In the eighteenth century, the most prosperous regions of the Indian subcontinent were located in the Maratha Empire. The Maratha rulers imposed low taxes and they maintained good law and order—as a result of their good governance, agriculture and industry was flourishing in most parts of their empire. In 1832, Major General John Malcolm, an administrator in the East India Company, made the following observation about the economic condition of the Maratha Empire:
“It has not happened to me ever to see countries better cultivated and more abounding in all the produce of the soil as well as in commercial wealth, than the Southern Mahratha districts. . . . Poona, the capital of the Peshwas, was a very wealthy and thriving commercial town, as there was as much cultivation in the Deccan as it was possible for an arid and unfruitful country to admit. I do not think either commercial or agricultural interests are likely to be improved by our rule. I refer their prosperity to be due... to the knowledge and almost devotion of the Hindus to agricultural pursuits; to their better understanding and practice than ours... in raising towns and villages to prosperity.” (This quote and other quotes that I have used in this article are from Reginald Reynold’s 1946 book, The White Sahibs in India.)
The condition in the areas ruled by the British was horrific—there was rampant corruption and lawlessness, and a major part of the population was starving. Some of the worst famines in the history of the Indian subcontinent have happened in Bengal after the East India Company conquered the region. In the famine of 1770, one-third of Bengal’s population, about 10,000,000 people, starved to death. Instead of being concerned about the starvation deaths, the East India Company bragged in its reports that the decline in Bengal’s population had led to less local consumption and rise in the company’s profits.
In 1771, the Calcutta Council of East India Company’s Court of Directors declared: “Notwithstanding the great severity of the late famine, and the great reduction of people thereby, some increase has been made in the settlements both of the Bengal and the Behar provinces for the present year.” In 1772, Warren Hastings boasted: “the net collections of 1771 exceeded even those of 1768.” Thomas Macaulay did not care about the millions who had starved to death under the East India Company’s watch—he was delighted by the company’s rising profits. He wrote: "Whatever we may think of the morality of Hastings, it cannot be denied that the financial results of his policy did honor to his talents.”
Before the British became the supreme power in Bengal, textile industry was flourishing in this region. Within three decades the British exterminated Bengal’s textile industry through their predatory policies—they imposed extortionate taxes, and mandated that the textile weavers could sell their products only to British agents. The textile mills could not function under such rules and they were forced to shut down. In the nineteenth century, when the British acquired power in other parts of India, they deliberately enacted policies to destroy the textile industry everywhere. Once the Indian textile industry was wiped out, they opened the Indian market to textiles produced in Britain.
The condition in the areas controlled by Islamic regimes was as horrific as the condition in British Bengal. In South India, several regions suffered catastrophic depopulation due to the extortionist policies and brutal campaigns of warlords like the Nawab of Arcot and Hyder Ali (and his son Tipu Sultan). People either fled from these lawless areas, or they were slaughtered during military campaigns. Untold numbers died due to starvation and disease. Massacres and famine were the constant features of life. In his speech delivered in the British parliament, Edmund Burke spoke about the brutality and corruption of the East India Company and the Islamic regimes.
The condition in the Hindu states of Rajasthan and other parts of North India was far better than the condition in British and Islamic states. Bishop Reginald Heber toured the Kingdom of Bharatpur (a Hindu Kingdom located in Rajasthan), in the early years of the nineteenth century. He has made the following observation:
“This country is one of the best cultivated and watered tracts which I have seen in India. The population did not seem great, but the villages were in good condition and repair, and the whole afforded so pleasing a picture of industry and was so much superior to anything I had been led to expect in Rajputana, which I had seen in the Company’s territories, that I was led to suppose that either the Raja of Bharatpur was an extreme exemplary and paternal governor or that the system of management adopted in the British provinces was less favorable to the improvement and happiness of the country than some of the Native States.”