History of Indian Economy (Set of 8 Books)

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About the Book

Book 1: Historiography, Environment and Economy

Book 2: Emergence And Structure of Complex Economy

Book 3: Early Medieval Economy and Its Continuities

Book 4: Expansion and Growth of Medieval Economy-1

Book 5: Expansion and Growth of Medieval Economy-2

Book 6: Trade and Markets

Book 7: The Rural Economy

Book 8: Craft Production Technological Change and Industrialisation

Book 1: Historiography, Environment and Economy

The present Block is a historiographical study of the history of Indian Economy. It takes into account the prevailing debates, issues, themes and trends pertaining to different aspects of economy. The diverse sources for the early historical and early medieval periods require different tools of analysis. For early historical period, we rely heavily on archaeology, while epigraphic and literary evidences begin to increase during the early medieval period. The Mauryan period saw the emergence of an economy dominated by the overarching imperial formation. By contrast, the dominant feature of the post-Gupta economies was their pronounced local and regional character. System of land grants and tendency of sub-assignment, decline of coin money led, according to the dominant view, to the emergence of feudalisation of Indian economy. This formulation, however, is hotly contested by a number of scholars and the debate continues. Unit 1 is an attempt at a survey of the various trends in historiography. We are providing at the end of the Block a historiographical survey done by Professor D.N. Jha, 'The economic History of India upto AD 1200: Trends and Prospects'. Kindly read this along with Unit 1.

The debates on pre-colonial Indian economy largely remain the contested domain of 'Marxists' and the 'Revisionists'. Unit 2 deals with writings, debates and prominent themes concerning village community, nature of taxation, peasant proprietorship, oppression of peasants, technology, role of the state, and rural-urban linkages.

Unit 3 traces the historiographical trends beginning with the colonial perception of Indian economy. While the colonialists defended the British policies; nationalists held colonial rule responsible for impoverishment of India. Marxists were equally critical of the British policies and held them responsible for drain of wealth from India. All these debates find place in Unit 3. The Unit also takes into account the new issues covered in recent writings -forests, labour, women, tribal societies, irrigation, etc. Unit 4 provides you an overall understanding of ecology and environment of India to facilitate the study of history of Indian economy.

Book 2: Emergence And Structure of Complex Economy

This Block deals with the history of Indian economy over a long span of time, tracing several significant stages of change, The first major change, which significantly altered the way of human life, began with the cultivation of edible plants and domestication of animals for various purposes. This change implied the shift from having to search for food to the production of food, organisation of human social groups around the process of production, adaptation to a new kind of environment where plants giving food could be cultivated and where domesticated animals could survive and multiply. The change also implied that in order to live in one place human groups had to start constructing dwellings and other kinds of structures, start using new kinds of implement or tool and start inventing new items for use such as pottery and other craft items. Since the emphasis came to be more on producing food and therefore essentially living in one place, new kinds of contact had to be established with other areas and other social groups for obtaining various items required for the society, but not available locally. There were many other changes around this change, including the emergence of social differences of status and wealth within each group.

You will see that although this change first occurred in the north western part of the .subcontinent about 8-9000 years before our time (see Unit 5). Other parts of India did not start producing food till much later. One must therefore remember that changes in economy, particularly in early stages, do not appear simultaneously at all places. It must also be remembered that in early food producing economy, other activities such as hunting, food-gathering and similar pursuits continued and were never completely abandoned.

The appearance of big cities, or the slow movement towards urbanisation, for the first time from about 4700 years ago (see Unit 5) marked another kind of change, following the emergence of food production. First the appearance of cities took place in a context in which metal implements, of copper and bronze, became more important in the production process than stone implements, although some types of implements in stone continued to be in use. This phase of change, known as the phase of Harappan civilisation did not mean that people everywhere lived in cities. Cities were large places or settlements where many groups of people lived and the range of economic activities was vast. Cities also were places which controlled and coordinated activities over a vast area including areas of other civilisations like Mesopotamia in Iraq (see Maps). There were at the same time small towns, village settlements and very small settlements which were used for manufacturing particular items.

