Read this article to learn about the economic impact of early British rule on Indian trade.
In 1656 Prince Shuja-ud-din, nawab of Bengal, granted the East India Company exemption from payment of the usual customs duty of 2½ % per cent in return for a consolidated payment of Rs.3,000.
Murshid Quli Jafar Khan when Governor of Bengal refused to allow this concession to be enjoyed by the English. The English Company, therefore, obtained a fresh farman from Emperor Farrukhsiyar in 1717 renewing the concession permitted by Prince Shuja in 1656. The nawab stipulated and the English agreed that the Company’s passport or dastaks could be used for only import and’ export trade and definitely not for internal trade.
The Concession was soon abused by the English who began to cover their internal trade by the dastaks and even to sell the dastaks to the Indian merchants who also began to fly the Company’s flag and transport their articles under the cover of the dastaks. This surreptitious use of the dastaks enabled the Company’s servants engaged in internal trade as well as the native merchants who managed to purchase the dastaks from the English to avoid payment of customs duties thereby undersell the other native merchants who did not resort to this dishonest practice.
Even vigilant nawabs like Murshid Quli Jafar Khan and Ali-vardi Khan could not supress the evil and the abuse of dastaks became very extensive. Siraj-ud-daulah also complained of this abuse to the English Governor but to no purpose. Under Mir Jafar who was obliged to the English, matters went so bad that even a spineless man like him could not but try for ending the evil practice.
He made piteous complaints to the English Governor in Calcutta about the abuse of the dastaks but with no success. By underselling the native merchants the English virtually monopolized the internal trade of Bengal amassing huge fortunes to the detriment of the nawab’s revenue and the native traders’ livelihood. Under Mir Qasim the evil practice became the most important cause of breach between the English and the nawab. Mir Qasim drew the attention of the Company’s Governor by writing to him in 1762: “They forcibly take away the goods…for a fourth part of their value; and by way of violence and oppressions, they oblige the ryots to give five rupees for goods which are worth but one rupee.” This state of affairs finds confirmation in the official documents of the Company. Those who refused the unjust demands of the Company’s servants, were flogged or confined.
Mir Qasim was of a more different mettle than that of his predecessors and when the English, Governor and his Council refused to grant any redress he abolished inland duties altogether so that all the traders would be on the same footing in regard to payment of customs duties. This eventually led to hostilities between Mir Qasim and the Company which cost him his masnad.
Decline of Indian Industry: New Trade Pattern:
By surreptitious use of the dastaks and oppression of the native merchants the English virtually monopolized the Indian trade. But this monopoly took an ugly shape and led to oppression of the Indian manufacturers, particularly of cotton goods.
Bengal cotton goods were in great demand in England and European markets. In order to ensure supply the English would enter into forward contracts with weavers,’ that is, would give dadan (advance) to them for supply of cloth of a stipulated quantity within a stipulated date. This became a new source of oppression in the hands of the Company’s servants. Armed with the Company’s authority the servants of the Company began to force the poor weavers, on pain of flogging, to sign iniquitous agreements.
The weavers were paid far less than the cost of production, thereby ruining the weavers. They were also prevented from working for any party other than the Company on pain of corporal punishment. The workers of raw silk were also subjected to same policy.
It was generally believed that many weavers of fine cotton fabrics and silk cloth cut off their own thumbs so that they might not be forced to weave for the Company and to get rid of the consequent oppression. The story is believed by the historians as a popular invention. But it certainly gave expression to the fear of those weavers who were forced to work for the Company, and the misery and oppression they suffered at the hands of the Company’s servants.
That the number of weavers gradually dwindled is confirmed by Verelst who writing in 1767 referred to the extreme scarcity of the weavers as a great number of them had deserted the profession. Needless to say that the evils of monopolistic control of cotton and silk cloth by the Company and the inhuman oppression perpetrated by the Company’s servants led to the ruin of the cotton and silk weaving industry which once accounted for huge influx of foreign gold through export of its products. Cornwallis’s efforts to revive the industry proved ineffectual, for already irreparable mischief had been done.
The ruin of the weaving industry in Bengal had been caused by two evils of Company’s monopoly control and the English servants’ oppression of the weavers. But the ruin was completed by the third evil of unfair competition of the British-made cloth. The cotton and silk cloth were extremely popular in England and was in higher demand than the machine-made cloth produced in England and European countries.
