Colonial Rule and Its Effects on India's Rural Economy
Read this article, which takes a much longer-term historical view of
India's contributions to the global economy. In particular, it covers
how British colonial rule may have "broken" the economy in ways that
have yet to be repaired.
Cotton and the Power of Looms
The Indian Valley civilization spun cotton fabrics since
3000 B.C. Herodotus the Greek historian mentions
Indian cotton in 400 A.D as wool exceeding in beauty
and goodness that of sheep. Strabo and Arrian
mentioned the vividness of Indian fabrics and Indo-Arabian trade in cotton fabrics. The Muslim entry into
Europe (via Spain) expanded European cotton trade and
the sale and transportation of cotton fabrics had become
very profitable. The secrets of hand-woven cotton cloth
from India were carefully guarded by the weavers but
some weavers converted to Christianity and revealed the
secrets to a French priest, Father Coeurdoux who
revealed the process of creating colorful patterns in
fabrics with frames and this enabled the European
textile industry to bloom.
The versatile cotton became the favorite for clothes since it could be printed easily and combined with linen. With the advent of the Industrial Age, new inventions like the spinning jenny, the water frame and steam power, made Britain a major manufacturing center of cotton textiles (Lancashire/Midlands). British restrictions on Indian textile imports and removal of the import duty in India on British mill manufactured cloth, destroyed Indian handloom textiles in export markets. Instead, instead raw cotton was being sourced from India.
In 1764, India exported 10,000 bales of cotton to England and the British took every conceivable means to aid and encourage and even to undertake the cultivation in India of more and better quality cotton and exported this cotton to England. These efforts reduced India from riches to rags in less than half a century and transformed the age-old producer of the finest cotton muslin in the world to a decayed colonial vestige, supplying raw cotton to the English textile mills.
The American Civil
War cut off supply of American cotton to Britain (1861–1865) causing a cotton famine. Indian raw cotton imports
which accounted for 31% of British cotton imports in
1861 rose to 90% in 1862 and reduced to 67% in 1864.
The destruction of the Indian cloth industry was
complete and now India was reduced to supplying raw
cotton to Britain (Dutt, 1990).