Model Answer
0 min readIntroduction
During British rule in India (1757-1947), economic policies were largely designed to benefit the British economy. A central element of this was the policy of ‘discriminating protection,’ a form of mercantilism where British industries were actively favored through tariffs, regulations, and other measures, while Indian industries faced significant disadvantages. This wasn’t a deliberate attempt to *destroy* Indian industry, but rather a systematic prioritization of British economic interests. This policy, implemented through various Acts and regulations, profoundly shaped the trajectory of industrial development in India, leading to de-industrialization in several sectors and a stunted growth of indigenous industries.
Early Phase & Context (Pre-1858)
Initially, the East India Company (EIC) focused on trade and revenue extraction. However, with the Industrial Revolution gaining momentum in Britain, the need to secure markets and raw materials for British industries became paramount. Early policies, like restrictions on Indian textile exports, signaled a shift towards prioritizing British interests. The EIC’s monopoly over opium trade, for instance, facilitated the import of British manufactured goods into India.
The Policy of Discriminating Protection
The policy of discriminating protection became more formalized after the Sepoy Mutiny of 1857 and the transfer of power to the British Crown. It manifested in several ways:
- Tariff Policies: High tariffs were imposed on Indian goods exported to Britain, while British goods entering India faced either low or no tariffs. This created an uneven playing field.
- Railways & Infrastructure: While railways were built in India, their primary purpose was to facilitate the transport of raw materials from the Indian hinterland to ports for export to Britain, and to distribute British manufactured goods within India.
- Currency & Exchange Rate: The fixed exchange rate between the Rupee and the Pound Sterling favored British imports.
- Restrictions on Indian Entrepreneurship: Policies discouraged Indian entrepreneurs from competing with British firms. Access to credit and capital was limited for Indians.
- Forest Policies: Restrictions on access to forests impacted traditional Indian crafts reliant on forest produce.
Impact on Indian Industrial Development
The impact of discriminating protection was largely negative for Indian industries:
- De-industrialization: Traditional industries like textiles, iron & steel, shipbuilding, and handicrafts suffered significantly. For example, the Indian textile industry, once globally competitive, declined drastically due to competition from cheaper, machine-made British textiles.
- Stunted Growth of Modern Industries: While some modern industries like jute mills and cotton mills emerged in India, their growth was limited and often dependent on British capital and technology.
- Dependence on British Capital: Indian industries became increasingly reliant on British investment, leading to foreign control over key sectors of the economy.
- Drain of Wealth: The policy contributed to the ‘drain of wealth’ from India to Britain, as profits from Indian industries were repatriated to Britain. Dadabhai Naoroji’s “Poverty and Un-British Rule in India” (1901) extensively documented this drain.
Specific Examples & Acts
| Act/Policy | Year | Impact |
|---|---|---|
| Corn Laws (Repeal) | 1846 | Removed tariffs on British agricultural imports, impacting Indian agricultural exports. |
| Indian Railways Act | 1854 | Facilitated transport of raw materials to Britain and British goods within India. |
| Import & Export Duties Act | 1875 | Formalized discriminatory tariff policies. |
Limited Positive Impacts
While overwhelmingly negative, some argue that the policy indirectly led to the development of certain industries like jute and cotton mills in India, albeit under British control. These industries served British interests by processing raw materials sourced from India.
Conclusion
The policy of discriminating protection was a cornerstone of British economic policy in India, designed to serve the interests of the British industrial revolution at the expense of Indian industrial development. It led to the de-industrialization of traditional sectors, stunted the growth of modern Indian industries, and fostered economic dependence on Britain. While some limited industrial growth occurred, it was largely controlled by British capital and served British interests. The legacy of this policy continues to shape India’s economic landscape even today, highlighting the long-term consequences of colonial economic exploitation.
Answer Length
This is a comprehensive model answer for learning purposes and may exceed the word limit. In the exam, always adhere to the prescribed word count.