The chief motive of the British to establish political control in India was mainly economic and commercial. The sole aim of the British government was to establish a colonial market for the British goods. However the British impact on the economic life of India was devastating and harmful. Britain used the most complicated methods to exploit India`s vast rich economic reserves of India. After a control of two hundred years the British completely shattered the economic set up of India. India in 1947 presented the picture of an economically underdeveloped nation with hunger, poverty, low national income etc.

Indian agricultures received maximum care under the east India Company. This was primarily because the main sources of state income were lands revenue. Moreover it was the sole aim of the British governmmnent was to establish India as agricultural base. Thus the agricultural produces in India could provide cheap raw materials to industrial England. The Company tried various experiments to maximize the land revenue by resort to the method of oppression and repression to the peasants. The system of farming of land revenue became obsolete. Cornwallis introduced Permanent Settlement or a system of Land Revenue in Bengal, Bihar and Orissa in the year 1793. Subsequent administrators introduced the Ryotwari system in the Bombay Presidency and most of the parts of the Madras Presidency. The Mahalwari system proved extremely devastating in the part of Uttar Pradesh. The Zamindary system encouraged absentee landlordism. It eventually created a host of intermediaries between the state and the cultivator. This complicated system of land revenue created a group of moneylender, who otherwise oppressed the poor peasants by lending them at high interests. The poor cultivators could not repay those high interests and ultimately submitted to those moneylenders. As a result famine was the regular feature of the time.

Indian industries suffered a maximum under the British domination. The superiority and extensive sale of the Indian handicraft in Europe was directed to the commercial interests of the Company. The Whig governments in the early years of the 18th century imposed heavy duties on Indians textiles imports in Britain. After the Napoleonic wars the Indian markets were made open to the British for free trades. The same British government now permitted British machine made goods to be poured in India duty free or at nominal cost only. The policy of one-way free trade, introduced in India made the Indian handicrafts losing its market. This caused a great misery to a major section of Indian population.

The impact of British rule created capitalism and bourgeoisie commerce to attain a thriving prosperity. The capitalist mode of production and bourgeoisie trends in the commercial transaction destroyed the handicraft industries in the European countries too. The evil impacts of the industrial revolution in England were suffered in India. The process of industrial regeneration did not start in India, because of British imperialism. Hence India was subjected in a continuing economic stagnation.

The imperial rulers were far from planning in the industrial developments in India, rather they planned to de-industrialize India. Britain`s chief interest was to constituted India as an agricultural farm for industrialized Britain. Hence the British rulers carried on the policy of ruralization and peasantization of the Indian Economy. However several cropped up Indians industries were cropped up from the situation of created by the World War I. The economic depression of 1930s suffered from economics disability, which was mostly controlled by the British finance and capital. Due to the development of industries like iron and steel, heavy industries, metallurgical etc, traditional industries like textile, cement, jute, paper, sugar, pig iron etc suffered a great deal.

The sole mission of the European in India was the economic exploitation. The burden of the Europeans was carried on through the economic exploitation in India. The British rulers created new economic structure belonged to the colonial institutions. The British established a colonial economy, colonial society and even colonial ideology. The institution of landlordism, casteism infested with narrow political consideration, communalism, regionalism etc were the immediate results of the British economic policy. Moreover" distorted modernization" created new problems. In 1947, when the British left, India represented a ruined economy, a sick society and the present danger of the evil effects of neo-colonialism.