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Table of Contents
STATE OF INDIAN ECONOMY
1. What percentage of working force was engaged in primary sector in 1951?
(a) 72.1 %
(b) 10.7%
(c) 17.2%
(d) 58.7%
Ans. a
2. What percentage of working force was engaged in secondary sector in 1951?
(a) 72.1%
(b) 17.2%
(c) 10.7%
(d) 27%
Ans. c
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3. Indian economy was said as imbalanced structure at the eve of independence, because:
(a) 72% of population was engaged in agriculture
(b) 10.7% of population was engaged in industry
(c) 17.2% of population was engaged in service sector
(d) All of the above.
Ans. d
4. At the eve of independence in 1947, Indian economy was:
(a) Poor
(b) Backward
(c) Stagnant, depreciated and disintegrated
(d) All of these
Ans. d
5. Indian economy was a dependent economy at the time of independence, because:
(a) Dependence on land was more due to decay of handicraft industry
(b) Agricultural productivity was low.
(c) Dependency on other countries for food grains.
(d) All of the above.
Ans. d
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6. What was the life expectancy in India during British rule?
(a) 65
(b) 38
(c) 32
(d) 45
Ans. c
7. When was the first postage stamp released in India?
(a) 1830
(b) 1840
(c) 1847
(d) 1852
Ans. d
8. Female literacy level during the British rule
(a) 9%
(b) 16%
(c) 7%
(d)5%
Ans. c
9. During the British rule, high mortality rate was due to:
(a) Inadequate public health facilities
(b) of frequent natural calamities
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Ans. c
10. …………… is described as a “year of great divide”.
(a) 1931
(b) 1942
(c) 1911
(d) 1921
Ans. d
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11. Which was the most important infrastructure developed during the British rule?
(a) Railways
(b) Air transport
(c) Water transport
(d) Roadwasy
Ans. a
12. When were the railways introduced in India?
(a) 1769
(b) 1825
(c) 1850
(d) 1875
Ans. c
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13. Under colonial period the economic policies of the government were concerned with
(a) Development of handicraft industries
(b) Development of the colonised country
(c) Promotion of British economic interest
(d) None of these.
Ans. c
14. The major cause of decay of Indian handicrafts during British Rule:
(a) Low-priced machine-made goods
(b) Discriminatory tariff policy
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Ans. c
15. During colonial period, India’s demographic profile showed:
(a) High birth rate
(b) High death rate
(c) High infant mortality
(d) All of these.
Ans. d
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16. On the eve of independence, India was net exporter of:
(a) Primary products
(b) Finished industrial goods
(c) Both (a) and (b)
(d) None of these.
Ans. a
17. What was the main characteristic of Indian economy on the eve of independence?
(a) Underdeveloped
(b) Semi-feudal
(c) Both (a) and (b)
(d) None of these
Ans. c
18. In 1948, what proportion of population was engaged in agricultural sector?
(a) 60%
(b) 70%
(c) 80%
(d) 75%
Ans. b
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19. What was per capita income growth rate in 1947-48?
(a) 0.5%
(b) 1%
(c) 1.5%
(d) 2%
Ans. a
20. Which type of land tenure system was prevailing in India during British Rule?
(a) Royatwari System
(b) Mahalwari System
(c) Zamindari System
(d) All of the above
Ans. d
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FILL IN THE BLANKS
1. The rate of growth of real output during the first half of the 20th century in our country was ……………
Ans. Less than 2%
2. Introduction of …………… tariff policy by the Britishers led to the decay of Indian handicraft industries
Ans. Discriminatory
3. Zamindari system implemented by the …………… was the major land settlement.
Ans. Bengal Presidency
4. Industries which produce machines and equipment’s to help in further production of goods is called …………… industries.
Ans. Capital goods
5. The first census data was collected in …………… during the British rule.
Ans. 1881
6. ……………is the year of divide between the first and the second stage of demographic transition.
Ans. 1921
7. The British introduced the railways in India in ……………
Ans. 1850
8. The overall literacy level during the British rule was less than ……………
Ans. 16%
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TRUE OR FALSE STATEMENTS
1. The underdeveloped State of Indian economy is the result of British rule.
True
2. Irrigated and fertile line did not become the part of Pakistan after partition.
False
3. Industrial sector was developed during British rule.
False
4. Indian jute industry suffered very much due to lack of raw material.
True
5. British Government had not monopoly control over India’s exports and imports.
False
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6. The second stage of demographic transition started after 1921.
