How Indian agroeconomy changed?

How Indian economy changed?

From the end of the 18th century three overlapping waves of change transcending patterns

of production and consumption happened in India .

1Rise of colonial rule which changed the existing rules and regulations of the nation to

change the economy

2.Extension of market economy over food production

3.Modern economy based on machinery and waged labour.

By 1947,when we got independence India was one of the poorest countries in the entire

world.

1757-1856

East India company annexed territories .The 1856 annexation of Oudh happened .60 %

of land (present India,Pakistan and Bangladesh) belonged to Oudh.In 1857 he great

Indian mutiny or first war of Indian independence happened. Close control of princely

states without annexation was called the indirect rule.

From 1850

The market economy gained momentum .The whole world including India was the

supplier of the food and raw materials to Industrializing Europe. This gave opportunities

for trade and commerce and product for export increased .The rough measure of

commercialization is the annual growth of foreign trade From 1835 upto world war 1 this

increased.

The ancient weights and measures of India famous even during the Indus valley period

was changed to the British systems. The railways,telegraphs,all public communication

channels were under the Government and the natives lost all control of their old systems
and the private property system introduced weakened the co-operative guild systems of

trade, commerce and agriculture .The taxation system changed and the regional co-

operative systems had no power to take any decisions in the favor of the people .

From an economist’s point of view market economy as a new policy and the monetary

system instead of the barter in kind and service is a quick action. But historically the

slowly acting forces of their effects had ruined the best co-operative commune systems

existed in the whole world from antiquity. The analogy is to that of human body. Our body

responds quickly to a chemical as a medicine and we get quick but temporary relief

only. Side effects of the chemical comes later. For long term effective measures it is better

to develop good immunity ,by lifestyles ,by harmonious relation to our environment and

genetic traits. The quality environments, the population, the cultural and mental make

up, the scientific and technological know-how related to the regional climatic and weather

conditions, and industrial organization based on a agrarian economy is the better type of

economy as far as India is concerned.

In 1776 Adam Smith wrote that the key to economic success is the productivity of

labour.Increase the quantity that each individual produce to increase the average

consumption and income. How does the productivity grow? If an individual concentrates

on one labour(specialization in one work)instead of wasting energy in different things, the

products will be both quantitatively and qualitatively good.(Division of labour and

specialization by the varna in India was based on this).Each discover the easier and

readier methods for production of each .Market increases and surplus also increases and

more and more specialized they become in the respective sphere of activity. The markets

become more competitive and even distant nations become dependent on the quality

products from such artisans .That is how Babylonians,Assyrians,Egyptians,Arabs,Greeks

and Jews and Romans and later Portuguese ,French, Danish and British became interested

in Indian products and markets and came here .

In 1969 John Hicks developed a view of European history as expansion and maturation

of markets like

1 products

2.And factors of production (land and labour ) by social systems and political power.

He said commerce ,competition and competence are interdependent and the control of

colonies by colonizers is justified by that. But trade and commerce were done with

competence ,and with competition between the richness and quantity and quality of each

one’s product in India and competition was on efficiency and not on destruction of

others. This basic change in the attitude happened with British supremacy.

India had fertile lands, plenty of rainfall in many of its areas, rivers for people and

agriculture and plenty of labour force which acted co-operatively for millions of years .It

was making surplus food for all and also creating world markets through organized land

and sea routes and administrative rules for protection and sustenance of all economic

activities. A country takes time to grow rich and prosperous and takes times to remain

rich for millennia .Such a country crumbling to poverty within 300 years of foreign rule

was unique in world history .Then such a poor country getting independence and

staggering back to its strength and competence by 64 years is also a unique feature in

history. The economic exploitation by trade ,hoarding and investment by individuals and

concentration of political power in inefficient hands was checked by the older system and

this was broken down in the 300 years and we haven’t been successful to get those ideals

back. The scholarly traditions of the west which deals with the question of why the west

grew rich ,ignore the complementary question why the east and southeast remained poor

after the rise of the west.

Marxist and the world system approaches:-

1.Ignore the local/regional peculiarities and apply the conditions of the west to the east

and theorize

2.The west grew rich by exploiting the non-west and this is either ignored or forgotten. The

west learnt the science of agrarian economy, and industries and philosophical ,medical

and astronomical knowledge from east and developed them in their own rights and

weakened these systems in the countries from where they learnt it .

3.The view of trade is unrealistic and lack a tendency of co-operation and is based on

exploitation of the neighbor

4.Identification problems.