The urban economic activities of Harappan civilisation declined from around 1800 BC, but you will read (Unit 6) that even much earlier farming communities had begun to emerge in different parts of the subcontinent and some of them were in contact with the Harappan civilisation. In fact the history of the emergence of agricultural communities which combined various types of economic activity -through the Neolithic, Chalcolithic and early Iron ages between around 7000/6000 BC and the close of the second millennium BC -is crucial for understanding the basic pattern of Indian economy, with farming village as its primary unit. How these dates are calculated can be studied in the glossaries

of terms at the end 'Of each Unit.

The cities of Harappan civilisation and the complex social and political organisation which generated and coordinated this urban growth may have declined, but a new phase of complex social and political organisation giving rise to new cities and towns can be seen in the period beginning approximately from the 6^th century BC. In Unit 7, different aspects of this new pattern of economies and their organisation have been discussed. Again, one must remember that all people were not living in cities or towns. There were vast stretches of forest in which forest dwelling communities lived; they were subordinated by kingdoms and empires. Their resources were highly valued. The countryside called janapadas was where most people lived and practised agriculture, cattle keeping and craft manufacturing. There were many areas of pastoral communities as well. When a major empire like the Mauryan empire arose towards the close of the 4th century BC it had to coordinate these different forms of economic activities as also the activities of trading communities who were financing and participating in acquiring goods which the society considered useful or valuable. These were then sold at various points of commercial importance. It is therefore in the period around 5^th -6^th century BC that we first see the use of coins in metals.

Unit 7 makes a comparative study of 4 major empires of early India. You will notice in the maps that these empires did not occupy the same areas. Therefore, the resources of the areas they controlled and the nature of the ways they acquired these resources varied. For various reasons explained in the Unit, political organisations of the forms of states and empires had to oversee production and allocation of resources. The emphasis on particular resources or the other, the ways they were acquired and allocated for different social groups implying that there were sharp in equalities in access to resources are points to remember in this on text. It needs also to be remembered that kingdoms and empires did not necessarily determine the nature of resources; it largely depended on what the society as a whole produced or acquired at that particular stage of history.

Units 8 and 9 deal in some detail with economy of the period approximately between B~ 600 and AD 300, both in northern and peninsular India. The information provided in these Units will sometime overlap with what is available in the Unit on the economy of the empires. This is because of the fact that of the 4 empires, 2 (the Satavahanas and the Kushanas) existed within this period. However, there are special reasons for treating this period separately and in some detail. A look at the maps will show you that the geographical area of the Indian subcontinent had in this period most extensive contacts with the Mediterranean world, Central Asia and China and also with Southeast Asia. Apart from various other historical dimensions of these contacts, in economic terms they meant movement of peoples, movement of various items of commercial goods and expansion of trade and urbanisation on an unprecedented scale. This is evident from the richness of archaeological, epigraphic, numismatic, textual and other kinds of historical source material cited in these Units.

To what extent the pattern of economy in a later period was similar to or different from the pattern suggested in these Units will be the subject matter of the next Block.

Book 3: Early Medieval Economy and Its Continuities

The shape of the economy which developed in different regions of India, through centuries between the middle of the 1 st millennium B.C. and third century AD, is now more or less understandable. The main features of this economy were: an agricultural base with villages accommodating the majority of the population, the significant presence of towns and cities which performed many more functions than agriculture, the practice of a wide range of crafts both in villages and cities and an extensive network through which commercial activities were carried out. Numerous coins minted in this period in different parts of India bear testimony to this. However, this does not mean that other forms of practices through which human communities derived their subsistence came to be abandoned. There were still groups of hunter and gatherers, tribes practising simple agriculture and collection of resources from forests; there were coastal fishermen communities all along the coast; there were even highway robbers whose practice was plundering of goods. Beyond where simple economic practices continued, the crystallisation of complex economic systems meant that human society was sharply divided among unequal groups, some with excess of resources and others, the majority, with very little to survive on. The appearance of the state with the king or the emperor at its head, the officials of various ranks, the priests and Brahmins in general meant that as belonging to elite groups they did not engage in production of resources for the society. Revenue system ensured that a large share of the resources of what was produced came to them. Those who produced or exchanged the different produced items were themselves of different groups. At the bottom were dasas or slaves, karmakaras or workers working on a small wage, chandalas or untouchables, sudras or servants or small cultivators, whereas big farmers (including Brahmin farmers) and big merchants (Sresthis) were extremely rich. The majority of the craftsmen like blacksmiths, potters, leather workers, whether in cities or in villages, were also poor.

