Indian Society and the Making of the British Empire
There was no reason to believe that British manufactures, textiles and machinery needed formal empire to penetrate Indian markets. After all, they had commanded markets throughout Asia, Europe and Latin America without benefit of collectors and judges. In fact, modern economic historians speculate that without easy colonial markets British industries might have modernised more rapidly in the later nineteenth century to face growing European and American competition. India would have sold raw materials on the world market regardless of her formal colonial status. Even the Indian army was used largely to patrol and contain dissidence within India. For this reason wise men at the supposed height of empire in the days of Victoria's coronation as Queen-Empress continued to reiterate doubts and questions which had persisted since the days of Edmund Burke.
For some the British Indian Empire had gone from adolescence to early senility without passing through an age of maturity. The reason for pessimism among Indian officials as much as Westminster politicians becomes clearer when they acknowledge how many false starts the Indian Empire had made on the road towards economic success and political stability by 1870. For the ambitions of colonial planners from Clive and Hastings through Wilberforce, Bentinck and Dalhousie had been disappointed again and again. For one thing India had not become a rich colony of plantation and conversion, an Asian Brazil, as some had thought possible in the 1820s. British capitalism in India was a relative failure. Little money was put into the economy, except through copper-bottomed schemes like railway loans. Fear of an uncertain trading environment and the lack of commitment to the local economy of expatriates in Calcutta and Bombay ensured that profits would be returned to England not ploughed back into the Indian economy. Cape Town, Sydney, even Buenos Aires, saw the development of much more dynamic British expatriate economies. The feeble showing of Protestant Christianity in India meant that there was no force for assimilation to breach the racial boundaries between Europeans and Indians which were now widened by the hauteur of the post-Mutiny generation of officials and businessmen. The flourishing, if dubious Anglo-Indian partnerships of the eighteenth century were discouraged in the new age of Victorian probity. Moreover, Indian government retained its hostility to plantations and European ownership of land. There were too many opportunities for conflict with indigenous landowners to please officialdom.
Again, India had been written off as an indigenous plantation economy in which peasants produced crops under state control for flourishing export markets. This, J. B. Money proclaimed in 1860, when he unfavourably compared British India with Dutch Indonesia in Java, or how to manage a colony. The Dutch, through their Cultivation System, had forced Javanese peasants to produce crops for them as a form of tribute in kind, and this had bailed Holland's weak economy out of the depressions of the early nineteenth century. India, despite its size, was a relatively inefficient producer of agricultural raw materials with only a weak hold in foreign markets. Apart from opium valuable export crops made relatively little contribution to government finances over much of the country. The British never gained sufficient control over peasant producers to extract cash crops as a form of tribute, even in areas such as 'wet' South India where tribute had once been exacted as a proportion of the crop. The rigid laissez faire economy of free market which had become dominant in official thinking by 1815 was a significant discouragement to state control over the economy. In fact the so-called Age of Reform of the 1830s coincided with a withdrawl of government from many areas of economic management.