Low wages can mean either an abundance of labour so that wages when distributed

among all becomes less, or even a political weakness of labour .What they consider as

unequal political power is a relative society or abundance of different factors of

productions based on geography of land and this was brought under the sharing principle

of co-operation. When this principle was weakened people could not help each

other, could not share anything with each other and every one lost faith in the other. Every

one became a potential enemy when individual property rights were introduced and co-

operative efforts negated .

The theory of Adam Smith and of Marx failed in India and even caused problems in

Indian economy .This is the 19th century left Nationalist paradigm articulated by R.C.Dutt

and Dada bhai Navroji.It is built around two beliefs.

1.The decline outweighed the growth

2.The decline of growth viewed from colonial position alone.

The colonial rule demanded cash revenue. Forced peasants to increase cash crops than the

subsistence crops. This increased risk of famine. The peasants fell to constant debts. They

were forced to sell or mortgage land to moneylenders. They became mere laborers and

tenants. Money lenders were not interested in investing money or profits in improving

land quality or its productivity. The agricultural stagnation was precipitated leading to

rural poverty and hunger and inequality .Import of British manufactured products

destroyed the traditional industries and handicrafts and this added to the number of

agricultural labourers.India’s position as a leading quality manufacturer declined .In 1750

1/4th of entire manufacture output of the world was supplied by India. By 1900 it became

as little as 1.7 %.In large scale industries ,the British capitalists were competing with

Indian capitalists. British Government supervised a transfer of wealth from India to

Britain which the nationalists called the “drain”. Foreign business in India created limited

income or wealth within India .Modern infrastructure built by the British for purpose of

transporting Indian wealth abroad had little impact on traditional economy of India and

Indian society .The ancient traditional routes of trade and its protectors were destroyed by

the new rulers.

In the 1950’s the left nationalist paradigm saw pre-colonial rural India as a cluster of

self-sustaining village communities oriented to subsistence and production (peasants and

artisans).And there was no class of agricultural labourers in it. All were agriculturists or

artisans who shared their produce mutually and co-operatively and lived peacefully. How

to create such an ideal situation or revive such an economy and improve long distance

domestic trade and international trade was the problem of the young nation when it

started its independent rule.

Subsistence production for entire population with surplus for years of famines :-

This requires co-operative farming techniques, increased production techniques and

education about the regional peculiarities of agriculture and its benefits. If there is a

failure one should know whether it is due to market failure, crop failure or Government

failure and take suitable measures.

The resource or the agricultural land and the weather conditions being the same for the

Indian subcontinent from antiquity to date ,what we want to revive was the co-operative

spirit and increased production by different methods.

In the 19th century the peasant problem of scarcity of water and floods lead to irrigation

schemes ,canals,tanks,wells .This was done by successive rulers/chieftains/kings from

time immemorial and was not a new thing for India. But if the land is not fertile and if

there is a population density which is very high such measures can be futile. In south west

and eastern pats where there is arable land investments in irrigation decreased and

production or growth decreased due to this reason in 1920.The population growth rate

increasing rapidly ,intensifying shortage of land and food for all was another

problem.19th century India had plenty of labour,cheap natural resources but no capital in

the form of money as such. Therefore the moneylender class /capitalist class emerged

slowly .Till then there had been no capitalist economy in India. Because entire land

belonged to God, and only trusteeship rights existed for people ,even for the rulers. The

inadequate Government investments in water resources by the British as against the

previous system of rulers further decreased agricultural productivity of land. From 1750

the old traditional systems were crumbling and new regimes were raising after decline of

the Mughal and Vijayanagara dynasties. These new regimes were famous for the armed

conflicts which did not spare civilian life and agriculture and the treasuries and granaries

of the village people being in the temples in the center of fields ,they were

attacked. Depopulation of the areas ,decline in agriculture mass migration happened in

many parts of India (ch 2 Economic history of India 1857-1947.Thirthankar Roy Oxford

uty press 2000).In fact my mother’s family migrated from the banks of river Choorni in

Alwaye to banks of rive Nila in Thirunaavaa and thence to Punnayurkulam in 1750 when

Tipu Sultan invaded Cochin state with help of Zamorin of Calicut.

