DISCUSSION:

India was a land of extensive manufactures. Indian artisans were famous for their skills the world over. In fact the reason for India's favorable foreign trade was its excellence in indigenous production. India indulged in a large scale manufacture of cotton and silk fabrics, sugar, jute, dyestuffs, mineral and metallic products like arms, metal wares and oil. Towns like Dacca and Murshidabad in Bengal; Patna in Bihar; Surat and Ahmadabad in Gujarat; Chanderi in Madhya Pradesh; Jaunpur, Varanasi, Lucknow and Agra in U.P.

Multan and Lahore in the Punjab; Masulipatnam, Aurangabad and Visakhapatnam in Andhra; Bangalore in Mysore and Coimbatore and Madurai in Madras were flourishing centers of textile industry. Kashmir specialized in woolen manufactures. Maharashtra, Andhra and Bengal were prominent centers of ship building industry. India's ships were bought by many European companies for their use.

India, towards the end of the 18th century was, undoubtedly one of the main centers of world trade. This status of India was completely destroyed under colonial times. Its beginnings can be traced to the after-math of the industrial Revolution in England. The machine made cloth of England began to replace the indigenous manufactures. India's artisans were forced out of production. It was this pressure from the British goods which led to the decline of the traditional India's centers of economic activity.

Before the prologue of exploitive policies the cotton and silk goods of India could be sold for a profit in the British market at a price from 50 to 60 per cent lower than those fabricated in England. It consequently became necessary to protect the latter by duties of 70 or 80 per cent on their value, or by positive prohibition. Had this not been the case that such prohibitory duties and decrees had not existed in India, the mills of Paisley and of Manchester would have been stopped in their outset, and could hardly have been again set in motion, even by the powers of steam. They were created by the sacrifice of the Indian manufactures. Had India been independent, she would have retaliated; would have imposed preventive duties upon British goods, and would thus have preserved her own productive industry from annihilation. This act of self-defense was not permitted to her and she was at the mercy of the stranger. British goods were forced upon her without paying any duty; and the foreign manufacturer employed the arm of political injustice to keep down and ultimately strangle a competitor with whom he could not contend on equal terms. By the Act 11 and 12 William III, it was enacted that the wearing of wrought silks and of printed or dyed calicoes from India, Persia and China should be prohibited, and a penalty of £200 imposed on all persons having or selling the same. Similar laws were enacted under George I, II and III, in consequence of the repeated lamentations of the afterward so “enlightened” British manufacturers. And thus, during the greater part of the 18th century, Indian manufactures were generally imported into England in order to he sold on the Continent, and to remain excluded from the English market itself.

The establishment of the British rule affected the existence of the handicrafts. With the virtual elimination of demand for the industry following the disappearance of noble courts, the industry wished a new source of demand from the European officials and tourists and from the 'baboos' and black Indian 'sahibs'. The European officials, of course, favored imported manufactures. The consumption habits of the newly educated Indians, a product of English education, also dealt a crippling blow to these industries. These newly created Indian 'bourgeoisie' not only disdained the products of indigenous industries but also tried to copy everything European which was considered to be the "hallmark of enlightenment."

The competition from the European manufacturers was partly responsible for the decline of Indian handicrafts. In the matter of quality, Indian weaver could easily hold the dominance but in the matter of price it was hopelessly beaten by the machine made goods. Great regard for everything foreign by the Indian middle class helped foreign goods a great deal in their competition with Indian textiles. Thus, the process of decay which began with the establishment of foreign rule and foreign influence got completed by the competition from foreign goods.

The tariff policy pursued by the British Government was responsible for the decay of handicrafts. This tariff policy came to be known as 'one-way free trade'. To put her manufacturing industries on a sound footing at home, England pursued the policy of protection through the imposition of import duties. But for India, she preached the gospel of free trade. R. C. Dutt wrote that "the East India Company and the British Parliament following the selfish commercial policy of a hundred years ago discouraged Indian manufacturers in the early years of British rule in order to encourage the rising manufacturers of England. Their policy was to make India subservient to the industries of Great Britain and to make the Indian producer grow raw material for the industries of England." Indian cotton and silk goods which could be sold at a price 50 to 60 per cent lower than the price of cloth manufactured in England were subjected to import duties varying between 70 to 80 per cent in England simply to drive them out from the British market.

