries played an essential role in the economic history of South Asia. Artisanal textiles were extremely significant for the Indian economy. The cotton textile was the most spread industry in the country. The researcher notes that experienced tool-based technology allowed India to develop the economy with the help of a hand-woven cloth.11 Thus, the creativity of the population led to products of high quality that were appreciated all over the world.
Also, India could offer its agricultural goods to the world. The countrys economy was rooted in local agriculture: the hard labor of the Indian population greatly contributed to the overall development of the economy. According to some researchers, rice, wheat, barley, bajra, maize, jowar, sugar cane, and cotton were key elements of Indian agriculture. 12 Hence, such products provided the countrys economy with vital power. Agricultural prosperity speeded up the developmental process.13 Cattle breeding provided the country with meat, milk, and other products. Punjab was the primary center for Indian cattle-breeding. Later, a large number of cattle (especially, bovine cattle) was exported to other countries of the world. 14
Some researchers dedicated their books to the Indian economy, where the East-India Company and Mughal Empire played a key role. According to the authors, the Mughal Empire positively influence the state economy. One of the main features of this period (mid. XVII c.) was a uniform revenue policy, centralized administration, and a network of inland trade that expands overseas commerce that gave powerful stimuli to the Indian economy. 15 However, the maritime power of European countries led to the declining Mughal Empire. The struggle for supremacy ended with the British victory that resulted in the colonial economic policy of the British Empire. 16
Besides, the context of the East-India Company contributed to economic status and development. Proceeding from the book, one sees that East-India Company included several trade communities in some European countries. 17 In each of these countries, there were established companies that had a monopoly right to trade with East India. However, the struggle between French, Holland, and British East-India Companies influenced the future of the country. 18 However, time passed and the economy faced challenges that were too difficult to be overcome.
Jayapan (2008) considers India to be a workshop of the world in the XVIII century, because this country supplied the entire world with everything necessary: food, cloth, etc. Owing to the developed shipping network, it was possible to deliver any article to any country in the world. 19 Nevertheless, despite the fertile lands, the country had low-scale farming. The decreased level of local agriculture could not provide India with economic wealth: most of the population constituted poor people or peasants. The devastation of the country continued, and India found itself on the way to economic decadence. Unprofitable sectors, such as handicraft and agriculture could no longer enrich the local economy. 20
Taking into consideration everything mentioned, one can note that traditional industries, agriculture, and cattle breeding built the base for the traditional Indian economy that proved its high potential. 21 The Mughal Empire and East-India Company positively influenced the economy and gave a stimulus for further development. However, the cruel struggle of European countries for India posed a threat to the countrys economy that needed modification and renovation in the context of the developed British economy. The colonial status of India had both advantages and disadvantages for the countrys development and populations life.
India as a British colony: British Raj
As it was mentioned, the glorious Mughal Empire was declined by British power. In 1856, the larger part of India was under the British East-Indian Company. At the same time, the economic situation of the country provoked unrest in peoples masses. Sepoy Rebellion of 1857 was inevitable: Indian troops that served for the British East Indian Company raised the national spirit of India that strived for independence. 22 Although the rebellion was repressed, it cast challenges for British control. As result, the East-India Company was liquidated; all the country passed into the British Crown. 23 The era of British raj started in 1857 when India became a British South Asian colony.
In 1857, British queen Victoria became the empress of India. The powerful British Empire finally gained control over India and started to implement its colonial policy, peculiar to British Imperialism. 24 Figure 3 (see Appendices, fig. 3) shows the territory of India at the beginning of the British raj. 25 One may see that the British Crown dominated not over the whole country: some independent states formally depended on the Crown. Figure 4 (see Appendices, fig. 4) shows Indian states and provinces at the end of the British raj period. 26
It is necessary to outline the characteristic features of British colonial policy in India. Hobson (2005) gave his definition to the phenomenon of colonialism; its features can be noted in British imperial policy in India. 27 According to the author,
Colonialism, where it consists in the migration of a part of a nation to vacant or sparsely peopled foreign lands, the emigrants carrying with them full rights of citizenship in the mother country, or else establishing local self-government in close conformity with her institutions and under her final control, may be considered as a genuine expansion of nationality, a territorial enlargement of the stock, language, and institutions of the nation . 28
However, the distance between the British island and its Indian colony specified the monopolys policy. The period of British raj may be considered as a bright example of capitalistic penetration of the monopoly country into the life of the colony. British colonial policy was based on exploitation through political and economic means. Indian population experienced hard times under the British Crown: white mans burden . 29
Cain and Hopkins (2002) book may reveal the nature of British colonial policy. According to the researchers, the British exploited natural and people resources, and tended to monopolization world trade. They liquidated intermediary countries, optimized the trade roots and Indian sale market. As India was a distant colony, the British had to provide the Indian market with security. 30 The interior policy was cruel. The predatory British policy expressed in military-confiscation methods, killing of the native population, violence, etc. 31
Explaining the meaning of imperialism, Cain and Hopkins (2002) underline that imperialism was the highest stage of capitalism in a global context ( absorbed by the elites ). Imperialism may be understood as one of the methods by which that elite can prosper and continually renew itself. 32 The period of British raj proves this theory.
