Romesh Chunder Dutt: The Causes of India’s Poverty

Romesh Chunder Dutt: Pioneer Economic Historian

[p. 210] From his own experience as a government official in rural Bengal from 1871 to 1897, Romesh Chunder Dutt (1848–1909) felt deeply the poverty of India's villagers. After taking an early retirement, he wrote two volumes on India's economic history under British rule, denouncing those policies that had led, in his opinion, to the poverty of the vast majority of his countrymen.

Dutt was born in Calcutta, the son of a surveyor in government service, and started school at the age of four. He saw a good deal of Bengal's countryside over the next eight years, since his father was posted from one rural town to another. He remembered that in 1858 “great cheers” and “cries of ‘Long live the Queen’ in English and Bengali rent the air” when Victoria was proclaimed Queen of India. The year after that his mother died, followed two years later by his father; an affectionate uncle raised him until his marriage was arranged at fifteen. At sixteen he entered college. At nineteen, he and a friend left their homes secretly at night, joined young Surendranath Banerjea, and all sailed to London to study for the prestigious Indian Civil Service. He came out near the top of the list and passed his bar exams as well; then he returned to India to take up his duties on a low rung of the civil service ladder.

By dint of hard work and good judgment he reached the post of divisional commissioner, the highest level an Indian had attained in the civil service. In 1895–1896 he had charge of the entire area that today is the State of Orissa. At intervals in this busy career he found time to write books about Bengal peasant life and Bengali literature, as well as two social and four historical novels in Bengali. In addition, he applied his literary skill to the task of making both his countrymen and the Western world more [p. 211] aware of the greatness of ancient India's civilization. First he outraged orthodox Brahmans by rendering the sacred hymns of the Rig Veda into Bengali, then he published selections from them in English. He also wrote a three-volume History of Civilization in Ancient India (1899–1900) with a patriotic purpose in mind. As he stated in his introduction: “No study has so potent an influence in forming a nation's mind, a nation's character, as a critical and careful study of its past history. And it is by such study alone that an unreasoning and superstitious worship of the past is replaced by a legitimate and manly admiration.” In addition, he selected and translated into English verse narrative passages from the Mahābhārata and Rāmāyana.

Romesh Dutt's services to his countrymen took new forms after retirement freed him to travel, give public speeches, and concentrate his writing on the relationship between India and Britain and how it might be improved. A series of terrible famines struck several areas of the country in 1896–1897 and 1900–1901, and Dutt's concern about how such catastrophes could be averted in the future was reflected in his presidential address to the Indian National Congress in 1899 and in his books England and India (1895), Famines and Land Assessments in India (1900), The Economic History of India Under Early British Rule (1901), and India in the Victorian Age: An Economic History of the People (1904). In each he prescribed measures for making the government of India more sensitive to the needs of the peasantry, and for lessening the tax burdens on the poor.

In his last five years, from 1904 to 1909, he resumed his career as an administrator by entering the service of the Gaekwar of Baroda, an Indian ruler in Gujarat. There he introduced some of the reforms he had implored the British to adopt in British India. From 1906 to 1909 he reasoned with Lord Morley (then secretary of state for India), privately and persuasively, in person and by mail, urging greater Indian participation in the provincial and central governments, which Parliament embodied in the Government of India Act of 1909. Later in that year he died, remembered by those who know his work as Garib ka Dost (“Friend of the Poor”).

The Causes of India's Poverty

Romesh Chunder Dutt attributed India's poverty to Britain's failings on four counts: the discouragement of handwoven cloth production; heavy and unpredictable taxes on agriculture; the outflow of money from India to pay its foreign debt and some of its administrative costs; and the absence of Indian representatives at the highest levels of government. Although his arguments on the first and third counts were countered to some extent in The Economic Transition in India (1911) by Theodore Morison, who noted that the “industrial transformation” of Canada, Argentina, Japan, and so forth, was also accompanied by the decline of “archaic” modes of production and considerable foreign indebtedness, Dutt's conclusion that India became impoverished under British rule remained a theme with all subsequent nationalist leaders.

Excellent works on the military and political transactions of the British in India have been written by eminent historians. No history of the people of India, of [p. 212] their trades, industries, and agriculture, and of their economic condition under British administration, has yet been compiled.

Recent famines in India have attracted attention to this very important subject, and there is a general and widespread desire to understand the condition of the Indian people—the sources of their wealth and the causes of their poverty....

Englishmen can look back on their work in India, if not with unalloyed satisfaction, at least with some legitimate pride. They have conferred on the people of India what is the greatest human blessing—Peace. They have introduced Western Education, bringing an ancient and civilised nation in touch with modern thought, modern sciences, modern institutions and life. They have built up an Administration which, though it requires reform with the progress of the times, is yet strong and efficacious. They have framed wise laws, and have established Courts of Justice, the purity of which is as absolute as in any country on the face of the earth. These are results which no honest critic of British work in India regards without high admiration.

