4.15 European Business enterprise and its limitations

• todo Page 447 BL Grover

Entry of British Finance and Capital in India

• Foreign capital that entered India but was used by the colonial administration for fuller exploitation of Indian resources not for dev of colonial economy.
• & There was no investment of British capital before 1833 but became significant after 1857 and became the new most powerful method of colonial exploitation.

Forms of Investment

1. Loans raised by England by Secy General on behalf of Govt for investment in railways, irrigation, development of ports, hydro electric projects etc.
2. Foreign Business investments in India

• 97% of British capital investment in India was diverted towards completion of economic overheads, mining industry, dev of financial houses etc.
• British Capitalists retained dominant control over Indian banking, commerce, exchange and insurance. Foreign banks held 3/4th of total bank deposits.
• Indian industrialists complained that racial and political discrimination were made in credit advances.
• During WWII India had massive BoP surplus due to massive purchases of Indian goods by British govt.

PYQs

1. "Plantations and mines, jutes mills, banking, insurance, shipping and export-import concerns in India were run through a system of interlocking managing agencies." Critically examine. [2012, 10m]

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