True
7. The most important contribution of the British rule was the introduction of railway in India in 1850.
True
ONE WORD TO ONE SENTENCE QUESTIONS ANSWER
Q.1. What is meant by primary sector?
Ans. It is the sector agriculture is main occupation and goods are produced by using natural resources.
Q. 2. What is meant by secondary sector?
Ans. It is the sector which is engaged in processing, manufacturing and transforming goods from one type to another.
Q.3. Define tertiary sector.
Ans. It is the sector which provides services alone.
Q.4. Define occupational structure.
Ans. It refers to the distribution of work force of an economy in different occupations.
Q5. What is meant by stagnant economy?
Ans. The economy which grows at a very low rate is called stagnant economy.
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Q. 6. What is meant by depleted economy?
Ans. It is an economy whose stock of capital assets gets exhausted or eroded.
Q. 7. What is meant by economic infrastructure?
Ans. It refers to the basic facilities and services on which economic development is based.
Q.8. What is under developed economy?
Ans. It is an economy whose per capita income is very low as compared to that of developed economies.
Q.9. In which year the first iron and steel company were established in India during British rule?
Ans. The first iron and steel company namely TISCO was established in Jamshedpur in 1907.
Q.10. What as the growth rate of India’s output per year during British rule?
Ans. Less than 2 percent.
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Q.11. What do you mean by commercialization of agriculture?
Ans. It means production of crops for the market rather than for self-consumption.
Q. 12. What is mean by subsistence agriculture?
Ans. Subsistence agriculture is a form of farming in which the crops raised to provide for the basic needs of the family with little surplus for marketing.
Q.13. What does low productivity in agriculture mean?
Ans. Low productivity means low output her hectare of land.
Q. 14. What is infant mortality rate?
Ans. Infant mortality rate is an estimate of the number of infant deaths for every 1,000 live births (infants refer to children below the age of one year).
Q.15. What is life expectancy?
Ans. Life expectancy is defined as the average number of years that a person can expect to live.
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SHORT ANSWER TYPE QUESTIONS
Q1. What were the main reasons for slow growth of economy during British rule?
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Ans. 1. Land Revenue System: Zamindari system implemented by the Bengal presidency was the major land settlement. The British government introduced the Zamindari system of land revenue that became the ultimate cause for backwardness and stagnation of Indian agriculture. Under this system of land settlement:
• the Zamindars were treated as permanent owners of the land.
• Zamindar’s used to pay a fixed sum in the form of “Lagan’ (tax) to the British Government.
• Zamindars were free to extract this tax or ‘Lagan’ from the tillers of the land as they could.
This system led to the unlimited exploitation of the tillers of the soil by Zamindars. The real benefits of the agriculture went straight in the hands of Zamindars. Farmers end up getting nothing. even after toiling hard for it. Neither the British Government nor the Zamindars did anything for the benefit of farmers. Their main interest was only to collect taxes. Even in the conditions of drought, famine or floods there was no mercy upon the farmers.
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2. Low Investment in Agriculture: Farmers were using centuries old methods of cultivation and farming. British India spent very little on technological improvement in the agricultural sector. There was mergre investment in terracing, flood control, drainage and desalinisation of the soil. Lack of fertilizers, inferior quality of seeds and less use of modern technology were also responsible for the murky state of agriculture.
3. India as an Exporter of Raw Materials and Importer of Finished Products: During British rule India became an exporter of primary products such as raw silk, cotton, wool, sugar, indigo, jute etc, and an importer of finished goods like cotton, silk and woollen clothes and capital goods like light machinery produced in the factories of Britain. This composition of foreign trade made India a backward and stagnant economy.
4. Wide Spread Poverty: There was wide spread poverty due to lack of education, poor health services and discriminatory policies of British Government. GDP and per capita income of country were very low which led to extensive poverty in the country.
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Q2. Mention briefly the adverse effects of the decline of handicraft industries during colonial period.
