The below mentioned article provides an overview on the Indian Economy during the Pre-British Period. After reading this article you will learn about: 1. Introduction to Indian Economy during Pre-British Period 2. Condition of Indian Villages and Village Communities during Pre-British Period 3. Condition of Agriculture 4. Prices and Wages and Others.

Introduction to Indian Economy during Pre-British Period:

During the pre-British period, i.e. during the mid-eighteenth century, the condition of Indian economy was not at all satisfactory. Just after the death of Aurangzeb in 1707, the central power at Delhi was so weak that the situation had led to disintegration and gradual downfall of deep rooted Mughal Empire.

During 1750, the Indian economy was passing through recurrence of crisis and disorders because by this time the central power at Delhi was either weakened or disappeared.

The writings of Dr. Francis Bukanon, Charles Metacalfe and Prof. Gadgil made available sufficient information about the conditions of Indian economy during the pre-British period.


Indian economy, during the pre-British period, consisted of backward, isolated and self sustaining villages on the one hand and on the other hand, there were number of towns which were the seats of administration, pilgrimage, commerce and handicrafts.

During this period, the mode of transport and communication of India were totally backward, underdeveloped and insufficient. Under such a situation, the size of market was also very small.

Condition of Indian Villages and Village Communities during Pre-British Period:

During the pre-British period, the village community was composed of different groups based on simple division of labour. There were farmers who cultivated land and tended cattle. Other groups of people were weavers, goldsmith, potters, washermen, carpenters, cobblers, oil pressers, barber-surgeons etc.

All the above mentioned occupations were hereditary. These various groups of people were getting their remuneration in terms of crops during the harvesting period against the services rendered by them.


These Indian villages were functioning independently as most of food articles and raw materials produced within the villages were either consumed or purchased by the village communities itself. Agricultural and handicraft industry were interdependent and thus the village republics were able to function independently.

Indian villages were almost self-sufficient in respect of daily necessities excepting commodities like salt, spices, fine cloth, luxury and semi-luxury goods.

In this connection, Sir Charles Metacalfe wrote, “The village communities are little republics having nearly everything they want within themselves, and almost independent of foreign relations. They seem to last where nothing lasts. This union of the village communities each one forming a separate little state by itself…………………… is in a high degree conducive to their happiness, and to the enjoyment of a great portion of freedom and independence”.

Thus during the pre-British period, Indian villages were mostly consisting of three distinct classes:


(a) the agriculturists,

(b) the village artisans and menials and

(c) the village officials.

There were again two types of agriculturists—the land owning and the tenants.

The village community had enjoyed a simple form of self government. The headman, the watchman, the accountant, the preacher, the school teacher etc. were all village officers. Thus Indian villages during those days were working as a complete administrative and economic unit.

Condition of Agriculture during the Pre-British Period:

During the pre-British period, i.e., during the mid-eighteenth century, the condition of Indian agriculture was not at all satisfactory. During those days, agriculture was the main source of livelihood in India. The economic condition of Indian agriculturists was really very much painful.

Poor farmers had to pay a high rate of taxes as imposed by the then administrators of the country which led to high degree of exploitation on these farmers.

During those days Indian rulers had constructed and maintained some irrigation projects but these works were very much insufficient as compared to its requirement. Moreover, farmers were following traditional methods in their agricultural operations.

Important crops which were grown by Indian farmers included mainly rice, wheat, bajra, jowar and minor cereals alongwith the commercial crops like jute, raw cotton, groundnut, tobacco etc.


Again, the crop rotation practices of standard pattern were followed without any variation. Some strips of land were left fallow every year just for the interest of regaining fertility. In those days, the agricultural implements were mostly primitive and simple which included wooden plough, iron sickle, leather bag for drawing water etc. During those days, agriculturists were applying only natural organic manures.

Thus it is better to conclude with Dr. Buchanon and Prof. Gadgil that the conditions of Indian agriculturists in total were very much depressed. Moreover, the land policy followed by the rulers of those days was mostly going against the farmers and these policies were specially framed to serve the interests of rulers and zamindars of India.

Prices and Wages during the Pre-British Period:

During the pre-British period, the prices of foodgrains used to fluctuate widely between different places. Markets for most of the commodities were very much restricted to local areas in the absence of adequate means of transport and communications. Under such a situation, agricultural produces and the other commodities produced by artisans in the cottage industries were not getting remunerative prices.

