Tiêu đề Chapter 10_CA Hardik Manchanda.pdf ✅

INDIAN ECONOMY STATUS OF INDIAN ECONOMY: PRE INDEPENDENCE PERIOD (1850 -1947) ▪ Between the first and the seventeenth century AD, India is believed to have had the largest economy of the ancient and the medieval world. It was prosperous and self-reliant and is believed to have controlled between one third and one fourth of the world's wealth. The economy consisted of self-sufficient villages as well as cities which were centres of commerce, pilgrimage and administration. Simple division of labour intertwined with attributes such as race, class, and gender was the basis of the structure of the villages and acted as a built-in mechanism of economic and social differentiation. Though agriculture was the dominant occupation and the main source of livelihood for majority of people, the country had a highly skilled set of artisans and craftsmen who produced manufactures, handicrafts and textiles of superior quality and fineness for the worldwide market. Ancient Economic Philosophy of India ▪ The earliest known treatise on ancient Indian economic philosophy is ‘Arthashastra’ the pioneering work attributed to Kautilya (Chanakya) (321–296 BCE) ▪ Arthashastra is recognised as one of the most important works on statecraft in the genre of political philosophy. It is believed to be a kind of handbook for King Chandragupta Maurya, the founder of Mauryan empire. - - ~ - Before Common era -
▪ Artha is not wealth alone; rather it encompasses all aspects of the material well-being of individuals. Arthashastra is the science of ‘artha’ or material prosperity, or “the means of subsistence of humanity,” which is, primarily, ‘wealth’ and, secondarily, ‘the land’. Kautilya’s writings relate to statecraft, political science, economic policy and military strategy. True kingship is defined as a ruler's subordination of his own desires and ambitions to the good of his people; i.e. a king's policies should reflect a concern for the greatest good of the greatest number of his subjects. The advent of the Europeans and the British marked a shift in the economic history of India. The period of British rule can be divided into two sub periods: 1. The rule of East India Company from 1757 to 1858 2. British government in India from 1858 to 1947 ▪ With the onset of Industrial revolution in the latter half of the 18th century, the manufacturing capabilities of Britain increased manifold, and consequently there arose the need to augment raw material supply as well as the need for finding markets for finished goods. � This led to a virtual reversal of the nature of India’s foreign trade from an exporter of manufactures to an exporter of raw materials. ▪ The Indian exports of finished goods were subjected to heavy tariffs and the imports were charged lower tariffs under the policy of discriminatory tariffs followed by the British. � In this backdrop, the Indian goods lost their competitiveness. Consequently, the external as well as the domestic demand for indigenous products fell sharply culminating in the destruction of Indian handicrafts and manufactures. - = -
▪ The problem was aggravated by the shift in patterns of demand by domestic consumers favouring foreign goods as many Indians wanted to affiliate themselves with western culture and ways of life. � The damage done to the long established production structure had far reaching economic and social consequences as it destroyed the internal balance of the traditional village economy which was characterized by the harmonious blending of agriculture and handicrafts. These were manifest as: ▪ Large scale unemployment and absence of alternate sources of employment which forced many to depend on agriculture for livelihood. The increased pressure on land caused sub division and fragmentation of land holdings, subsistence farming, reduced agricultural productivity and poverty. The imports of cheap machine made goods from Britain and shift of tastes and fashion of Indians in favour of imported goods made the survival of domestic industries all the more difficult. Zamindari system created a class of people whose interests were focused on perpetuating the British rule. Excessive pressure on land increased the demand for land under tenancy, and the zamindars got the opportunity to extract excessive rents and other payments Absentee landlordism, high indebtedness of agriculturists, growth of a class of exploitative money lenders and low attention to productivity enhancing measures led to a virtual collapse of Indian agriculture. - - - -
▪ Factory-based production did not exist in India before 1850. The ‘Modern’ industrial enterprises in colonial India started to grow in the mid-19th century. The cotton milling business grew steadily throughout the second half of the 19th century, and achieved high international competitiveness. The cotton mill industry in India had 9 million spindles in the 1930s, which placed India in the fifth position globally in terms of number of spindles. ▪ At the end of the 19th century, the Indian jute mill industry was the largest in the world in terms of the amount of raw jute consumed in production. Heavy industries such as the iron industry were also established as early as 1814 by British capital. India’s iron industry was ranked eighth in the world in terms of output in 1930 Just before the Great Depression, India was ranked as the twelfth largest industrialised country measured by the value of manufactured products. The producer goods industries, however, did not show high levels of expansion. India’s industrial growth was insufficient to bring in a general transformation in its economic structure. The share in the net domestic product (NDP) of the manufacturing sector (excluding small scale and cottage industries) had barely reached 7% even in 1946. Considering its slow progress, the share of factory employment in India was also small (i.e. 0.4% of the total population in 1900 and 1.4% in 1941). - - 1930s Machines