The labour process in agrarian production marked by its predominantly familial character was encumbered by various forms of appropriation imposed upon it. The colonial state, local landlords, metropolitan capitalists, indigenous merchants and moneylenders, and richer peasants were among the many claimants of the surplus produced by the working peasantry. The aim of those who lorded over landed rights and controlled the circuits of capital was to hold down, with the assistance of those who wielded state power, the share of labour in the total social product. Several mechanisms of extracting the surplus were available and generally deployed simultaneously. Yet, while the social organization of production displayed a strong strand of continuity despite important elements of qualitative change, the principal modes of exploitation and relations of appropriation underwent more decisive transitions over the two centuries following the onset of colonial rule.

The extraction of surplus value produced by peasant labour in the forms of rent, interest and profit occurred during the century following the grant of the Diwani to the Company in 1765 within a primary framework of the colonial state's land revenue demand. The Permanent Settlement of the land revenue with the zamindars of Bengal in 1793 was designed to ensure the security and stability of the state's main source of income. As the votaries of free trade got the better of defenders of the Company's monopoly in the 1810s, the need for remittances was added to the major concern about fiscal strength. An assessment of the early experience in Bengal and the new ideological currents of the nineteenth century led colonial administrators to institute varying sorts of land revenue systems in other regions of India.