Land Revenue Systems, Drain of Wealth and Early Peasant and Tribal Revolts

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Why the economy changed

The Company came to trade, but after the Diwani of 1765 land revenue became its main income, and the goods it exported were bought with Indian revenue itself. Three land revenue systems were created, the old handicraft economy collapsed and wealth flowed to Britain without return. The burden fell on peasants, artisans and forest tribes, who rose in a long series of revolts well before 1857.

Permanent Settlement

Lord Cornwallis, advised by John Shore, made the ten-year settlement of 1789-90 permanent in 1793 in Bengal, Bihar and Orissa; it was later extended to the Banaras region and parts of northern Madras. Zamindars became hereditary owners of the land, and the revenue they paid was fixed forever at about ten-elevenths of the rent they collected, one-eleventh being left to them. Under the Sunset Law an estate whose revenue was not paid by sunset on the due date was auctioned. The state gained a fixed income and a loyal landed class, but it lost any share of later increases in land value, peasants became tenants at will, and many old zamindari families lost their estates to new, often absentee, buyers.

Ryotwari and Mahalwari

The Ryotwari system was first tried by Alexander Read in Baramahal in 1792 and developed by Thomas Munro, who extended it across the Madras Presidency as Governor from 1820; it was later applied in the Bombay Presidency, Assam and Coorg. Here the state settled directly with each ryot (cultivator), who was treated as owner as long as he paid the revenue; there was no middleman, but rates were high and were revised every 20 to 30 years. The Mahalwari system was proposed by Holt Mackenzie in 1822 for the North-Western Provinces and revised under William Bentinck in 1833 by Robert Bird and James Thomason; it was also used in Punjab and parts of Central India. The settlement was made with the village or group of villages (mahal) as a unit, and the headman (lambardar) collected the revenue on behalf of the community.

Drain of wealth and deindustrialisation

Dadabhai Naoroji put forward the drain theory in 1867 and set it out fully in Poverty and Un-British Rule in India (1901), where he estimated India's per capita income at 20 rupees a year for 1867-68. The drain was the part of India's wealth sent to Britain without economic return: salaries and pensions of British officials, interest on loans, the home charges, profits of British firms and the cost of the India Office in London. R.C. Dutt's Economic History of India and M.G. Ranade carried this critique forward. Meanwhile Indian handicrafts collapsed. After the Charter Act of 1813 ended the Company's monopoly of trade with India (except in tea), machine-made British cloth entered India almost duty-free while Indian textiles faced heavy duties in Britain; famous centres such as Dhaka (muslin) and Murshidabad (silk) declined, artisans were pushed onto the land, and agriculture was turned towards indigo, cotton, jute and opium for export.

Early revolts in Bengal and the east

The Sanyasi and Fakir rebellion in Bengal in the late 18th century, linked to leaders such as Majnu Shah, Bhawani Pathak and Debi Chaudhurani, grew out of the famine of 1770, high revenue and curbs on pilgrims; Bankim Chandra Chattopadhyay's novel Anandamath (1882) is set against it. The Paika rebellion (1817) in Khurda, Odisha, was led by Bakshi Jagabandhu. The Kol uprising (1831-32) in Chhotanagpur, led by Buddho Bhagat, was against outsiders who took tribal land. The Faraizi movement of Haji Shariatullah and his son Dudu Miyan in eastern Bengal turned against zamindars and indigo planters.

Santhal, Indigo and later revolts

The Santhal Hul (1855-56), led by the brothers Sidhu and Kanhu in the Rajmahal hills (Damin-i-Koh), targeted zamindars, moneylenders and police, the dikus or outsiders; after it was crushed a separate Santhal Parganas district was created. In the Indigo revolt (1859-60) in Nadia and Jessore, ryots led by Digambar and Bishnu Biswas refused to grow indigo for European planters; Dinabandhu Mitra's play Neel Darpan (1860) exposed the planters, Harish Chandra Mukherjee's Hindoo Patriot backed the ryots, and the government set up an Indigo Commission in 1860. Later came the Pabna agrarian league (1873) against rent increases and the Deccan riots (1875) against moneylenders, which led to the Deccan Agriculturists Relief Act (1879).

Birsa Munda and the meaning of the revolts

The Munda Ulgulan (1899-1900) of Birsa Munda, called Dharti Aba, opposed the breakdown of the khuntkatti system of joint tribal landholding, the dikus and missionary interference; Birsa died in Ranchi jail in 1900, and the Chhotanagpur Tenancy Act followed in 1908. These revolts were local, fought with traditional weapons and crushed by superior force, but they showed how deeply Company rule had disturbed rural life, and several of them forced protective laws.

Key facts

Permanent Settlement 1793: Cornwallis (advised by John Shore); Bengal, Bihar and Orissa; zamindars made owners; revenue fixed forever; Sunset Law for defaulters.
Ryotwari: Alexander Read (Baramahal, 1792) and Thomas Munro (Madras, 1820); direct settlement with the cultivator; also Bombay, Assam and Coorg.
Mahalwari: Holt Mackenzie 1822, revised in 1833 under Bentinck (Bird and Thomason); village (mahal) as the unit; North-Western Provinces, Punjab and parts of Central India.
Drain theory: Dadabhai Naoroji, Poverty and Un-British Rule in India (1901); per capita income 20 rupees (1867-68). R.C. Dutt wrote Economic History of India.
Sanyasi and Fakir rebellion (Bengal, late 18th century): Majnu Shah and Bhawani Pathak; background of Bankim Chandra's Anandamath (1882), which contains Vande Mataram.
Paika rebellion 1817: Bakshi Jagabandhu, Khurda (Odisha). Kol uprising 1831-32: Buddho Bhagat, Chhotanagpur.
Santhal Hul 1855-56: Sidhu and Kanhu, Rajmahal hills, against the dikus; led to the Santhal Parganas district.
Indigo revolt 1859-60: Digambar and Bishnu Biswas (Nadia); play Neel Darpan by Dinabandhu Mitra; Indigo Commission 1860.
Deccan riots 1875 against moneylenders led to the Deccan Agriculturists Relief Act 1879; Pabna agrarian league 1873 fought rent increases.
Munda Ulgulan 1899-1900: Birsa Munda (Dharti Aba), Chhotanagpur; died in Ranchi jail 1900; Chhotanagpur Tenancy Act 1908.

Quick revision

Permanent Settlement 1793 (Cornwallis, zamindars, Bengal, Sunset Law); Ryotwari - Read 1792, Munro in Madras 1820; Mahalwari - Holt Mackenzie 1822, Bird and Thomason 1833; drain theory - Naoroji, per capita income 20 rupees; Charter Act 1813 opened India to British goods; Sanyasi revolt (Anandamath); Paika 1817; Kol 1831-32; Santhal 1855-56; Indigo 1859-60 (Neel Darpan); Deccan riots 1875; Munda Ulgulan 1899-1900

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