How features of indian economy on the eve of independence are different from those present in today’s scenario? Explain.
Answers
Hey Mate !
1. Indian Economy-Underdeveloped:
On the eve of independence, Indian economy was underdeveloped economy. As an underdeveloped economy, Indian economy had the following features:
(i) Low Per Capita Income:
Underdeveloped economies have low per capita income. India has no exception to it. In 1947-48, per capita income was Rs. 230. People were poor. They were not getting fair square meals a day. They had no shelter and clothing. Most of the people were unemployed.
(ii) Poor Infrastructure:
On the eve of independence infrastructural development which comprised of communication and transport and electricity etc. was very poor. In 1948, power generation capacity was nearly 2100 MW; length of railway lines was 53,596 Kms.
(iii) Dependence on Imports:
The country had to heavily depend on imports. Armed forces of the country also depended on foreign imports. Moreover, several consumer goods like sewing machines, medicines, oil, bicycles etc. were imported from abroad.
(iv) Illiteracy:
Illiteracy was both cause and effect of poverty. Due to illiteracy, people were unable to use new techniques in agriculture and industry. They were unable to organize trade and commerce on modern lines. In 1948, rate of illiteracy was 18%. Thus 82% of the population was illiterate.
(v) Agricultural economy:
Indian economy was predominantly agricultural. In 1948, about 70% population was engaged in agriculture. Moreover, agriculture constituted 50% of national income. But agriculture itself was backward. Regarding productivity, it was 110 kg/hectare for rice in 1947 as against 748 kg in Japan.
(vi) Low Development of Industries:
There was very little development of industries. Large industries used to produce consumer goods. Basic and key industries were very less in number. In 1947, cement production was 26 lakh tonnes, of sugar 10 lakh tonnes and that of cloth just 421 crore meter.
2. Stagnant Economy:
During the British period, Indian economy remained almost stagnant. There was very slow growth of economy. This was clear from the fact that for almost a century, the average annual growth rate of per capita income in India was not more than 0.5%.
The high growth rate of population tended to make it difficult to maintain even the proposed growth rate. In fact poverty was widespread and about 40% people were living below poverty line.
The causes of stagnation and backwardness are laissez faire, commercialization of agriculture, neglect of irrigation, destruction of cottage and handicraft and economic drainage and discriminatory tariff policy.
3. Semi-Feudal Economy:
During the British rule, Indian economy had a mixed mode of production. Feudalism was more prominent than other modes of production.
A substantial developed capitalistic sector had emerged. Handicraftsmen had lost their independent status and were engaged in a simple commodity production. Bonded labour force was prevalent in agriculture. Primitive social organizations existed in areas inhabited by the tribals.
4. Depreciated Economy:
On the eve of Independence Indian economy was depreciated. In every economy, extensive use of factors of production, inevitably leads to their wear and tear. If no arrangements are made to replace the depreciated factors then the stock of gross capital declines.
Hope it helps u !