Ans. Prior to British rule, Indian handicrafts industry was in full swing and enjoying worldwide reputation. Indian handicrafts industry was destroyed due to the following systematic discriminatory policies:
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1. Increased unemployment due to Introduction of Discriminatory Tariff Policy: The British government followed discriminatory tariff policy which allowed tariff-free export of raw materials from India and tariff-free import of finished goods from Britain. But Indian made handicrafts were discouraged by imposing heavy duty on their exports. It led to the easy entrance of British made goods in India and decline of sale of Indian handicraft products both in domestic as well as in international market. As a result, there was decay of Indian handicrafts industry industries, because of unemployment in the country. Closure of handicraft created
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2. Closure of handicraft industries because of Competition from Machine Made Goods: Machine made products from Britain were low priced which gave stiff competition to India made handicraft products. Machine made products were better than Indian products in terms of precision and quality. Competition from Britain made goods caused steep decline in the demand for Indian handicrafts and forced the craftsmen to shut down their firms forever in India.
3. Changes in Tastes and Preferences: Due to the influence of British culture, tastes and preference of people were shifting towards British products. This increased the demand for British products in Indian markets. Due to fall in demand for India made goods, the Indian handicrafts industry perished.
4. Fall in Encouragement to Indian Handicrafts: Before the British rule Indian handicrafts were supported by the Indian emperors, princes, nawabs etc. which had given domestic and international recognition to our handicrafts. Because of British rule, these patrons were losing their existence and accordingly Indian handicrafts too were losing their State patronage. As a result, there was decay of handicrafts in India.
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Q3. State the twofold motive behind the de-industrialization by the colonial government in India.
Ans. On the eve of independence, secondary or industrial sector contributed just 14.3 % of national income. India had lop-sided industrial development and could not develop a sound industrial base under the British rule. The British Government followed the policy of systematic de – industrialisation. It was a twofold policy:
(i) Decay of indigenous handicraft industries.
(ii) Slow progress (growth) of modern industry.
There were two reasons for keeping India away from modern industries:
(a) One was to keep India reduced to just as an exporter of prime raw materials for the major industries in Britain.
(b) Second was to turn the domestic market of India into a prime consumer of finished British goods to earn maximum benefits for Britain.
Q4. What were the main drawbacks of the industrial sector during colonial rule.
Ans. In India Britishers established industry in those sectors, which suited them. Unbalanced and lopsided structure of Indian industries is highlighted in the following points:
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1. Lopsided Growth of Industries: It was only in the second half of 19th industry began to take roots in India but its progress was very slow and tardy. Initially, this century, modern development was confined to the setting up of jute and cotton textile mills and coal mines. British rulers neither permitted modernisation of Indian industry nor did they encourage the growth of heavy industries in India. Major development came in the form of setting up of Tata Iron and Steel Company (TISCO) by Jamshed Ji Tata in 1907. A few other industries such as sugar, paper, cement etc. came up after the second world war but their growth was also very slow.
2. Lack of Capital Goods Industries: There were hardly any capital goods industries like machines, industrial plants, equipments etc. to promote further industrialisation of India. Guided by self-interest, the British Government introduced railways in India. But this was also to widen the market for the British products in India, Due to lack of capital goods industries, industrialisation in India could not prosper as per the requirements of the development of the country.
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3. Lower Contribution to GDP: The contribution of industrial sector to Gross Domestic Product (GDP) had been very low. Most of the raw material was transformed into finished goods in Britain. The Indian industrial sector was not progressing at the desired rate and level of overall production and income generation remained very low.
4. Limited Area of Operation of the Public Sector: British government did not extend its participation to the development of those industries which were strategic for growth of industrialisation. The public sector remained confined to railways, power generation, ports, communication and some other departmental undertakings which was not adequate. In the absence of capital goods industry, industrialisation in India was highly lopsided.
Q5. Explain how was Zamindari system an important cause of agricultural stagnation during colonial period.
Ans. Land Revenue System: Zamindari system implemented by the Bengal presidency was the major land settlement. The British government introduced the Zamindari system of land revenue that became the ultimate cause for backwardness and stagnation of Indian agriculture. Under this system of land settlement:
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• the Zamindars were treated as permanent owners of the land.
