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
Political warfare in British colonial India aspect, the Company codified Muslim and Hindu law to take the flexibility out of the law’s traditional practice, to strengthen the Company’s indirect rule and entrench the local elites. Initially, the British in the East India Company favoured the Hindus over the Muslims as government agents because the Hindus were generally less hostile to their presence; the Company systematically removed Muslims from positions of power over its tenure in India. However, by 1893 Hindu power in the Indian National Congress was growing at rate disquieting to the British, so they reversed their traditional policies and began encouraging Muslims to enter