Thursday, March 31, 2011
Sunday, March 27, 2011
Indian Economy just before and after the British get entry into the region.
1725 - 1750
During this period, Mughals were replaced by the the Maratha Empire in much of India. While the other small regional states who were mostly late Mughal tributary states such as the Nawabs in the north and the Nizam in south India remained. However, the Mughal tax administration system was left largely intact. China was the world's largest economy followed by India and France. The gross domestic product of India in 1750 was estimated at about 80 per cent that of China.[11]
1750 - 1775
During this period, tax administration system in India was collected by officers of the Maratha empire which expanded to almost 2.8 million km². While the Nizam's remained prosperous in the Deccan. China was the world's largest economy followed by India and France. The gross domestic product of India in 1775 was estimated at about 70 per cent that of China. Nevertheless, a devastating famine broke out in the eastern coast in early 1770s killing 5 per cent of the national population.
British rule
Main articles: Economy of India under Company rule and Economy of India under the British Raj
The British colonial rule created an institutional environment that did stabilise the law and order situation to a large extent. The British foreign policies however stifled the trade with rest of the world. They created a well developed system of railways, telegraphs and a modern legal system. The infrastructure the British created was mainly geared towards the exploitation of resources ofin the world and totally stagnant, with industrial development stalled, agriculture unable to feed a rapidly accelerating population. They were subject to frequent famines, had one of the world's lowest life expectancies, suffered from pervasive malnutrition and were largely illiterate.
GDP estimates
An estimate by Angus Maddison argues that India's share of the world income went from 24.4% in 1700, comparable to Europe's share of 23.3%, to a low of 3.8% in 1952. While Indian leaders during the Independence struggle and left-nationalist economic historians have blamed the colonial rule for the dismal state of India's economy, a broader macroeconomic view of India during this period reveals that there were segments of both growth and decline, resulting from changes brought about by colonialism and a world that was moving towards industrialization and economic integration.
Price of Silver - Rate of Exchange: 1871-72 to 1892-93
Period Price of Silver (in pence per Troy ounce) Rupee exchange rate (in pence)
1871–1872 60½ 23 ⅛
1875–1876 56¾ 21⅝
1879–1880 51¼ 20
1883–1884 50½ 19½
1887–1888 44⅝ 18⅞
1890–1951 47 11/16 18⅛
1891–1892 45 16¾
1892–1893 39 15
Source: B.E. Dadachanji. History of Indian Currency and Exchange, 3rd enlarged ed.
(Bombay: D.B. Taraporevala Sons & Co, 1934), p. 15.
The fall of the Rupee
The crisis of silver currency and bank notes (1750–1870)
After its victory in the Franco-Prussian War (1870–71), Germany extracted a huge indemnity from France of £200,000,000, and then moved to join Britain on a gold standard for currency. France, the US and other industrializing countries followed Germany in adopting a gold standard throughout the 1870s. At the same time, countries, such as Japan, which did not have the necessary access to gold or those, such as India, which were subject to imperial policies that determined that they did not move to a gold standard, remained mostly on a silver standard. A huge divide between silver-based and gold-based economies resulted. The worst affected were economies with a silver standard that traded mainly with economies with a gold standard. With discovery of more and more silver reserves, those currencies based on gold continued to rise in value and those based on silver were declining due to demonetization of silver. For India which carried out most of its trade with gold based countries, especially Britain, the impact of this shift was profound. As the price of silver continued to fall, so too did the exchange value of the rupee, when measured against sterling.
British East India Company rule
1775–1800
During this period, the East India Company began tax administration reforms in a fast expanding empire spread over 250 million acres (1,000,000 km2), or 35 per cent of Indian domain. Indirect rule was also established on protectorates and buffer states. China was the world's largest economy followed by India and France. The gross domestic product of India in 1800 was estimated at about 60 per cent that of China, not taking into account the falling price of Rupee.
The Company treasury reported annual revenue of £111 million in circa 1800[citation needed]. This needs to converted to Indian Rupees with the falling price of Rupee to assess the impact on Indian economy. Almost all of the Indian land revenues were diverted by the Company to help the British Crown defend herself in the Napoleonic Wars.
