Economic Impact of British rule on Agriculture and Land Revenue
Indian agricultures received major attention under the East India Company. It was mainly because of the fact that the chief source of the state income was land revenue. Moreover, the British government mainly wanted to establish their agricultural base in this country. So that the agricultural produces in India could provide cheap raw materials to industries in England. Further, East India 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 The system of farming of land revenue became outdated. Lord Cornwallis introduced 'Permanent Settlement' or a system of Land Revenue in Bengal, Bihar and Orissa, in the year 1793, through which the Zamindars gained permanent ownership over the land.
Subsequent administrators introduced the Ryotwari system in the Bombay Presidency and most of the parts of the Madras Presidency. The British administrators decided and set the revenue with the farmers directly, which was pretty high in most regions. The Mahalwari systemproved extremely devastating in parts of Punjab, Uttar Pradesh and some regions of Central India. 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. The commercialisation of agriculture had severely affected the rural economy. The existing structure of agriculture was already destabilized, but it was further wrecked by the cultivation of crops and food grains for the market rather than for consumption. This further diminished the economic conditions of the peasants.
Economic impact of British rule on Industry
Indian industries suffered massively under the British domination. The superiority and extensive sale of the Indian handicraft in Europe was directed to the commercial interests of the East India Company. The governments in the early years of the 18th century imposed heavy duties on Indian textile 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 resulted in capitalism and bourgeoisie commerce to attain a flourishing prosperity. The capitalist mode of production and bourgeoisie trends in the commercial transaction destroyed the handicraft industries in the European countries too. The British government also wrecked the Indian cottage industries, which served as one of the major sources of trade. Industries such as pottery, tanning, woollen and silk textile, metal and paper were adversely affected, resulting in weakening of the rural economy. The evil impacts of the industrial revolution in England also affected India. The process of industrial regeneration did not start in India, because of British imperialism. Hence India was subjected in an ongoing economic stagnation.
The imperial rulers were far from planning in the industrial developments in India; rather they planned to de-industrialise India. Britain's chief interest was to constitute India as an agricultural farm for industrialised Britain. However several Indians industries were cropped up from the situation created by the World War I. The economic depression of 1930s suffered from finances disability, which was generally 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.
Thus, it is quite clear that 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 that solely belonged to the colonial institutions. The British established a colonial economy, colonial society and even colonial ideology. The institution of landlordism 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, India represented a ruined economy, a devastated society and evil effects of neo-colonialism.
Thus, it can be said that commercialisation of agriculture, increase of agricultural labourers, growth of money lending class, excessive drain of wealth and demolition of handicrafts and cottage industries from the country are some of the major impacts on Indian economy by the British rule.