• Zamindar’s used to pay a fixed sum in the form of “Lagan’ (tax) to the British Government.
• Zamindars were free to extract this tax or ‘Lagan’ from the tillers of the land as they could.
This system led to the unlimited exploitation of the tillers of the soil by Zamindars. The real benefits of the agriculture went straight in the hands of Zamindars. Farmers end up getting nothing. even after toiling hard for it. Neither the British Government nor the Zamindars did anything for the benefit of farmers. Their main interest was only to collect taxes. Even in the conditions of drought, famine or floods there was no mercy upon the farmers.
Q6. How did the British rulers policy adversely affect the foreign trade of India?
Ans. Restrictive trade policies followed by British government adversely affected the structure, composition and Volume of India’s foreign trade. The scenario of India’s foreign trade under British rule is explained as under:
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1. India as an Exporter of Raw Materials and Importer of Finished Products: During British rule India became an exporter of primary products such as raw silk, cotton, wool, sugar, indigo, jute etc. and an importer of finished goods like cotton, silk and woollen clothes and capital goods like light machinery produced in the factories of Britain. This composition of foreign trade made India a backward and stagnant economy.
2. Monopoly Control: British government exercised monopoly control over India’s foreign trade. More than 50 percent of India’s foreign trade was with Britain and rest was with only a few countries like China, Ceylon (Sri Lanka) and Persia (Iran). The opening of Suez Canal in 1869 also intensified British control over India’s foreign trade. It reduced the cost of transportation and provided a direct route for trade between India and Britain.
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Q7. Write a note on state of industrial sector on the eve of independence.
Ans. On the eve of independence, secondary or industrial sector contributed just 14.3 % of national income. India had lop-sided industrial development and could not develop a sound industrial base under the British rule. The British Government followed the policy of systematic de – industrialisation. It was a twofold policy:
(i) Decay of indigenous handicraft industries.
(ii) Slow progress (growth) of modern industry.
There were two reasons for keeping India away from modern industries:
(a) One was to keep India reduced to just as an exporter of prime raw materials for the major industries in Britain.
(b) Second was to turn the domestic market of India into a prime consumer of finished British goods to earn maximum benefits for Britain.
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Q8. What were the objectives of British rulers in bringing about infrastructural changes in Indian economy?
Ans. The main reasons to develop infrastructure by British rulers in India were to serve the following purposes:
1. To have effective control and administration over the vast country. For this purpose, Britishers linked important military and administrative centres.
2. To earn profits through foreign trade. For this purpose, they linked railways with marketing centres and major ports.
3. To create an opportunity for profitable investment of British funds in India.
4. Real motive to develop infrastructure was not to provide basic amenities to the people but to serve various selfish interests of the British Government.
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LONG ANSWER TYPE QUESTIONS
Q 1. State the level of economic development in India on the eve of independence.
Ans. On the eve of independence, Indian economy had very low level of economic development under the British rule. The British government practiced policies which were great impediments in the process of development in the country. Various sectors of Indian economy viz. Agriculture, Industry, Foreign Trade, Infrastructure, Transport etc. were in shambles. Throughout the colonial rule, the policies transformed the country into a supplier of raw materials and consumer of British manufactured finished products. This policy of British drained Indian capital to meet the revenue requirements of the Imperial defence.
1. Underdeveloped Economy: On the eve of independence Indian economy had all the features of an underdeveloped economy. Per capital income was ₹ 230 only in India during 1947-48. Agriculture was main occupation and majority of population was dependent on it. Moreover, agriculture was extremely backward. Poverty, unemployment and illiteracy were widely prevalent in the economy.
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2. Economic Stagnation: Indian economy was a stagnant economy, showing very low or negative growth rates in per capita income over time. Per capita income growth rate during 1860-1945 was just 0.5 percent per annum whereas it was – 0.1 percent per annum during 1925 – 1950. So, it showed extremely low standard of living of people in India.
3. Agricultural Backwardness: Indian population was primarily dependent on agriculture. But no attention to improve agricultural status was given by Britishers. For irrigation, agriculture was dependent mainly on rain. Zamindari system and non-economic fragmented land holdings were other contributing factors towards backwardness of agriculture. Also, the methods of cultivation were obsolete. In 1947 – 48 country was producing 527 lakh tonnes food grains. Per hectare output of rice was 665 kgs and of wheat was 660 kilograms only. Backwardness of agriculture had many negative impacts on Indian economy.