Did this pattern of economy, which accommodated so many practices and so many economically different human groups, undergo a major change in the post-300 period? To the students of economic history of early India, an answer to this question is very important because some well-known historians have agreed that post-300 India did go through major changes in its economy, and, in fact, an answer to this question has assumed the form of a debate among historians. What you are going to study in the next few Units of this Block, which covers the time span between roughly AD 300-1300, starts with a statement of this debate.

Those who advocate a sharp change in the pattern of economy after c. AD 300 do so because they argue that land, which was the basic requirement for producing resources for the society and wealth for the state, became the basis for drastically different relations between human groups in the society for a variety of reasons. This new pattern of agrarian relations has been characterised as Indian Feudalism, although many historians, like D.D. Kosambi do not use the term Indian Feudalism. This feudalism had many features; it was village-based, local in character; extensive trade networks connecting towns and cities and extensive use of metallic currency were absent in it. Since local lords and landowning religious institutions now controlled agricultural economy the power of the state was weak and dependent upon the support of these elements.

Many historians, while admitting that early medieval economy was in many ways different from early historical, do not accept the "feudalism" hypothesis because of the way it has been constructed. This is not merely a question of the weight age of evidence. Land being the main source of wealth in all early agricultural societies, it was not a question of urban, monetised economy being transformed into rural economy. Whether there was really a major reorientation with regard to relations over control in land should be the basic question. There cannot be any doubt that there was vast expansion in agrarian space, that artificial irrigation figures prominently in the context of cultivation and that different types of exchange networks emerged in the early medieval period. All these important changes which characterise the economy were the result, it has been argued, of important changes taking place in various local, sub-regional and regional levels. The increasing focus on the slow transformation of regional economy is thus to be seen in studies on early medieval economy. This is argued as the main basis of change in economy. In the Units that follow, precedence has been given to the 'Indian Feudalism' debate, and you will understand why characterising any economy as 'feudal' or not-feudal is not a simple issue. The Units are written to give you a synthesis of how rich the source material on early medieval economy is and how different areas of economic activity constitute a total pattern. The Units also intend to give you an idea of the special traits of economies of different regions.

Book 4: Expansion and Growth of Medieval Economy-1

Units 16 to 20 seek to trace out the most significant facets of Medieval Indian economy and to evoke images of life in medieval India's villages, townships and cities, though in the barest outline.

Considering that all medieval economies around the world were essentially agrarian in nature, it is understandable that agriculture in its various dimensions should occupy the largest space, the first two large Units, in this picture. We begin the story with agricultural production, itself a multi-dimensional problem.

Static, or at least slow moving, as the picture of agricultural production in history might appear, it is nonetheless a story of great dynamism where new crops are constantly being experimented with, new techniques employed and new areas brought under cultivation It is also a story ofkeeping an ecological balance intact, any serious disturbance of which would bring stiff retribution from nature. It is a story of human organisation in its interaction with nature; therefore peasants as individuals and as communities, the social stratification, the state as the embodiment of ultimate institutional power, all these enter the story to make it comprehensive.