During those days, the prevailing wage rates were very low. Wages of village artisans were paid not in terms of cash but in kind. The wages were paid mostly once in a year and that is just after the harvesting season. The rates of wages were mostly determined by customs and conventions.

The Structure and the Conditions of Towns during the Pre-British Period:


During the pre-British period, the major portion of the total population of India was living in the rural areas. Nearly 10 per cent of the total population was living in the urban areas and those towns were merely out grown villages.

According to Prof. D.R. Gadgil, towns of those days owed their existence principally due to the following three reasons:

(a) A good number of towns of India were places of pilgrimage or sacred religious centres (for example, Gaya, Benaras, Allahabad, Puri, Nasik etc.);

(b) A good number of towns were the seats of courts of Nawabs or kings or the capital of a province (for example, Bijapur, Golconda, Delhi, Lahore, Lucknow, Poona etc.); and


(c) A good number of towns were trading or commercial centres due to its trade importance (for example, Surat, Mirzapur, Hubli, Bangalore etc.). These towns were existing on different trade routes. Those towns which were actually the trade centres proved more stable.

Lifestyle in the towns was completely different from that of the villages. In these towns, a large category of occupations and different varieties of trades were existing. Thus the sizes of population of these towns were gradually increasing. Moreover, the size of market of these towns was also wide.

Industries and Urban Handicrafts during the Pre-British Period in India:

Although agriculture had dominated the Indian economy during the pre-British period yet some Indian industries, producing certain special products, enjoyed worldwide reputation. During those days, many of the handicrafts produced in the urban areas of India were quite famous. Among all those various famous urban handicrafts, textile handicrafts earned a special status and were also spread over the whole country.

During those days, the muslin of Dacca, silk sarees of Benaras, shawls and carpets of Kashmir and Amritsar, the calicos of Bengal, dhoti and dopattas of Ahmedabad, silk and bordered cloth of Nagpur and Murshidabad etc. were very famous and received much recognition in international markets.

While recognising the skill of Indian artisans, T.N. Mukherjee wrote, “A piece of the muslin 20 yards long and one yard wide could be to pass through a finger ring and required six months to manufacture.”

Moreover, India was well known for her other artistic handicraft industries which include jewellery made of gold and silver, brass, copper and bell metal wares, marble work, carving works in ivory, wood, stone etc.


Artistic glassware were also produced in India during those days and had earned international reputation during those days. India had also developed high level of metallurgy by those days and the cast-iron pillar standing near Delhi is a real testament of that.

All these industries and handicrafts had its patronage of local administrators for their gradual development. In the urban area each handicraft was properly organised into a guild so as to safeguard their common interest. These guilds were enacting their own laws which were again respected by the then rulers of the country.

According to M.G. Ranade, the Indian industries “not only supplied all local wants but also enabled India to export its finished products to foreign countries.” During those days, Indian export items were consisting mostly of manufactured items like cotton and silk fabrics, calicos, silk and woollen cloth and artistic wares made of glass and metal.

Besides, the other export items were cinnamon, pepper, opium, indigo etc. Throughout the 17th and 18th century, European countries were purchasing the above mentioned manufactures of India.

Thus considering this superior industrial state of India during the pre-British period, the Industrial Commission (1918) recorded the following lines:

“At a time when the West of Europe, the birth place of modern industrial system, was inhabited by uncivilised tribes, India was famous for the wealth of her rulers and for high artistic skill of her craftsmen. And even at a much later period, when the merchant adventurers from the west made their first appearance in India, the industrial development of this country was at any rate, not inferior to that of the more advanced European nations.”

Conditions of Transport and Trade during the Pre-British Period:


During the pre-British period, there were no proper transportation systems in India. In the absence of pucca roads, different villages of India were connected with dusty tracks. Naturally, most of the roads become muddy during the rainy season and even some of the villages were cut-off due to heavy rainfall followed by consequent flood.

In respect of water transport, it was only in some parts of Northern India where some rivers were navigable and small wooden country boats were used for carrying passengers as well as freights. But in most other part of the country, bullock carts and pack animals were considered as the standard modes of transport. Thus under such a condition, the movement of men and materials was very slow.

During those days weekly markets were organised in different parts of the country and most of the people used to make their daily purchases from these weekly markets. In some places annual fairs were organised in addition to these weekly markets. Thus, in fine, we can conclude that the transport system as well as the market conditions in India during the pre-British period was not at all satisfactory.