4. Industrial Backwardness: Indian industry was also backward. There was almost absence of basic goods industries. Tata Iron and Steel industry was the single example of heavy industry. Cotton and jute textile and sugar industries were also not producing sufficient output. In 1947-48, textile production was 421 crore meters. Sugar production was 10 lakh tonnes and cement were recorded 26 Lakh tonnes. These figures show low level of output of consumer goods industries. Small and cottage industries were very backward. Due to the direct ownership of British Government, no attention was given to the of modernisation or replacement of obsolete machinery of industries.
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5. Backward Infrastructure: Infrastructure of any economy is a major contributor of its growth. It includes means of transport, power or energy, means of communication, banking facilities etc. But in India, all these were at their infancy stage. In 1947-48, length of roads was approximately 97,500 miles, length of railway lines was 53.6 thousand kms. There were only 430 commercial banks with 4115 branches. Only 3,000 villages were electrified in the country.
6. Problems Related to Population: There was population explosion after 1921 in India. Main cause, was the gap between birth rate (41 per thousand) and death rate (27 per thousand). Moreover, India was lacking in health and educational facilities. Infant mortality rate was about 218 per thousand. About 83 percent of the population was rural. So, India was related as one of the poorest countries in the world.
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Q2. What were the main causes of India’s agricultural stagnation during the colonial period?
Ans. 1. Land Revenue System: Zamindari system implemented by the Bengal presidency was the major land settlement. The British government introduced the Zamindari system of land revenue that became the ultimate cause for backwardness and stagnation of Indian agriculture. Under this system of land settlement:
• the Zamindars were treated as permanent owners of the land.
• Zamindars used to pay a fixed sum in the form of ‘Lagan’ (tax) to the British Government.
• Zamindars were free to extract this tax or ‘Lagan’ from the tillers of the land as they could.
This system led to the unlimited exploitation of the tillers of the soil by Zamindars. The real benefits of the agriculture went straight in the hands of Zamindars. Farmers end up getting nothing, even after toiling hard for it. Neither the British Government nor the Zamindars did anything for the benefit of farmers. Their main interest was only to collect taxes. Even in the conditions of drought, famine or floods there was no mercy upon the farmers.
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2. Commercialisation of Agriculture: British India compelled Indian farmers to grow more of cash crops such as indigo, cotton instead of main crops. This eventually helped the British industries back home as they were getting raw material at very low prices. But farmers were still on darker side with no real benefits.
3. Impact of Partition on Agriculture: Partition of country caused a drastic fall in agricultural production. Highly irrigated and fertile land went to Pakistan. On the western front Punjab, which was rich in producing wheat and East Pakistan (now Bangladesh) known for jute production, went to divided nation. Thus, Indian jute industry suffered heavily.
4. Low Investment in Agriculture: Farmers were using centuries old methods of cultivation and farming. British India spent very little on technological improvement in the agricultural sector. There was mergre investment in terracing, flood control, drainage and desalinisation of the soil. Lack of fertilizers, inferior quality of seeds and less use of modern technology were also responsible for the murky state of agriculture.
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Q3. Briefly describe the state of infrastructural facilities during the British period.
Ans. Under the British rule, basic infrastructures such as railways, ports, water transport, posts and telegraphs developed. But this development was not to provide basic facilities to the people but to sub serve the colonial interests. The state of infrastructure during the British rule is described as follows:
1. Roads: Roads were built by the British government primarily to mobilise army with in India and carrying out raw materials from the country side to the nearest railway station or port to send these to Britain. There was acute shortage of all-weather metal roads in the rural areas. Due to this, rural people suffered badly during natural calamities and famines.
2. Railways: The British introduced railways in India in 1850 and Indian railways begun their operations in 1853. It is considered as one of the most important contribution of British rule in India. The development of railways affected the structure of Indian economy in following important ways.
(i) It provided cheap and rapid transport system especially for distant places.
(ii) It broke geographical barriers and this promoted national unity and understanding.
(iii) It created new employment opportunities.
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(iv) It helped in controlling famines.