The colonial policy of the British Crown became a hardship for millions of Indians. As India was a feudal country, the government introduced the zamindar system to facilitate the process of agricultural tax collection. This way, in the provinces of British India, there appeared the groups of zamindars feudal inherited landowners, who had the right to collect heavy taxes from their peasants. 33 This policy helped to extract the maximum income from the Indian population.
The transition from manufacture to factory industry dictated new rules in the colonial policy. India became an agrarian and raw-material-producing appendage: agricultural development and market outlets of Indian industrial products were sources of the increasing capitalistic industry of the metropolis. The British government in India increased the amount of export from India (cotton cloth) that resulted in British enrichment. 34
The Indian colony, for the British Crown, was a vital source of finance accumulation, and the tool to speed up the process of British economic development. In the colonial trade, export prevailed over import. For this, the British governance limited and, sometimes prohibited import from other countries. Gradually, India was turned into the market outlets of English goods. It led to the cut off of export of goods of Indian production. In its turn, it resulted in the mass destruction of Indian craftsmen. The development of national industry was artificially retarded. One of the purposes of British colonial policy was to enforce the Indian population to buy English goods. Nevertheless, there was a necessity to facilitate colonial policy in world trade using free trade. 35 For this reason, principles of free trading were applied in the sphere of the British-Indian trade market. It pushed off the excessive English import, and avoided inflation; also, it allowed exporting the produced Indian goods. Hopkins and Cain explain that the free market was an opened door that could be used by foreign rivals. 36
As British raj is characterized by advantages and disadvantages for Indian life, his period may be considered ambiguous. On the one hand, it had negative effects. All the goods, imported from India to the British Crown, were acquired using exploitation of the population. India was flooded with the goods of English production. There was a certain decline in the local industries (for example, the cotton industry). The financial condition of India was horrible. 37 However, there was a positive influence of the British rule in India, as well.
Expansion of the British crown was realized not only in the political and economic spheres of Indian life but in culture, as well. For example, the practice of Sati was considered an inhuman cultural expression; for this reason, it was outlawed: since that time, Indian widows could remarry. Moreover, the British government in India decreased the criminal rate: for a long time, numerous travelers had been killed by local thugs. Also, the situation with health care and sanitation was improved in the country. The technical progress led to the appearance of the telegraph, postal service, and railroads. In the period of the British raj, India became the country with a successfully-developed railroad network. Figure 5 shows numerous railways all over India in 1893 (see Appendices, fig. 5). 38 This way, the British turned the imperial civilized standards into global ones. The industrial revolution in England resulted in certain technological development in India. However, in the book, Hobson shows two aspects of the industrial revolution. According to the author, it
is one thing when it is the natural movement of internal forces, making along the lines of the self-interests of a nation & with advancing popular self-government; another thing when it is imposed by foreign conquerors looking primarily to present gains for themselves, and neglectful of the deeper interests of the people of the country . 39
It is evident that when the British provided India with the achievements of the industrial revolution they pursued their financial benefits: the more technological progress in the country was introduced the more profit it could bring. Nevertheless, in general, British control operated to the benefit of an average Indian citizen.
The British paid much attention to the education of the population. Thomas Babington Macaulay introduced a new system of school education in India. There were established special educatory centers for training and examination of Indian elite (disciplines on civil service, instruction of young girls as future wives. 40Moreover, there was created an Indian medical service. Primarily, Indian and English armies took advantage of it; however, in peaceful times, Indian doctors provided the local population with their services. Also, the period of British raj gave India new roads, bridges, barrages.
Despite the fact, that price of British colonialism was high for India, the period of British raj was full of colonial reforms that influenced the countrys life forever. British governance brought relative stability and order into Indian society. 41 The effects of British raj were ambiguous, as there was an improvement of some spheres of Indian life in the prejudice of others.
