"The British railway construction policy in India benefitted British economy in the nineteenth century." Critically Examine.

Answer:

Indian railways, begun in 1853, grew into one of the world's largest networks, but their construction was financed, equipped and routed to serve British commercial and strategic interests, so the primary benefit accrued to the British rather than the Indian economy.

How Britain benefited

• The guarantee system assured British investors five per cent interest charged to Indian revenues.
• Locomotives, rails and rolling stock were purchased almost entirely from Britain.
• Lines ran from the interior to the ports, easing the export of raw cotton, jute and wheat.
• Cheap British manufactures penetrated the interior, hastening the ruin of handicrafts.
• Strategic routes after 1857 allowed rapid movement of troops to control the country.

Limited benefit to India

• Backward and forward linkages that industrialised Europe were exported to Britain.
• Freight rates favoured export traffic over internal and inter-regional trade.
• Daniel Thorner concluded that the railways failed to trigger Indian industrialisation.
• Naoroji and R.C. Dutt treated the guaranteed interest as part of the drain of wealth.

A qualification

• Railways did integrate markets and helped move grain during famine.
• They fostered national consciousness by making travel and pilgrimage easier.
• The network became a genuine national asset after 1947.

The scale of the enterprise

• The first line ran from Bombay to Thane in 1853.
• By 1900 India possessed one of the largest networks in the world.
• British investment in Indian railways exceeded that in any other colonial venture.
• The guarantee ensured investors could not lose, whatever the traffic.

The statement is therefore well-founded. As Thorner and the nationalist economists demonstrated, the railways were built with Indian money for British purposes, and though they created a valuable physical asset, their design ensured that the economic gains of the nineteenth century flowed principally to Britain.