(v) It encouraged the process of industrialisation.
(vi) It promoted foreign trade but benefited British more than Indians.
(vii) It increased the commercialisation of Indian agriculture.
3. Water Transport: During the British rule measures also taken to develop inland and oceanic water ways for increasing domestic for foreign trade. Inland waterways proved to be uneconomical as in case of coast canal on the Orissa coast.
4. Communication: British Government developed post and telegraph which were the most popular and widely used means of communication. Electric telegraph was mainly used to maintain law and order in the country. In India the first postal stamp was released in 1852 and the first telegraph line was started in 1853.
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Q4. State the condition of Indian handicraft industry on the eve of independence.
Ans. Prior to British rule, Indian handicrafts industry was in full swing and enjoying worldwide reputation. Indian handicrafts industry was destroyed due to the following systematic discriminatory policies:
1. Increased unemployment due to Introduction of Discriminatory Tariff Policy: The British government followed discriminatory tariff policy which allowed tariff-free export of raw materials from India and tariff-free import of finished goods from Britain. But Indian made handicrafts were discouraged by imposing heavy duty on their exports. It led to the easy entrance of British made goods in India and decline of sale of Indian handicraft products both in domestic as well as in international market. As a result, there was decay of Indian handicrafts industry industries, because of unemployment in the country. Closure of handicraft created
2. Closure of handicraft industries because of Competition from Machine Made Goods: Machine made products from Britain were low priced which gave stiff competition to India made handicraft products. Machine made products were better than Indian products in terms of precision and quality. Competition from Britain made goods caused steep decline in the demand for Indian handicrafts and forced the craftsmen to shut down their firms forever in India.
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3. Changes in Tastes and Preferences: Due to the influence of British culture, tastes and preference of people were shifting towards British products. This increased the demand for British products in Indian markets. Due to fall in demand for India made goods, the Indian handicrafts industry perished.
4. Fall in Encouragement to Indian Handicrafts: Before the British rule Indian handicrafts were supported by the Indian emperors, princes, nawabs etc. which had given domestic and international recognition to our handicrafts. Because of British rule, these patrons were losing their existence and accordingly Indian handicrafts too were losing their State patronage. As a result, there was decay of handicrafts in India.
Q5. What are the negative consequences of British rule in India?
Ans. British rule in India was a long history of systematic exploitation of the general people of the country by the so-called imperialistic government. The consequences of various forms of exploitation of the Indian economy by the British can be broadly analysed as follows:
1. India remained primarily an agricultural country throughout the British period. Its agricultural sector totally remained backward with its little bit of commercialisation just to serve the interests of British government.
2. British rulers never permitted to modernise the prevailing industrial structure of India during 18th and 19th centuries. This resulted in destruction of world-famous handicrafts and cottage industries of India.
3. By following the policy of discriminating protection Britishers gained complete control over the entire Indian markets.
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4. British rulers gradually transformed the Indian economy into a primary producing country exporting only raw materials for industries in Britain and importing only finished products from Britain.
5. British rulers’ built-up economic infrastructure to promote foreign trade and to exploit natural resources of India to their advantage.
6. The British rulers thoroughly exploited Indian economy through economic drain in the form of home charges and huge amount of family remittances.
7.Underdeveloped Economy: On the eve of independence Indian economy had all the features of an underdeveloped economy. Per capital income was ₹ 230 only in India during 1947-48. Agriculture was main occupation and majority of population was dependent on it. Moreover, agriculture was extremely backward. Poverty, unemployment and illiteracy were widely prevalent in the economy.
8. Economic Stagnation: Indian economy was a stagnant economy, showing very low or negative growth rates in per capita income over time. Per capita income growth rate during 1860-1945 was just 0.5 percent per annum whereas it was – 0.1 percent per annum during 1925 – 1950. So, it showed extremely low standard of living of people in India.
9. Agricultural Backwardness: Indian population was primarily dependent on agriculture. But no attention to improve agricultural status was given by Britishers. For irrigation, agriculture was dependent mainly on rain. Zamindari system and non-economic fragmented land holdings were other contributing factors towards backwardness of agriculture. Also, the methods of cultivation were obsolete. In 1947 – 48 country was producing 527 lakh tonnes food grains. Per hectare output of rice was 665 kgs and of wheat was 660 kilograms only. Backwardness of agriculture had many negative impacts on Indian economy.
