Consider the following statements : 1. Dadabhai Naoroji first put forward ‘the theory of drain of wealth’. 2. The Indian National Congress adopted a resoultion to criticize the drain of wealth in its annual session at Calcutta in 1896. Which of the statements given above is/are correct ?

Dadabhai Naoroji is credited with first putting forward the 'theory of drain of wealth' to describe the systematic transfer of India's resources to Britain without adequate return [2]. He first articulated this concept in his 1867 paper 'England's Debt to India' and later popularized it in his 1901 book 'Poverty and Un-British Rule in India' [1]. The Indian National Congress (INC) officially adopted and endorsed this theory during its 12th annual session held in Calcutta in 1896 [2]. During this session, the Congress passed a resolution proclaiming that the recurring famines and poverty in India were a direct result of the continuous drain of wealth [2]. This marked a significant shift as the INC began using economic nationalism as a core critique of colonial rule, a stance further solidified in subsequent sessions like Lucknow in 1899.

Sources

1. [1] History , class XII (Tamilnadu state board 2024 ed.) > Chapter 1: Rise of Nationalism in India > 1.6 Naoroji and his Drain Theory > p. 12
2. [2] Rajiv Ahir. A Brief History of Modern India (2019 ed.). SPECTRUM. > Chapter 28: Economic Impact of British Rule in India > Economic Drain > p. 548