Chapter 35 : RECENT INDIAN ECONOMIC THOUGHT

Introduction: Context of Indian Economic Thought

• Indian Economic Thought in the recent past was influenced by mass poverty, Indian nationalism, anti-British sentiments, and contact with the West.
• Arrested Economic Growth: India during the British Raj is a classic example of arrested economic growth.
• Causal Chain of Exploitation: Colonial/imperial policy of Britain → exploitation of the Indian economy → encouragement of British industries and promotion of market for machine-made goods → decline and downfall of Indian handicrafts → poverty and underemployment.
• The British policy of Free Trade advantaged her manufacturing industry. The policy of discriminating protection granted to some Indian industries did not significantly develop Indian industry.
• India became a market for British manufactured goods and a source of cheap raw materials. Maxim: "the British were in India not for our good, but for our goods."
• Nationalist Movement Focus: Leaders attributed mass poverty to British rule → sought freedom from colonial rule as the remedy. Economic theory aimed to provide momentum to the nationalist movement by showing how the British Government exploited the masses.
• Applied Economics: Recent Indian economic thought concentrated on applied economics rather than pure theory (focusing on national income, population, and agricultural problems). Writers were not always professional economists.
• Post-Planning Era: Since the advent of planning, economists contributed a sizable literature to the study of problems of economic planning in the social context of a planned economy under a democratic setup.

Key Terms

📌 Exam Tidbits

• Maxim: "the British were in India not for our good, but for our goods."
• Pure vs Applied Theory: Recent Indian economic thought focused on applied economics (Indian economic problems) rather than pure theory.

R.C. Dutt (1848-1909)

• Romesh Chandra Dutt was born in a Bengali family in 1848 and died in 1909 . He joined the…