Even with all odds India escaped from becoming a desert due to its rivers, monsoon rains

and wetlands which allow one to three crops of food grains a year .Hence the area selected

for study is very important which has all the three factors of protection for Malabar

coast. The agricultural and irrigation facility for the kaaninilam of our family was very

good which I remember from my childhood and is redrawn here from the memory .Now

only the small tank and well remain and the canal system is gone forever.(Figure )

Each family had a kaananilam(the field which is directly seen in front of every house)

with a canal system of irrigation, from bigger or smaller tanks and wells and even facility

to lift water by oxen(kaalaathekkku) or by basket(kottathekku)manually by two

people. The Nalapat kaananilam was connected by a system of canals to the big

chira(lake)of the ruling family of the village (Eliyanghat /Mooshakavansa)on the east and

this was interconnected to the tank of Nalapat family on the southeast of the house and

the bigger deep kokkarini (big tank)on the west which had kottathekku facility in dry

seasons. The excess rain water in the tanks were reaching the kokkarini and stored there

for use in dry seasons. This system of canals always kept the land fertile. The puncha was

always cultivated by co-operative basis and all the villages in the entire area participated

in the maintenance of the system of canals and the help was provided by Cochin and

Zamorin Rajas ,since the area of kol puncha extends in these Raja’s areas and though

they were rivals for supremacy ,they did the bund construction together on a co-operative

basis .(Still that old bund is used by the kol agricultural farmers).The systems of water

storage, reservoirs and distribution for multipurpose was a very important feature of

agrarian economy of villages. Now this system of canals,tanks,wells,and fields are being

lost for construction works and the ecology is changed and disturbed.

In agrarian relations janmam rights were the land rights.It was connected with the birth

rights given with a neerattipperu(given with water and a honest truthful deal)by the

geopolitical head and the religious head as representative of God on condition that the

receiver of the land will produce good grains and keep the land fertile. It was not

permanent for anyone who does not do this, including the ruler himself. Rotation of the

heirs from the ruling family in 12 years was based on this and they had to prove their

efficiency as administrator, producer of the land allotted to them as well as superiority of

defense abilities. Right of revenue collection which is the right and obligation concerning

the state was related to the janma property .The janma rights of the matriarchal family

was only for the women of the lineage and the men were only trustees who looked after

the sister’s property for the next generation of nephews and nieces (both royal families

and Nair families had this system, which is comparable to the ancient system of the

Egyptian Pharaoh).A massive pyramid of revenue leasing and collection from the

emperor at the top to the village chief at the bottom was functional from ancient to pre-

British times in India and for some years into the British rule .When the authority and

relationship of people and their chieftain weakened certain tiers leased out the land by

auction to highest bidders and this was called revenue farming and this created problems

for the old janmam villagers .If a new area is a new acquisition, the local officer’s loyalty

to the new right holder was important for them. These rights were not hereditary but by

prolonged practice ,experience and speculation ,the successors had and could become the

rulers/chieftains/agricultural heirs .This was the practice not only in Kerala but also in

Bengal,Ayodhya,etc where the Talukdars were members of the old weakened dynasties

and their smaller branches.Thereofore the revenue collection was the same for several

generations and no one had asked for excess revenue or evicted the old tenants .They

were doing revenue collection, held hereditary positions in courts, and were supplying

troops from the people for the new nawabs of the Mughal dynasties etc also. In 18th

century the British were suspicious of the loyalty of them and the revenue farming had

already weakened their power and they were political nonentities but the people still

considered them as their protectors .Therefore British appointed new tax collectors and

people to watch the old chieftains who were helping the tax collecting British

officials. None of their previous duties or rights existed .They were just obeying orders

from the beaurocratic new Government the ways of which were totally different from

what they were used to practice. The revolutions lead by Pazhassiraja or

VeluthampiDalawa were protests to such systems of ruling .In places where there was no

leadership the people thought their old rulers are responsible for the entire system and

rose in revolt against them ..Some of the old chieftains revolted and got killed .Others

succumbed and obeyed and by that became rich .The warrior class of Andhra was called

Poligar by British and Thalukdar in Gujarat,and in southwest as Mirazdars by both

mughals and British. And the janmi in Kerala .They were really substantial cultivators

who claimed descend from an original settler family or lineage .Mirazi rights were

saleable in some areas only, where the land was not fertile like the north west . .Mirazdar

can lease land to tenants .The tenants in those areas were a minority .