But after the Industrial Revolution England was in need of markets and the British Parliament thought it expedient to prevent import of Indian cotton and silk goods in England by passing two Acts in 1700 and 1720 prohibiting wearing of, or otherwise use of, Indian cotton and silk goods. Hostilities between England and America in 1776, i.e., during the American War of Independence, Napoleonic Wars as also war between England and America in 1812 practically stopped import of Bengal cotton and silk goods into England. The British calico printers also had represented to the British Government for stopping import of printed cotton and silk cloth from Bengal which was agreed to by the British Government and all imports of printed cotton and silk were stopped for four years.
By these arbitrary and artificial methods the British government gave the English manufacturers opportunity to improve the quality of their goods and by increasing the duty and freight on imports made by the Company. This enabled the English manufacturers to undersell the Indian cotton goods in English markets.
It then became the policy of the Company to follow the policy of importing only raw materials from India and export finished goods in Indian markets. Manchester cotton goods were exported to Bengal in huge quantities and sold at a very cheap price. The English export of cotton goods to India was of the value of 1,200,000 pound sterling in 1786 but it reached 18,400,000 pound sterling by 1806. Subsequent progress was far more phenomenal.
Within half a century from the Battle of Plassey Bengal suffered total ruin of her most flourishing industry, namely, the cotton and silk textile industry. Inland trade passed into the hands of the English servants and cotton and silk industries were ruined due to unfair competition, oppression of the Bengal weavers. British Parliament’s legislations etc. ruined the trade and industry which had made Bengal one of the most prosperous marts of India.
The present economic backwardness of the Indians had its genesis in the above circumstances But Bengal was not the only sufferer. What was true of Bengal was, generally speaking, true of the rest of India. Decay of trade and industry in Bengal set in throughout India towards the close of the eighteenth century.
It is generally said that India had never been an industrial country. But this is contrary to facts of history. Indian arts and crafts had been the greatest contributor to the immense wealth of India from time immemorial. The Industrial Commission Report stated that “even at a much later period when the merchant adventurers from the West made their first appearance in India, the industrial development of this country was, at any rate, not inferior to that of the more advanced European nations”. Both Indian finished goods and natural products like pearl, perfumes, dye-stuff, spices, sugar, opium, etc., were exported to distant countries and her imports were copper, gold, zinc, tin, lead, wine, horses, etc.
The balance of trade was always in India’s favour .Which led to the influx of huge quantities of gold. Pliny, the Roman historian, made a bitter complaint of the use of Indian luxury goods in the Roman Empire which caused drainage of huge quantity of gold to India in the first century A.D. Curiously enough similar complaint was made by the Englishmen in the eighteenth century, that is, seventeen hundred years later. The chief industry in India was weaving of cotton, silk and wool. Apart from Bengal, Ahmedabad, Nagpur, Luck-now, Meerut were important centres of cotton industry, and Punjab and Kashmir were specially noted for manufacture of shawls and other woolen textiles.
Wares of bell-metal, copper, brass etc. were produced in most parts of India but the most notable centres were Benares, Poona, Tanjore, Nasik, Ahmedabad and Rajasthan. Fine jewellery work including filigree in gold and silver, artistic marble work, carving of sandal wood in extraordinary artistic forms, ivory work and manufacture of glass and various other articles, such as perfumery, paper-making, tannery etc. were important industries of India. Till the “beginning of the nineteenth century A.D. the shipbuilding industry was more developed in India than in England. Like the Indian textile industry, it roused the jealousy of the English manufacturers and its progress and development were restricted by legislation”.
The decay of the Indian trade and industry was more or less complete by the middle of the nineteenth century.
The causes of the decay may be summarized as:
(i) Policy of the British Parliament,
(ii) Competition of cheaper machine-made goods,
(iii) Lack of intention of the English Government in India to protect or encourage Indian arts and crafts,
(iv) Oppression of the Indian manufacturers, particularly the weavers by the Company’s servants,
(v) According to some writers the Industrial Revolution in England and production of massive quantities of finished goods with the help of machineries and consequent low cost of production enabled the English manufacturers to undersell the Indian manufacturers, thus ruining the Indian industries. But others are of opinion that the very Industrial Revolution in England was the “consequence of the plundered wealth of India”, and what the British did in India was not to try to protect the Indian industries but purposely threw obstacles in their way and in certain cases discouraged Indian manufacture in order to help development of those in England. Rush-brook Williams is of opinion that it would be assuming modern statesmanship in the leaders of those days if we were to find a purposeful effort to neglect the Indian industries in order to encourage those in England.
But British statesmen from the early years of the 18th Century possessed enough ideas of modern economics and actually protected the English industries by legislation from the competition of the Indian goods. That similar steps were not taken to protect the Indian industries was not due to lack of statesmanship but due to the desire of the ruling authorities to promote the English industries at the cost of the Indian.
