INDUSTRY AND INFRASTRUCTURE

Indian Economy Before and After Independence

The evolution of Indian industry will be analyzed right from the colonial period. The current industries and its system were a result of British colonization and went through phases such as Disappearance of Indian cottage and handicraft industry, Industrial revolution, raise of Indigenous capitalists, emergence of heavy industries, until the present importance given to MSMEs and Atma Nirbhar Bharat.

In this chapter we will examine all the aspects in Industry sector.

India was a colony for long. Colonialism refers to a system of political and social relations between two countries, of which one is the ruler and the other is its colony.

The ruling country not only has political control over the colony, but it also determines the economic policies of the subjugated country.

Thus, the people living in a colony cannot take independent decisions in respect of utilization of the country’s resources and important economic activities. India had the bitter experience of colonialism.

Indian Economy during the British Period:

Indian’s sea route trade to Europe started only after the arrival of Vasco da Gama in Calicut, India on May 20, 1498. The Portuguese had traded in Goa as early as 1510. In 1601 the East India Company was chartered, and the English began their first inroads into the Indian Ocean. In 1614 Sir Thomas Roe was successful in getting permission from Jahangir for setting up factories and slowly moved all parts of India.

Hundred years after Battle of Plessey, the rule of the East India Company finally did come to an end. In 1858, British Parliament passed a law through which the power for governance of India was transferred from the East India Company (EIC) to the British crown. Even the transfer of power from the East India Company to the British Crown did not materially alter the situation.

Britain had exploited India over a period of two centuries of its colonial rule. On the basis of the form of colonial exploitation, economic historians have divided the whole period into three phases: namely the period of merchant capital, the period of industrial capital, and the period of finance capital.

Period of Merchant Capital:

• The period of merchant capital was from 1757 to 1813.
• The only aim of the East India Company was to earn profit by establishing monopoly trade in the goods with India and the East India’s.
• During this period, India had been considered as the best hunting ground for capital by the East Indian Company to develop industrial capitalism is Britain.
• When Bengal and South India came under political shake of the East India Company in 1750s and 1760s, the objective of monopoly trade was fulfilled.
• The company administration succeeded in generating huge surpluses which were repatriated to England, and the Indian leaders linked this problem of land revenue with that of the drain. Above all, the officers of the company were unscrupulous and corrupt.