The farmers were the hereditary owners with kaanam rights. Those without janmam rights

doing tillage of the land were called the uzhavar (T.Ray Choudhary .The middle

eighteenth century background in Cambridge economic history of India 2)and the Chera

king is often called the uzhava in sangham literature.Uzhavar existed only in areas where

the land had to be tilled with a plough like Tamil Nadu and Kerala.In other areas where a

slash and burn agriculture was preferred they were not present. The presence of them in

low-lying wetlands was because of the need for co-operative farming in wide fields .The

tenants whose rights to cultivate or occupancy rights were hereditary ,and transferable in

different degrees and was not like the property rights of the modern times where one can

sell transfer or gift(bequest)and mortgage ones property as one pleases. Even the king did

not have that right in pre-British times because the land belonged to God and therefore to

entire village alike. Each individual can get a piece of land to cultivate ,to produce and to

eat and live and make profits by haring produce and it was prospering together that was

the basis of the rights. When one produce more, give more and share more for prolonged

periods with honesty and truth, the janma becomes hereditary and permanent and even

then the individual incentive of the entire family existed to become the chief of the

family. The joint families and their kulasangha(guilds of joint families )did joint farming

and they were given revenue-free farming .This was called the temple lands in sangham

period and inam lands later during the Muslim rule. In fertile gangetic plains of the east

also this existed. The prosperity of their land depended upon the amount, fertility of

land, on the strength of their organization to work co-operatively and thus increase

production and the surplus they produced to share and trade with others. The low land-

man ratio ,the high population density area decreased their hold. When the British

introduced the Seminary system their position was jeopardized.


In Ranajit Guha’s Subaltern studies 11 Goutham Bhadra (Two Frontier uprisings in


Mughal India pp43-59 Oxford India paperbacks.OUP 1999) points out the uprising of

the Tribals against Jehangir and his rule in Kuch Bihar and Assam border when king of

Kuch Bihar and Kamarup were deported by Mughals and the daughters and sons of the

people and royalty were taken away by soldiers. Their chief was Sanatana Kuch chief of

Paiks .Sanatan in a letter to the Mughal chief’s request for peace said because of Mughal

oppression the Ra’yas(cultivators)have no capacity to pay revenue and two of our great

princes have paid lakhs and crores of Rupees and have surrendered to Mughals. This

revolt ha started in Khuntaghat ,in south bank of Brahmaputhra in the present district of

Goalpara in 1614 AD well before the British became rulers. In 1621 the second upraising

in Khuntaghat was the Hathikheda revolt.Palis gave services for capturing elephants and

auxiliary footmen (gharduwari paiks)drove them to the enclosure where palis kept

them.The ryots who worked on the fields used to do the work when there is no work on

the fields.But Mughal army sent them for catching elephants when there was work in

lands and their farming suffered.Moreover when some of the elephants escaped the palis

and paiks were ordered to bring back them or pay Rs 1000 for each elephant.The

hilltribes proclaimed the elephant headman as their king and killed entire army and

confiscated all elephants of the emperor.It was not a Hindu versus Muslim rebellion

because Balabhadra the Divan of Mirza Nathan was the tyrant who was strongly opposed

by Bhaba Singh a Kutch noble and brother of Raja Parikshith Narayan who had earlier

been deported by Mughals.The fact is that the revolt was by ordinary people belonging to

lower strata of society ,a group of Machwagiri or fishermen who had built a fort over

Goalpara .That means all the chiefs were not from upper caste and all the forts were not

built by upper castes and the revolts had a basis on whether the land and its products and

also the dignity of its sons and daughters were touched. These happened even before

British rule and much before Pazhassi Revolt of Kerala which has a similar background.

Paiks were peasants who worked as soldiers and armed retainers also. In return for

service in army they are given arable land free of revenue and the land is called Paikan or

Chakran.The labour was revenue so that the peasants need not pay any tax. Receiving

land in return for military and other services was custom. Land was given to 140 families

in Kuch Bihar who were votaries of a common temple, among them most important

being blacksmiths,weavers,messengers,panegyrists etc.Even during Shah Jahan reign we

find these people being given jagirs .The soldiers are paiks,the land for their livelihood is

paikan,and they were also doing service in capturing and driving elephants (Abdul Hamid

Lahori ,Padshah Namah ed Moulavi Kabiruddin ,Moulavi Abdur Rahim Bibliotheca

Indica vol 11 Calcutta 1867-8 pp 71 Q pp 51 ibid) From every house 1 out of three

people were taken to services of the king as soldier . Each family is a Gote(Gothra?) and

by rotation each of the 4 members of a gothra becomes a paik or soldier and the other

three does the other jobs like looking after farms,and other activities. In Pre-Mughal days

of King NarNarayan this Paikhan system was established in Assam .Each soldier was

given 12 Bighas of land for cultivation. The Kari among the people were considered

inferior with lesser privileges and Chamuas were skilled artisans and they need not go to

war and had more privileges. Kari could enter the soldier group and higher status but

were still considered lower in status .That is the difference between Kari and Chamua is

that the Chamua need not pay labour service and were more like the Bhadralok of

Bengal. They were more involved with arts ,sciences and administrative role .The

situation is comparable to Kari of the Sangham period in Tamil literature and the Sami or

Samana people (who later became the Brahmins ).The Panchajana concept of the Vedic

people and the importance of the village economy based on this persisted till

Independence at least in some places of India without interruption.

