Question map
Which one of the following statements about the Colonial economy is NOT correct ?
Explanation
The statement that Laissez-faire actively promoted indigenous capitalism is incorrect. In the colonial context, Laissez-faire was often a 'one-way' policy that opened Indian markets to British manufactured goods while providing no protection for local industries, leading to deindustrialization. The British presence inhibited indigenous capitalism by subordinating India's economic interests to Britain's, forcing a structure where India provided raw materials while Britain produced high-technology goods [1]. Foreign capital dominated industrial and financial fields, with British firms maintaining a 'white collective monopoly' through managing agencies, particularly in Eastern India (Bengal). Furthermore, the Bombay hinterland was indeed difficult to penetrate before the railways because the Western Ghats acted as a significant geographical barrier, and early transport infrastructure was primarily designed for military use or raw material export rather than internal economic integration.
Sources
- [1] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 6: Indian Economy [1947 – 2014] > 6.1 Impact of British Rule on Indian Economy > p. 201