(A) Systematic Deindustrialization during British Rule in India:
1. Decline of Indian courts: The disappearance of Indian courts struck the first blow at Indian handicrafts. As native states passed under British rule, the demand for fine articles, for display in durbars and other ceremonial occasions disappeared. The ordinary demand did continue for some time longer, but the younger generation lacked the means and inducement to patronize the arts and handicrafts and they declined.
2. Introduction of New Patterns: With the disappearance of Indian states, old rulers and nobles also disappeared and their place was taken up by the European Officers and tourists. Indian craftsmen, however, did not clearly understand the forms and patterns which suited European tastes. They tried to please their new customers by copying their forms and patterns.
3. Competition of Machine Made Goods: Apart from the abolition of Indian courts and the introduction of foreign influences, it was the superior manufacturing technique based on power and improved machinery which enabled the British manufacturers to drive the Indian artisans from out of their home market.
(B) British rule in India brought an end to India’s foreign trade as India primarily became a net exporter of raw materials and importer of finished goods produced by British industry.
1. Net Exporter of Primary Products and Importer of Finished Goods- India under British rule became an exporter of raw materials (cotton, wool, indigo, etc) and importer of finished goods. Composition of exports and imports showed the backwardness of the economy.
2. Monopoly control of India’s Foreign Trade- British government monopolized the exports and import soft the country in a way that, more than 50% trade with Britain only. Imports of Britain’s finished goods provided a huge market to British industry in India.
3. Surplus Trade but only to Benefit the British- Despite the exports exceeded our imports there was mass export of primary goods which was a sign of economic backwardness. Trade surplus used for administrative and war expenses of Britishers and not for growth and development of the country.