Model Answer
0 min readIntroduction
Discriminatory protection, a cornerstone of British colonial economic policy in India, involved granting preferential treatment to British industries while imposing restrictions on Indian industries. This policy, implemented through tariffs, duties, and regulations, aimed to transform India into a supplier of raw materials and a market for British manufactured goods. Beginning with the early East India Company policies and intensifying after 1858, this approach fundamentally reshaped the Indian economic landscape. The consequences were far-reaching, impacting traditional industries, hindering industrial development, and contributing to widespread economic distress. Understanding this policy is crucial to comprehending the long-term economic underdevelopment of India.
The Policy of Discriminating Protection
The policy wasn’t a sudden imposition but evolved over time. Initially, the East India Company focused on maximizing revenue. However, with the rise of industrialization in Britain, the need to protect British industries from Indian competition became paramount. This manifested in several ways:
- High Tariffs on Indian Exports: Heavy duties were imposed on Indian textiles and other manufactured goods exported to Britain, making them uncompetitive.
- Low or No Tariffs on British Imports: British manufactured goods were allowed to enter India with minimal or no tariffs, flooding the Indian market.
- Suppression of Indian Industries: Traditional Indian industries, particularly textiles, were actively suppressed through various measures, including destroying looms and discouraging local production.
- Railways & Infrastructure: While railways were built, their primary purpose was to facilitate the transport of raw materials from the Indian hinterland to ports for export to Britain, rather than fostering internal industrial growth.
Impact on Indian Industries
The impact on Indian industries was devastating. The textile industry, once a global leader, suffered the most.
- Decline of Textile Industry: The once-thriving handloom and spinning industries were decimated. The value of Indian cotton exports declined significantly. (Source: Dharma Kumar, *The Cambridge Economic History of India*, 1983 - knowledge cutoff).
- Stagnation of Iron and Steel: The nascent Indian iron and steel industry was unable to compete with cheaper British imports, hindering its development.
- Lack of Capital Formation: The destruction of traditional industries led to a loss of capital and skills, preventing the emergence of new industries.
Impact on Agriculture
While not directly targeted, agriculture also suffered due to the discriminatory policies.
- Commercialization of Agriculture: Indian agriculture was forced to shift towards producing raw materials like cotton, indigo, and opium for British industries, often at the expense of food crops.
- Land Revenue Systems: The introduction of harsh land revenue systems (like the Zamindari, Ryotwari, and Mahalwari systems) led to increased indebtedness and landlessness among farmers.
- Famines: The focus on cash crops and the disruption of traditional agricultural practices contributed to frequent and severe famines in India. (e.g., The Great Famine of 1876-78).
Debates and Counterarguments
Some historians argue that the decline of Indian industries was also due to factors like technological backwardness and internal inefficiencies. However, the discriminatory trade policies undoubtedly exacerbated these problems and prevented Indian industries from modernizing and competing effectively. The deliberate suppression of Indian industries to protect British interests remains a central argument.
Long-Term Consequences
The long-term consequences of discriminating protection were profound:
- Underdevelopment of Indian Economy: India remained a primarily agrarian economy with a weak industrial base.
- Drain of Wealth: A significant amount of wealth was drained from India to Britain through trade imbalances and administrative costs. (Dadabhai Naoroji’s ‘Drain Theory’ – 1880s).
- Increased Poverty: The destruction of traditional industries and the exploitation of agriculture led to widespread poverty and economic hardship.
Conclusion
The policy of discriminating protection during the British regime had a profoundly negative impact on the Indian economy. It systematically undermined Indian industries, distorted agricultural practices, and contributed to widespread poverty and underdevelopment. While internal factors played a role, the deliberate policies designed to benefit British industries were a primary driver of India’s economic stagnation. The legacy of this policy continues to shape India’s economic challenges even today, highlighting the importance of a fair and equitable global trading system.
Answer Length
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