A Historical Perspective To Indian Economy

A Historical Perspective To Indian Economy

For an understanding of the present state of the Indian economy as also its likely future, a study of its past is of great help. With the knowledge and experience that it offers, one can perceive the emergence and evolution of the present problems. Events of the past do not mercilessly bind us, but they have a certain significance in our appreciation of the present and assessment of the future. We discuss the subject in terms of the history that is closest to the ushering in of Independence in 1947, namely, the British Period. This is, however, preceded by a short description of the economic conditions of India that prevailed before the British came on the scene.

Check out Economic development notes in detail. 

Pre British Period

The economic conditions of India, before the British came around the middle of the 19th century, were almost similar to those which prevailed in other countries at a comparable stage of industrial development. In some respects, India, in fact, was better placed for modern growth. Fairly Advanced Sectors: The Agricultural sector, as also the Industrial sector, was in a high degree of development. While trade and transport sectors were just satisfactory, banking was quite a developed sector. India was predominantly an agricultural country. This is obvious from the fact that more than two-thirds of the males were dependent on land. According to the 1871 census, 56.2 per cent of the adult male population was engaged in agriculture. To these may be added another 12.3 per cent classified as general labourers. Even these figures do not convey fully the overwhelming importance of agriculture. The picture of the agrarian character of the country is more truly represented if we also take into account the fact that most of the rural population carried on agriculture as a subsidiary occupation.

As for its economic level, Indian agriculture had attained a high degree of development and was flourishing. This is clear from the several aspects of the agricultural scene. There were, for: instance, many important crops that had been grown for very long times in the past. Dr Voeleker, in his Report on the Improvement of Indian Agriculture (1889 ), mentions how Indians cultivated wheat, centuries before the English did. Similarly, cotton was before the English did. Similarly, cotton was cultivated in this country from a very early timeş. So were other major crops. Another feature of the advanced agrarian scene was the industrious peasantry which was highly skilled, having inherited this quality from their forefathers over many generations. The agricultural techniques used were also highly developed. Good agricultural practices were a common phenomenon. These related to such facets of agriculture as land husbandry like keeping land free of weeds; proper timing of the sowing and reaping operations; rotating the cultivation of mixed crops; keeping some land fallow for recuperation, and cultivating land as per its capabilities. In the sphere of irrigation, too, the techniques used were much advanced. Quite a several ingenious water-raising appliances were in use. The ancient irrigation works of southern Indian received much praise at the hands of Sir Charles Trevelyan, the Finance Minister of India (1863-65). In the Industrial, field, India had attained a high degree of development. There were many industries some of them of national importance. The variety of crafts and goods produced was large indeed. To mention a few, there were, for example, spinning, weaving, dyeing, manufacture Iridia’s trade, internal and external, was not large. principally because of the inadequacy of our communication and transportation. Internal trade was restricted to comparatively valuable products. There was little trade in bulky and cheap goods, largely on account of me 18 cost of transportation of these goods. Trade was also less because of the restrictions on the types of goods traded, also on the distances covered. As far as the external trade is concerned, this too was not much because of the weak internal communication system and shortage of transport facilities. Even then Indian goods were found market in far-flung places in the world. Muslin, for example, went as far as Egypt. Dacca muslin was well-known to the Greeks as Gangetika. In Rome too there was large consumption of Indian goods.

Other countries with whom Indians traded were South -East Asia, Japan, France, Portugal, England etc. Most of the goods exported were industrial in character. These were cotton and silk fabrics, shawls and carpets, artistic and decorative articles, sugar etc. Imports were of small variety and consisted of such items as gold, precious stones, pearls, tea and coffee, dry fruits etc. In its external trade, India enjoyed surpluses and received gold and silver in ample quantities as payment for the same. In the sphere of transport as also as communication, India’s position was not satisfactory in the first half of the 19th century. Roads as such did not exist or existed in unsatisfactory conditions. The most important vehicle in use was the bullock cart. The Indus and the Ganges were the only river systems that were navigable. Shipping, of course, had attained remarkably high standards. The Governor-General; Lord Wellesley, writing in 1901, had testified to the excellence of Indian-built ships which sailed to the Thames ( London ) in company with the British built ships. The banking system was quite developed. Some individuals and families functioned as banks. they had come to be known by different names in different parts of the country.

Some of the important ones were Jagat Seth, Nagar Seth, Mahajan, Shroff etc. The main instrument of credit was the Hundi’ i.e., a document which promised to pay to the bearer a certain sum of money on sight (Darshni Hundi)-or after the expiry of a fixed period ( Mudati Hundil Big banking-houses also functioned as the receiver and treasurer of government venues. These banking-houses financed credit requirements of domestic /business as also of modelling international trade. The capital of these banking houses was accumulated from several sources such as interest from loans provided to handicraftsmen, traders etc. people around 90 per cent, lived in villages. Their ways of living characterised the far between with a variety of occupations flourishing over the Indian economy. Towns were few and far between with a variety of occupations there.

Here are some notes for Rural Economy During Pre British Period.

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