On 7 September 1695, state sponsored English pirates attacked a large Indian trading ship, the Ganj-i-Sawai, carrying 900 passengers and crew from Yemen to Surat. After murdering a large number of the men and raping the womenfolk over several days, the pirates took off with gold, silver and precious stones with an estimated value of £200,000 to £600,000 ($400 million in modern times). For perspective, the average annual salary in England in 1688 was around £32.
That was the wealth from just one ship in a single day. During the approximately thirteen thousand days of British rule in India, vessels sailed daily for Britain from ports all along India’s coasts. They were laden with incalculable quantities of wealth and other valuables such as icons, statues, scrolls and books looted from the treasuries of Indian kings, businessmen, temples, landlords, schools, colleges, charitable institutions and the common people.
The Teutonic thoroughness of the loot can be assessed from the British sacking of Jhansi in 1858. D.V. Tahmankar writes in his book The Ranee of Jhansi that on the first day the British led by Dalhousie carted away the more valuable property, jewellery, gold, silver and money. By the end of the fourth day, they had taken all the rich clothes, beds, mattresses, sheets, blankets, carpets, hinges and bolts on doors and windows, pots and pans, cereals and lentils, farm animals, chairs, charpoys (string beds), bedsteads and even water wheels and ropes with which the people drew water from the wells. “Not a single useful thing was left with the people.”
Dalhousie was following the lofty precedent set a hundred years earlier by Governor Generals Robert Clive and Warren Hastings. Clive had taken £250,000 as well as a jagir worth £27,000 when he returned home to England. That bounty apparently wasn’t enough and he proceeded to steal a million pounds more by shaking down the prostrate Indian kingdoms, businessmen and the peasantry. At his trial Clive said that considering the quantum of wealth he had seen in India, he was astounded at his own moderation at not taking more.
But the loot of gold and silver is hardly enough to destroy an economy. For, in the previous seven centuries, Islamic invaders from Arabia, Turkey, Central Asia, Afghanistan and Persia had raided India countless times and yet India remained wealthy. For instance, what Persian Nadir Shah looted in his 1739 invasion of India was greater than the cash appropriated by Clive and his successors in the two decades after 1757.
Even during the reign of the most avaricious and cruel Muslim tyrants, such as the Tughlaqs, Khaljis, Lodhis and Aurangzeb, the people of India’s villages continued in their age old ways of economic production. This is because the Islamic invaders did not tamper with the village economy. It took Britain’s colonial wrecking machine to bring down India.
The British caused irreparable losses to India in a number of sectors. Like a huge sponge Britain soaked up the country’s wealth and simultaneously ruined its industry, agriculture and education. And as a parting shot, they divided the country, thereby ensuring that India would never again be the dominant economic power it once was.
In 1993 Belgian economist Paul Bairoch presented a detailed study of the world economy. In Economics and World History: Myths and Paradoxes he said that in the year 1750 China’s share of global GDP was 33 percent, India’s 24.5 percent, and the combined share of Britain and the US was two percent. In order to investigate Bairoch’s claims, the OECD constituted the Development Institute Studies under professor Angus Maddison of the University of Groningen. The data Maddison compiled showed India had the largest economy on the planet for 1700 of the past 2000 years.
From 1 CE to 1000 CE, India had a 32 percent share of global GDP. During the second millennium, Islamic invasions disrupted economic activity, and India yielded the top spot to China. Still, India’s share remained at 28-24 percent between 1000 CE and 1700 CE. By 1947, when India became free, the country’s GDP comprised around three percent of the global economy. Here’s how it happened.
First, let’s look at the steel sector, the backbone of any economy, in which India had been a world leader for millennia. India in the eighteenth century had literally thousands of steel mills. The world’s best steel i.e. wootz originated over 2500 years ago in Tamil Nadu where it was known as ukku. The Arabs introduced ukku steel to Damascus, where an entire industry developed for making the legendary Damascus sword. The twelfth century Arab traveller Edrisi mentions the Hinduwani or Indian steel as the best in the world. However, the British banned the production of ukku in 1866 and the process was lost.
