Discuss the impact of 1st world war on indian economy,policy and society?
Answers
Explanation:
In order to understand how the Indian society and economy fared during the World War I (WWI from now on), an abnormal period, it is necessary .... the standard history of British food policy during WWI, Barnett (1985)......
Answer:Economic Impact
There was a sharp increase in demand for Indian goods in Britain as production capabilities in Britain itself were diverted to the war effort.
However, the disruption in shipping lanes because of the war also meant that Indian industry faced inconvenience because of the shortage of inputs that were earlier imported from Britain and Germany. There was excess demand as well as supply bottlenecks.
Another result was inflation. Industrial prices nearly doubled in the six years after 1914. Accelerating prices benefitted Indian industry.
Farm prices rose as well, but at a slower pace than industrial prices. The internal terms of trade(ratio of export prices to import prices) moved against agriculture. This trend continued for most of the next few decades, and especially during the collapse in global commodity prices during the Great Depression.
Demand for food supplies, particularly cereals, led to rampant food inflation.
Exports of cash crops like jute suffered due to the loss of the European market. Meanwhile, rising military demand for jute products compensated for the decline in civilian demand with jute mills in Bengal establishing monopolies; skewed income distribution grew even more so.
The drain on the Indian economy in the form of cash, kind and loans to the British government came to about 367 million pounds.
Domestic manufacturing sectors such as cotton benefited from the decline in British goods that had dominated the pre-war market.
The steel sector benefited as well. For instance, the ailing Tata steel mills were handed a lifeline in the form of a contract to supply rails to the Mesopotamian campaign.
British investment was rerouted to the UK, creating opportunities for Indian capital. In short, the war economy boosted Indian capitalism in some ways at least.
Economic Impact
There was a sharp increase in demand for Indian goods in Britain as production capabilities in Britain itself were diverted to the war effort.
However, the disruption in shipping lanes because of the war also meant that Indian industry faced inconvenience because of the shortage of inputs that were earlier imported from Britain and Germany. There was excess demand as well as supply bottlenecks.
Another result was inflation. Industrial prices nearly doubled in the six years after 1914. Accelerating prices benefitted Indian industry.
Farm prices rose as well, but at a slower pace than industrial prices. The internal terms of trade(ratio of export prices to import prices) moved against agriculture. This trend continued for most of the next few decades, and especially during the collapse in global commodity prices during the Great Depression.
Demand for food supplies, particularly cereals, led to rampant food inflation.
Exports of cash crops like jute suffered due to the loss of the European market. Meanwhile, rising military demand for jute products compensated for the decline in civilian demand with jute mills in Bengal establishing monopolies; skewed income distribution grew even more so.
The drain on the Indian economy in the form of cash, kind and loans to the British government came to about 367 million pounds.
Domestic manufacturing sectors such as cotton benefited from the decline in British goods that had dominated the pre-war market.
The steel sector benefited as well. For instance, the ailing Tata steel mills were handed a lifeline in the form of a contract to supply rails to the Mesopotamian campaign.
British investment was rerouted to the UK, creating opportunities for Indian capital. In short, the war economy boosted Indian capitalism in some ways at least.