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
Indirect rule European "advisors" effectively overseeing the government of large numbers of people spread over extensive areas. Some British colonies were ruled directly by the Colonial Office in London, while others were ruled indirectly through local rulers who are supervised behind the scenes by British advisors. In 1890 Zanzibar became a protectorate (not a colony) of Britain. Prime minister Salisbury explained his position: The Princely States of India were ruled indirectly. So too was much of the West African holdings. The ideological underpinnings, as well as the practical application, of "indirect rule" in Kenya and Nigeria is usually traced to the work