#26: How was the economy of India transformed by the British? The first thing we'll talk about is the East India Company.

Then we'll talk about the metaphoric Jewel in the Crown, and then the impact of colonialism.

To understand how the economy of India was transformed by the British, you have to understand that it wasn't the country of Britain that imperialized India, it was a private corporation: the East India Company.

It's like Microsoft coming over the United States and taking over California.

They actually rule the country for the British Crown until the Sepoy Mutiny in the middle of the 19th century.

The things that they were making in India and exporting around the world were: cotton, silk, which are obviously things that you use to make textiles and they would sail those back to England and make textiles, indigo, which is a dye they make everything from blue to purple, saltpeter, which is really important in the introduction of gun powder, we cannot make gunpowder without saltpeter, tea, which the British were famous for drinking, and opium, which is a very powerful narcotic.

The British didn't actually use the opium, they would sail and take it to China.

Now, here's a map of India to Pakistan.

Afghanistan's up here, and then to the east is China.

So, what they would do is they would promote this concept of laissez faire.

Laissez faire, remember, is free market capitalism.

What they would try to do is they would say, "Listen, we're doing laissez faire, but only in Europe.

" And India would produce all these materials, raw materials for the factories of England.

This promotes the concept of capitalism, where people could invest money and make a profit.

But the reason it's so powerful for England is they have trade monopolies in India, they actually control production of everything.

Here we have a picture of today in Afghanistan, they still grow opium.

This is the poppy plant and they have sliced open the bulb, and the sap itself becomes opium.

Opium can be refined into what we call heroine today.

The way the East India Company did this was the sepoys, and here are some pictures of the sepoys.

These are Indian soldiers in India who actually work for the East India Company.

Now there's two major groups you have to know in India.

There are the Muslims and the Hindus, and those are the two groups.

What the British did is they would always play those two groups off each other as a way to control the country.

Now, India becomes so profitable for England that it becomes known as the Jewel of the Crown.

It was a phrase used by the British prime minister to describe India.

The Queen of England during the 19th century, here she is right here, Queen Victoria, was proclaimed Empress of India.

And the reason it's the Jewel of the Crown is it is the most valuable of all the colonies, they make a lot of money off of India.

The way they made a lot of money off of India were these textiles, famously calico.

Calico, which you see right over here and over here as well, was this Indian cloth with floral prints, and it was originally from Calicut.

What they actually do is they do such a good job of stealing calico that they export it around the world, including to America, and they destroy native Indian textile production.

And when we study Gandhi, we'll see how he responds to this, in a future unit.

So, opium.

Opium is another product that they use.

Now, they created a trade deficit with China, and you'll study this later this week with a geography assignment.

And they could never get any access to the Chinese market.

The Chinese were not interested in Western products.

However, they were interested in opium.

So they would grow the opium in India, and they would transport it from India and Afghanistan to China.

And it's very addictive, and this became notorious because there were these opium dens, they were the 19th century crack houses basically.

So we'll talk a lot more about that later in the year.

India benefits in some ways.

They benefit by railroads.

Right here is a map of all the different railroads across India.

They used to transport these goods, and this creates benefits in India that didn't exist.

You have better travel, better goods, and better markets.

And they actually still use a lot of these railroads today in India.

Local warfare.

They also get rid of all the local warfare that happened in India before the British arrived.

They stopped the war between the Hindus, the Muslims, and the Sikhs.

There were lots of wars between these groups until the British arrived.

The British show up and they actually stop it all.

So there was that benefit as well from Imperialism.

The cash crops.

Now famously the two cash crops that we're going to study to help us understand the independence given to India later by Gandhi is indigo, and indigo is this plant right here and you use indigo to stain cloth to get purples and blues, and cotton.

Now why are they called cash crops? You can grow them for sale, but you cannot eat them.

So that is how the Indian economy is changed by the British.

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