India could probably have copied Lancashire's technology more quickly if she had been allowed to impose a protective tariff in the way that was done in the USA and France in the first few decades of the nineteenth century, but the British imposed a policy of free trade. British imports entered India duty free and when a small tariff was required for revenue purposes Lancashire pressure led to the imposition of a corresponding excise duty on Indian products to prevent them gaining a competitive advantage. This undoubtedly handicapped industrial development.

Until the end of the Napoleonic wars, cotton manufactures had been India’s main export. They reached their peak in 1798, and in 1813 they still amounted to £2 million, but thereafter they fell rapidly. Thirty years later, half of Indian imports were cotton textiles from Manchester. This collapse in India’s main export caused a problem for the Company, which had to find ways to convert its rupee revenue into resources transferable to the UK. The Company therefore promoted exports of raw materials on a larger scale, including indigo, and opium.

Was de-industrialization a myth?

Three different sets of views have emerged round the process of de-industrialization following the evidence suggested by nationalist economists, modern researchers and foreign scholars. One school of thought represented by Daniel Thorner tends to argue that de-industrialization might have appeared in the early 19th century but the evidence of industrialization was clearly visible in the last decade of the 19th century and the early 20th century. Secondly, to the U.S. scholar Morris D. Morris the stage of de-industrialization in India was highly difficult to find. Nationalist economists, however, had no doubt about de-industrialization.

In support of their assertion, nationalists like R. C. Dutt, M. M. Malabya relied on external trade statistics which indicated a rapid growth of imports of broadcloth in conjunction with a decline in textiles import. The value of imports showed a remarkable uptrend during 1860 and 1900 when it rose from 96 Lakh pounds to 27 Crore pounds. Fall in exports is tantamount to loss of foreign market of indigenous products while rise in imports means destruction of home made goods in the home market. However, this trade data do not clearly explain de-industrialization since this data do not give any definite inkling about the decline in productions.

Western View-Point:

The U.S. scholar Morris D. Morris opined that de-industrialization was a myth since it did not take place even in the early 19th century. Morris argued that nationalists' index of de-industrialization (that is, external trade data) could not stand as a fair index. Unfortunately, his arguments were more conjectural and dubious. Village handicraft industries survived mainly as an only occupation left to the artisans. Above all, artisans were forced to put themselves into the clutches of moneylenders. In a colonial economy, this merchant capital or the question of exploitation played a dominant role in the survival of these industries. In terms of output and employment, handloom and a variety of traditional industries suffered a catastrophic decline.

The purpose of Daniel Thorner’s study was to evaluate the notion of de-industrialization in India under British Rule during the last phase of the 19th century. Thorner’s presentation of the issue is a threefold proposition to the effect that decline of handicrafts continued into the 20th century and it was not compensated by a sufficient rise of modern industry. In consequence the Indian economy became more and more agricultural. To test this hypothesis, Thorner depended on the information available in the census report from 1881 to 1931. As an index he considered Manufacturing Work Force (MWF) and reached the conclusion that the census data for males do not support the case either for absolute de-industrialization or even for relative de-industrialization. He suggested that if indeed a major shift from industry to agriculture ever occurred during the British Rule in India, it might have happened sometime between 1815 and 1880.

If the opinions of Morris D. Morris, W.H. Moreland, or European travelers or British factory records are accepted that India was underdeveloped when the British gradually conquered it, then the implication is that the British conquest of India was beneficial for the economy, society and polity of this country. In history whenever two societies interact, the advanced and well organized society succeeds in establishing its control over the less advanced society and at the same time the less advanced society gains from the technology and organization of the advanced society.

The western writers view the British colonial rule as a rule of advanced society over an underdeveloped one. In this process, the underdeveloped society like India achieved benefits from the British rule and they are enumerated by the Western scholars as: "The British provided political unity and stability to India. The British developed a system of roads and rail transport which had a positive impact on the economic development of India. The British developed irrigation and other public works which facilitated the growth of agriculture, commerce and manufacturing activities in India. To sum up, the Western writers have made two points regarding the impact of British rule over India. First, on the eve of colonial expansion, the British found a highly underdeveloped India with low productivity in agriculture, very low per capita income and absence of any developed technology or tools for manufacturing. Second, the benevolent policies of the British helped in the establishment of political unity, a system of governance and it laid the foundations of economic development in India."

