Foreign Trade Under The British Rule
Foreign trade means the exchange of goods and services between two or more countries/borders or territories. India has been an important trading nation since ancient times. But the restrictive policies of commodity production, trade, and tariff pursued by the colonial government led to the adverse impact on the structure, composition, and volume of India’s foreign trade.
What was the condition of foreign trade under British rule?
The features of foreign trade in India during the colonial rule (the British rule);
An exporter of raw materials and importer of finished goods
India became an exporter of primary products such as raw silk, cotton, wool, sugar, indigo, jute, and an importer of finished consumer goods like cotton, silk, woolen goods. It also imported capital goods like light machinery produced in the factories of Britain.
Britain maintained monopoly control over India’s exports and imports. As a result, more than half of India’s foreign trade was allowed with a few other countries like China, Sri Lanka, and Persia. The opening of the Suez canal further intensified British control over India’s foreign trade.
What is the Suez Canal?
Suez Canal is an artificial waterway, that resulted in the provision of a direct trade route because ships were operating between European ports and ports located in South Asia, East Africa, and Oceania. Strategically and economically, it is one of the most important waterways in the world. Suez Canal came in 1869, and it reduced the cost of transportation. It made access to the Indian market easier. Suez Canal acted as a highway between India and Britain.
Misuse of large export surplus
Several essential commodities like food grains, clothes, kerosene were scarcely available in the domestic market. The export surplus did not result in any flow of gold or silver into India, because this was used to make payments for the expenses incurred on war, fought by the British government which led to the drain of Indian wealth.
What is the meaning of export surplus?
The amount by which the value of a country’s exports exceeds that of its imports.
What is the meaning of the drain of Indian wealth?
The constant flow of national wealth from India to England for which India did not get an adequate economic, commercial, or material return has resulted in a ‘drain’ of wealth from India. This is because Britishers never made any efforts in improving the conditions of India.
Read more about the state of the Indian economy during colonial rule and its other sectors;
- Agriculture Sector
- Industrial Sector
- Infrastructural Sector
- Demographic Conditions
- Occupational Structure