INDIAN ECONOMY ON THE EVE OF INDEPENDENCE PART 1

• INDIAN ECONOMY ON THE EVE OF INDEPENDENCE PART 1
  INDIAN ECONOMIC DEVELOPMENT
  
  
• SHASHI AGGARWAL ECONOMICS AND LAW CLASSES
• INDIAN ECONOMY ON THE EVE OF INDEPENDENCE

1. COLONIAL EXPLOITATION OF THE INDIAN ECONOMY UNDER THE BRITISH RULE
2. FEATURES OF INDIAN ECONOMY ON THE EVE OF INDEPENDENCE
3. AGRICULTURE SECTOR ON THE EVE OF INDEPENDENCE
4. FOREIGN TRADE UNDER THE BRITISH RULE
5. DEMOGRAPHICS PROFILE DURING THE BRITISH RULE
6. OCCUPATIONAL STRUCTURE ON THE EVE OF INDEPENDENCE
7. INFRASTRUCTURE ON THE EVE OF INDEPENDENCE
8. INDIAN ECONOMY ON THE EVE OF INDEPENDENCE

1. COLONIAL EXPLOITATION OF THE INDIAN ECONOMY UNDER THE BRITISH RULE

• TARGETED EXPLOITATION OF ALL THE SECTORS OF ECONOMY BY THE BRITISH GOVERNMENT.
• COLONIAL EXPLOITATION OF AGRICULTURE SECTOR: EXPLOITATION THROUGH ZAMINDARI SYSTEM OF LAND REVENUE.

1. ZAMINDARS WERE DECLARED OWNERS OF THE LAND AND HAD TO PAY A FIXED SUM TO THE GOVERNMENT AS LAND REVENUE AND FREE TO COLLECTS AS MUCH AS THEY WANT FROM THE TILLER
2. ACTUAL CULTIVATOR GOT BARE MINIMUM
3. ZAMINDAR USED REVENUE INCOME ON THE LUXURIES OF LIFE AND NO INVESTMENTS WERE MADE FOR THE DEVELOPMENT OF AGRICULTURE

•  COLONIAL EXPLOITATION OF INDUSTRIAL SECTOR

1. INDIAN HANDICRAFTS ENJOYED WORLD WIDE REPUTATION FOR THEIR VARIETY AND QUALITY BUT DESTROYED BY BRITISH GOVERNMENT IN TWO WAYS:
2. HEAVY DUTY ON THE EXPORT OF HANDICRAFTS
3. DUTY FREE IMPORT OF THE BRITISH GOODS IN INDIAN MARKET

• COLONIAL EXPLOITATION OF INTERNATIONAL  TRADE

1. DUTY FREE EXPORT OF INDIAN RAW MATERIAL TO FULFILL THE INDUSTRIAL NEEDS IN BRITAIN
2. DUTY FREE IMPORT OF BRITISH GOODS TO EXPAND DEMAND FOR THE BRITISH GOODS IN INDIAN MARKET

3.    INDIAN ECONOMY BOTH STAGNANT AND BACK WARD

•  2.FEATURES OF INDIAN ECONOMY ON THE EVE OF INDEPENDENCE
• STAGNANT ECONOMY: A STAGNANT ECONOMY IS THE ONE WHICH SHOWS LITTLE OR NO GROWTH IN INCOME AND GROWTH RATE OF PER CAPITA INCOME WAS .5% PER ANN UM DURING 1860-1945 AND IT WAS 0.1 PER CENT PER ANN UM BETWEEN 1925 AND 1950. BULK OF INDIAN POPULATION LIVED IN POVERTY AND LIVING STANDARD WAS VERY POOR . THERE WAS EPIDEMICS AND STARVATION.
• BACKWARD ECONOMY :MEANS PER CAPITA INCOME WAS VERY LOW. IN 1947-48,PER CAPITA INCOME IN INDIA WAS JUST 230 RS. UNEMPLOYMENT,POVERTY EXISTED  WHICH LED TO  BACKWARD ECONOMY.
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• AGRICULTURE BACKWARDNESS:-

1. NEARLY 72 PERCENT OF THE WORKING POPULATION WAS ENGAGED IN AGRICULTURE BUT CONTRIBUTION TO GDP WAS ONLY 50%
2. LOW PRODUCTIVITY. PER HECTARE OUTPUT OF WHEAT WAS ONLY 660 KILOGRAMS AND RICE JUST 710 KILOGRAMS
3. FOOD GRAINS WAS BARELY ENOUGH FOR SUBSISTENCE.