Historian Romesh Chandra Dutt explains:
Then there was the ‘cost’ of governing India a.k.a. the white man’s burden. Maddison writes in The Economic and Social Impact of Colonial Rule in India
Maddison points out that British employees in the colonial government were paid high salaries . The viceroy received £25,000 a year, and governors £10,000. In 1911 the Indian Army had 4378 British officers and practically no Indian. One Englishman notes his father did not have a very successful career as a civil servant in India, “but had 21 servants to start married life, 39 when he had three children, and 18 when living on his own. The 18 servants cost him less than six percent of his salary”.
The starting salary of a British employee in the engineering service was about 60 times the average income of an Indian worker. D.H. Buchanan points out in The Development of Capitalist Enterprise in India that European managerial personnel were paid overly high salaries despite the fact they were usually less efficient.
Under an Indian administration, income from government service would have accrued to the local inhabitants and not to foreigners. The diversion of upper-class income into the hands of foreigners inhibited the development of local industry because it put purchasing power into the hands of people with a taste for foreign goods. This increased imports and was particularly damaging to the luxury handicraft industries.
Maddison adds :
Another form of wealth transfer can be described, without hyperbole, as daylight robbery. Economist Gurcharan Das explains :
Russia-born Paul Baran of Stanford University calculates in The Political Economy of Growth that eight percent of India’s GNP was transferred to Britain each year.
The wealth of a country is not its GDP, which is the annual national income. The real wealth is the combined value of cash savings, gold, silver, precious stones, homes, buildings, factories, railways, ports and so on. To illustrate, the US GDP is $17 trillion but American national wealth is more than $50 trillion. British rule forced Indians to unlock their savings. 2nd Look offers a graphic detail of how these savings got denuded.
On 27 October 1931, the British government in London rammed through a series of measures that depressed silver and gold prices and raised interest rates in India. “Done over the protests by Gandhi, trade bodies and merchants and threats of resignation by the Viceroy and his Executive Council, the resulting ‘money famine’ had Lord Willingdon ecstatically say ‘Indians are disgorging gold.’ Indians have a different reason to revile Neville Chamberlain, who with great satisfaction said :
The astonishing gold mine that we have discovered in India’s hordes has put us in clover.
Impoverished Indians were selling their gold and silver savings. The booty was transported due West. One of these ships was the SS Gairsoppa, which was sunk by a German U-boat in the Atlantic in 1941. In 2011 an American exploration company found the SS Gairsoppa’s wreck, which has been found to contain 200 tonnes of silver. The haul was worth nearly £150 million.
All war torn countries have in common a low quality of life, lost economic growth and fall in population. India during British rule was no different. The most savage Islamic invader such as Timur or Mahmud Ghazni would be unable to match the efficiency of the British killing machine.
For instance, after the First War for Independence in 1857, the British may have killed up to 10 million Indians in reprisals. In War of Civilisations: India AD 1857, Amaresh Misra, a writer and historian, says the British pursued a decade-long campaign to wipe out millions of people who dared to rise up against them.
Conventional histories have counted only 100,000 Indian soldiers who were slaughtered, but none have tallied the number of rebels and civilians killed by British forces.
Artificial famines were another major killer. Britain changed the old land revenue system to the disadvantage of the farmer, who had to now pay revenue whether or not the monsoon failed. This led to famines. In Late Victorian Holocausts, Mike Davis points out that there were 31 serious famines in 120 years of British rule compared with 17 in the 2,000 years before British rule.
Davis tells the story of the famines that killed up to 29 million Indians. These people were, he says, murdered by British State policy. In 1876, when drought drove the farmers of the Deccan plateau to destitution, there was a net surplus of rice and wheat in India. But the Viceroy, Robert Bulwer-Lytton, insisted that nothing should prevent their export to England.