From agriculture we move on to other areas of the economy, collectively and traditionally, although rather unsatisfactorily, designated as 'Non-Agricultural Production'. Some of these have a direct relationship with agriculture in that the raw material is derived from it. Textiles, silk, indigo, sugarcane and edible oils belong to this group. Another group is quite independent of any relationship with agriculture: Gold and silver, metals and metallurgy, diamonds and gems, and not least iron. There is besides the massive building construction industry. Unit 18 deals extensively with these sectors of non-agricultural production. It goes beyond description of the production processes in these sectors, and takes up questions closest to historians' hearts, i.e., society's interaction with the processes of production and thus the social organisation of these processes.

Unit 19 turns exclusively to the relationship between the State and the Economy, mediated through the question of taxation Agriculture being the chief activity of economic production in the pre-modern age, it was also the chief source of the state's revenue. The legitimacy of the collection of revenue was constructed on the ground that the state provided security, so essential for carrying the processes of cultivation through. The collection of revenue was generally carried out through an elaborate and multi-layered mechanism, the one essential objective of which was to let the rich and the powerful subsist in luxury paid for by the labours of the poorest of peasants. Clearly then this was a scenario of constant tension among the various layers of the revenue payers and revenue collectors, tension which expressed itself in many different forms.

Unit 20 deals with an adjunct to life in the countryside, i.e. life in the urban centers, albeit all-too-briefly. Ever since the Belgian historian, Henri pirenne, in the 1920s and 30s focused upon the town and trade as the chief dynamic forces in contrast with rural economy, which he perceived as 'self-sufficient' and therefore unchanging, the relationship between town and country has been a running theme for debate among historians. The Unit discusses this question too and then moves on to other themes more specific to Medieval Indian data.

If one major lesson comes through all these Units, it is that history and historians do not have one single answer to questions. Diversity of views is the very soul of our discipline. As students of history, we should learn to cherish this diversity.

Book 5: Expansion and Growth of Medieval Economy-2

If by some miracle you had been a student of medieval history at a University some half a century ago, the history you would have learnt would have been along the following lines: the question of technology would probably not be part of your course; if by some chance it was, the absence of any major technological change would have been emphasised. Consequently static productivity and production levels in agriculture as well as crafts would have been a standard lesson. Following the pattern, trade would have occurred only as small scale transactions where craftsmen with limited means and small traders carried on with their petty businesses in a predominantly agrarian economy. The question of money would not have become a very serious question and the means of transport and communications might have been discussed as an exotic theme rather than as part of the functioning of the economy. And of course, the eighteenth century was best ignored because with the decline of the Mughal Empire supposedly after 1707, the year Aurangzeb, the last 'great Mughal' died, nothing of much interest remained for the medieval historian and for the modem historian, their part of history began with 1765, after the battle of Plassey.

Today, a half century later, historical perspective has undergone sea change. All the Units in this Block bring home the rapidity and depth of change in almost every sphere in medieval India, as in other periods of history. The Unit (21) on 'Inland and Maritime Trade' highlights the centrality of India in the medieval trading world which extended to all directions. The arrival of European trading companies in India was just one dimension of it, important as it was. And trade was constantly modifying the levels of productivity and production as any dynamic economy would. The Unit establishes the vibrancy of the Indian trader to face the challenges of what until some time ago were seen as the more 'advanced' business practices of European companies and to stay in business.

The next Unit (22) on 'Business Practices and Monetary History' puts together evidence of the most sophisticated business practices in medieval India, be it partnership, brokering, money lending, money changing, insurance, bills of exchange, etc. Joint stock companies were, however, still to develop. The developments in most of these business practices were of long duration and deep. Various institutional frameworks were deployed to generate and accommodate these changes: the state, caste organisations, regional groupings, etc.

The Unit (23) on 'Technology and Economy' takes in a wide sweep of the arena and locates tremendous dynamism and constant change in it. Technological change is the driving force of economy; it both creates, and responds to, growing economic demands in a society. The question of development of scientific concepts and theories, however, still remains an open area.

If agricultural and non-agricultural production were growing rapidly as was trade, both in land and maritime in these commodities, clearly transport and communications had to grow at the same pace. The next Unit (24) is on this theme.

The last Unit (25) takes us through the many by lanes of the raging debates among historians on the eighteenth century in Indian history. Suddenly, all the existing notions about this century -that it was a century of political, economic, moral and cultural decay -appear suspect. Instead an extremely variegated, multi-hued picture emerges which defies a single characterisation. That makes it the historian's truly dream century.

Book 6: Trade and Markets

This Block discusses the history of trade and traders in the colonial period. Unit 26 focuses on merchants and markets in the first century of British rule. To explore the specific nature of shifts that occurred in this period, 'the chapter begins with an account of developments in the seventeenth century. From the extensive research on the subject, we now know that traders in pre-colonial India did not operate only in the margins of society, working with small amounts of capital, dealing in a limited range of goods, buying and selling within the small confines of local society. A hierarchy of trading links connected the port -towns to the hinterland, the villages to the qasba and the larger urban centers. Hundis enabled complex transfers of commodities and capital across vast distances. This vibrant network was sustained by trading communities who, in fact, wielded considerable political power in different regions. All this changed in significant ways in the eighteenth century. The weakening of the central power, the growth of regional formations, and the outbreak of peasant rebellions disrupted the flow of intra-regional trade. The expansion of British private trade and shipping displaced local traders and undermined the indigenous shipping industry. This Unit discusses these changes in detail, shows the pattern of early colonial trade, and the dissimilar histories of different trading regions. Eastern and western Indian, Bengal and Surat tell us contrasting stories of colonization.

Unit 27 takes us into the subsequent phase of colonial history (1857 -1947), a period that witnessed dramatic changes in the pattern of trade. There was a general boom in the volume of trade and India became integrated to a wider network of multilateral exchange between Great Britain, United States of America and Japan. While the Exchange Banks and international exporters consolidated their hold over the commerce of the country, at another level we see the operation of a vast network of traders that forged the links between different regions and connected the villages to the international markets. This chapter focuses not only on the flows of international trade but also on the traders who operated in the bazaars, and the peddlers who extended the market into the countryside. It analyzes the long-term trends in trade, as well as the shorter-term fluctuations. It discusses the changing composition of the trade over the period along with the shifting fortunes of different community of traders -Chettiars, Marwaris, Shikarpuris. It helps us understand what colonialism meant for trade and traders.

Book 7: The Rural Economy

This Block focuses on rural society and economy. It looks at forest, tribal and agrarian economies and tracks the changes within them over the colonial period.

It begins with a chapter (Unit 28) on agrarian policies and lands rights. Through the agrarian policies the British sought to establish power in the countryside, reorder society in accordance with their vision, and create structures that could both supply agricultural commodities for the market and revenue for the state. There was however no official consensus on how colonial priorities were to be best attained. Officials in India operated with a diverse range of conceptual ideas, related to the intellectual traditions in Europe in varying ways, and reacted differently to local societies in India. So we see a continuous debate over agrarian policies and frequent shifts -within them. This Unit discusses these shifts in colonial policies and analyzes their implication for local society. It shows how the impact of these policies varied in the dry and wet regions, and between tracts with different forms of revenue settlement, but some general trends became characteristic of the colonial rural landscape. Everywhere existing rights were redefined, differentiation within local society deepened, smaller holdings increased, migration streams oflandless peasants became common.

Unit 29 looks at the history of commercialization of agriculture. It locates the changes in the colonial period within a longer history of commercialization, tracing the narrative back to the pre-Mughal period. It shows that by the time of the Mughals this commercial economy was highly developed But this pre-modern commercialism occurred within a context where strong territorial boundaries were yet to develop: the landscape was mobile, boundaries fluid, allowing people and goods to move with ease over space and cultures. This chapter discusses the changes that came about when this mobility was sought to be contained, when territorial boundaries become important for governance, and when colonial needs began to determine the trajectory of commercialization of agriculture.

