The chapter, along with a discussion on India’s population size, and estimates of mortality based on the decennial censuses from 1872 to 1951, reviews at length the factors that explain virtual stagnation in population size during most of the decades. Lack of growth in India’s population from 1872 to 1921 was a result of high mortality due to the spread of epidemics such as cholera, plague and malaria. Their etiology and spread were not fully understood. As a result, the measures taken by the British Raj could not bring deaths under control. Also, recurrent famines – widespread or localized – caused food shortages that resulted in starvation deaths and the spread of water-borne infections during post-famine periods when rains arrived. The period between 1921 and 1951 witnessed modest population growth and the onset of slow but steady decline in death rates. The decline is attributed to control over famines, mass vaccination against smallpox, some improvement in sanitation and an increase in health facilities, mostly in urban areas. However, malaria and diarrheal diseases continued to take a heavy toll when India became independent in 1947.

When colonial rule began in the mid-nineteenth century, India and Britain were both poor by modern standards, although Britain was somewhat richer. In 1947, when colonial rule ended, the gap between the two was gigantic. Britain was a sophisticated and wealthy economy where per capita income, health and education had improved dramatically, whereas India was still exceedingly poor on all these metrics. India’s economy changed over 200 years: it was far more engaged in international trade, a modern industrial sector had developed and railways criss-crossed the country. At the same time, productivity was low in all sectors of the economy, especially in agriculture. Life was precarious: as late as 1943, a devastating famine took millions of lives in Bengal, a horror that indicted colonial rule. We introduce the reader to this complex story of transformation without enrichment, briefly commenting on how each chapter fits in the narrative.

Trade and finance together formed the third-largest livelihood type in colonial India. These two activities were interdependent because banks and moneylenders mainly financed commodity trade. The combined share of the two activities rose significantly in national income in the early twentieth century. Behind this growth, the expansion of transport infrastructure and an open economy with few barriers to foreign trade were responsible. It was not, however, a business without friction. A great deal of the historical scholarship around these activities asks how environmental risks, information asymmetry, law and politics shaped the decisions of merchants, lenders and firms, as this chapter shows.

This chapter deals with the aspects of political economy in British India from c. 1850 to c. 1950, focusing on the major debates and controversies about economic policies, which concerned the role of the colonial state and its implications for British imperial policies. British India had wider economic relations with surrounding Asian and African regions, located as it was within dense regional trading networks, as a hub of transactions of goods, money, people (migration), services and information. Through the development of global economic history, new works and interpretations are presented as a new paradigm against the traditional Eurocentric approach. Using recent works by Asian and Japanese scholars, this chapter analyses a changing economic shift from trade to finance in British India and the transformation of the economic international order of Asia and the role of India in the interwar years, with a special focus on the drastic impacts of the Second World War.

The chapter emphasizes three aspects. First, it points out that, in the colonial period, Indian entrepreneurs were able to establish industrial enterprises in the cotton, jute and iron and steel industries that competed successfully in domestic and overseas markets. Second, it argues that the fact that Indian industrialization emerged from the bazaar economy facilitated the entrance of Indian capitalists into manufacturing and provided them with an advantage for accessing interior markets. The chapter also explores why Indian enterprises failed to engage in highly specialized areas such as the electrical or the pharmaceutical industries or the manufacture of cars, ships or aeroplanes until the mid-twentieth century. Third, the chapter argues that it would be short-sighted to merely focus on the subcontinent or on Indo-British relations when examining the economic development of India in the colonial period. Rather, it points out that Indian economic history needs to be examined within a global framework.

Located on a large delta, eastern India confronted a series of ecological challenges in the previous centuries – from the filling up of marshy lands to deforestation. But its developed state of agriculture and handicrafts placed it at the forefront of the country’s economic development, attracting foreign traders to settle therein, and finally to establish their rule in this region. But the question is: how did its economy perform during colonial rule? Indeed, the economic environment that it confronted was not always conducive. Initially, it received a boost from the trading activities of the Company. But later on, an uncongenial environment followed, ruining its age-old industries. Also, many opportunities emerged, thereby giving rise to many modern industries. The chapter seeks to highlight how eastern India’s economic development was shaped during colonial rule. Apart from agriculture and industry, it discusses the development of transport facilities, and also demographic issues, including migration.

Agriculture was the main pillar of the Indian economy under British rule. Production increased in the second half of the nineteenth century, when the agricultural area expanded, the cultivation of cash crops spread, irrigation networks were extended and export of agricultural commodities increased. In the first half of the twentieth century, production stagnated as room for further area expansion vanished, technical breakthroughs to enhance per-acre yield were limited, and the public investment in infrastructure lost its momentum. Bengal and eastern Indian areas experienced the most stagnation, while Punjab and Madras continued to grow with improvement in land productivity, including shifts to higher-value-added crops. Nevertheless, on average, the absolute level of land productivity of major crops in colonial India lagged behind global standards of that time. The chapter suggests that limited resource endowments constrained by inadequate technical breakthroughs and institutional constraints, such as the structure of land rights, were the main causes of stagnation.

