From the size of India's population alone the economic history of India constitutes an important segment of the economic history of mankind. But with the middle of the eighteenth century, it assumed a further, special significance: subjugated by the first industrial nation of the world, it offered the classic case of the colonial remoulding of a pre-modern economy. Not surprisingly, the changing nature and consequences of this process and all its surrounding conditions have formed the constant theme of a long and continuing debate.

If Indian history is not timeless, some parts of Indian historiography certainly seem to be. Habib's paper is a notable example, with its reverence for sacred texts, vigilant even of the order in which the great ones are mentioned, and its repetition in substantially unchanged form of arguments that have been made and answered several times already.

I have no stomach for this ancient battle, and do not propose to answer Habib point by point. But those new to the literature should be warned of some of the peculiarities of his style of controversy.

For too long, considerations of state formation in India have divided on the colonial threshold of history, and the British regime in the subcontinent has been treated as completely different from all prior states. The most important reason for this seems to be that the historiography of the British empire was created by those who ruled India; it was therefore a kind of trophy of domination. Other reasons include the vast and accessible corpus of records on the creation of the British colonial state, the recency of its emergence, and the foundational character of the colonial state for the independent states of the subcontinent. Continuity of the British colonial state with its predecessors is acknowledged only in the case of the Mughals owing, in part, to the prolonged process of separation of the Company's government from its Mughal imperial cover before the Mutiny. Thus, long after they had ceased as a governing regime, the Mughals were considered by contemporaries and subsequently by historians to be the old regime of India.

Thispaper is exclusively concerned with developing broader conceptions of state and state-formation in pre-colonial India, and thus with problems of synthesizing diverse elements separately discussed and researched in the literature. It seeks to argue that certain critical aspects of the development of state and society in the long term have been neglected with serious consequences for overall conceptions and expectations.

Researches in Indian economic history have stimulated curiosity about India's connections with the Indian Ocean area. Work done on European expansion in the non-European world has also contributed to the development of this area of enquiry. Recent writings on the Indian Ocean and the Indian maritime merchant have indicated important possibilities of further research. I shall first briefly consider some of these, and then pass on to an examination of a concrete historical problem where Indian economic history meets the history of European expansion and the two themes are held together by the Indian Ocean.

In 1800, British India was emphatically a multi-region economy, with political and physical boundaries separating the different parts. The British were on the eve of bringing the whole of India (except Sind and the kingdom of Ranjit Singh in the North-West) under their political control. But political control did not at once bring a real unification of currency or banking that serviced long-distance or external trade, let alone the network of cash or credit transactions that kept the locally centred economic activities going.

It isan axiom of India's economic history that government financial resources during the last half-century of the British period were inadequate. ‘The poverty of India was matched by the poverty of its government’ writes Dharma Kumar in The Cambridge Economic History and she estimates that ‘except during the two wars of the twentieth century, the tax revenues amounted to a mere 5 to 7 per cent of the national income'. Raymond Goldsmith's assessment is of an even lower proportion realized by taxation and he further believes that the scanty share of government expenditure in national product declined after the first world war. In most of the historiography, this situation is seen as a notable shortcoming created by imperial rule, the inevitable product of the passivity of the ‘night-watchman state’. Reviewing financial policy in 1939, P. J. Thomas described its predominant characteristic as ‘conservatism’, marked by ‘extreme reluctance to venture on new experiments in raising revenue’, ‘the low burden of public debt’ and ‘inadequate expenditure on social services’.3 These features could have played an important role in constricting India's economic and social development, particularly in the inter-war period of the twentieth century. Financial weaknesses then may have undermined the 'new industrial policy' of the post-first world war era4 and in the 1930s superficially present a crucial contrast with Asia's other major industrializing power, Japan, where government appeared to stimulate the economy impressively by massive borrowing and expenditure.5