Nationalists' View-Point:

The nationalists argued that British rule led to the de-industrialization of India. India was an exporter of cotton manufacture and this was how the Company started its trade but gradually India became an importer of cotton manufacture and thus Indian artisans, craftsmen and important trading centers collapsed and whatever manufacturing activity existed was destroyed under the impact of imports of cotton manufacture exclusively from Britain. Amiya Bagchi observed: "India remained the major importer of cotton goods from Britain, often taking more than forty per cent of the British exports."

The industrialization of England was accompanied by the decline and destruction of Indian cotton manufacturer. As a result, India witnessed, from the early 19th century onwards, a steady decline in population dependent on indigenous industries and a consequent over-burdening of agriculture. This proved injurious for her ramifications which have been summed up by Sumit Sarkar: "The decay of Dacca, Surat, Murshidabad and many other flourishing towns bear testimony to de-industrialization of India. The population of the town of Dacca has fallen from 1,50,00 to 30,000 or 40,000 and the jungle and malaria are fast encroaching upon the town. Dacca, which was the Manchester of India, has fallen off from a very flourishing town to a very poor and small one; the distress there has been very great indeed."

Ramesh Chandra Dutt stated: "India in the eighteenth century was a great manufacturing as well as a great agricultural country, and the products of the Indian loom supplied the markets of Asia and Europe. It is, unfortunately, true that the East India Company and the British Parliament, following the selfish commercial policy of a hundred years ago, discouraged Indian manufacturers in the early years of British rule in order to encourage the rising manufactures of England. Their fixed policy, pursued during the last decades of the eighteenth century and the first decades of the nineteenth, was to make India subservient to the industries of Great Britain, and to make the Indian people grow raw produce only, in order to supply material for the looms and manufactories of Great Britain."

According to Karl Marx "It was the British intruder who broke up the Indian handloom and destroyed the spinning wheel. England began with driving the Indian cottons from the European market; it then introduced twist into Hindustan, and in the end inundated the very mother country of cotton with cottons."

M. Davis concludes: "If the history of British rule in India were to be condensed to a single fact, it is this: there was no increase in India’s per-capita income from 1757 to 1947." In fact, incomes may have declined by 50 percent in the last half of the 19th century, as portrayed below:

S. No	Country	1700	1820	1890	1952
1.	China	23.1	32.4	13.2	5.2
2.	India	22.6	15.7	11	3.8
3.	Europe	23.3	26.6	40.3	29.7

Source: Davis, M (2001½: Famines and the making of the Third World, London, Verso Books.

Consequences of De-industrialization:

De-industrialization caused imbalance in the occupational structure leading to rural unemployment and under-employment. Daniel and Alice Thorner showed that in 1881, the number of workers engaged in agricultural activities stood at 7.17 Crores which swelled to 10.02 Crores in 1931. As against this, people engaged in industrial activities declined from 2.11crores to 1.29 Crores between 1881 and 1931. Amiya Bagchi used employment statistics of the period 1809 to 1901 as evidence of de-industrialization when the proportion of cotton spinning and weaving population to total industrial population declined from 62.3 p.c. to 15.1 p.c. People released from industry of various kinds found agriculture as the only alternative means of livelihood. Consequently, agricultural sector became overburdened with surplus population consequently a new proletariat class of landless labour emerged in the countryside.

CONCLUSION:

The progress made in India under British Rule like the coming of railways, Postal System, Telegraphic communications, etc. were all undertaken by the British administration to facilitate their rule. The aim of British policy was to integrate the Indian economy with that of the British in way such that India supplied Great Britain with cheap raw material for being manufactured into valued-added (costly) finished products. It is not true that if India remained independent it could not have developed railways or telegraphic system; Japan or Thailand was never colonized but they have today much better infrastructure than that in India.

REFERENCES:

1. Dutt Ramesh Chandr. Economic History of India. London. 1987.

2. Davis M. Famines and the making of the Third World. London. Verso Books. 2001.

3. Bose Sugata; Jalal Ayesha. Modern South Asia-History Culture and Economy. London. 2003.

4. Habib Irfan. Indian Economy 1858–1914. Aligarh and New Delhi. Tulika Books. 2007.

5. Bagchi Amiya Kumar. The Political Economy of Underdevelopment. Cambridge. Cambridge University Press. 1982.

Received on 18.10.2010

Accepted on 31.10.2010

Head of Dept., Dept. of History, Shri Menash College, Jamuaramgarh, Jaipur, Rajasthan

INTRODUCTION: