Need to study consequences of Colonialism
To fully grasp the problems faced by India in the process of development, after Independence,
it is important to study the consequences of colonial rule. Understanding the multiple and contradictory nature of consequences is itself an engrossing exercise.
Colonialism as a system started emerging at the very beginning of the modern era, that is, the sixteenth century. Although colonialism existed even in the period before that, the Greeks had established colonies in the pre-Christ era, the Cholas went overseas and established colonies
in Indo-China and Indonesia. This form of conquering territories was never referred to as colonialism.
What we witnessed from the 16th century onwards was the forced incorporation by one small part of the world with the rest of the globe. A few countries like Spain, Portugal, Holland, Britain and France established political domination over the rest of the world. Unlike earlier when the
balance kept shifting between different powers, colonialism established an enduring pattern of rule and domination of a few countries over the entire world. This led over a short period of time of the economic integration of the colonised world into the needs of the economies of conquering powers through a process of deeply inequitable trade. There arose a dependent sort of interdependent world. For example, interdependence between Germany and the USA is not harmful to any party, but the same can not be said to be true for the relationship between Brazil and its colonies.
Three Phases of British Rule
The First Phase-Peasantry and its Impoverishment
colonialism destroyed the Indian agrarian economy which led to the impoverishment of peasantry. British retained much of the Mughal revenue system, they made some drastic changes of detail within its overall structure. The first, though a minor one, was they raised the share of revenue collected enormously. This led to severe famines, a third of the population perished, yet the revenue collected continued to grow. However there was no re-investment to increase productivity. An example of the exploitative methodology used by British could be- Under the Mughal if the peasant was entitled to cultivate, for instance, 100 acres of land but actually cultivated only 55 acres, the revenue collected was only for 55 acres but the British assessed and collected the revenue for the entire 100 acres of land. Thus increasing the burden enormously.
The British forced the auction of land in case of failure to pay the revenue or other debts and for the first time allowed non-peasants to buy up land. British were also inflexible in relation to the vagaries of climate that highly affected agriculture.
A repercussion of this was, one, the ability of the superior holders or the money-lenders to confiscate the land of the peasants for realisation of arrears due to whatever reasons and, two, even the land of the superior holders, like Zamindars, could be taken over the moneylender for failure to repay debt and the interest accumulated on it. The consequence was the emergence of absentee landlords as a sizable proportion of land owners who then would let out land on back breaking rent or share-cropping.
The Second Phase-De-industrialisation and its Effects
This phase of colonialism had a dual impact on Indian political economy, the destructive and developmental.
The Destructive Role
The beginning of this process of de-industrialisation started in India. Within a few decades cotton textiles completely disappeared from the list of India’s exports. There was a ruinous decline in the production of textiles in India. In place of this there was an excessive increase of cotton manufactures in the list of its imports. In the wake of the industrial revolution Britain had become the leading producer of cotton textiles in the world. Indian market had become crucial for the expanding British industry. For example in the 1880s, one of the peak points of textiles production, India alone accounted for 40 percent of Britain’s world share.
The story was the same for a number of manufacturers. For silk goods, the British forced the weavers under its control to give up weaving and replaced it with the production of raw silk as the sale of raw silk in Europe was found to be more profitable. Britain also monopolised the manufacture and sale of salt, opium (a key item in trade with China), indigo (very important in the bleaching of cotton goods), etc. Many other manufactures were also decimated.
By the second half of the 19th century de-industrialisation was complete. Its consequence on agriculture, to note in passing, was extremely damaging. People thrown out of secondary manufactures were thrown in on the agriculture for direct sustenance, land had to support so many more millions of people. This led to a Wher ruination of an already, as we have seen
earlier, impoverished peasantry.
The British, beginning with the 19th century, set up a modern administrative apparatus and a modern judicial system. This was a social infrastructure of a new kind for India. Large number of Indians were needed to run it. The British also therefore set up a new type of educational system to run these institutions both public and private. A new class of Indian well versed in English emerged.
The second very important development during this period was the beginning of the construction of railways. Starting in 1854 the first two-truck routes were started and then its construction was taken up in a big way. By 1914, 34,000 miles of railways were constructed linking all the major areas of India. But the railways also surprisingly contributed to a greater integration of Indian economy into the metropolitan one and thus contributed to the augmentation of India’s economic exploitation. It did so by a peculiar route alignment
and fare-structure. The fare for goods was higher if transported between two interior places, e.g., between Indore and Gwalior but much lower. (almost half) if the same were to move from interior to the port cities, e.g. from Gwalior or Indore to Bombay or Calcutta. So that these would discourage internal trade but help external trade with Britain.
The third important change to which reference has to be made is the development of modern irrigation networks. By 1914, 25 million acres came under irrigation.
The third Phase-Imperialism and Industrialisation
In the last decades of the 19th century the nature of capitalism was changing. Different types of capital like the industrial and the banking capitals were getting merged. This gave rise to large financial oligarchies within advanced capitalist countries like Britain, Germany, France, USA, etc., with excess of capital to export. There was intense competition among these countries
to export capital to countries like India. Such competition further gave birth to the first world war.
By 1914 India had developed an industrial base. These industries were concentrated in certain enclaves like the Jute Textiles around Calcutta, Cotton Textiles around Bombay, etc. Other industries, viz., rice-mills, for making refined sugar, cement and so on also started coming up. Tatas (the only Indian allowed to do so) had also established a heavy industry for making steel.
This process got a big push after the first world war. The Indian capitalist who had accumulated large capital through trade started establishing industries on their own. After the war, Britain’s position relatively declined and it faced strong competition from other industrial powers. The Indian capitalist wrested large concessions from Britain to start industries, modify the one-way free-trade, and get some state protection. The rise of the mass-based national movement
also helped the aspiring Indian industrialist to bargain better with Britain.
There was no state assistance for Indian industry but Britain was forced to grant protective tariff to Indian industry vis-a-vis other imperialist powers, although its own goods continued to enjoy preferential treatment. By the time of the second world war, India had achieved a good measure
of self-sufficiency in, apart from Industries mentioned above, consumer goods as also in crude and intermediate goods like pig-iron, steel, cement, etc. Much of what was imported from Britain earlier was being produced within the country itself. This pattern of industrialisation has been referred to by the economists as “import-substitution” industrialisation.