1800–1825
China was the world's largest economy followed by India and France. The gross domestic product of India in 1825 was estimated at about 50 per cent that of China. British cotton exports reach 3 per cent of the Indian market by 1825.(pdf)
1825–1850
China was the world's largest economy followed by the UK and India. Industrial revolution in the UK catapulted the nation to the top league of Europe for the first time ever. During this period, British foreign and economic policies began treating India as an unequal partner for the first time.[13] English replaced Persian as the official language of India. The gross domestic product of India in 1850 was estimated at about 40 per cent that of China. British cotton exports reach 30 per cent of the Indian market by 1850.(pdf)
Decline of the cotton textile industry
Ray (2009) raises three basic questions about the 19th-century cotton textile industry in Bengal: when did the industry begin to decay, what was the extent of its decay during the early 19th century, and what were the factors that led to this? Since there is no data on production, Ray uses the industry's market performance and its consumption of raw materials. Ray challenges the prevailing belief that the industry's permanent decline started in the late 18th century or the early 19th century. The decline actually started in the mid-1820s. The pace of its decline was, however, slow though steady at the beginning, but reached crisis point by 1860, when 563,000 workers lost their jobs. Ray estimates that the industry shrank by about 28% by 1850. However, it survived in the high-end and low-end domestic markets. Ray agrees that British discriminatory policies undoubtedly depressed the industry's export outlet, but suggests its decay is better explained by technological innovations in Britain.[14]
British Raj
1850–1875
The formal dissolution of the declining Mughal Dynasty heralded a change in British treatment of Indian subjects. During the British Raj, massive railway projects were begun in earnest and government jobs and guaranteed pensions attracted a large number of upper caste Hindus into the civil service for the first time. China was the world's largest economy followed by the USA, UK and India. The gross domestic product of India in 1875 was estimated at about 30 per cent that of China (or 60 per cent that of the USA), not taking into account the falling price of Rupee. British cotton exports reach 55 per cent of the Indian market by 1875.(pdf)
1875–1900
USA was the world's largest economy followed by China, UK, Germany and India. Collapse of the central authority of the Qing Dynasty and the resultant chaos triggered China's short but rapid decline on the world stage. The gross domestic product of India in 1900 was estimated at about 20 per cent that of the USA.
The Crown treasury reported annual revenue of £122 million in circa 1900[citation needed]. While the revenue in terms of Pound Sterlings reported very low growth, it does not take into account the price of Rupee falling drastically, which is needed to understand the growth of revenue in terms of Indian economy.
During this period, Mughals were replaced by the the Maratha Empire in much of India. While the other small regional states who were mostly late Mughal tributary states such as the Nawabs in the north and the Nizam in south India remained. However, the Mughal tax administration system was left largely intact. China was the world's largest economy followed by India and France. The gross domestic product of India in 1750 was estimated at about 80 per cent that of China.[11]
1750 - 1775
During this period, tax administration system in India was collected by officers of the Maratha empire which expanded to almost 2.8 million km². While the Nizam's remained prosperous in the Deccan. China was the world's largest economy followed by India and France. The gross domestic product of India in 1775 was estimated at about 70 per cent that of China. Nevertheless, a devastating famine broke out in the eastern coast in early 1770s killing 5 per cent of the national population.
British rule
Main articles: Economy of India under Company rule and Economy of India under the British Raj
The British colonial rule created an institutional environment that did stabilise the law and order situation to a large extent. The British foreign policies however stifled the trade with rest of the world. They created a well developed system of railways, telegraphs and a modern legal system. The infrastructure the British created was mainly geared towards the exploitation of resources ofin the world and totally stagnant, with industrial development stalled, agriculture unable to feed a rapidly accelerating population. They were subject to frequent famines, had one of the world's lowest life expectancies, suffered from pervasive malnutrition and were largely illiterate.
GDP estimates
An estimate by Angus Maddison argues that India's share of the world income went from 24.4% in 1700, comparable to Europe's share of 23.3%, to a low of 3.8% in 1952. While Indian leaders during the Independence struggle and left-nationalist economic historians have blamed the colonial rule for the dismal state of India's economy, a broader macroeconomic view of India during this period reveals that there were segments of both growth and decline, resulting from changes brought about by colonialism and a world that was moving towards industrialization and economic integration.