In 1943-44, Prime Minister Winston Churchill diverted India’s food stocks to Europe, resulting in the deaths of over three million people by British estimates alone. Indian estimates place the number at up to seven million. That’s more than Adolf Hitler’s victims in Nazi Germany’s gas chambers.
The regularity of famines and the deaths of millions of its productive citizens undeniably impacted India’s vitality. It had a cascading effect on every sector, whether agriculture, labour, irrigation, industry or guilds. A once proud people were forced out of their lands that had become barren and desiccated. It also led to the Indian diaspora as tens of thousands of Indians were transported to distant colonies in the Caribbean, Fiji and Africa to work as virtual slaves on plantations.
One reason why India ranked ahead of China in 1700 of the past 2000 years was that the areas that today constitute Pakistan and Bangladesh were part of India. The British sliced off 20 percent of India’s best wheat and rice growing areas. In the early 1940s, Jawaharlal Nehru said that after independence India would take its rightful place as a major world power. He was dead wrong. Due to the loss of important areas as Punjab and Sindh, independent India was born crippled at birth.
Seventy years later, India is still not a major world player. Its relations with both Pakistan and China are bedeviled by boundary troubles, again created by the British. Pre-Partition, India’s location provided easy and strategic access to Arabia, Iran, Central Asia, Burma and Southeast Asia, but with the creation of two hostile territories on its flanks, India became hemmed in by and was hyphenated with minor countries. India is always referred to as a “South Asian giant” which if a compliment at all is a backhanded one.
Partition placed blinkers on Indians and today the country struggles to discover a global role for itself. Although modern Britain is accurately described by Russia as a small island nobody pays attention to, London nevertheless has more diplomatic clout than New Delhi.
In the pre-colonial era, several important trade routes ran through present day Pakistan . It extended from Iran, Afghanistan and Central Asia in the west to India in the east. These routes were severed by the imposition of colonial era borders, impacting national income and the livelihood of traders and manufacturers in India and its neighborhood.
Again, Partition was not only political but also economic. Zafar Mahmood, Pakistan’s commerce secretary in 2012 pointed out-
...in 1948–49, a hefty 56 percent of Pakistan’s exports was sent to India. For the next several years, a period of tense political relations, India was Pakistan’s largest trading partner. Incredibly, in 1965, the year Pakistan and India went to war, nine branches of six Indian banks were operating in Pakistan.
Undivided Punjab was the focal point of economic activity for places such as Delhi and Kashmir. Karachi and Bombay were economically interlinked. Ancient and thriving trade routes that ran via the areas of Pakistan to Central Asia are little more than abysses today. Rabindranath Tagore’s tragic Kabuliwala, the Pathan who hawked produce from Afghanistan in the streets of Calcutta, is a nostalgic reminder of those days.
The cultural loss is irreplaceable. The Victoria and Albert Museum in London holds the largest collection (over 40,000 items) of Indian art treasures outside of the subcontinent. To this the British had planned to add no less than pieces of the Taj Mahal.
Stephen Knapp writes in Crimes Against India that in the 1830s Governor General William Bentinck had worked out plans to dismantle the Taj Mahal and ship the marble to collectors in London-
However, just as the demolition crew was getting to work, word came in from London that the first auction was a failure and all further sales stood cancelled. It was not worth the money to demolish the Taj Mahal.
The transfer of art and artefacts westwards continued. Aurel Stein and Austine Waddell must be given credit for this. Stein was a Hungarian explorer and scholar who later became a British citizen, receiving generous funding from the British Museum for his expeditions.
He is frequently described as an “imperialist looter” by the Chinese. Waddell was the “Official Collector” of artefacts in India. In one particular correspondence referring to Tibet, Stein compliments Waddell on his explorations and work, but laments he did not have “opportunity to ransack the Chinese Buddhist monasteries before they were looted”.
