History Optional (Paper 2 Section A) (Economic Impact of British Colonial Rule) by Rashid Yasin Sir

Model Answer

Question #1. The poverty of the Indian people was the consequence of the government 's land revenue and taxation policy. Discuss this statement with reference to British rule in India in the 19th century.

The classical colonial economic relationship that gradually emerged during the 19th century placed the resources of India at the disposal of Britain, while India itself underwent a period of economic decline. Land revenue system and taxation policy emerged as two of the main instruments of this plunder.

Since acquiring political power, the British had developed an elaborate mechanism to extract the agrarian surplus in the form of the land revenue system. The land revenue assessment was often poor and revenue demand exorbitantly high with respect to the actual produce.

Moreover, in the Permanent Settlement areas, an intermediary class of Zamindars was introduced, who extracted high rents and illegal abwabs, further burdening the peasantry class, who were reduced to the status of tenants.

The result of this oppressive revenue system was that the peasants began to rely excessively on the money lenders to pay the rent. The burden of rent often forced the peasants to shift to cash crops, but even here they were subjected to exploitation by the European planters.

The overall result of the British land revenue system was the rise of oppressive classes of landlords (Zamindars) and money lenders and land speculators that ultimately increased agrarian indebtedness and pushed the peasantry into poverty.

The taxation policy was also a factor in accentuating poverty in India. The preferential tariff policy facilitated the import of the British manufactured goods in India while restricting the Indian goods. Also, India's trade surplus with other countries was used to help Britain's balance of payments. Thus, the British taxation policy was biased against the Indian industries and set in motion the process of deindustrialization, which led to the pauperization of Indian artisans.

Overall, the drain of wealth amounted to about 2% of India's export value, but what was being drained was essentially the surplus that could have been ploughed back into the Indian economy and support industrialization.

Thus, it was this drain of wealth of which the land revenue and taxation policy were instruments of extraction, that led to the poverty of Indian people under the

Question #2. Identify the main features of industrial development in India from 1914 to 1947 with special reference to the emergence of a class of factory labourers.

The first World War managed to break the stranglehold of British capital over Indian industries. The Calcutta based Marwari money lenders succeeded in infiltrating the Boards of European managing agencies and later established Indian owned Jute mills outside the control of European dominated Indian Jute Mills Association. Gradually they began to expand to other sectors like sugar mills, chemicals, paper mills, etc and diversified their hold. Similar developments took place in the cotton textile sector where trading communities like Gujaratis, Bohras, Marwaris began to diversify into manufacturing as well.

Post-World War I, the British government also adopted the policy to develop India as a manufacturing country, as far as desirable. The Montagu- Chelmsford reforms advocated fiscal autonomy for India and a policy of discriminatory protection was introduced to consider protective tariffs for specific sectors. Thus, Indian industries were able to emerge as competitors in certain fields and grow considerably.

Meanwhile, the identity of factory labourers also underwent a change. Since the beginning, the factory labourers had been divided horizontally as a class based on religion, caste, ethnicity, etc. These differences were often used as tools to suppress the workers' agitations and thus the early part of their struggle was characterized by too much militancy, yet too little organization. Despite this, Post - World War I, the workers were able to harness their community ties for their cause and managed to pull off many successful strikes 1919 onwards. The cause of workers was also taken up by Mahatma Gandhi during the Ahmedabad Mill Strike, where he emphasized on his theory of trusteeship and familial relations between the employer and the employee.

Congress' attempts to orient workers' agitation towards Nationalist cause with the formation of All India Trade Union Congress(AITUC) in 1920, however, remained only partially successful. The fact that the workers were not entirely willing to compromise on their demands in favor of a Nationalist cause also reflects the beginning of the formation of class identity. Their support for the nationalist agitation remained conditional, as can be seen from Gandhi's 11 Point Demand, which included demands of the working class as well, in order to ensure their successful participation in the Civil Disobedience Movement.

The role of Communists was also crucial in mobilizing the working class, which included utilizing the community ties as well. Thus, they were more successful in emerging as leaders of the working class movement particularly because of their consistent opposition to the government, which was seen as an ally of employers. In contrast, the Congress support to agitations was limited in foreign-owned industries only and it was only in 1937 elections that they conceded to some of their radical demands.

However, post-victory, legislations like the Bombay Trade Disputes Act and brutal suppression of agitations further drove the working class into Communist influence and strengthened their class identity. Thus, from 1914-47, there were numerous strikes particularly in the 1920s and 1940s, that were usually organized at local levels, and sometimes backed by Nationalist leaders like Bose, V.V. Giri, Nehru, etc, to increase their support. These instances strengthened and shaped their class identity, though community ties remained just as potent forms of mobilization.