Indian Economy on the Eve of Independence

The colonial government's policies were aimed at protecting and promoting Britain's economic interests, turning India into a supplier of raw materials and a market for British manufactured goods. National income estimates by Dadabhai Naoroji, William Digby, Findlay Shirras, V.K.R.V. Rao and R.C. Desai showed very slow growth. Aggregate real output grew at less than 2% a year in the first half of the twentieth century, and per capita output at only about 0.5% a year. You will study the stagnation of agriculture under the zamindari system. The chapter also explains de-industrialisation, the decline of world-famous handicrafts, and the slow growth of modern industries such as cotton and jute textiles and the Tata Iron and Steel Company set up in 1907. It covers foreign trade, which gave India an export surplus that was used to meet British administrative and war expenses, a drain of wealth. Finally, it describes the demographic condition, with high birth, death and infant mortality rates, low literacy, the occupational structure and the railways.

Detailed Worksheet: Indian Economy on the Eve of Independence Section A - Definitions (10 marks) 1. What was the main aim of British economic policy in India? (2 marks) 2. Name two economists who estimated India's national income during colonial rule. (2 marks) 3. What is meant by de-industrialisation? (2 marks) 4. What was the zamindari system? (2 marks) 5. Why is 1921 called the year of the great divide in India's demographic history? (2 marks) Section B - Calculations and Applications (15 marks) 6. During the first half of the twentieth century, India's aggregate real output grew at less than 2% a year and per capita output at about 0.5% a year. Calculate the approximate growth of population implied. Using the rule of 70, calculate the years needed for per capita output to double at 0.5%. (3 marks) 7. At independence, about 70-75% of the workforce was in agriculture, 10% in manufacturing and 15-20% in services. If the workforce was 15 crore, calculate the number in agriculture (taking 72%), manufacturing and services. (3 marks) 8. The infant mortality rate at independence was about 218 per thousand live births. Calculate the number of infant deaths in a district with 50,000 births. Compare it with an IMR of 28 and calculate the lives saved. (3 marks) 9. The overall literacy rate before independence was less than 16% and female literacy about 7%. If a province had 2 crore people, half of them women, calculate the number of literate people overall at 16% and of literate women at 7%. (3 marks) 10. Arrange in chronological order and give the years: the Permanent Settlement in Bengal; the first railway line in India; the opening of the Suez Canal; the first official census; the founding of TISCO. (3 marks) Section C - Diagrams (10 marks) 11. Draw a pie chart showing the occupational structure at independence: agriculture 72%, manufacturing 10% and services 18%. (4 marks) 12. Draw a flowchart showing how colonial policies led to the stagnation of Indian agriculture. (3 marks) 13. Draw a flowchart showing how the export surplus led to the drain of Indian wealth. (3 marks) Section D - Analysis and Higher-order Thinking (15 marks) 14. 'Indian agriculture under colonial rule remained stagnant.' Explain the causes of this stagnation, including the land settlement system, commercialisation, lack of irrigation and low technology. (5 marks) 15. Explain the twofold motive behind the British policy of de-industrialisation. How did it affect Indian handicrafts and the economy? (5 marks) 16. Explain the positive and negative aspects of the infrastructure developed under colonial rule, especially the railways. (5 marks) Instructions: Time allowed 2 hours. Attempt all sections. Show the steps of all calculations. Data are approximate figures for practice.