An Indian Economics?

Historical Background

When the East India Company, and later the Crown, established peace under a single paramount power, India was confronted, for the first time in its history, with a foreign power that set the economic agenda to suit the long-term interests of the ‘home’ country. The short-term economic interests of Britain had to be balanced against the need to maintain peace, keep costs down, ensure that British strategic interests were met and, especially after the events of 1857, secure the support of influential groups within the country. As a result, the door was opened to a dialogue with educated Indians on economic and social policies. This was an unequal exercise, as the monopoly of decision- making remained with the colonial power, which could in many cases ignore or override Indian opinion.

Indians nevertheless engaged in this dialogue, partly to try to convince their imperial masters of the need for policy changes and partly to get their compatriots to understand what was holding back Indian development. By the early twentieth century, the debate was best carried out using familiar and generally accepted theory. This made it much more difficult for the government and their sympathizers to refute the arguments of Indian economists who could also draw support from their teachers and counterparts in Britain and elsewhere.