Impact Of British Economic Policies on Traditional Indian Industry (1757–1857)

Abstract

This study analyses the impact of British economic policies on traditional Indian industry during the period 1757–1857, a century marked by the transition from indigenous economic systems to colonial domination. Prior to British rule, India possessed a diverse and resilient industrial base, particularly in textiles, metalwork, shipbuilding, and artisanal crafts, which supported both domestic consumption and international trade. The introduction of British economic policies, driven by mercantilist and later free-trade principles, fundamentally altered this structure. Policies such as discriminatory tariffs, the dismantling of protective regulations, and the forced integration of India into the global market as a supplier of raw materials and a consumer of British manufactured goods led to the systematic decline of traditional industries. The collapse of the handloom textile sector, especially in regions like Bengal, serves as a critical illustration of this process of deindustrialisation. Furthermore, the revenue settlements and commercialisation of agriculture reduced artisans’ access to raw materials and local markets, exacerbating economic distress. The study argues that British economic interventions not only weakened indigenous industrial production but also transformed India’s economy into a colonial dependency, marked by unemployment, impoverishment of artisans, and loss of technological skills. By examining these developments, the paper highlights the long-term structural consequences of colonial economic policies on India’s industrial trajectory.