• INDUSTRIAL BACKWARDNESS:

1. LACK OF BASIC AND HEAVY INDUSTRIES IN THE COUNTRY
2. VERY LOW PRODUCTION OF MACHINES
3. SMALL SCALE AND COTTAGE INDUSTRIES WERE ALMOST RUINED
4. FOR CAPITAL GOODS. DEPENDENT ON THE IMPORT  FROM BRITAIN

• RAMPANT POVERTY:HIGH DEGREE OF UNEMPLOYMENT AND POVERTY AND PEOPLE WERE NOT ABLE TO GET TWO SQUARE MEALS A DAY
• POOR INFRASTRUCTURE:-LOW MEANS OF COMMUNICATION AND TRANSPORT AND GENERATION OF POWER. 1948,POWER GENERATION CAPACITY WAS MERELY 2100 MW.LENGTH OF RAILWAY LINES WAS 53.596 KM AND PUCCA ROADS HAS COVERAGE OF 155 THOUSAND KMS ONLY
•  HEAVY DEPENDENCE ON IMPORTS:- FOR DEFENCE GOODS,MACHINERY AND OTHER EQUIPMENT OF PRODUCTION AND ALSO CONSUMER GOODS
• LIMITED URBANIZATION : ONLY 14% POPULATION LIVED IN URBAN IN 1948
• SEMI FEUDAL ECONOMY :MIXED ECONOMY OR SEMI FEUDAL. LEADS TO LOW PRODUCTIVITY AND LOW BACKWARDNESS
• COLONIAL ECONOMY: AS IT WAS BRITISH COLONY AND BRITISH EXPLOITED IT FOR THEIR OWN BENEFITS

1. RUINING OF DOMESTIC INDUSTRY BY IMPOSING HEAVY TAXES
2. NATURAL RESOURCES WERE DEPLETED FOR THE GROWTH OF BRITISH ECONOMY
3. ATROCITIES ON INDIAN ARTISAN  WHICH LED TO CLOSING OF COTTAGE INDUSTRIES.

• 3. AGRICULTURE SECTOR ON THE EVE ON INDEPENDENCE
• LOW PRODUCTION AND PRODUCTIVITY: PRODUCTION MEANS TOTAL OUTPUT AND PRODUCTIVITY REFERS TO OUTPUT PER HECTARE OF LAND. PRODUCTIVITY OF WHEAT WAS NEARLY 4.9 TIMES LOWER IN 1947 COMPARED WITH ITS LEVEL IN 2016-2017 AND OUTPUT OF WHEAT WAS LOWER 15.4 AND RICE WAS NEARLY 5 TIMES LOWER. PRODUCTIVITY OF RICE WAS NEARLY 3.8 TIMES LOWER AS COMPARED WITH ITS LEVEL OF 2016-2017
• HIGH DEGREE OF UNCERTAINTY: EXCESSIVE DEPENDENT ON RAIN FALL
• DOMINANCE OF SUBSISTENCE FARMING:

1. OWNERS OF THE SOIL WERE THE ZAMINDAR AND TILLERS WERE PEASANTS AND LABORERS
2. SUBSISTENCE FARMING IN WHICH THE CROPS WERE PRODUCED TO PROVIDE THE BASIC NEEDS OF THE FAMILY

• GULF BETWEEN THE OWNERS OF THE SOIL AND TILLERS OF THE SOIL: THE TILLERS WERE GIVEN ENOUGH FOR SUBSISTENCE
• SMALL AND FRAGMENTED HOLDING:- WHICH LED TO LOW OUTPUT AND LOW PRODUCTIVITY
• LAND REVENUE SYSTEM UNDER THE BRTISH RAJ:

1. TRIANGULAR RELATIONSHIP AMONG GOVERNMENT,LANDLORD AND TILLER. POPULARLY KNOWN AS ZAMINDARI SYSTEM
2. ZAMINDAR AS PERMANENT OWNERS AND  HAS TO PAY A FIXED SUM TO THE GOVERNMENT
3. FREE TO EXTRACT AS MUCH AS FROM THE TILLERS

• IMPLICATIONS FOR THE FARMERS:
• UNLIMITED EXPLOITATION

1. UNNECESSARY ENHANCEMENT OF THE LAND REVENUE DUE TO WHICH TILLER HAS TO VACATE THE LAND
2. TILLER AS LANDLESS LABOURERE  AND MERELY GOT SUBSISTENCE WAGES

• FORCED COMMERCIALIZATION OF AGRICULTURE: COMMERCIALIZATION OF AGRICULTURE REFERS TO SHIFT FROM CULTIVATION FOR SELF CONSUMPTION TO CULTIVATION FOR THE MARKET

1. SHIFT TO COMMERCIAL CROP INDIGO TO PARTICULARLY FROM CONVENTIONAL SUBSISTENCE CROPS LIKE RICE AND WHEAT. INDIGO WAS REQUIRED BY TEXTILE BRITISH INDUSTRY
2. EITHER LURED OR FORCED TO ACCEPT ADVANCE PAYMENT
3. EARLIER THEY USED TO GROW FOOD CROPS FOR SELF CONSUMPTION,NOW THEY REQUIRE CASH FOR PURCHASING. PERPETUAL INDEBTEDNESS AND PERPETUAL STAGNATION OF FARMING

• ON THE EVE OF INDEPENDENCE AGRICULTURE WAS BACKWARD AS WELL AS  STAGNANT
• BACK WARD  OF THE AGRICULTURE MEANS:-

1. LOW PRODUCTION AND LOW PRODUCTIVITY
2. HIGH DEGREE OF UNCERTAINTY
3. DOMINANCE OF SUBSISTENCE FARMING AND SMALL AND FRAGMENTED HOLDINGS

• STAGNATION OF AGRICULTURE:

1. GULF BETWEEN THE OWNERS OF THE LAND AND TILLERS OF THE SOIL
2. LAND REVENUE SYSTEM UNDER THE BRITISH RAJ
3. FORCED COMMERCIALIZATION OF THE AGRICULTURE