10. Industrial Backwardness: Indian industry was also backward. There was almost absence of basic goods industries. Tata Iron and Steel industry was the single example of heavy industry. Cotton and jute textile and sugar industries were also not producing sufficient output. In 1947-48, textile production was 421 crore meters. Sugar production was 10 lakh tonnes and cement was recorded 26 Lakh tonnes. These figures show low level of output of consumer goods industries. Small and cottage industries were very backward. Due to the direct ownership of British Government, no attention was given to the of modernisation or replacement of obsolete machinery of industries.
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11. Backward Infrastructure: Infrastructure of any economy is a major contributor of its growth. It includes means of transport, power or energy, means of communication, banking facilities etc. But in India, all these were at their infancy stage. In 1947-48, length of roads was approximately 97,500 miles, length of railway lines was 53.6 thousand kms. There were only 430 commercial banks with 4115 branches. Only 3,000 villages were electrified in the country.
12. Problems Related to Population: There was population explosion after 1921 in India. Main cause, was the gap between birth rate (41 per thousand) and death rate (27 per thousand). Moreover, India was lacking in health and educational facilities. Infant mortality rate was about 218 per thousand. About 83 percent of the population was rural. So India was related as one of the poorest country in the world.
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Q6. Discuss the features of Indian economy on the eve of independence.
Ans. 1. Underdeveloped Economy: On the eve of independence Indian economy had all the features of an underdeveloped economy. Per capital income was ₹ 230 only in India during 1947-48. Agriculture was main occupation and majority of population was dependent on it. Moreover, agriculture was extremely backward. Poverty, unemployment and illiteracy were widely prevalent in the economy.
2. Economic Stagnation: Indian economy was a stagnant economy, showing very low or negative growth rates in per capita income over time. Per capita income growth rate during 1860-1945 was just 0.5 percent per annum whereas it was – 0.1 percent per annum during 1925 – 1950. So it showed extremely low standard of living of people in India.
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3. Agricultural Backwardness: Indian population was primarily dependent on agriculture. But no attention to improve agricultural status was given by Britishers. For irrigation, agriculture was dependent mainly on rain. Zamindari system and non-economic fragmented land holdings were other contributing factors towards backwardness of agriculture. Also, the methods of cultivation were obsolete. In 1947 – 48 country was producing 527 lakh tonnes food grains. Per hectare output of rice was 665 kgs and of wheat was 660 kilograms only. Backwardness of agriculture had many negative impacts on Indian economy.
4. Industrial Backwardness: Indian industry was also backward. There was almost absence of basic goods industries. Tata Iron and Steel industry was the single example of heavy industry. Cotton and jute textile and sugar industries were also not producing sufficient output. In 1947-48, textile production was 421 crore meters. Sugar production was 10 lakh tonnes and cement were recorded 26 Lakh tonnes. These figures show low level of output of consumer goods industries. Small and cottage industries were very backward. Due to the direct ownership of British Government, no attention was given to the of modernisation or replacement of obsolete machinery of industries.
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5. Backward Infrastructure: Infrastructure of any economy is a major contributor of its growth. It includes means of transport, power or energy, means of communication, banking facilities etc. But in India, all these were at their infancy stage. In 1947-48, length of roads was approximately 97,500 miles, length of railway lines was 53.6 thousand kms. There were only 430 commercial banks with 4115 branches. Only 3,000 villages were electrified in the country.
6. Low Rate of Capital Formation: Capital formation plays a significant role in the growth of any economy. But on the eve of independence, rate of capital formation was very low. Government had contributed only 20 percent of total capital formation against 80 percent of private sector. In this, 50% was contributed by household sector and 22 percent by private enterprises and rate of savings was just 7 percent.
7. Problems Related to Population: There was population explosion after 1921 in India. Main cause, was the gap between birth rate (41 per thousand) and death rate (27 per thousand). Moreover, India was lacking in health and educational facilities. Infant mortality rate was about 218 per thousand. About 83 percent of the population was rural. So, India was related as one of the poorest countries in the world.
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ALSO VISIT: INDIAN ECONOMY
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