Question

how does first World war created economic problem in India? explain​

Answer 1

It led to a huge increse in defence expenditure which was financed by war loans and increasing taxes customs duties were raised and income tax introduced.

hope it will helps you.

Answer 2

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➾The First World War created a new political and economic situation in India. ..

(i) It led to huge increase in defense expenditure, Custom duties were raised,income tax was introduced to finance the war.

(ii) Villagers were called upon to supply soldiers, forced recruitment in rural areas caused widespread resentment.

(iii)Increased military expenditure and the demands for war supplies led to the sharp rise in prices which badly affected the common mass. They found it difficult to fulfil even their essential needs.

(iv)On the other hand business groups reaped fabulous profits from the war. The war created a demand for industrial goods like jute bags, cloth, rails, and caused a decline of imports from other countries into India. As a result Indian industries expanded during the war.