Do you think that new economic reforms of British rule have disrupted the old economic system of India? Substantiate your answer with suitable examples.

Disruption of the Old Economic System: A Comprehensive Analysis

The new economic reforms introduced by the British comprehensively disrupted India's traditional economic system. This disruption was not merely incidental but a deliberate restructuring designed to integrate India into the global capitalist system as a subordinate colonial entity.

1. De-industrialization and Ruin of Handicrafts

• Pre-British Era: India was a major global manufacturing powerhouse, especially in textiles (e.g., Dacca muslin), accounting for approximately 25% of the world's industrial output in 1750.
• British Reforms: The British deliberately promoted the import of cheap, machine-made goods from Britain while imposing high tariffs on Indian textiles entering Britain.
• Impact: This "one-way free trade" policy led to the rapid decline of India's traditional handicraft industries, particularly textiles. Artisans lost their livelihoods, leading to an exodus from urban centers to overcrowded rural areas, increasing pressure on agriculture.
• Example: Amiya Bagchi's research shows that the proportion of the population involved in cotton spinning and weaving declined significantly from 62.3% to 15.1% between 1809 and 1901.

2. Commercialization of Agriculture

• Pre-British Era: Agriculture was largely subsistence-oriented, focused on producing food crops for local consumption.
• British Reforms: The British encouraged the cultivation of cash crops (e.g., indigo, cotton, opium, jute) for export to feed British industries, often at the expense of food grain production. This was incentivized by the need for cash to pay high land revenues.
• Impact: It linked Indian farmers to volatile international markets, increased their dependence on moneylenders, and reduced food security, leading to frequent famines.
• Example: The Indigo Revolt (1859-60) in Bengal, where peasants were forced by British planters to cultivate indigo instead of food crops, is a stark example of this exploitative commercialization. Between 1893-94 and 1945-46, the production of commercial crops increased by 85%, while food crop production fell by 7%.

3. Exploitative Land Revenue Systems

• Pre-British Era: Land revenue systems, though sometimes heavy, often recognized customary rights and communal land ownership.
• British Reforms: The introduction of Permanent Settlement (Zamindari), Ryotwari, and Mahalwari systems transformed land into a marketable commodity and aimed at maximizing revenue for the colonial state.
• Impact: These systems created a new class of absentee landlords, dispossessed traditional cultivators, increased rural indebtedness, and led to the impoverishment of the peasantry.
• Example: The Permanent Settlement (1793) in Bengal led to the creation of Zamindars as landowners who were primarily interested in revenue collection rather than agricultural improvement, resulting in the exploitation of tenants and a decline in agricultural productivity.

A comparative overview of the land revenue systems and their impact:

System	Region	Key Features	Impact on Old System
Permanent Settlement (1793)	Bengal, Bihar, Odisha	Zamindars recognized as landowners; fixed revenue demand.	Created absentee landlordism; dispossessed traditional cultivators; led to rural indebtedness.
Ryotwari System (1820s)	Madras, Bombay Presidencies	Direct settlement with cultivators (Ryots); revenue reassessed periodically.	Imposed heavy tax burdens directly on peasants, leading to their impoverishment and land alienation.
Mahalwari System (1822/1833)	North-Western Provinces, Punjab, Central India	Settlement with village community (Mahal); revenue reassessed periodically.	Burdened village communities; led to inflated assessments and loss of land for many cultivators.

4. Drain of Wealth

• Pre-British Era: India had a favorable balance of trade, with an inflow of bullion in exchange for its manufactured goods.
• British Reforms: Through various mechanisms, the British systematically transferred wealth and resources from India to Britain without any equivalent return. This included "Home Charges" (payments for administrative expenses, pensions of British officials), interest on public debt, and profits from British enterprises.
• Impact: This constant outflow of wealth severely hampered capital formation and investment in India, contributing to its widespread poverty and underdevelopment.
• Example: Dadabhai Naoroji, in his book "Poverty and Un-British Rule in India" (1901), extensively quantified this drain, estimating it to be approximately £8-30 million annually during different periods, representing a significant portion (6-7%) of India's national income.

5. Transformation of Trade and Commerce

• Pre-British Era: India was a significant participant in global trade, exporting finished goods.
• British Reforms: British policies reversed this, making India primarily an exporter of raw materials (e.g., cotton, indigo, jute) and an importer of finished British manufactured goods. The construction of railways was primarily aimed at facilitating the movement of raw materials to ports and finished goods to the interior markets.
• Impact: This fundamentally altered India's trade patterns, destroying indigenous industries and preventing the growth of modern Indian industry.

6. Famines and Poverty

• Pre-British Era: While local famines occurred, their scale and intensity were often mitigated by traditional coping mechanisms and relatively self-sufficient village economies.
• British Reforms: The combined effects of de-industrialization, commercialization of agriculture (leading to reduced food crop production), high land revenue demands, and the drain of wealth created immense poverty and exacerbated the severity of famines.
• Example: The Great Famine of 1876-78 and the Bengal Famine of 1943, where millions died, were intensified by British policies that prioritized revenue collection and cash crop exports over food security.