Tim Myatt writes in Trinkets, Temples and Treasures: Tibetan Material Culture and the 1904 British Mission to Tibet, that many major collectors including the Cambridge University Ethnological Institute, the Victoria Institute and University College London wrote directly to the India Office requesting that artifacts be passed on to them.
India’s universities and gurukuls were the tutors to the world. They attracted foreign students in huge numbers. Although nearly all of them, such as Nalanda University, were destroyed by Islamic conquerors before the coming of the British, the country’s schooling system continued as before. Dharampal has explained in The Beautiful Tree how the so called lower castes comprised the majority of students in Tamil Nadu, United Provinces and Bihar.
The British dismantled this egalitarian education system by destroying the guilds that financed these schools. Then they replaced it with a joke. Maddison explains:
Now compare British colonialism with that of Russia. When Russia dissolved the Soviet Union in 1991 and set free its 14 republics, these newly independent countries had 100 percent literacy, thriving universities and robust industrial clusters. Ukraine was an agrarian basket case in the 1920s but by 1991 it had the crown jewels of Russian heavy industry. Kazakhs used to be nomads; Kazakhstan is a space power. Uzbekistan produces commercial airliners and military aircraft. The Central Asian republics, which did not even have a script for their languages prior to the arrival of the Russians, became civilizationally uplifted. Inter-marriage among Russians and non-Russians was common in all the republics.
Humanity: Greatest Loss
The most egregious effect of Partition is neither economic nor political. It is the poisoning of relations in what used to be close-knit and friendly communities. Punjab, the land of sufi singers and inter-communal lovers, turned into an inferno where Hindus, Sikhs and Muslims fled their ancient homeland. Lahore’s population was 47 percent Hindu and Sikh; today it’s 100 percent Muslim. The orgy of violence sparked by Mohammed Ali Jinnah’s threat to turn Hindustan into a kabristan (cemetery) if Hindus did not give him Pakistan was as unprecedented as it was unexpected.
The tragedy of Partition, wrote Bombay-based writer Saadat Hasan Manto, was not that there were now two countries instead of one but the realisation that “human beings in both countries were slaves - slaves of bigotry, slaves of religious passions, slaves of animal instincts and barbarity”.
Seven decades later, even as South Asia continues to be the world’s leading laggard in most indices of human development, India and Pakistan continue to spend hundreds of billions of dollars on their militaries and nuclear programmes. This again is a huge opportunity cost of Partition. Had there been no Pakistan, the equivalent of Pakistan’s annual defence budget would have been available for development, rather than for producing Ghauri and Ghaznavi missiles. Neither would India’s defence budget be so high.
If you add up what India, Pakistan and Bangladesh have lost because of British rule and continue to lose with every passing year and compare it with the Kohinoor, the diamond would be a “mere peanut”. As the inimitable John Oliver says
So let the British keep the stone. (It’s known to bring bad luck anyway) The Kohinoor should remind Indians that they became enslaved because they were divided. And they should say: “Never again.”
Rakesh Krishnan Simha is a New Zealand-based journalist and writes on defence and foreign affairs for Russia Beyond the Headlines, a global media project of Moscow-based Rossiyskaya Gazeta. He is on the advisory board of Europe-based Modern Diplomacy.Rakesh’s articles on defence and foreign have been quoted extensively by a number of leading think tanks, universities and publications worldwide. He has been cited in books on counter terrorism and society in the global south.
An appeal from Swarajya
At Swarajya, we rely on our readers' support through subscriptions to sustain our media platform. Unlike larger conglomerates, we are unable to relentlessly chase advertising money — our model is largely built on your patronage.
Your support has never been more crucial. We work tirelessly to deliver 10-15 high-quality articles daily, ensuring you receive insightful content from 7 AM to 10 PM.
If you believe India's story has to be articulated in a way it has never been done before without shrugging it off, become a patron (or) subscribe now for ₹̶2̶4̶0̶0̶ ₹1999 and get 12 print issues, unlimited digital access for 1 year, a special India that is Bharat T-shirt (Offer ends soon).
We are counting on you!