How Was The Economy on Eve of Independence? | UPSC Economy

India gained independence from British colonial rule on August 15, 1947. At that time, India’s economy was predominantly agrarian, and industrialization was limited. Here’s a brief overview of the economy on the eve of independence.

Agriculture

• Agriculture was the backbone of the Indian economy, employing nearly 70% of the population.
• India was known as the “breadbasket of the British Empire,” as it was a major exporter of agricultural products such as jute, cotton, tea, and spices.
• However, Indian farmers were heavily exploited by the British colonial government through policies such as the land revenue system, which forced them to pay high taxes.

Industry

• India’s industrial sector was small, accounting for only about 10% of the country’s GDP.
• Industries were mainly concentrated in a few cities such as Kolkata, Mumbai, and Chennai, and were owned by British companies.
• The textile industry was the largest industrial sector, and India was a major exporter of textiles.

Infrastructure

• India’s infrastructure was poorly developed, with few roads, railways, and ports.
• The British colonial government did little to develop India’s infrastructure, as it was more interested in exploiting India’s natural resources for its own benefit.
• India’s infrastructure was also damaged during World War II, as the British colonial government used many of India’s resources to support the war effort.

Trade

• India’s trade was largely controlled by British companies, which dominated the country’s export and import markets.
• The British colonial government imposed high tariffs on Indian products, making it difficult for Indian companies to compete in the international market.
• India’s trade deficit was large, as it imported more than it exported.

India’s economy on the eve of independence was largely agrarian, with a small industrial sector and poorly developed infrastructure. Indian farmers were heavily exploited by the British colonial government, and Indian industries were largely owned by British companies.

Also Read

• What Is Drone Technology? | UPSC Science And Technology
• What Are Capital And Investment? | UPSC Economy