The historical origins of Indian poverty

Abstract

The Indian subcontinent is today the poorest area in the world. Its living standard is wretched, both through Western eyes, and from the perspective of most other developing countries. But in the sixteenth century, India was considered wealthy by Europeans. This paper attempts to analyse the reasons for the decline in India’s relative economic status from the time of the Moghuls up to independence. Such an exercise is essential in order to make a valid assessment of the tasks and performance of economic policy in India and Pakistan since independence. It may also contribute to the economic analysis of colonialism. The author examines briefly the nature of the Moghul economy before analysing the main ways in which British rule promoted or retarded economic growth.

JEL: I32, N15, O53