The arguments of the free traders were a curious mixture of economic hard-headedness, social benevolence, cosmopolitan idealism and class prejudice.

The Contradictions of Free Trade in India

The core tenet of free trade, as advocated by economists like Adam Smith and David Ricardo, emphasized the benefits of comparative advantage and unrestricted international commerce. However, its application to India was heavily skewed.

Economic Hard-headedness

British policymakers genuinely believed in the economic benefits of free trade – for Britain. They argued that removing tariffs and other trade barriers would allow British manufactured goods to flood the Indian market, stimulating economic growth. This, however, came at the cost of destroying India’s nascent industries. For example, the decline of the Indian textile industry after 1820, due to competition from cheaper, machine-made British textiles, is a prime illustration. The focus was on creating a market *for* British goods, rather than fostering economic development *within* India.

Social Benevolence

Victorian social thought emphasized ‘civilizing’ missions and the spread of ‘progress.’ Free trade was presented as a benevolent force that would introduce Indians to the benefits of modern industry and commerce. This paternalistic view justified the dismantling of traditional Indian economic structures, even if it caused short-term disruption. The argument was that Indians were incapable of managing their own economies efficiently and needed British guidance. This ‘benevolence’ conveniently masked the exploitative nature of the system.

Cosmopolitan Idealism

The free trade ideology promoted a vision of a globalized world where goods, capital, and ideas could flow freely across borders. This cosmopolitan outlook was used to justify British dominance in India, portraying it as a necessary step towards creating a more interconnected and prosperous world. However, this ‘idealism’ was selective. While advocating for free movement of goods, Britain actively restricted Indian immigration and trade with other nations, maintaining a tight grip on colonial commerce. The Opium Wars (1839-1842, 1856-1860) exemplify this hypocrisy – forcing open Chinese markets for British opium, despite its devastating social consequences.

Class Prejudice

Perhaps the most cynical element was the class prejudice underpinning free trade policies. British industrialists and merchants stood to gain immensely from access to the Indian market. Policies were designed to benefit this powerful class, even if it meant the impoverishment of Indian artisans and farmers. The land revenue systems, like the Permanent Settlement (1793) and Ryotwari system, were designed to extract maximum revenue to fund British imports and administrative costs. The destruction of local industries led to widespread unemployment and de-industrialization, creating a cheap labor force for British enterprises. The Indigo Revolt (1859-60) demonstrates the exploitation of Indian farmers by British planters, fueled by the demand for raw materials in British industries.

Table: Impact of Free Trade on Indian Industries

Industry	Pre-Free Trade (Early 19th Century)	Post-Free Trade (Mid-Late 19th Century)
Textiles	Flourishing, exporting to global markets	Decline, replaced by British imports
Iron & Steel	Indigenous production, though limited	Stifled by competition from British steel
Shipbuilding	Significant shipbuilding activity	Virtually disappeared due to British dominance

Furthermore, the railway construction, while presented as a modernizing force, primarily served British economic interests by facilitating the transportation of raw materials from the Indian hinterland to ports for export to Britain.