home, will pay only Rs a maund. and imports nearly halved between and . As international prices crashed, prices in India also plunged. Between and , wheat prices in India fell by per cent.
Peasants and farmers suffered more than urban dwellers. Though agricultural prices fell sharply, the colonial government refused to reduce revenue demands. Peasants producing for the world market were the worst hit. Consider the jute producers of Bengal.
They grew raw jute that was processed in factories for export in the form of gunny bags. But as gunny exports collapsed, the price of raw jute crashed more than per cent. Peasants who borrowed in the hope of better times or to increase output in the hope of higher incomes faced ever lower prices, and fell deeper and deeper into debt. Thus the Bengal jute growers’ lament: Across India, peasants’ indebtedness increased.
They used up their savings, mortgaged lands, and sold whatever jewellery and precious metals they had to meet their expenses. In these depression years, India became an exporter of precious metals, notably gold. The famous economist John Maynard Keynes thought that Indian gold exports promoted global economic recovery. They certainly helped speed up Britain’s recovery, but did little for the Indian peasant.
Rural India was thus seething with unrest when Mahatma Gandhi launched the civil disobedience movement at the height of the depression in . The depression proved less grim for urban India. Because of falling prices, those with fixed incomes – say town-dwelling landowners who received rents and middle-class salaried employees – now found themselves better off. Everything cost less.
Industrial investment also grew as the government extended tariff protection to industries, under the pressure of nationalist opinion. Who profits from jute cultivation according to the jute growers’ lament? Explain.