On the other hand, no open-minded Englishman contemplates the material condition of the people of India under British rule with equal satisfaction. The poverty of the Indian population at the present day is unparalleled in any civilised country; the famines which have desolated India within the last quarter of the nineteenth century are unexampled in their extent and intensity in the history of ancient or modern times. By a moderate calculation, the famines of 1877 and 1878, of 1889 and 1892, of 1897 and 1900, have carried off fifteen millions of people. The population of a fair-sized European country has been swept away from India within twenty-five years. A population equal to half of that of England has perished in India within a period which men and women, still in middle age, can remember.

What are the causes of this intense poverty and these repeated famines in India? Superficial explanations have been offered ... and have been rejected.... It was said that the population increased rapidly in India and that such increase must necessarily lead to famines; it is found on inquiry that the population has never increased in India at the rate of England, and that during the last ten years it has altogether ceased to increase. It was said that the Indian cultivators were careless and improvident ... but it is known to men who have lived all their lives among these cultivators, that there is not a more abstemious, a more thrifty, a more frugal race of peasantry on earth. It was said that the Indian money-lender was the bane of India, and by his fraud and extortion kept the tillers of the soil in a chronic state of indebtedness; but the inquiries of the latest Famine Commission have revealed that the cultivators of India are forced under the thraldom of money-lenders by the rigidity of the Government revenue demand. It was said that in a country where the people depended almost entirely on their crops, they must starve when the crops failed in years of drought; but the crops in India, as a whole, have never failed, there has never been a [p. 213] single year when the food supply of the country was insufficient for the people, and there must be something wrong, when failure in a single province brings on a famine, and the people are unable to buy their supplies from neighbouring provinces rich in harvests....

It is, unfortunately, a fact which no well-informed Indian official will ignore, that, in many ways, the sources of national wealth in India have been narrowed under British rule. India in the eighteenth century was a great manufacturing as well as a great agricultural country, and the products of the Indian loom supplied the markets of Asia and of Europe. It is, unfortunately, true that the East Indian Company and the British Parliament, following the selfish commercial policy of a hundred years ago, discouraged Indian manufacturers in the early years of British rule in order to encourage the rising manufactures of England. Their fixed policy, pursued during the last decades of the eighteenth century and the first decades of the nineteenth, was to make India subservient to the industries of Great Britain, and to make the Indian people grow raw produce only, in order to supply material for the looms and manufactories of Great Britain. This policy was pursued with unwavering resolution and with fatal success; orders were sent out, to force Indian artisans to work in the Company's factories; commercial residents were legally vested with extensive powers over villages and communities of Indian weavers; prohibitive tariffs excluded Indian silk and cotton goods from England; English goods were admitted into India free of duty or on payment of a nominal duty.

The British manufacturer, in the words of the historian H. H. Wilson, “employed the arm of political injustice to keep down and ultimately strangle a competitor with whom he could not have contended on equal terms”; millions of Indian artisans lost their earnings; the population of India lost one great source of their wealth. It is a painful episode in the history of British rule in India; but it is a story which has to be told to explain the economic condition of the Indian people, and their present helpless dependence on agriculture. The invention of the power-loom in Europe completed the decline of the Indian industries; and when in recent years the power-loom was set up in India, England once more acted towards India with unfair jealousy. An excise duty has been imposed on the production of cotton fabrics in India which disables the Indian manufacturer from competing with the manufacturer of Japan and China, and which stifles the new steam-mills of India.

Agriculture is now virtually the only remaining source of national wealth in India, and four-fifths of the Indian people depend on agriculture. But the Land Tax levied by the British Government is not only excessive but, what is worse, it is fluctuating and uncertain in many provinces....

It will appear from the facts stated above that the Land Tax in India is not only heavy and uncertain, but that the very principle on which it is raised is different from the principle of taxation in all well-administered countries. In such countries the State promotes the accumulation of wealth, helps the people to [p. 214] put money into their pockets, likes to see them prosperous and rich, and then demands a small share of their earnings for the expenses of the State. In India the State virtually interferes with the accumulation of wealth from the soil, intercepts the incomes and gains of the tillers, and generally adds to its land revenue demand at each recurring settlement, leaving the cultivators permanently poor. In England, in Germany, in the United States, in France and other countries, the State widens the income of the people, extends their markets, opens out new sources of wealth, identifies itself with the nation, grows richer with the nation. In India, the State has fostered no new industries and revived no old industries for the people; on the other hand, it intervenes at each recurring land settlement to take what it considers its share out of the produce of the soil. Each new [land tax] settlement in Bombay and in Madras is regarded by the people as a wrangle between them and the State as to how much the former will keep and how much the latter will take. It is a wrangle decided without any clear limits fixed by the law—a wrangle in which the opinion of the revenue officials is final, and there is no appeal to judges or Land Courts. The revenue increases and the people remain destitute.

