Critique of British Economic Policies
1. Drain of Wealth
Dada Bhai Naoroji used this term in his book titled “Poverty and Un-British Rule in India”, to describe the economic exploitation of India by the British colonial rule.
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- Economic Exploitation: The economic policies of the British were designed to benefit Britain at the expense of India. The heavy taxation policies, trade regulations, and the appropriation of resources from India were draining the wealth of the country.
- Economic Drainage: The surplus revenue generated in India was being sent to Britain, leaving India impoverished. This economic drainage hindered the development of the Indian economy and perpetuated poverty. The economic imbalance resulted in the transfer of wealth from India to Britain.
- Limited Economic Opportunities: The British policies restricted industrial and economic development in India. The emphasis on raw material extraction and export-oriented policies left India in a state of economic dependence.
2. Deindustrialisation of Indian Economy
The deindustrialization of the Indian economy under British rule is a historical phenomenon that refers to the decline of traditional Indian industries, particularly in the textile sector, during the period of British colonial dominance.
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- Free Trade Policies: The British adopted a free trade approach, which meant that Indian markets were flooded with cheap British goods, leading to a decline in demand for Indian products.
- Introduction of Machine-made Goods: The advent of the Industrial Revolution in Britain led to the mass production of machine-made goods. This led to decline of cottage industries and handicrafts.
- Impoverished Agriculture: Due to heavy taxation under the land revenue system, there was no surplus left which could have led to modernisation of agriculture.
- Railways: While the British built a railway network in India, it was primarily geared towards facilitating the transportation of raw materials from the hinterland to the ports for export.
- Economic Dependence: India became economically dependent on Britain, relying on the export of raw materials and the import of finished goods.