New Trade Pattern:
By the first half of the nineteenth century, India lost her supremacy in trade and industry over the European world which proud position she occupied for nearly two thousand years. She was now transformed into a country for production of raw materials and a market for dumping of cheap machine-made goods produced in England. The British Government in India which was morally responsible to protect the interest of the millions of the Indians, did not take any step to save India from the calamity.
The English Company began to encourage cultivation of cash crops like indigo, jute, tea as well as industries like jute textiles, sugar, paper, mining etc. and carry on trade in the produce of the cash crops and products of the industries established with the capital invested by Englishmen. The new trade pattern was based on two principles, namely, trading in cash crops and treating India as a source of supply of raw materials and to establish such industries which were not in direct conflict with those of England and to derive profit by trading in the goods produced by these industries.
Yet, it has to be mentioned here that the main purpose of the trade of the English was exploitation of Indian wealth.
Permanent Settlement, 1793:
The circumstances leading to the Permanent Settlement and the impact of it on the agrarian society of Bengal.
Ryotwari Settlement in Madras:
Within ten years from 1792, the year in which Tipu Sultan concluded the Peace of Seringapatam, the East India Company acquired the richest and fairest portions of the territory which later formed the Province of Madras.
A new system of land settlement grew up in this newly acquired territories of the British. The land settlement in Madras called Ryotwari Settlement is as intimately connected with the name of Thomas Munro, later made Sir, as the name of Lord Cornwallis is connected with the Zamindari Settlement of Bengal. Formerly the nawab of the Carnatic settled revenue year to year on the basis of the grains sown. The surveyors in making their reports measured the lands. But they practiced a thousand frauds and their reports were guided by the bribes they received.
When the territory came under the East India Company, a Revenue Board was established for the purpose of settlement of revenue, the Collectors and members of the Board of Revenue robbed public money, that is, the revenue collected, without any danger of detection. They gave the government a rent roll below the actual rent collected.
Thomas Munro first completed the Ryotwari Settlement of Baramahal. In this system rent was directly settled with 60,000 farmers, that is, with the ryots. The result of Ryotwari Settlement was the most encouraging, for the amount collected in the first year was 165,000 Pagodas which left not a single rupee outstanding.
The system was a permanent settlement of revenue with the ryots directly instead of Zamindars, i.e., intermediaries. This permanence of settlement was necessary, for there must be fixity of the government demand for the improvement of agriculture and prosperity of the people. Thomas Munro’s Ryotwari Settlement was permanent but only additional land reclaimed for cultivation was to be subjected to additional revenue.
Munro’s Ryotwari Settlement found favour with the authorities and gradually Canara, Malabar, Tanjore, etc. were brought under this system and the Rajas and Nair Chiefs of Malabar, the Pattakdars of Tanjore, etc. were replaced by the ryots in matters of land settlement.
The real motive behind the Ryotwari system was to realize the maximum from the land in shape of revenue. One of the ablest of the Directors of the Company remarked, “It cannot be concealed or denied that the object of this (Ryotwari) system is to obtain for Government the utmost that the land will yield in the shape of rent.” About the wrong policy of eliminating the old system of settlement with landlords R. C. Dutta observes, “True statesmanship would have continued the old order of things, and reduced the Rajas and Nair Chiefs into loyal subjects of the British Government and leaders of the people. But the desire to make settlements immediately with the cultivators, in order to get as much revenue as the land could yield, steadily influenced the policy of the Company’s government more and more as years passed by”.
Before acceptance of ryotwari System for the province of Madras as a whole there was an elaborate debate. William Bentinck was precisely of the same opinion as Munro had expressed, and recorded that Zamindari settlement suited Bengal where there were hereditary
Zamindars, but did not suit those parts of Madras where such landlords did not exist.
Munro desired a settlement with individual ryot, and desired it to be permanent, subject to increase or decrease of revenue as more or less land was taken under cultivation.
The Governor said, “If an annual settlement, founded upon fixed principles, the essential part of which was to secure to the ryot for a year the fruits of his industry, had actually been productive of such derided advantages, a Permanent Settlement founded upon the same principles, but carried to a greater extent with regard to benefit of the ryot, would produce the same effect in an increased ratio”.
Thus permanent settlement with the ryots directly was the predominant idea of the British administrators and Ryotwari Settlement was acted upon in Madras.
