Introduction
- Dadabhai Naoroji, famously called the Grand Old Man of India, was the pioneer who coined the term ‘Drain of Wealth’.”
- In his book “Poverty and Un-British Rule in India” (1901), he explained how British economic policies transferred India’s wealth to Britain, leaving the Indian economy hollow and underdeveloped.
Meaning of “Drain of Wealth”
- The process by which Indian revenues, taxes, and natural resources were collected from India but not invested back for India’s development.
- Instead, this wealth was transferred to Britain to serve imperial interests.
Drain of Wealth – Key Aspects
|
Aspect |
British Rule (Before 1947) |
Independent India (After 1947) |
|
Use of Taxes & Revenue |
Money sent to Britain as Home Charges, pensions, profits; not used for Indian welfare |
Revenue invested in development projects like dams, roads, schools |
|
Agriculture |
Exploitative revenue collection; farmers overtaxed; famines common |
Focus on welfare: irrigation, subsidies, MSP, crop insurance |
|
Industry |
Suppressed Indian industries; promoted British imports |
Industrialisation via PSUs, Make in India, PLI scheme |
|
Infrastructure |
Built mainly for British trade & army movement |
Modern highways, metros, airports, renewable energy |
|
Education & Health |
Schools were confined to elites and public healthcare was barely developed. |
Promoting inclusive development via universal schooling, premier institutes (IITs/IIMs), advanced healthcare (AIIMS), and programs like Ayushman Bharat. |
|
Social Welfare |
Almost zero investment in welfare |
MGNREGA, pensions, food security, poverty alleviation |
|
Military |
Indian soldiers used in British imperial wars abroad |
Indian forces serve national defence (Army, Navy, Air Force) |