Economic History of the East India Company

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Questions and Answers

What was the significance of August 12, 1765, in relation to the East India Company?

The Mughal emperor appointed the East India Company as the Diwan of Bengal, marking a pivotal moment in their financial administration.

How did the East India Company's approach to revenue change after becoming the Diwan?

Initially resisting standardized assessments, the Company aimed to maximize revenue by purchasing goods like cotton and silk at low prices, funded by Bengal's revenues.

What led to the economic crisis in Bengal during the time of the East India Company?

The crisis arose from artisans leaving villages, struggling peasants, and significantly low prices paid for goods, which decreased production.

What was the impact of the famine in 1770 on the population of Bengal?

The famine in 1770 resulted in the deaths of roughly 10 million people, which was about one-third of Bengal's population. Signup and view all the answers

Describe the economic environment of the weekly market (haat) in Murshidabad during the economic crises.

The markets were significantly affected, as local artisans and peasants struggled to sell and buy goods due to declining production and economic instability. Signup and view all the answers

What was a primary aim of the Permanent Settlement introduced by the Company in 1793?

The primary aim was to ensure a regular flow of revenue into the Company's coffers while encouraging zamindars to invest in land improvements. Signup and view all the answers

Identify one significant problem that arose from the Permanent Settlement.

One significant problem was that zamindars did not invest in land improvements and struggled to pay the fixed high revenues. Signup and view all the answers

How did the Mahalwari System differ from the Permanent Settlement?

The Mahalwari System revised revenue demands periodically and involved the village headman in revenue collection, rather than permanently fixing the amount owed. Signup and view all the answers

What was the focus of the Munro System in southern India?

The Munro System focused on making revenue settlements directly with the cultivators (ryots) who worked the land, rather than with traditional zamindars. Signup and view all the answers

Explain the impact of excessive rents on under-tenants in Bengal as described by H.T. Colebrook.

Excessive rents resulted in under-tenants facing high debts and perpetual economic hardship, making it difficult for them to escape from debt. Signup and view all the answers

What were the consequences of the new systems imposed by the British in rural areas?

Conditions worsened, leading to high revenue demands that peasants couldn't meet, resulting in deserted villages. Signup and view all the answers

Which crops did the British expand cultivation of in rural India by the late 1700s?

The British expanded the cultivation of indigo and opium, along with jute, tea, sugarcane, wheat, cotton, and rice. Signup and view all the answers

How did the British perceive the potential of the Indian countryside?

They saw it as a source of raw materials to produce crops for European markets. Signup and view all the answers

What was the significance of indigo to European cloth manufacturers?

Indigo's rich blue pigment was preferred over woad's dull violet/blue, making it highly sought after. Signup and view all the answers

What occurred in worldwide indigo production between 1783 and 1789?

Worldwide indigo production declined by 50% during this period. Signup and view all the answers

What types of labor were associated with indigo plantations?

Indigo plantations used forced labor to maximize production. Signup and view all the answers

What strategies did the British East India Company employ to increase indigo cultivation?

They utilized various methods to expand indigo cultivation in response to European demands. Signup and view all the answers

What led to peasant flight from rural areas under British rule?

High revenue demands that peasants could not pay forced many to flee, leaving villages deserted. Signup and view all the answers

What role did indigo play in British industrialization?

Indigo was critical as a dye for cotton production, which surged during British industrialization. Signup and view all the answers

How did the shift in the demand for indigo impact Indian agriculture?

Increased demand led to the expansion of indigo cultivation, often at the expense of traditional farming practices. Signup and view all the answers

Study Notes

Ruling the Countryside

The East India Company gained control over Bengal, Bihar, and Orissa in 1765.
Robert Clive was instrumental in this acquisition.
The takeover event was commemorated in a painting.
The Company became the Diwan, managing the territory's finances.
The Company aimed to establish revenue collection for its own benefit.
The Company was initially reluctant to implement a regular system for revenue collection.
Efforts were made to increase the collection of revenue and the sales of raw materials to Britain.
The Company's revenue strategies took some time to bear fruit.
By the 1770s, there was an economic crisis in Bengal.
Many artisans and villagers deserted villages.
Crop yields were substantially reduced.
This was a result of economic pressures and the Company's policies.
A major famine occurred around 1770, devastating the region and killing approximately one-third of the population.
The Company's economic policies and practices had a profound impact on the region.
The impact on the region included a crisis-inducing economic downturn and a famine.

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Description

Explore the significant events and economic policies of the East India Company, focusing on its impact on Bengal and the introduction of various settlement systems. Understand the implications of the Permanent Settlement, the Mahalwari System, and the economic crises that ensued during this period. This quiz examines the changes in revenue collection and the resulting social effects on the population.