Roots of under development : A peep into india’s colonial past

This book is outcome of a joint effort by an economist and a historian, both faculty members at the Banaras Hindu University. The background to this work is the “serious debate… regarding the applicability of the economic doctrines and philosophy developed in the last two centuries in the west, to the problems of ex-colonies”. The authors are mach upset over a recommendation made through the UGC that hereafter “socialist economics” be taught as part of the syllable to provide an antidote to the heavy dose of free enterprise capitalist model ordinarily taught. Their plea is for adoption of an historical approach to the economic analysis of the Indian problem of development, which it is expected, would also lead to an examination of the genetic assumptions of the economic
Theories and models evolved in the west. This introduction of history or ‘time factor’ into economics, they believe, in that process “the possible direction in which we should move”

The main body of the text is arranged in nine chapters which we could conveniently group into three units. The first unit deals essentially with the historical setting , from the commencement of the interaction of Europeans with India in the 15th Century, leading upto the British conquest of India in the 18th Century. The second unit of three chapters deals with the disruption and disorganization of Indian economy under the British rule, in terms of three broad sectors, viz trade,agriculture and manufacture. The last unit of three chapters considers problems of modernization of the Indian economy, from the later part of the British rule till the present day. The last chapter (“Our Problem”) contains an impassioned plea to the economists to mend their ways, to move away from the lure of careerism and fellowships of foreign foundations etc.

The first set of three chapters provides a novel sort of historical setting to the Indo-Europen interaction of the early phase (16th-18th Centuries). The emphasis placed on the need to comprehend the internal structure of European societies, in particular that of England is fully justified (pp. 1- 19). The legitimization of piracy through extension of official support and encouragement of slave trade are the means through which wealth was accumulated in ‘the Crown’. Equally important is the brief description of the life of ordinary people in England prior to the so called industrial revolution, when the profitable nature of wool making the ony manufacture of England led to deprivation of land and livelihood for large part of the population . But mor significant is the statement that for Europeans trade and commerce ment pillage , plunder, conquest and slavery as well.

Thus, the period Ir European history which passes for an era of great expansion of foreign trade in textbooks, !s seen to be characterised by the emergence and consolidation of buccaneers, pirate- conquerors and stave-traders as pillars of the society.

Keeping in view the continuity of such a static, crime-prone society, with rudimentary agriculture and poetically no manufacture, the Invention of a few devices,in late eighteenth century appeared, to be a radical departure from the past,deserving of the tittle of "Industrial Revolution". During the earlier phase of this revolution, the only worthwhile raw material, to be processed was cotton, instead of wool as was the situation obtaining before. The authors point out that the availability of a unique system of commerce' in the sense of the term discussed above) was crucial In rendering the small number of crude Inventions useful (p. 33-37). An aspect of this system of commerce was the power to levy tariffs on foreign (mostly Indian) materials to block them out effectively from competition. This, the authors believe, was the foundation for establishment of a system of "capital drain" from India which financed the industrial revolution in Great Britain.

The chapter on "Rewriting of 18th Century India" Is an important contribution. The authors draw upon the recent researches relating to various records of maritime trade of India in the Mughal period. Even though the European records of this sector in that period are likely to be sketchy, certain broad conclusions could be drawn from them. It emerges, for example, that all European companies had such a small volume of India's trade in their command that they were no more than 'front organizations for Asian merchants (p. 70). A number of Indian commercial organizations, identified closely with certain Individuals, were engaged In large-scale maritime trade, building and fitting-out their own ships. The volume of trade carried on by many an organization was at least equal to that of the " on Company" in the 18th century (pp. 73-75). Gaining control over such lucrative commerce seems to have necessitated the encirclement of India by Europeans, which ultimately gave them control over the sea-lanes of trade traffic (p. 79). This strategy appears to be only an extended projection of the Venltian system of "guarded trade" In the Mediteranean In the I2th-14th Centuries. Fresh focus on the maritime trade of Mughal India, drawing upon the available Mughal State Papers, will contribute to rewriting of the economic history of India in the 16th Century.

In the next set of three chapters on disruption and disorganization of Indian economy -trade, agriculture and manufacture - the authors present a picture of the various mechanisms evolved by the British conquerors to extract maximum possible revenue out oi the country. Details on disruption of internal trade through levying of discriminate tariffs are given. Coercion was resorted to persuade weavers and other manufacturers to take loans from the Company to secure their agreement to supply only the latter. The wealth then the company Acquired In India was so large, that the rulers in England started to evolve measures to contain the latter from acquiring "undue" influence in politics through Its ower of patronage .

