Tag: economics

It was in May $1867$ that Dadabhai Naoroji put forward the idea that Britain was draining India. This is Drain Theory. The drain, he declared, was the basic cause of India's poverty and the fundamental evil of British rule of India.

All India Trade Union Congress (AITUC) is the oldest trade union federation in India and one of the five largest. It was founded on 31st october 1920 in Bombay by Lala Lajpat Rai, Joseph Baptista, First president- Lala Lajpat Rai. First General Secretary- Diwan Chaman Lal.

EXIM Bank (Export-Import Bank) of India is the leading export finance institution in the county. The bank was set up in the year 1982 under the Export-Import Bank of India Act, 1981. The Government of India launched the Export-Import Bank of India with an aim to augment exports from India and also to combine the county's foreign trade and investment with the overall economic growth. The bank began its operations as a supplier of export credit, but has over the period evolved into an institution that plays a major role in partnering with Indian industries including small and medium enterprises. It is the apex institution for coordinating the working of institutions in India engaged in financing exports and import of goods and services.

Portuguese were the first Europeans to start trade with India. After the fall of Ottoman Empire and capture of Constantinople in 1453 it became difficult for Europeans to trade with India via land route.  The first successful voyage to India was by  Vasco da Gama in 1498, when after sailing around the Cape of good hope  he arrived in Calicut  now in Kerala. Having arrived there, he obtained from Saamoothiri Rajah permission to trade in the city. The navigator was received with traditional hospitality, but an interview with the Saamoothiri (Zamorin) failed to produce any definitive results. Vasco da Gama requested permission to leave a factor behind in charge of the merchandise he could not sell; his request was refused, and the king insisted that Gama should pay customs duty like any other trader, which strained their relations.

Mostly fine cotton and silk were exported from India to markets in Europe, Asia, and Africa; by the second quarter of the 19th century, raw materials, which chiefly consisted of sugar, raw cotton, opium, and indigo, accounted for most of India's exports.

From the time of Pre-Independence India has been one of the important trading countries, exporting primary items like cotton, raw silk, sugar, wool, jute, and indigo, etc. and importer of finished consumer goods like woollen clothes, cotton, silk, and capital goods like light machinery manufactured in Britain.

Scarce resources in Indian domestic market was because the British exported manufactured goods in surplus because selling manufactured goods means making more money as a state. Having more money as a state in return means that it can reinvest and can help its citizens better.

Britain held the monopoly of over India's imports and exports. Most of the foreign trade was restricted only to Britain, while the rest half was allowed to trade with other countries like Ceylon (Sri Lanka), China, and Persia (Iran).

The reason why the British wanted to export manufactured goods is because selling manufactured goods means making more money as a state. Having more money as a state in return means that it can reinvest and can help its citizens better, or spend the money in any other way it had to, to keep the country going .The Britishers utilized the wealth earned from export not for India's development but to  purchase expensive  and materials from Britain for their own use.