Price of Silver - Rate of Exchange: 1871-72 to 1892-93
Period Price of Silver (in pence per Troy ounce) Rupee exchange rate (in pence)
1871–1872 60½ 23 ⅛
1875–1876 56¾ 21⅝
1879–1880 51¼ 20
1883–1884 50½ 19½
1887–1888 44⅝ 18⅞
1890–1951 47 11/16 18⅛
1891–1892 45 16¾
1892–1893 39 15
Source: B.E. Dadachanji. History of Indian Currency and Exchange, 3rd enlarged ed.
(Bombay: D.B. Taraporevala Sons & Co, 1934), p. 15.
The fall of the Rupee
The crisis of silver currency and bank notes (1750–1870)
After its victory in the Franco-Prussian War (1870–71), Germany extracted a huge indemnity from France of £200,000,000, and then moved to join Britain on a gold standard for currency. France, the US and other industrializing countries followed Germany in adopting a gold standard throughout the 1870s. At the same time, countries, such as Japan, which did not have the necessary access to gold or those, such as India, which were subject to imperial policies that determined that they did not move to a gold standard, remained mostly on a silver standard. A huge divide between silver-based and gold-based economies resulted. The worst affected were economies with a silver standard that traded mainly with economies with a gold standard. With discovery of more and more silver reserves, those currencies based on gold continued to rise in value and those based on silver were declining due to demonetization of silver. For India which carried out most of its trade with gold based countries, especially Britain, the impact of this shift was profound. As the price of silver continued to fall, so too did the exchange value of the rupee, when measured against sterling.
British East India Company rule
1775–1800
During this period, the East India Company began tax administration reforms in a fast expanding empire spread over 250 million acres (1,000,000 km2), or 35 per cent of Indian domain. Indirect rule was also established on protectorates and buffer states. China was the world's largest economy followed by India and France. The gross domestic product of India in 1800 was estimated at about 60 per cent that of China, not taking into account the falling price of Rupee.
The Company treasury reported annual revenue of £111 million in circa 1800[citation needed]. This needs to converted to Indian Rupees with the falling price of Rupee to assess the impact on Indian economy. Almost all of the Indian land revenues were diverted by the Company to help the British Crown defend herself in the Napoleonic Wars.
1800–1825
China was the world's largest economy followed by India and France. The gross domestic product of India in 1825 was estimated at about 50 per cent that of China. British cotton exports reach 3 per cent of the Indian market by 1825.(pdf)
1825–1850
China was the world's largest economy followed by the UK and India. Industrial revolution in the UK catapulted the nation to the top league of Europe for the first time ever. During this period, British foreign and economic policies began treating India as an unequal partner for the first time.[13] English replaced Persian as the official language of India. The gross domestic product of India in 1850 was estimated at about 40 per cent that of China. British cotton exports reach 30 per cent of the Indian market by 1850.(pdf)
Decline of the cotton textile industry
Ray (2009) raises three basic questions about the 19th-century cotton textile industry in Bengal: when did the industry begin to decay, what was the extent of its decay during the early 19th century, and what were the factors that led to this? Since there is no data on production, Ray uses the industry's market performance and its consumption of raw materials. Ray challenges the prevailing belief that the industry's permanent decline started in the late 18th century or the early 19th century. The decline actually started in the mid-1820s. The pace of its decline was, however, slow though steady at the beginning, but reached crisis point by 1860, when 563,000 workers lost their jobs. Ray estimates that the industry shrank by about 28% by 1850. However, it survived in the high-end and low-end domestic markets. Ray agrees that British discriminatory policies undoubtedly depressed the industry's export outlet, but suggests its decay is better explained by technological innovations in Britain.[14]
British Raj
1850–1875
The formal dissolution of the declining Mughal Dynasty heralded a change in British treatment of Indian subjects. During the British Raj, massive railway projects were begun in earnest and government jobs and guaranteed pensions attracted a large number of upper caste Hindus into the civil service for the first time. China was the world's largest economy followed by the USA, UK and India. The gross domestic product of India in 1875 was estimated at about 30 per cent that of China (or 60 per cent that of the USA), not taking into account the falling price of Rupee. British cotton exports reach 55 per cent of the Indian market by 1875.(pdf)
1875–1900
USA was the world's largest economy followed by China, UK, Germany and India. Collapse of the central authority of the Qing Dynasty and the resultant chaos triggered China's short but rapid decline on the world stage. The gross domestic product of India in 1900 was estimated at about 20 per cent that of the USA.
