What were the social, economic and political situation of India after WW 1??
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Version 1.0|Last updated 24 May 2018
Post-war Societies (India)
By Sumit Sarkar PDF EPUB KINDLE Print
The decades between the two world wars seethed with tumultuous and momentous events. A complex pattern of opportunities and crises in the aftermath of the First World War inspired diverse agitations against and negotiations with the colonial state. The late 1920s and 1930s again witnessed profound economic changes, new political genres, and constitutional initiatives. They led to freedom with partition and decided the shape of post-colonial politics.
Table of Contents
1 The Wartime Economy
2 Constitutional Changes
3 Politics in the Interwar Years
4 The Depression
5 Nationalisms: Armed and Unarmed
Notes
Selected Bibliography
Citation
The Wartime Economy↑
The war was thrust upon India, without consultation with Indian political organisations, although many, including Mohandas Karamchand Gandhi (1869-1948), supported the war effort. For most Indians, though, it was a costly war. Massive, sometimes forced, recruitment exacerbated long-term processes of colonial extraction of Indian resources and labour. There was, in the first place, a drain of manpower, as men were recruited, and later compulsorily dragged off to war zones as coolies and soldiers.[1] The Indian army expanded to 1.2 million and 335,000 men were taken from Punjab alone, significantly damaging its economy.[2]
Alongside this was the drain of money, and an enormous addition to the national debt of Rs 3 million between 1914 and 1923. This was exacerbated by heavy war loans and taxes, mostly indirect ones laid on essential goods, which especially hurt ordinary people. Since land revenue could not be increased under its established terms, customs duties had to finance a 300 percent increase in defence expenditure. Import duties on cotton textiles were raised by 7.5 percent, while total customs duties rose by 8.9 percent to 14.8 percent. Income taxes yielded only 2 percent of gross revenue in 1911-1912: they went up to 11.75 percent in 1917-1918. The axe fell heavily on Indian business groups, especially as a tax on companies and undivided Hindu business families, and another on excess profits, were added in 1917 and 1919.
Wartime transport bottlenecks reduced shipping space for non-military commodities. Prices of industrial goods rose steeply as a result, and export prices of agricultural commodities could not keep pace. Peasants, consequently, paid more for cloth, oil and kerosene, but the rice, indigo or jute they produced remained at the same price level. A disastrous decline in the production of food crops occurred in 1918-1919 and 1920-1921. This hurt rich peasants, while poorer peasants and agricultural workers were devastated by the price of coarse food grains, their staple food, which rose far more rapidly than prices of finer rice or wheat. Despite the agrarian crisis, food and fodder were exported to feed the military, bringing parts of the country close to a famine situation. The crisis was deepened by a virulent influenza pandemic, which killed a total of about 12 to 13 million people in India – a number higher than the total war casualties.
Standards of living and consumption declined significantly. At the same time, the impact of the war was uneven in its spread, and distress for some came with opportunities for others. The price differential between agricultural raw material and industrial goods was followed by a growing war demand for jute sandbags, and for canvas, cloth and leather goods. Their manufacturers enjoyed massive profits, especially as transport disruptions blocked imports and vastly reduced foreign industrial competition. Though this primarily helped British jute magnates in East India, it also laid the basis for Indian investment in jute factories after the war. In Bombay and Ahmedabad, Lancashire cotton goods imports declined sharply as import duties were pegged at 7 percent, while export duties on cotton remained at the older rate of 3 percent. This gap greatly benefitted Indian capitalists. Some scholars think that higher prices of imported yarn led to a decline of handicrafts. Others argue that handicrafts actually expanded in the south.[3]
However, traders and merchants resented the fluctuating rupee-sterling exchange rate, import cuts and new taxes. Industrialists, too, were disturbed when the exchange rate finally settled at 1s-6d per rupee in 1926. This reduced import prices in the post-war period, cutting into their wartime advantage. As industrial production boomed, the number of factory workers expanded massively, by about 575,000 between 1911 and 1921. There was no increase in real wages that corresponded to increased production, even though the cost of living rose sharply. Large profits contrasted tellingly with workers’ distress.[4]