Tag: economics

The reason responsible for the heavy population pressure is high birth-rate, falling death-rate, high immigration from adjoining countries. The growing population imposes a huge economic burden on the society because the growing requirements of basic necessities are to be met by the government. It effects the economic progress of the country.

An expert committee under the Chairmanship of Sir Otto Niemeyer was appointed in 1936 to inquire into the financial position of the Provinces, the special assistance required by each and the time and mode of distributing the provincial share of income tax and proceeds of the export duty on jute.

Sir Niemeyer recommended that assistance should be given to the provin­ces in three-ways:

(a) The outstanding debts incurred before 1935 by Bengal, Bihar, Assam, the N.W.F.P. and Orissa plus approximately Rs. 2 crores of pre-1921 debt in the case of Central provinces should be cancelled.

(b) Appreciating that the jute growing provinces stood in special need of financial assistance, it recommended distribution of a further 12.5% of the Export duty on jute, thus making a total of 52.5% to the jute growing provinces.

(c) Such provinces as might be in need of assistance should be given grants- in-aid to balance their budgets. It was expected to provide “in-built flexibility.”

As regards the distribution of the proceeds of Income Tax between the Centre and the provinces, it recommended that provinces and the federated states should get 50% of the proceeds of the tax; the share of each province to be fixed partly on the basis of population and partly on the basis of the residence of the assessees.

The author Dadabhai Naroji, wrote "Poverty under British Rule in India" , who devoted his entire life to the cause of India's upliftment and independence was a social reformer, a member of the British Parliament and founder of the Indian National Congress.

In India, British developed railway because of their own interest. They wanted to export raw material from inner parts of India to their country and also to supply their manufactured products in interior hinterland. In this process they need to develop railway infrastructure in India.

Drain Theory was published by Dadabhai Naoroji in his book 'Poverty and Un-British Rule in India". According to it, while a part of India's capital and wealth was being drained out or exported to England in the form of interests on loans, earning of the British capital invested in India and salaries and pensions of European officers, India get nothing in return.

The Indian economists Dadabhai Naoroji, V.K.R.V. Rao, R.C. Desai and British Findlay Shirras and William Digby attempted to measure India's national income. Among all, V.K.R.V. Rao was the most successful.

The country's growth of aggregate real output during the first half of the twentieth century was less than two per cent coupled with a meagre half per cent growth in per capita output per year.

British's profits came primarily from the sale of Indian goods abroad. It tried constantly to open new markets for Indian goods in Britain and other countries. Thereby, it increased the export of Indian manufactures and thus encouraged their production.

Colonial rule transformed India's agriculture sector to a mere supplier of raw materials for the British industries. This not only affected the production of the agricultural sector but also ruined the small manufacturing units like handicrafts and cotton industries. There was very minimal appreciation of the labor forces and compensation of the employees by the colonial regime therefore the workers motivation was very low, with low motivation the workers input will definitely go down low input will obviously lead to lower rates of industrials potential output therefore hindered .

The country's growth of aggregate real output during the first half of the twentieth century was less than two per cent coupled with a mere half per cent growth in per capita output per year.