Critically appraise some of the shortfalls of the industrial policy pursued by the British colonial administration.

Question

Accepted Answer

The focus of the industrial policies pursued by the colonial government in India was to make our country a mere supplier of Britain's own flourishing industrial base. The policies were concerned mainly with the fortification and advancement of their own country. The industrial policy pursued by the British colonial administration had the following shortfalls:

1. **Neglect of Indian handicraft industries**: The British followed a discriminatory tariff policy under which they imposed heavy tariffs, or export duties, on India's export of handicraft products, while allowing free export of India's raw material to Britain and free import of British products into India. This made Indian exports costlier, and their international demand fell drastically, leading to the collapse of the handicraft industries. Indian handicrafts also faced stiff competition from the machine-made textiles of Britain. The emergence of a new section of people who liked British goods more than domestic goods encouraged British industries at the cost of Indian industries.

2. **Lack of investment in Indian industries**: The modern industries in India demanded investments in capital goods that were beyond the means of Indian investors. On the other hand, the British government was least interested in investing in Indian industries. Thus, due to the lack of sufficient investment, the growth of Indian industries was acutely constrained.

3. **No capital goods industries**: There were hardly any capital goods industries to promote further industrialisation in India. The British rulers did not pay any attention to their promotion, as they always wanted Indians to be dependent on Britain for the supply of capital goods and heavy equipment.

4. **Limited role of the public sector**: Due to the lack of public investment, India could not develop a sound industrial base. The public sector remained confined only to the railways, power generation, communications, ports and some other departmental undertakings.

5. **Low contribution to GDP**: The growth rate of the new industrial sector and its contribution to the GDP or Gross Value Added remained very small, as the development of industries was lopsided. Consumer goods industries were not adequately supported by capital goods industries, and no priority was given to the development of basic and heavy industries.

Thus, the industrial policy of the colonial administration systematically de-industrialised India and failed to lay the foundation for a sound and self-reliant industrial base.