South India had joint land lordship with distinct and important roles of offices of states

located in or near the village. Two offices which were critical and universal were the

headman (janmi/mooppil)and the accountant (kanakkaayaan/aasaan/guru).Revenue

collection, keeping accounts of land ,investments in agriculture ,like irrigation ,co-

operative farming facilitation are their duties .

The uniform tax which British insisted on all cultivators of British India was not

practicable simply because of the different climatic and geographic conditions, different

fertility and productivity and crop systems and therefore it was a regressive system. When

the Government took away the entire surplus the market for mass consumption goods

was severely restricted .Subsistence consumption was from the village collage industry

and that too was taken away and the slash and burn cultivation was prevented by law and

people were denied access to forests for their sustenance food from there by the forest

laws. Thus the people were starving and when a famine came there were no stores for

them to survive and the Government did not know what to do .

How was the revenue share in produce managed by the earlier villages ?It was used for

village administration and consumption needs of the villagers during times of need like

natural calamities and for the consumption needs of the non-agriculturist families of the

village who do kazhakam or vaaram for the village ,and the artisan class. These included

several groups from the chaamar to the village accountant and the warriors who guarded

the passages of land transport in mountain passes etc .The aasaan or teacher and the king

also were given wages out of it .Temple administration, education of village ,and

accountancy services for village and the revenue staff and warrior class of defense were

all paid with this. When British insisted on cash the people had to sell it at low prices and

give entire amount to the British. The old transport root defenders called kallar and the

people of the mountains and forests had lost their jobs, their shifting cultivation practices

and even the access to forest products .The rural profits from raw cotton ,raw silks

,indigo,sugar,salt and saltpeter trade were blocked by the mercenary trade of the new

ruling class .The entire sustenance ,revenue ,barter ,sharing and customary system of

living was upset .The network of transport by pack bullock carts and boats and ships to

distant lands were under the British so that they could not carry out their trade which they

were doing for millions of years without any obstruction and people did not know what

was happening to them. The share of crop as revenue was a kind of insurance the people

had against famine offered by the temple and big landlords/chieftains to both the

cultivators and artisans and also to themselves when the crop fails. This was lost .The

pre-colonial exchange of crops and forest produce was for labour,manufacture and also for

surplus production for sale .This vary between regions especially in rice and wheat

producing areas. By 1750 the system weakened

The janmani system introduced by British and accepted later by nationalist Government

with an intention of making the village integrated ,self-sufficient ,egalitarian made it also

commercial and opposite of what was intended. Egalitarian was a myth since inequality

has increased over the years. The poor have become rich ,one may argue but the rich has

become too rich keeping the ratio and gap deep.

The village economy of agricultural India depended on barter, customary dues, production

of manufacture for local consumption, and for distant trade, specialization in each craft/job

later called by the British as caste system of India and this system crumbled in 19th

century by the abovementioned policies.

What were the village industries ?

These were done by collective specialized artisan families who were either part-time

cultivators or fulltime artisans. Textiles of coarse and fine cotton and

silk,pottery,agricultural implements of wood and iron,sugar called chakkara(from which

the word saccharin was coined in English language)leather ,oil ,gold and silver works

salt,saltpeter ,indigo and alloy metals were done by part-time and fulltime artisans and

widely traded .Ivory ,musical instruments, toys ,spices, medicines and herbs and mats and

baskets of reed and palm leafs were prevalent. The crafts were protected as agriculture in

two ways .

1.consumption/markets

2.from piracy

High quality goods were met with high rewards and incentives. The karakkana or

karkkana(factory of handicrafts)existed in India from antiquity .The guild of such people

worked and moved as a gana or kulasangha and each branch settled in a neighboring

village so that every one can have an assured number of customers and they had an

endogamous breeding system to protect the races. The place for the artisan family was

specified in each village alike .(A general lay out of plan for village and town existed).In

the west and east coast shipbuilding was an extra industry.