Colonialism and imperialism share a common design for the expansion and control of the economy and political systems of other countries. The history of imperialism suggests that control over other countries is gained in the name of civilisation and development. The imperialist powers believe that their culture is supreme and should be imposed on others to civilise them. The ‘others’, are viewed as, primitive, uncivilised, and underdeveloped creatures.
There is a set pattern in the way that imperialism converts the local development of colonised countries to underdevelopment and imposes its own version of development. This strategy was also applied by the British in India in a systematic manner. The scene was set by the East India Company (EIC), which came to India for trade, but with the passage of time started gaining political control by building a fort in Kolkata, Bengal without the permission of Siraj-ud-Daula, the Nawab of Bengal. The war of Plassey in 1757 paved the way for East India Company to take control of more states.
The EIC started following the imperialist strategy of economic exploitation. The EIC had its own army and needed a hefty budget for administrative arrangements. The best source of taxes in India was land revenue. Thus, a number of new taxes were imposed by the EIC to extract as much money as possible.
Diwani (the right to collect revenues from the people) was imposed in Bengal. Interestingly, the Mughal Emperor was part of this arrangement, which allowed the East India Company to extort a large amount of money as diwani and a small amount of money would go the Mughal emperor. A new system of revenue was introduced in the states of Orrisa, Bihar and Bengal, through which revenue was collected from zameendars (large landowners), who would collect it from peasants.
The ryotwari system was introduced in the southern province of British India. According to this system, the revenue was collected directly from the peasants, but they were not given propriety rights. In the northern and central parts of British India, the company collected taxes from the heads of families or the heads of villages. The worst part was that there was no rebate or reduction, even when the crops were negatively affected by adverse weather.
In the wake of this stifling agricultural policy, a number of peasants were forced to quit their profession, which led to a drastic decline in the production of crops and a severe shortage of food in certain areas of India. According to an estimate, between 1769 and 1943, there were about 15 major famines in India.
Besides the agricultural taxes, the EIC employed a creative strategy to seize the riches of the princely states. The weakening control of Mughal king led to the internal conflicts of local states. There was a sense of insecurity among the states. This was an opportune time for the EIC to introduce the Subsidiary Allowance System. Being part of this arrangement, the states’ security would be provided by the EIC army and, in return, the states would be required to pay for all the expenses of the army.
This system not only allowed the EIC to keep their army in different states but also to extract a large sum of money for the maintenance of army. The ultimate outcome of this system was that the princely states started relying heavily on the British army and their own armies started dwindling.
Another clever move by the EIC to extract money was to introduce the Doctrine of Lapse. In case of the death of a ruler, who had no heir, the propriety would go to the adopted son or daughter. The new doctrine put an end to the provision of transfer of propriety to the adopted son or daughter. Now in the case of the death of an heirless ruler, the propriety would go to the British Empire. This doctrine opened a new avenue to exploit the riches of states. All of these taxation practices negatively impacted the economic condition of the peasants.
A major step taken by the EIC to convert the local development into underdevelopment was to extract raw material from India and ship it to Britain. For this purpose, the local farmers were forced to produce raw materials such as cotton and indigo. This was contrary to the previous practices, in which the farmers used to grow crops according to their needs. The factories in Britain needed raw materials to manufacture goods and also some markets for the consumption of these goods. India was exploited to obtain both these objectives: raw materials were extracted from India to manufacture goods in Britain, which were then sold to Indians at much higher prices.
This unfair arrangement disturbed the import-export balance and played a major role in turning the local development into underdevelopment. According to Michael Parenti, “In 1810, India was exporting more textiles to England than England was exporting to India.” He further claims that, “By 1850, India’s debt had grown to 53 million pounds. From 1850 to 1990, its per capita income dropped by almost two-thirds.”
The local craftsmen and weavers were sidelined in a systematic manner. The craftsmen were not allowed to work beyond the demand of the EIC. Once the British successfully managed to convert indigenous development into ‘undevelopment’, they applied a version of development that is very popular with colonisers and despotic states. This version of development focuses on physical infrastructure – roads, railway carriages, buildings etc. – and is the least sensitive to the personal rights, freedom and choices of the people.