Unit 30 and Unit 32 look at the changes beyond the landscape of settled agriculture. F or long historians read the history of rural society as a history of the peasantry. It was commonly assumed that under colonialism India became a producer of agricultural commodities and importer of manufactured goods; and to understand this process of colonization we needed to look at the revenue settlements, their impact on agriculture and the nature of commercialization of agriculture. The history of forests and commons, tribals and shifting cultivators, pastoralists and nomads, never entered the pages of history. In recent decades historians have turned from an exclusive focus on intensively cultivated tracts to forests, from wet areas to dry belts, from the plains to the hills, from peasants to tribals. Unit 31 here traces the changes within the tribal economies, analyses their diverse histories, and critiques the common stereotypes about them.

Changes in rural society are critically shaped -but not entirely determined -by demographic histories. Rates of population growth in many ways define the nature of pressure on agriculture, the logic of partitioning and fragmentation of holdings, the calculations of the peasant households, the per capita food availability within society, the levels of income and well being. The pressure of population operates within economic, social and political contexts, but these historical linkages cannot be grasped unless we first understand the nature of demographic regimes in different regions and the rhythms of demographic history. Unit 31 offers an analysis of the patterns of population change in the colonial period.

Book 8: Craft Production Technological Change and Industrialisation

This Block will explore the changes within the non-agrarian sector in the colonial and post-colonial periods. We will see what happened to the cotton weavers and tanners under colonialism, and how industrial capital developed in the twentieth century. We will discuss how post-colonial development became linked to the idea of planning, and how the era of planning gave way to the age of liberalization.

Two units in this Block (Units 34 and 35) look at the history of small-scale production. The fate of artisanal industries under colonialism has 'been the subject of passionate and polemical debates since the nineteenth century. If colonial officials told us stories of growth and expansion under imperial tutelage, nationalists produced narratives of loss and suffering, death and destruction. The plains of Bengal in the late eighteenth century, we were told, lay bleached with the bones of artisans. Unable to survive under the rapacious regime of the East India Company, cheated of a fair price for their products, thousands died of famine and starvation. This was an imagery that captured the mind of the people, underlined with dramatic effect the brutality of colonial intervention, and aroused righteous anger against British rule. Today we need to rethink these images, scrutinize the assumptions on which they are built and the evidence on which they are founded. To do this we need to question not only Imperial narratives that discovers everywhere only evidence of growth, but also the simple nationalist counter narratives that can see nothing but impoverishment and decline under colonialism. We need to recognize that colonial rule impacted in different ways in different regions within different sectors; and that local workers and artisans reacted variously to the new contexts of their lives. But in revisiting these old debates we have to be wary of replacing once again pessimist teleologies of suffering and decline with optimist teleologies of growth and increased well being.

Unit 34 charts the debate on de-industrialization from its nineteenth century origins to the present. This debate has taken four different forms. First regarding the data. Historians have considered whether the twentieth century Census figures can be used to examine the changes in the work force and calculate the decline in the numbers employed in industries. And if the argument is to be premised on quantification, then what kind of data can be used to measure the shifts in the work force in the pre-Census period? Second regarding chronology. If there was de-industrialization, when did that happen? Was it in the early or late nineteenth century? Or was it in the twentieth century? Third: historians in recent years have tried to shift the debate away from consideration of general trends to the specificities of regional experiences, mapping the differential patterns of decline in different regions. Fourth: this shift in focus to particular histories has also led to careful inquires into the varying developments in different industries. While Unit 34 maps the entire debate, Unit 35 examines more closely the internal changes within the small-scale industries.

Unit 36 shifts the focus to large-scale industries. From a discussion of what happened to artisanal industries and handicrafts, we move to a consideration of the changes within the factory sector. Till the late nineteenth century, industrial production in India was based on the cottage sector, only in the twentieth century was there an expansion of the manufacturing sector. What was the magnitude and character of this growth? What defined its limits? Who were the capitalists investing in industries?

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