The Crown treasury reported annual revenue of £122 million in circa 1900[citation needed]. While the revenue in terms of Pound Sterlings reported very low growth, it does not take into account the price of Rupee falling drastically, which is needed to understand the growth of revenue in terms of Indian economy.
Battle of Wandiwash,1760
From 1744, the French and English fought a series of Battles for supremacy in the Carnatic region. In the third Carnatic war, the British East India Company defeated the French forces at the battle of Wandiwash ending almost a century of conflict over supremacy in India. This Battle gave the British trading Company a far superior position in India compared to the other Europeans. 
The Battle of Wandiwash was a decisive battle in India during the Seven Years' War. The Count de Lally's army, burdened by a lack of naval support and funds, attempted to regain the fort at Vandavasi near Pondicherry. He was attacked by Sir Eyre Coote's forces and decisively defeated. The French general Marquis de Bussy-Castelnau and the French were then restricted to Pondicherry, where they surrendered on 16 January 1761. Wandiwash is the Anglicised pronunciation of Vandavasi.[1]
This was the Third Carnatic War fought between the French and the British. After making substantial gains in Bengal and Hyderabad, the British, after collecting huge amount of revenue, were fully equipped to face the French in Wandiwash. Thus, they defeated the French comprehensively in this Battle.
According to the 19th century book ("Annals of the wars of the eighteenth century") by Author Eduard Cust, the French Army has used 300 European Cavalry, 2250 European Infantries, 1300 Sepoys, 3000 Mahrattas with 16 pieces of Artillery and the English had used about 80 European Horses, 250 Native horses, 1900 European Infantries, 2100 Sepoys and 26 pieces of Artillery.[2]. Battle of Wandiwash involved capture of Chetpattu (Chengalpattu), Tirunomalai(Thiruvannaamalai), Tindivanam and Perumukkal.
2nd and 3rd Carnatic wars
Second Carnatic War (1749-1754)
After the death of Nizam-ul-Mulk in 1748, the Nizam of Hyderabad
, a civil war for succession , known as the 2nd Carnatic War, broke out in the south between Mir Ahmad Ali Khan ( Nasir Jung), the son of the Nizam-ul-Mulk, and Hidayat Muhi ud-Din Sa'adullah Khan ( Muzaffar Jung), the grand son of Nizam-ul-Mulk.
, a civil war for succession , known as the 2nd Carnatic War, broke out in the south between Mir Ahmad Ali Khan ( Nasir Jung), the son of the Nizam-ul-Mulk, and Hidayat Muhi ud-Din Sa'adullah Khan ( Muzaffar Jung), the grand son of Nizam-ul-Mulk.This opened a window of opportunity for Chand Sahib, who wanted to become Nawab of Arcot. He joined the cause of Muzaffar Jung and began to conspire against the Nawab Awaruddin Muhammed Khan in Arcot. The French allied with Chand Sahib and Muzaffar Jung to bring them into power in their respective states. But soon the British also intervened. To effect the French influence, they began supporting Nasir Jung and Muhammad Ali Khan Walajah (son of the deposed Nawab Anwarauddin Muhammad Khan of Arcot). Initially, the French succeeded in both states in defeating and murdering their opponents and placing their supporters on thrones in 1749. In 1751, however, Robert Clive led British troops to capture Arcot. Clive's success led to additional victories for the British and their Nizam and Arcot allies. The War ended with the treaty of Pondichery, signed in 1754. Muhammad Ali Khan Walajah was recognised as the Nawab of Arcot. The French leader Dupleix was asked to return to France. The Directors of the French East India Company wer dissatisfied with Dupleix's political ambitions, which had led to immense financial loss. In 1754, Charles Godeheu replaced Dupleix.