Given their sheer numbers, it is hardly surprising that the fate of peasants during British Rule in India should have become a principal index for evaluating its successes and failures. Since the Raj was much more than another effete political superimposition on supposedly timeless villages, the question of agrarian growth or stagnation during its currency is intertwined with more general issues. In so far as colonialism meant a sizable expansion of trade to and from the rural areas, its impact on village social structure in India bears comparison with that of a modern market on peasantries in other parts of the world. Perhaps, the classic case of a peasantry coming face to face with a growing market happened in Russia between 1860 and 1930. The history of that period has generated conceptual discussion about the dynamics of peasant society. The possibility of some of those ideas shedding light on the situation in India has prompted Indo-Russian contrasts and comparisons in agrarian history on more than one occasion (Charlesworth: 1979; Stein: 1984). As a sequel to these writings the Russian debate is considered here briefly in order to suggest some ways in which it might be useful in the Indian context.

The problem of regional underdevelopment, particularly in tribal India, has long been recognized and more than one political party has campaigned on this issue. The Indian constitution and state and central government development plans have included special clauses aimed at assisting those groups, the tribals or adivasis, who are most affected by the problem. Reports have been commissioned and investigations conducted, but rarely have these ended in constructive or relevant action. The work of anthropologists over a number of generations since the 1920s has perhaps done most to tell us of the real depth of the problem as it has affected central India. Foremost amongst them was W. V. Grigson, the aboriginal tribes enquiry officer of the government of the Central Provinces and Berar, whose 1944 report stands as the most comprehensive study available of the condition of the tribal peoples of this region at the end of the colonial period.

The purpose of this short discussion paper is to raise some general questions concerning the current state of the historiography on the industrialization of pre-Independent India. Although triggered off by a close reading of Professor Morris's contribution to the recent Cambridge Economic History of India, volume 2, it is not my intention to review the essay in a detailed and systematic manner; rather I seek to place it in the wider context of what is, in my view, the unsatisfactory state of our accumulated knowledge. The paper is organized in the following way. Section II contends that all too little is known about a seemingly crucial sector—a vacuity that is not confined to India alone among the Third World economies—and that this tends to distort accounts of the general functioning of the international economy. In Section III I try to pinpoint the major areas of weakness, and then go on to suggest the main reasons for this somewhat surprising situation. Finally, in Section IV, I argue that Morris's study reflects the problems I identify but does not take us further down the road towards their resolution.

Models of industrialization and social change, whether Marxist or functionalist, have been derived largely from the historical experience of Western Europe and, especially, of Britain. Social theories came to be constructed upon a specific reading of a particular, and in some respects, unique, historical development. These theories or models, now deepseated in our historiographical consciousness, increasingly offer yardsticks against which industrial development elsewhere in the world is measured. On closer examination, universal postulates thus derived have appeared to generate a large number of special cases. Vast expanses of the globe are seemingly littered with cases of arrested development or examples of frustrated bourgeois revolutions.

The history of economic growth and industrial development in Meiji Japan has long attracted the attention of economic historians of India, especially those who are concerned with the question of industrial development. There is as yet no consensus as to the message of any comparison between Japan and India, and the battlefield between different analyses of the Meiji economy has proved a useful source of pillage to dress up conflicting interpretations of the Indian economy in this and later periods.

Undivided colonial India experienced an accelerated rate of economic change in the nineteenth and twentieth centuries. Official policies and funds combined with private entrepreneurial energies and investment to intensify India's linkages with the world market in trade, industry, agriculture, and natural resource extraction. Slow, but in the long term steady, population expansion accompanied this trend. After 1947, economic development accelerated under five-year plans in India, Pakistan, and Bangladesh, and transformed the earlier colonial economy. Population figures have similarly shot up since partition and independence. These two linked trends have accompanied steadily intensifying human intervention in the natural environment of the subcontinent over the same time. One effect, among others, has been dramatic alteration in land use and vegetation cover. Comparing Francis Buchanan's early nineteenth-century descriptions of the countryside in both north and south India with the appearance of these areas today suggests just how sweeping these changes have been. The landscape of today in virtually every Indian district is very different from that seen two hundred or even hundred years ago.