Economic Impact of British Rule

Three stages of British Colonialism

         First phase- The Mercantile phase (1757-1813)

                              The East India Company used its political power to monopolize trade and dictate terms to traders of Bengal. 

                             Imposition of Inflated prices of goods id to buccaneering capitalism whereby wealth flowed out of barrel of the British trader’s gun. 

                            Revenues of Bengal were used to finance exports to England
.

Second phase –The Industrial phases (1813-1858) 

      

            India was exploited as a market for British goods.

                      Act of 1813 allowed one way trade for the British, as a result the Indian markets flooded with cheap and machine –made imports. Indian traders lost foreign as well as home market.

                      Indians were forced to export raw materials and import finished goods. 

        Act of 1813 allowed one way trade for the British, as a result the Indian markets flooded with cheap and machine- made imports. Indian traders lost foreign as well as home market.  

       Indians were forced to export raw materials and import finished goods.

      Heavy import duty on Indian products to England to discourage them in the market.

Third phase- Financial phase (1860 onwards)

               The British consolidated their position in India and made India a market for manufactures and a supplier of foodstuffs and raw materials.

                           Introduction of Railways (1853), Post and Telegraph (1853), banking System (Avadh Commercial Bank- 1881).

                          Heavy British investment in India and burden of public debt increases.

               Industries came into existence (Tata Iron and Steel in 1907).