British Rajs Economic Policy
When most of the Indian territory was under British rule, it was evident that the colonial economic policy of British raj would be aimed at the enrichment of the British Crown. Although slavery was abolished by the British, the colonial rulers implemented the strategy of excessive taxation that helped to extract the countrys resources to the benefit of the British Empire. As some researchers note, the amount of economic drain was equal to 0.04-0.07% of Indian national income. 42
In the article, Maddison (1971) outlined the key elements of British colonial policy. 43 According to the author, British imperialism pursued economic aims, not evangelical. It was not blinded by Christian fanaticism and westernized India in its way. When the British chose their policy in India, they had several kinds of interests. 44
First of all, the primary aim was to come into a monopolistic trading status. The British capitalists invested in banking and shipping services that favored free trade. One of the monopolistic privileges for British capitalists was to enjoy the policy of free trading: India turned into a large market for British products and a source of raw materials. Second, India provided the British middle-class portion of the population with employment; in its turn, their remittances contributed to the British budget. Third, the control over India could give the British Crown prevailing positions in the world: it strengthened its power (especially, military power), and allowed controlling the territory of South Asia. 45
Maddison (1971) believes that the economic policy of British raj did not tend to develop the Indian economy. They did not protect the Indian textile industry. The Indian population was poorly technically educated. Of course, India borrowed some British concepts of property, but it was not convincing too for improvement of the local economy. Most of all, British rajs economic policy was more beneficial for the upper class of population: British aristocracy, a bureaucratic-military portion of the British population, capitalists, landlords, and professional classes. In contrast to the Moghul Empire, British administrators did not carry out efficient investments in the agricultural and industrial sectors of the Indian economy. 46
Gradually, India transformed into the home for the British elite spent their Western lifestyle on Indian ground. There appeared new towns, where urban life boiled with the energy of the British. In this world, the Indian population was the least essential people. Although the Indian population increased, there was extremely small income and output per capita. According to Maddison (1971), the economic and social impact on Indian development was relatively limited. 47 This way, the period of British raj can be considered as a bright example of the typical British colonial policy that retarded the economic potential of India.
However, during the British raj, there was a certain reformation of agriculture. The British administrators transformed the traditional property rights of India into private property by the Western model. The British rulers reinforced the system of land tax collection through zamindar authorities. Their hereditary status excluded administrative functions; they paid low rental payments, and could not be evicted. Their rights were abolished only in 1952. The British established a profitable and effective peasant tenure system that enriched the overall Indian income to the British Crown. Moreover, as titles appeared, it was possible to mortgage land that improved the status of moneylenders who rooted out inefficient landowners 48.
The income of landowners rose for the reason of certain factors: heavy land taxes and rental payment. Under British raj, land scarcity led to the wide-spread phenomenon: the class of landless agricultural laborers. At the same time, rural capitalists had the rights to sell and buy land freely, and increase the number of products in such away. The British rulers faced a certain challenge in Indian villages: most of the population was illiterate, and had problems with a technique that helped to achieve high product performance. As agriculture grew, the Indian population increased. According to Maddison (1971), it grew from 165 million in 1757 to 420 million in 1947 . 49
Also, almost half of British Indian territory was successfully irrigated (primarily, Panjab and Sind). For example, the territory near Afghanistan turned from the lifeless desert to a highly-populated area with high productivity: wheat and cotton were exported to other countries and sold on the territory of India. At the end of the British raj, irrigation investment covered nearly 25 million acres of British Indi . 50 Nevertheless, the development of cash crop trade would not be possible without investment in the transport system (railways, steamships, the Suez Canal).
Farming based on plantations, as well. Indian hard labor on plantations is famous all around the world. On plantations, tea, jute, sugar, indigo were cultivated. Maddison (1971) underlines: in 1946, the two primary staples, tea, and jute, were less than 3.5 percent of the gross value of crop output . 51 Probably, the British tea tradition rooted in the successful British East-India Company and increased tea exports from India to the British island. Thus, Indian tea became a part of the English tea tradition.
Unfortunately, agricultural technology experienced decadence under the British raj. The agricultural output was extremely small. The statistics show that only a 3 percent increase in crop output in British India from 1893 to 1946, i.e. a period in which population increased 46 percent . 52 At the same time, Indian home spinning (a traditional activity of Indian rural women) was reduced. However, in contrast to hand-loom products, textile consumption was high.
In Page and Sonnenburgs (2003) book, one may find information about successful railway network building. 53 In the 1860s, there were constructed first railway lines. The Suez Canal allowed Bombay to be the first Asian city in commerce: it was called the Gateway of India (in 1853, from this city, there was built the first railway line). It turned the city into the highly industrialized cities of India. 54
In the context of a developed railway network, the coal mining industry achieved significant results. The output of this industry
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