This chapter offers a global perspective on Indian education in the colonial era. Indian literacy was significantly below Western Europe in 1800 when adult English literacy (53%) was ten times higher than that of India (estimated to be 6%). While schooling and literacy increased between 1870 and 1940, improvement in India was small compared to the rest of the world. Low income, low fiscal capacity and being a colony all constrained colonial India’s ability to expand mass education, along with norms, for example, that undervalued female education.

This chapter discusses the employment of poor and labouring women between the mid-nineteenth century and the mid-twentieth. In this period, they suffered first a loss of their independent occupations in manual manufacturing and then exclusion from mechanized large-scale industry. This marks the beginning of a persistent and long-term pattern of low female workforce participation in India. The discussion is organized around multiple themes of marginalization, quantitative and qualitative: first, the question of numerical decrease in household industry, craft production and the small-workshop sector; second, the ideological exclusion from mills and mines, which were emerging as preserves of adult men earning family wages; third, resistance to women’s long-distance employment on contracts in plantations, which was perceived as a challenge to familial control over their labour; fourth, commercialization of women’s reproductive work in sectors such as midwifery, domestic work and sex work, providing increasing employment but under stigmatized conditions. These themes are linked to questions of regulation by family, caste, community and the state.

This chapter describes the financing and building of Indian railways, the largest infrastructure investment of the colonial state, and assesses their economic effects. Due to the poor quality of pre-rail transport, railways integrated markets, reduced price dispersion and increased incomes in colonial India. Net earnings as a share of capital were low in the first wave of railway construction and operations because of moral-hazard problems. As the Government of India took ownership of railways from private British companies, working expenses decreased and net profits improved with no negative effects on productivity. Yet the government did not always maximize their railway profits, opting to purchase more expensive British locomotives over cheaper alternatives. Despite these shortcomings, railways were a unique sector of the colonial economy. By the twentieth century, railways were delivering significant tax revenues to the Government along with higher incomes to the country.

This chapter documents the long-run pattern and changes in sectoral labour productivity in India. It explores factors that can explain the historically high labour productivity in services. Literate upper castes in service sector occupations gained from modernization from the late nineteenth century and moved into new high-skilled occupations mainly in services. Colonial education policy prioritized secondary and tertiary education and the higher education bias that continued after independence increased labour productivity in skilled occupations, most of which were in services.

Soon after the establishment of British colonial authority, south India underwent institutional changes in the administrative, military, educational and other spheres. In the countryside, the furthest-reaching of these changes was the introduction of the raiyatwari and zamindari land settlements, which granted a particular class of people in rural society exclusive landownership. The period covered in this chapter, 1850–1950, saw the consequences of these early institutional changes unfold and the emergence of new processes in the urban and service economies, including in transport, trade, finance and industry. The chapter discusses these general trends, paying particular attention to the countryside.

South Asia’s economies, as well as the scholarship on their economic histories, have been transformed in recent decades. This landmark new reference history will guide economists and historians through these transformations in Bangladesh, India and Pakistan. Part 1 revisits the colonial period with fresh perspectives and updated scholarship, incorporating recent research on topics such as gender, caste, environment and entrepreneurship. The contributors highlight the complex and diverse experiences of different groups to offer a more nuanced understanding of the past. Part 2 focuses on economic and social change in South Asia over the last seventy-five years, offering a comprehensive view of the region’s historical trajectory. Together, the contributions to this volume help to reassess the impact of colonialism through a more informed lens, as well as providing analysis of the challenges and progress made since independence.

By the end of the nineteenth century, British-ruled India faced an ecological crisis due to the extension of cultivation, deforestation and desiccation. Famines since the 1870s had led to a decline in population in some regions. While colonial authorities attributed the famines to climatic factors, others held taxation, institutional reforms and economic policies responsible for these disasters. Colonial science emerged as a significant tool in managing and monitoring environments at the same time. The chapter examines the interlinked economic and ecological history of India in these times and the responses by the British imperial authorities and scientists to the perceived crisis.

Several themes shape the historiography of economics in western India in colonial times, including the history of ryotwari land tenure, international factors like the growing engagement of agriculture with the world markets via cotton exports, dependence on monsoon agriculture and the outbreak of famines and epidemics, and the industrialization of Bombay and Ahmedabad. Although these processes may seem disparate, there were also deep connections between them. The chapter offers an economic history integrating these processes, and shows how western India in the colonial period saw significant innovation and entrepreneurship in industry, in the broader context of an economy that remained largely agricultural, with low productivity and high risk.

The chapter describes colonial India’s unique urbanization story. In 1750 India had big urban centres such as Hyderabad and Delhi and urbanization was close to the global average. While urbanization in India increased over the next two centuries, the increase was small compared to the rest of the world and Indian urbanization had fallen significantly below the global average by 1950. Yet the modest temporal change masks the important shift in urban centres from inland in the 1700s to the eastern and western coasts by the 1900s. As British rule expanded, the port cities of Bombay and Calcutta emerged as the new centres of administration, trade and commerce. More generally, cities close to railways grew faster than cities close to rivers. Unlike rural India, colonial towns and cities were characterized by more educated residents, more industrial and service sector jobs, male-biased sex ratios and growing political influence.