The British rule had pronounced and profound economic impact on India. The various economic policies followed by the British led to the rapid transformation of India’s economy into a colonial economy whose nature and structure were determined by needs of the British economy. One important aspect of British economic policy was commercialization of agriculture.
The commercialization of agriculture means that the agricultural crops and goods are produced by the peasants for sale in the market and not for their own consumption. Commercialization of agriculture in India began during the British rule.
The commercialization of Indian Agriculture took place not to feed the industries of India because India was far behind in industrial development as compared to Britain, France, Belgium and many other European countries of eighteenth century. The commercialization of Indian agriculture was done primarily to feed the British industries that it was taken up and achieved only in cases-of those agricultural products which were either needed by the British industries or could fetch cash commercial gain to the British in the European or American market.
For example, several efforts were made to increase the production of cotton in India to provide raw and good quality cotton to the cotton-textile industries of Britain which were growing fast after the Industrial Revolution in Britain. Most of the plantations for commercial crops were controlled by the English. The commercialization of India agriculture was initiated in India by the British through their direct and indirect policies and activities.
Firstly, the new land tenure system introduced in form of permanent settlements had made agricultural land a freely exchangeable commodity.
Permanent settlements, by giving ownership right to the zamindars created a class of wealthy landlords; could make use of this ownership right by sale or purchase of land. Agriculture, which had been way of life rather than a business enterprise, now began to be practiced for sale in national and international markets.
Moreover, crops like cotton, jute, sugarcane, ground nuts, tobacco etc. which had a high demand in the market were increasingly cultivated. The beginning of the plantation crops like tea, coffee, rubber, indigo etc heralded a new era in agricultural practices in India.
Social and Economic Effects
The commercialization of agriculture had many results. It was beneficial to the British planters, traders and manufacturers, who were provided with opportunity to make huge profits by getting commercialized agricultural products at throwaway prices.
The commercialization of Indian agriculture also partly benefited Indian traders and money lenders who made huge fortunes by working as middlemen for the British. In this regard, they acted as conduits delivering the products from peasants to the British company from where it was taken abroad. Moreover, Indian money lenders advanced cash advances to the farmers to cultivate the commercial crops and if the peasants failed to pay him back in time, the land of the peasants came under the ownership of moneylenders.
Most of the people suffered miserably due to the British policy of commercialization of Indian agriculture. It resulted in reduced area under cultivation of food crops. The net result was that the Indian cultivators failed to produce even that much food which could provide two square meals a day to its population.
The misery was further enhanced as the population of India was increasing every year, fragmentation of land was taking place because of the increasing pressure on land, and modern techniques of agricultural production were not introduced. This becomes ample from the fact that till 1880, India had a surplus of foodstuffs to the extent of five million tons and by 1945 it had a deficit of 10 million tons. The consumption of food was then estimated at one and a half lb per individual and in 1945 it was 1 lb. Nearly thirty percent of the Indian population was estimated to be suffering from chronic malnutrition and under nutrition.
The poor peasant was forced to sell his produce just after harvest at whatever prices he could get as he had to meet in time the demands of the government, the landlord, the money lender and his family members’ requirements. This placed him at the money of the grain merchant, who was in a position to dictate terms and who purchased his produced at much less than the market price. Thus, a large share of the benefit of the growing trade in agricultural products was reaped by the merchant, who was very often also the village money lender.
Further, by making agricultural land a tradable commodity, the peasant lost his security feeling. High land revenue demands forced him to take loan from the money lender at high interest rates. The failure to pay debts in time meant loss of land to the money lender at high interest rates. It led to land alienation and increase in the number of agricultural labourers whose conditions, especially in the plantation industry, were pathetic.
Transport and Communication
Considering military requirements between 1780 and 1840, the British began to repair, improve the roads of India.
One of their major priorities was securing and improving communications between Calcutta and northern India.
A military road staring from Calcutta to Benares was constructed in 1781. This was again followed in 1833 by reconstruction of the Grand Trunk Road. This road by the year 1855 had reached Karnal. Between 1820 and 1850 military roads were built.
In the southeast, roads were built in order to merge the British hold on south India. The construction of the Grand Trunk Road sparked a limited revolution in transport between Calcutta and the northwest. Horse-carriages replaced slower modes of transport by early 1850s.
Throughout the nineteenth century roads continued to be built in areas such as the Central Provinces, where railways could not penetrate. In fact these roads played a major role in promoting economic integration and merging political authority. Steam locomotion did not prevent the need for older dispersed transport technologies.
India’s inland coalfields could not be exploited until the introduction of railways. Coal transportation was one of the main incentives behind the early drive for railway construction in India. One of the first railway lines to be completed, in 1855, ran around 120 miles from Hooghly to the Raniganj coalfield. However, the high demand for cotton from Deccan and North India also led to more construction of railway routes.
British trade and industry now had greater access to Indian markets as well as to the sources of cotton, oil-seeds, grain and other major goods. Railways were considered as an effective means of fighting famine thereby facilitating the desired growth of the market economy. Locomotives and the railway network helped the British to furnish proof of their material superiority and their commitment to civilizing and improving the Indian society. Railways have had a great socio-economic impact on Indian society.