Economic history of India Indian reserve Bank held a positive balance of £1160 million, with it, on 14 July 1947, and that British India maintained a trade surplus, with the United Kingdom, for the duration of the British Raj eg. Source: Indian sterling balances, p. 2, 15 Jan.1.1947, Bank of England (BoE), OV56/55. Modern economic historians have blamed the colonial rule for the dismal state of India's economy, with investment in Indian industries limited since it was a colony. Under British rule, India's native manufacturing industries shrank. During the British East India Company's rule in India, production of food crops declined, mass impoverishment and
Economic history of India world leader in manufacturing, producing 25% of the world's industrial output up until the mid-18th century, prior to British rule. Due to its ancient history as a trading zone and later its colonial status, colonial India remained economically integrated with the world, with high levels of trade, investment and migration. India experienced deindustrialization under British rule, which along with fast economic and population growth in the Western World resulted in India's share of the world economy declining from 24.4% in 1700 to 4.2% in 1950, and its share of global industrial output declining from 25% in 1750 to 2% in