Third Carnatic War
The outbreak in 1756 of the Seven Years' War in Europe resulted in renewed conflict between French and British forces in India. The Third Carnatic War spread beyond southern India into Bengal where British forces captured the French settlement of Chndernagore (now Chandannagar) in 1757. However the war was to decide in the south , as British Commander Sir Eyre Coote decisively defeated the French under the Comte sw Lally at the Battle of Wandiwash in 1760.The French capital Pondichery fell to the British in 1761,.The treaty of Paris in 1763 decided the result of both the parties. France to have factories ( trading posts) and British would get dominant foreign power in India. 'Let there be light, and there was light' for British in India.
Saturday, March 26, 2011
Carnatic Wars (1746-1763)
The Carnatic Wars, 1st,2nd, and 3rd were a series of military conflicts in the middle of the 18th century on the Indian Subcontinent. The conflicts involved many independent rulers for succession of their territories and between the two European forces the French and the British.
First Carnatic war (1746-1748) 
The Mughal Emperor Aurangazeb died in 1707 CE.He was succeeded by Bahadur Shah I but there had been a general decline of the central control over the entire empire after the death of Aurangazeb. Several erstwhile Mughal colonies revolted. Carnatic was ruled by Nawab Dost Ali, despite being under the legal perview of the Nizam of Hyderabad. Dost Ali's death spurked a power struggle between his son-in-law Chand Sahib and the Nizam;s nominee, Anwar-ud-Din. The British enlisted the help of Anwar-ud-Din to oust Joseph Francois Dupleix and the French from Madras.
The Genesis of the Carnatic wars are generally attributed to the ambition of Dupleix. As governor of the French East India Company , Dupleix sought to establish a French colony in India. Immediately upon his arrival in india, he organized Indian recruits under French officers for the first time in 1740.
In the mean time the British and the French went to war over the succession of the throne of Austria in 1740. The decline of Mughal power in India provided an opportunity for the contending European trading Companies to venture out brazen use of intrigues for obtaining hold over the land for the benefit of their respective companies.By that time, the French and the British trading companies had the largest presence among all the European Companies trading in India, dominating in influence those of the Dutch Republic and Portugal.
After the British initially captured a few French Ships , the French, in return, captured , in 21 Sept. 1746, the British city Madras. Among the prisoners of war was Robert Clive.
With the termination of the war of Austrian Succession in European, the first Carnatic War also came to an end. In the treaty of Aix-la-Chapelle (1748), Madras was given back to the British in exchange for the French fortress of Louisbourg in north America, which the British had captured.
Wednesday, March 23, 2011
Chennai-Formally Madras Presidency
The name Chennai came from the word Chennaipattinam, the name of the town that grew around the Fort St. George, which was built by the English in 1640. The first official use of the name Chennai is said to be in a sale deed, dated August 1639, to Francis day of the English East India Company. Chennai in Tamil means face, and the temple is regarded as the face of the city.The region around Chennai has served as an administrative, military, and economic centre since the 1st century.The area was ruled by various South Indian Dynasties notably the Pallava, the Chera, The Chola, The Pandya, and Vijaynagar.The Portuguese arrived in 1522 and built a port called Sao Tome after the christian apostle, St. Thomas, who is believed to have preached in the area between 1552 and 1570 AD. In 1612, the Dutch established themselves near Pulicat, just north of the City.
On 22nd August 1639, Francis Day of the British East India Company bought a small strip of land on the Coromandel coast. The region was ruled by the Nataka of Vandavasi. He granted British permission to build a factory and warehouse for their trading enterprises.A year later the British built Fort St. George and Madras was captured by the French under General La Bourdonnais, the Governor of Mauritius, who plundered the town and its outlying villages. the British gained control in 1749 through the Treaty of Aix-la-Chapelleand fortified the town's fortress wall to withstand further attacks from the French and another looming threat , Hyder Ali, the Sultan of Mysore.By the late 18th century , the British had conquered most of the region around Tamil Nadu, Andhra Pradesh, and Karnatak , establishing the Madras Presidency with Madras as capital.
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