Development Experience (1947-90) and Economic Reforms since 1991
Current Challenges Facing Indian Economy
Development Experience of India
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Agriculture on the eve of independence

  • The Indian economy was an agrarian Economy-  70%-75% of the population directly engaged in the agricultural sector and about 85% of the population residing in villages derived its livelihood directly or indirectly from the agriculture sector.
  • Despite this fact, India frequently faces an acute shortage of food and faced Stagnancy in the agriculture sector. Conditions of Farmers was miserable.
  • Although India was Agrarian economy, the country faces continuous stagnancy in the agricultural sector. Even though in absolute terms the sector experienced some growth, but it was due to the expansion of the aggregate area under cultivation.

Features of Indian agrarian sector which leads for stagnancy and miserable condition of Farmers (Peasants):

    • Unfair Land Revenue Systems; such as Zamindari, Ryotwari and Mahalwari.
    • Forced Commercialisation of Agriculture in which food crop was replaced by cash crops like Indigo, cotton, tea and coffee.
    • There was almost negligible use of technology, most of the farmers were using obsolete technology
    • Lack of Irrigation facilities (Most farmers were depending on monsoon for irrigation)
    • Negligible use of fertilisers.
    • India’s agriculture was starved of investment in terracing, flood-control, drainage and desalinisation of soil.

Unfair Land Revenue Systems; such as Zamindari, Ryotwari and Mahalwari.

Zamindari System

Zamindari System was the most infamous system of land revenue system, it was implemented by Britishers in the Bengal Presidency.

It’s a three-tier relationship between British Government, Zamindars and Peasants.

Zamindars acts as the intermediaries between farmers and Britishers. They were declared the proprietor of land on condition of fixed revenue payments to the British regime on the fixed date, failing to which the zamindars were to lose their rights.

However, Rent was not fixed by the government and Zamindars were free to collect any rent from farmers. Main Interest of the Zamindars was to collect rent only regardless of the economic condition of farmers.

Consequences of the unfair revenue system such as the Zamindari System:

  • Zamindars and Colonial Government did nothing to improve the condition of agriculture.
  • Farmers were like a tenant on their own land, always in fear to lose their land.
  • Immense social tension had been created between farmers and zamindars.
  • India’s agriculture was starved of investment in terracing, flood-control, drainage and desalinisation of soil.

Meaning of Commercialisation of the crop.

 The process under which food crop is replaced by cash crop, it is said to be Commercialisation of the crop.

Forced Commercialisation of Crop.

Britishers forced Commercialisation of the crop to Indian Farmers to fulfil the demand for raw material for emerging  Industries in Britain. For example, Farmers were forced to produce Indigo, which is used by the textile industry of Britain for Dying.

Impact of Commercialisation of the crop on Indian Farmers:

•Commercialisation of Indian Crop hardly helped farmers in improving their economic condition
Instead of producing food crops, now they were forced to produce cash crops like Cotton and Indigo which were to be ultimately used by British Textile industries back home.
•Commercialisation of crop adversely affected self-sufficiency of the village economy and acted as a major factor in bringing the declining state in the rural economy.
•It is seen that productivity of cash crop increases substantially and food crops fall, Country had to pay its cost by facing frequent famines.

Quick Acid Test

The Indian economy was an agrarian Economy-  70%-75% of the population directly engaged in the agricultural sector and about 85% of the population residing in villages derived its livelihood directly or indirectly from the agriculture sector.

Although India was Agrarian economy, country faces continuous stagnancy in agricultural sector. Even though, in absolute terms the sector experienced some growth, but it was due to the expansion of the aggregate area under cultivation.

Features of Indian agrarian sector which leads for stagnancy and miserable condition of Farmers (Peasants):

  1. Unfair Land Revenue Systems; such as Zamindari, Ryotwari and Mahalwari.
  2. Forced Commercialisation of Agriculture in which food crop were replaced by cash crops like Indigo, cotton, tea and coffee.
  3. There was almost negligible use of technology, most of the farmers were using obsolete technology
  4. Lack of Irrigation facilities (Most farmers were depending on monsoon for irrigation)
  5. Negligible use of fertilisers.
  6. India’s agriculture was starved of investment in terracing, flood-control, drainage and desalinisation of soil.

Zamindari System was the most infamous system of land revenue system, it was implemented by Britishers in the Bengal Presidency.

It’s a three-tier relationship between British Government, Zamindars and Peasants.

Zamindars acts as the intermediaries between farmers and Britishers. They were declared the proprietor of land on condition of fixed revenue payments to the British regime on the fixed date, failing to which the zamindars were to lose their rights.

However, Rent was not fixed by the government and Zamindars were free to collect any rent from farmers. Main Interest of the Zamindars was to collect rent only regardless of the economic condition of farmers.

Consequences of the unfair revenue system such as the Zamindari System:

  • Zamindars and Colonial Government did nothing to improve the condition of agriculture.
  • Farmers were like a tenant on their own land, always in fear to lose their land.
  • Immense social tension had been created between farmers and zamindars.
  • India’s agriculture was starved of investment in terracing, flood-control, drainage and desalinisation of soil.

Meaning of Commercialisation of the crop.

 The process under which food crop is replaced by cash crop, it is said to be Commercialisation of the crop.

Forced Commercialisation of Crop.

Britishers forced Commercialisation of the crop to Indian Farmers to fulfil the demand for raw material for emerging  Industries in Britain. For example, Farmers were forced to produce Indigo, which is used by the textile industry of Britain for Dying.

Impact of Commercialisation of the crop on Indian Farmers:

  • Commercialisation of Indian Crop hardly helped farmers in improving their economic condition
  • Instead of producing food crops, now they were forced to produce cash crops like Cotton and Indigo which were to be ultimately used by British Textile industries back home.
  • Commercialisation of crop adversely affected self-sufficiency of the village economy and acted as a major factor in bringing the declining state in the rural economy.
  • It is seen that productivity of cash crop increases substantially and food crops fall, Country had to pay its cost by facing frequent famines.