Wealth of Nations, Scars of Empire: India’s Economic Blight

By Mayyar Almubarak

Following the East India Company’s control over India for centuries, an inevitable imprint was perpetually left on their economy, setting off a chain reaction that cascaded into today’s economic and political climate. Exploitation, ethnic marginalisation, and an overall inefficient initial structuring of their economy created the foundations for a “kludgy” system - one in which the current system of governance and economy is failing its people. Whilst it may be easy to simply blame present-day leadership, the reality sets its roots further into history. The devastating progression of India’s economy from a British colony into what is labelled a modern-day “kludgeocracy” (term coined by Steven Teles) calls into question the severity of adverse continued impacts of colonialism in modern economies, and the way these impacts are plainly visible.

India as a British colony was severely limited in terms of development. It is reported that India’s GDP per capita fell by over one-third from 1600 to 1871 as India increasingly came under British colonial rule (Broadberry, Custodis, and Gupta 2014, 1). The mere significance of this was not fathomable at the time, as they could not see the severe repercussions this would create in the future. The very living standards within the country faced steep decline – a decline that created a permanent scar on the country’s advancement. Even in the twenty-first century, as general standards of living are significantly higher than a few centuries ago, in India this remains unsteady and low. Colonial powers ensured that potential was capped and lives were tough, thus consequently limiting growth. For example, the series of Crown Oversights between 1773 and 1858 monopolised trade and retained control over the Indian economy. Furthermore, the Bengal Famine of 1770 was catastrophic; millions died, whilst the genetics of countless more were altered, creating epigenetics that lead to diabetes and heart problems present within the modern population of India. Such was the impact of the Bengal Famine: its effect continues to be present centuries later, detrimentally affecting the health and thus the employability of India’s future generations. Their contributions to the workforce will forever be hindered by the aftermath of a decades-old colonial policy, stumping the output of the country. 

The burden of this is persistent within approximately 77 million members of the Indian population, and is predicted to rise. These issues simply would not be present had India not been colonised, conveying the continuous influence of a past colonial power. In addition to this, the introduction of the Doctrine of Lapse (1848) only furthered control through its annexation process, creating further instability within the economy. The question that arises surrounds the permissibility of one country to institute such destruction upon another. In total, according to Utsa Patnaik - an Indian economist - it is estimated that the British colonial powers looted the Indian colony of the modern-day equivalent of $45 trillion; a shocking figure and the possible key to fixing a broken economy. A good first step would be for the British government to pay reparations. Returning what is owed to India is integral in rectifying their mistakes. Further from this, redistribution of income and wealth would aid in wealth disparities within India, thus increasing living standards. 

Today, the Indian economy is in shambles. Regardless of whichever programs and resources are instilled by the government – those poverty-ridden of the country seem to constantly face the prospect of being failed by a government that is simply not equipped to fix the overwhelming mass of issues. Approximately 60% of India’s 1.3 billion people live on less than $3.10 a day (Basu 2015). Under the British Raj, poverty intensified even further, thus creating the push for the surge of the Indian nationalist movement, “hindutva”. 

In essence, the post-colonial impact on a less economically developed country, such as India, is clearly evident in the way its modern economy is structured and run. The long-term effects of colonialism are simply too persistent to dismiss; the epigenetics created as a result of colonialism, in addition to the high poverty rates, only further perpetuate this, as they reflect the dire, calamitous nature of a failing economy. Thus, a rigid kludgeocracy is said to be formed, wherein the inefficiencies of the system truly highlight its existence.