Taxation raised by a king, says the Indian poet, is like the moisture of the earth sucked up by the sun, to be returned to the earth as fertilising rain; but the moisture raised from the Indian soil now descends as fertilising rain largely on other lands, not on India. Every nation reasonably expects that the proceeds of taxes raised in the country should be mainly spent in the country. Under the worst governments that India had in former times, this was the case. The vast sums which Afghan and Moghal Emperors spent on their armies went to support great and princely houses, as well as hundreds of thousands of soldiers and their families. The gorgeous palaces and monuments they built, as well as the luxuries and displays in which they indulged, fed and encouraged the manufacturers and artisans of India. Nobles and Commanders of the army, Subadars, Dewans, and Kazis, and a host of inferior officers in every province and every district, followed the example of the Court; and mosques and temples, roads, canals and reservoirs, attested to their wide liberality, or even to their vanity. Under wise rulers as under foolish kings, the proceeds of taxation flowed back to the people and fructified their trade and industries....

For one who has himself spent the best and happiest years of his life in the work of Indian administration, it is an ungracious and a painful task to dwell on the weak side of that administration, the financial and economic policy of the Indian government.... The deep-seated cause of the poverty of the Indian people has to be explained. Place any other country under the same condition, with crippled industries, with agriculture subject to a heavy and uncertain Land Tax, and with financial arrangements requiring one-half of its revenues to be annually remitted out of the country, and the most prosperous nation on earth will soon know the horrors of famine. A nation prospers if the sources of its wealth are widened, and if the proceeds of taxation are spent among the [p. 215] people, and for the people. A nation is impoverished if the sources of its wealth are narrowed, and the proceeds of taxation are largely remitted out of the country. These are plain, self-evident economic laws, which operate in India, as in every other country, and the Indian statesman and administrator must feel that the poverty of India cannot be removed until Indian industries are revived, until a fixed and intelligible limit is placed on the Indian Land Tax, and until the Indian revenues are more largely spent in India....

Nor are Indian administrators strong in the support of the Indian people. The Indian Government means the Viceroy and the Members of the Executive Council, viz., the Commander-in-Chief, the Military Member, the Public Works Member, the Finance Member, and the Legal Member. The people are not represented in this Council; their agriculture, their landed interests, their trades and industries, are not represented; there is not, and never has been, a single Indian member in the Council. All the Members of the Council are heads of spending departments, as was lately explained by Sir Auckland Colvin and Sir David Barbour before the Royal Commission on Indian expenditure. The Members are high English officials, undoubtedly interested in the welfare of the people, but driven by the duties of their office to seek for more money for the working of their departments; there are no Indian Members to represent the interests of the people. The forces are all arrayed on the side of expenditure ... [and] none on the side of retrenchment....

“The government of a people by itself,” said John Stuart Mill, “has a meaning and a reality; but such a thing as government of one people by another does not, and cannot exist. One people may keep another for its own use, a place to make money in, a human cattle-farm to be worked for the profits of its own inhabitants.”

There is more truth in this strongly worded statement than appears at first sight. History does not record a single instance of one people ruling another in the interests of the subject nation. Mankind has not yet discovered any method for safeguarding the interests of a subject nation without conceding to that nation some voice in controlling the administration of their own concerns....

The wisest administrators in the past, like Munro, Elphinstone, and Bentinck, ... sought to promote the welfare of the people by accepting the co-operation of the people, as far as was possible, in their day. What is needed today is a continuance and development of the same policy, not a policy of exclusiveness and distrust. What is needed to-day is that British rulers, who know less of India to-day than their predecessors did fifty years ago, should descend from their dizzy isolation, and should stand amidst the people, work with the people, make the people their comrades and collaborators, and hold the people responsible for good administration....

The dawn of a new century finds India deeper in distress and discontent than any preceding period of history. A famine, wider in the extent of country affected than any previous famine, has desolated the country. In parts of India, [p. 216] not affected by this famine, large classes of people attest to semi-starvation by their poor physique; numbers of them suffer from a daily insufficiency of food; and the poorer classes are trained by life-long hunger to live on less food than is needed for proper nourishment. In the presence of facts like these, party controversy is silenced; and every Englishman and every Indian, experienced in administration and faithful to the British Empire, feel it their duty to suggest methods for the removal of the gravest danger which has ever threatened the Empire of India.

[From Dutt, The Economic History of India Under Early British Rule (London: Morrison and Gibb, 1901), v–ix, xi–xvi, xxi–xxii.]