In 1895, the British government set up the Welby Commission to investigate wasteful spending in India. The commission presented its findings in 1900—it had found a number of cases of English expenses being relieved through the revenues squeezed from India. The starving Indian peasants were bearing the burden of not only Britain’s wars in Persia, Afghanistan, Burma, and China, but also for an array of civilian activities which could be of no benefit to them.
For instance, out of the British Empire’s revenues from India, 200,000 British pounds every year (a very high sum in those days) was being paid as Ecclesiastical charges. The objective of this outlay was to fund the preaching of Christianity to India’s Hindu masses. Thus, in the British regime, the starving Hindu peasants were being made to pay for their own proselytization. Millions of pounds were spent as Ecclesiastical charges over a period of around four decades.
The Indian peasants were paying for the maintenance of Aden (capital of Yemen), and of the Persian Mission, and the Consular Establishments in China. The operations of the company called Red Sea and India Telegraph were being funded through revenues from India—when this company failed, the burden of taking care of its liabilities, including the pension of its employees, fell on the Indian peasants.
The top ranking British officials in India had been granted lifelong pensions (in the tune of thousands of pounds). Charles Cornwallis (the Marquess Cornwallis) was granted a pension of 5000 pounds. Warren Hastings’s legal expenses were covered by the Indian peasants, who were also forced to fund his yearly pension of 4000 pounds and his interest free loan of 50,000 pounds. Francis Rawdon-Hastings, Wellesley, Hardinge, Dalhousie and others received similar pensions.
In his 1902 book Poverty And UN-British Rule In India, Dadabhai Naoroji, who was one of the members of the Welby Commission, has conducted an analysis of the commission’s report. Naoroji suggests in his book that the British ruled areas in India were being racked by famines, which consumed millions of lives, because the British were squandering India’s wealth to fund their global empire. Large-scale famines were unheard of in India before the British arrived.
The British politicians were unconcerned about the fact that their extortionate policies were directly responsible for the death (through starvation) of millions in India. In his book, Naoroji offers the irresponsible and cruel statement that Lord Salisbury, the Secretary of State for India, made in 1875:
“The injury is exaggerated in the case of India, where so much of the revenue is exported without a direct equivalent. As India must be bled the lancet should be directed to the parts where the blood is congested or at least sufficient, not to those (the starving peasants) which are already feeble from the want of it.” According to Lord Salisbury, Britain was doing nothing wrong by bleeding India, since Indian blood was vital for the maintenance of the British Empire.
Naoroji posits that the despotic model of governance was the primary cause of India's massive poverty. He wrote in his book that in the British ruled areas, “the people of India have not the slightest voice in the expenditure of the revenue, and therefore in the good government of the country. The powers of the Government being absolutely arbitrary and despotic, and the Government being alien and bleeding, the effect is very exhausting and destructive indeed.”
Between 1896 and 1900, British India suffered one of the worst famines in India’s history, but the British refused to reduce their tax demand. In 1897, the worst year of famine, they collected 17 million pounds as land revenue (which was the normal quota). They exported grain worth 10 million pounds from a country where millions had nothing to eat and were starving to death. According to the British government's own estimates, one million people died in the famine. The non-British sources present a much higher figure of starvation related deaths.
The British government had known since the 1880s that famine-like conditions were erupting in their domain. But they did nothing to avert the crisis. The living conditions in the regions ruled by Hindu kings were better, because in these areas the rulers listened to the masses and they did not impose an unbearable tax burden. In his account of India, Bishop Reginald Heber observes that “no native king demands a land rent as high as the British do.”