Indian agriculture was disrupted to a large extent. The various types of settlements' viz. zamHtdari ryotwari and nahafwari systems are described, showing all the attendant consequences which have been stated by various scholars These authors stress the point that the British sought to legitimize their system of exaction of tribute through mlslnterpi elation of the traditional system of agricultural revenue (p. 128), which Is briefly touched upon In a description (pp. 134-137). The principally disastrous consequence of the British policy of agricultural revenue, the authors believe, was the exaction and transfer of 'tribute" and they cite figures justifying such an opinion (p.144). Another Important consequence was the creation of rural Indebtedness on a large-scale .

The manufacturing sector In India was annihilated with the twin alms of exaction of raw materials for processing at "the centre1' and to render the population into consumers of British industrial goods. Such a" process may be taken to have commenced with the "Renewal of Charter" In 1813 (p. 152), mostly due to the emergence of a class in England that depended upon the existence of "protected markets" for the industrial goods. Such a market was easily found in India which had been politcally subjugated by then (p. 153). The authors mention the cases of annihilation of Indian shipping, iron, paper and sugar manufacturing industries in addition to the well known cases of cotton and silk manufacture. This resulted in shift of sizable part of population to. the over-burdened agriculture, leading to recurrent famines.

"Modernization" is the theme of the last set of chapters and, among the tools of modernization, railways receive considerable attention (pp. 201-218). The emphasis here is on the classical controversy "railway vs irrigation" in which the authors side with the irrigation-school. In the discussion on "industrialisation", the British are charged with obstruction of the development of "modern Industries" in India until the advent of the first world war when the contingency of the situation demanded supplies of steel and ammunition. The inter-war years witnessed slower growth but the onset of the second war accelerated growth of industries tied to war machinery. Another point is that, even the industrial enterprises that came into existence had to have collaboration with the British manufacturer's, thus depriving possibilities of indigenous development. The authors go on to observe that the process of "export of capital" that-was Initiated under the British rule Is continuing today through the mechanism of the MNCs and the advice tendered by agencies such as trie IMF or trie World Bank The authors recommend some kind of "severing the links" with the international system of commerce and trade.

On the whole, this book should be viewed as outcomes of a well-intentioned effort to alter rectify certain notions prevalent in the teaching of economics. But the book, as it stands, is not appropriate to be a resource book in economics. For one thing, the character of the discourse in] the book changes from that of classical historical scholarship to that of pamphleteering a la columnists in the Economic and Political Weekly. Perhaps this was unavoidable: Presenting a clear view of the nature and character of linkages that have1 developed between the West and India all through a period of 400 years is a difficult, demanoing task. Without fulfilling that, it may not be worth the effort to build a theory" of underdevelopment, which keeps sliding back Into the favorite Western leftwlng theories of neocolonialism based on a framework of "economic drain", evolved and supported mostly with reference to the experience of Latin America. The authors would have done better to examine critically these theories, for instance those advocated by Andre Guhder Frank and Samlr Amin, to assess their worth In.

evolving a realistic picture of "underdevelopment". Quoting the estimates of drain' from the 'Third World" to the West presented from the works of a certain Paul Harrison who. In turn, quotes another Paul Bairoch (pp. 271-272)- there cannot be a bigger breach at the authors' promise to justify their utterances with the support of 'authorities' (p. vl). Are they not aware of estimates made in early eighties by the editors of "an independent socialist magazine" in the US that the volume of trade between the West and the Third World" Is no more than 20% of the total volume of trade and transactions carried on In the West? Perhaps the name of the game is subjugation and control of populations. In which the issue of export-oriented growth and the assortment of Rostowian theories provide the necessary mechanisms to keep the populations "engaged". Demonstration of a continuity In the interaction between the West and the conquered populations demands a greater degree of comprehension of the ties between these two systems than what is attempted, even if It be in a preliminary way, In the book.

The authors do make a tentative but Interesting effort to comprehend the nature of Western society prior to colonial expansion. While it is an easy task to call them "pirates", "shopkeepers" and the like, the fundamentally conquest-oriented nature of the Western society has not been stressed. That the ruling system of the West treated harshly any population, including .its own, Is a fact worth substantiation, particularly when some material is available (eg. the conquest and extermination of the population in the Americas). Inquiry into all these aspects would swell the pages but would undoubtedly contribute to the effective challenge of the canonical writings (such as the recent two volume Cambridge Economic History of India) and to substantial redefinition of the nature of "colonialism". The authors, similarly, could have expounded a little more on traditional Indian system of land-tenure etc., on which factual material is available in India.

Before concluding the review, we must, however, take note of certain serious lacunae. The book Is supposed to bring history into economics but the authors have made books and articles beyond history by not citing the dates of publication. Secondly, quotations of historical material from other sources are found smoothly merging with the text in many places (an enterprising effort which perhaps requires greater care to conceal). Third, the system of both footnotes, most of them shooting into the next page and separate "notes and references" makes reading cumbersome. An Interesting work, commendable more for the boldness of the attempt.

Author: V.Balaji

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