Discuss how Indian economy was effected by great depression?
Answers
The Great Depression of 1929 had a very severe impact on India, which was then under the rule of the British Raj. The Government of British India adopted a protective trade policy which, though beneficial to the United Kingdom, caused great damage to the Indian economy. During the period 1929–1937, exports and imports fell drastically crippling seaborne international trade. The railways and the agricultural sector were the most affected.
The international financial crisis combined with detrimental policies adopted by the Government of India resulted in soaring prices of commodities. High prices along with the stringent taxes prevalent in British India had a dreadful impact on most Indians. The discontent of farmers manifested itself in rebellions and riots. The Salt Satyagraha of 1930 was one of the measures undertaken as a response to heavy taxation during the Great Depression.
The Great Depression and the economic policies of the Government of British India worsened already deteriorating Indo-British relations. When the first general elections were held according to the Government of India Act 1935, anti-British feelings resulted in the pro-independence Indian National Congress winning in most provinces with a very high percentage of the vote share.
● Remarkable shift of Congress policy from the demand of dominion status to full independence of India at Lahore session in 1929.
● Founding of RBI in 1935
● Salt satyagraha - launching of civil disobedience movement in 1930
● Prepared the ground for Great famine of Bengal (1943) , in which more than 25 lakhs people died , one of the worst famine in the Indian history (Yes, I do agree Bengal famine was mostly because of second world war but we should not forget that Economic Depression of 1929 gave rise to Hitler in Germany who was key player in initiating the World War 2 )
● At that time more than 70% of Indian population was dependent on agriculture and other primary activities due to brutual policies of Britishers .So, it become extremely important to us to know what were the situation of lower and middle class peasants and labourers .
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2.) Agriculture prices fell sharply ,but the colonial government refused to reduce revenues .
3.) Peasants used up their savings mortgaged lands and sold their precious jewelry
to meet their expanses.
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