In the epilogue to his memoirs, Bao-Dai, the last sovereign of the Nguyên Dynasty, wrote:

In ancient Vietnamese society, the social system is embodied in the person of the emperor, through whom everything religious is done, down to the lowest village level. But, if he sanctifies this act by prescribing or controlling it, he does not assume it. On the contrary, the Vietnamese ideal is that of a sovereign wise enough to reign without stirring, ‘with his hands hanging and his clothes loose…’.

Researches in Indian economic history have stimulated curiosity about India's connections with the Indian Ocean area. Work done on European expansion in the non-European world has also contributed to the development of this area of enquiry. Recent writings on the Indian Ocean and the Indian maritime merchant have indicated important possibilities of further research. I shall first briefly consider some of these, and then pass on to an examination of a concrete historical problem where Indian economic history meets the history of European expansion and the two themes are held together by the Indian Ocean.

In 1800, British India was emphatically a multi-region economy, with political and physical boundaries separating the different parts. The British were on the eve of bringing the whole of India (except Sind and the kingdom of Ranjit Singh in the North-West) under their political control. But political control did not at once bring a real unification of currency or banking that serviced long-distance or external trade, let alone the network of cash or credit transactions that kept the locally centred economic activities going.

It isan axiom of India's economic history that government financial resources during the last half-century of the British period were inadequate. ‘The poverty of India was matched by the poverty of its government’ writes Dharma Kumar in The Cambridge Economic History and she estimates that ‘except during the two wars of the twentieth century, the tax revenues amounted to a mere 5 to 7 per cent of the national income'. Raymond Goldsmith's assessment is of an even lower proportion realized by taxation and he further believes that the scanty share of government expenditure in national product declined after the first world war. In most of the historiography, this situation is seen as a notable shortcoming created by imperial rule, the inevitable product of the passivity of the ‘night-watchman state’. Reviewing financial policy in 1939, P. J. Thomas described its predominant characteristic as ‘conservatism’, marked by ‘extreme reluctance to venture on new experiments in raising revenue’, ‘the low burden of public debt’ and ‘inadequate expenditure on social services’.3 These features could have played an important role in constricting India's economic and social development, particularly in the inter-war period of the twentieth century. Financial weaknesses then may have undermined the 'new industrial policy' of the post-first world war era4 and in the 1930s superficially present a crucial contrast with Asia's other major industrializing power, Japan, where government appeared to stimulate the economy impressively by massive borrowing and expenditure.5

Given their sheer numbers, it is hardly surprising that the fate of peasants during British Rule in India should have become a principal index for evaluating its successes and failures. Since the Raj was much more than another effete political superimposition on supposedly timeless villages, the question of agrarian growth or stagnation during its currency is intertwined with more general issues. In so far as colonialism meant a sizable expansion of trade to and from the rural areas, its impact on village social structure in India bears comparison with that of a modern market on peasantries in other parts of the world. Perhaps, the classic case of a peasantry coming face to face with a growing market happened in Russia between 1860 and 1930. The history of that period has generated conceptual discussion about the dynamics of peasant society. The possibility of some of those ideas shedding light on the situation in India has prompted Indo-Russian contrasts and comparisons in agrarian history on more than one occasion (Charlesworth: 1979; Stein: 1984). As a sequel to these writings the Russian debate is considered here briefly in order to suggest some ways in which it might be useful in the Indian context.

The problem of regional underdevelopment, particularly in tribal India, has long been recognized and more than one political party has campaigned on this issue. The Indian constitution and state and central government development plans have included special clauses aimed at assisting those groups, the tribals or adivasis, who are most affected by the problem. Reports have been commissioned and investigations conducted, but rarely have these ended in constructive or relevant action. The work of anthropologists over a number of generations since the 1920s has perhaps done most to tell us of the real depth of the problem as it has affected central India. Foremost amongst them was W. V. Grigson, the aboriginal tribes enquiry officer of the government of the Central Provinces and Berar, whose 1944 report stands as the most comprehensive study available of the condition of the tribal peoples of this region at the end of the colonial period.

The purpose of this short discussion paper is to raise some general questions concerning the current state of the historiography on the industrialization of pre-Independent India. Although triggered off by a close reading of Professor Morris's contribution to the recent Cambridge Economic History of India, volume 2, it is not my intention to review the essay in a detailed and systematic manner; rather I seek to place it in the wider context of what is, in my view, the unsatisfactory state of our accumulated knowledge. The paper is organized in the following way. Section II contends that all too little is known about a seemingly crucial sector—a vacuity that is not confined to India alone among the Third World economies—and that this tends to distort accounts of the general functioning of the international economy. In Section III I try to pinpoint the major areas of weakness, and then go on to suggest the main reasons for this somewhat surprising situation. Finally, in Section IV, I argue that Morris's study reflects the problems I identify but does not take us further down the road towards their resolution.