Thomas Munro had laboured practically all his life to obtain for the Madras cultivator fixity of rental so that all improvements made by him of his own land would be his own profit. Question of additional rental would arise when fresh land would be brought under cultivation. Long after Munro the Administrative Report of 1855-56 mentioned that the Madras ryot “cannot be ejected by the Government so long he pays the fixed assessment. The ryot under the system is virtually a proprietor on a simple and perfect title, and has all the benefits of a perpetual lease”. But the title of the ryot was not covered by any proclamation or Act. In 1857 the Board of Revenue also mentioned that the “Madras ryot is able to retain his land perpetually without any increase of assessment”.
But despite all these assurances and emphatic words, the land tax assessed on every cultivator was being fixed at the discretion of the revenue officers in each recurring settlement. Thus actually the Madras ryot had neither any fixity of rental nor any security against enhancement and naturally no motive for improvement of land under him. “The uncertainty of land tax hangs like the sword of Damocles on his head.”
In 1856 the Court of Directors declared that the Government was not entitled to a land revenue and not a rent which was the surplus above the cost of production (i.e., economic rent). In 1858 when the East India Company was abolished, Charles Wood declared the Government desire to take only a share, generally half share of the Tent as land tax. Half of the rent, that is, surplus over the cost of production. For a small farm cost of cultivation was approximately £7 or £8 and the Government would claim £4 which was practically the entire surplus above the cost of production.
Thus with uncertainty of land tax and the demand by the government of the total surplus of production naturally ruined the cultivators and left them resource-less. In the circumstances Lord Ripon laid down that rent once fixed could not be raised except on equitable ground of a price rise. It left the door open for enhancement, of land revenue.
But as Ripon left India in December, 1884, in January, 1885 the Secretary of State for India cancelled the equitable rule Ripon had announced. The India Office thus showed its ungenerous- and consequently disastrous attitude to the Indian cultivators. The effect of the ryotwari settlement was that the Madras cultivator was left without security against uncertain State demand and therefore no motive to save and no resources left with him to improve his land.
Land Settlement in Northern India:
The State now called Uttar Pradesh (North-Western Provinces and Oudh of the early British times) came under the British rule by parts at different dates. Benares and some adjoining areas were annexed by Warren Hastings, Allahabad and some other districts were ceded by the Nawab of Oudh to the British in 1801 due to the pressure brought to bear on him by Lord Wellesley. The Basins of the Ganges and the Jumna as also Agra were conquered by Lord Lake in 1803 and the remaining portion of Oudh was annexed by Lord Dalhousie in 1856.
As the lands in Northern India were being brought under British rule the question of land settlement naturally arose. Cornwallis and John Shore wanted to extend Zamindary settlement in these areas on a permanent basis as was done in Bengal in 1793. In 1795 Permanent Settlement of revenue over whole of Benares was made.
The old Zamindars who had lost their estates under the Raja of Benares were restored and revenue settled with them as also with village Zamindars on a permanent basis. The Code of Regulations for Bengal, Bihar and Orissa was extended to Benares with little alteration and the civil and criminal laws administered were the same as in Bengal, Behar and Orissa.
When Allahabad and other districts were ceded to the British by the Nawab, a Board of Commissioners was appointed to settle land for three years with the Zamindars and farmers. The settlement was very high as is evident from the first settlement report, 1803. While the Nawab’s assessment up-to 1802 amounted to thirteen and half crores of rupees the British assessment in the first year (1802-3) was more than fifteen and half crores of rupees which was raised to nearly seventeen crores in the third year.
Thus the blunder of high assessment committed in Bengal and in Madras was repeated in northern India. Further the Company’s demand was realized with a rigidity which the people of India had never known before. One of the Collectors remarked in 1802 that the settlement was “pressed beyond reasonable demand and the British Government continued the heavy rates of the Nawab’s government without the same elasticity in realizing”.
By a Regulation it was announced that the triennial settlement of land revenue will be followed by another triennial settlement which will be followed by yet another settlement for four years after which, that is, after the expiration of ten years the settlement would be made permanent.
In the meantime Bundelkhand and Cuttack were conquered and the Regulations recently introduced in the’ Ceded Districts, that is, Allahabad and other districts ceded to the “Company by the Nawab Vizier, were introduced into these conquered provinces. Settlement was made for one year to be followed by three years and four years in succession and made permanent after the last one if the landholders would agree but subject to the confirmation by the Court of Directors.
The ravages by the Marathas of northern India during the Maratha war of 1803 and extremely high assessment made by the Company’s servants gave people no chance of improving their condition. The result was the widespread famine of 1804. The Government was compelled to grant remissions in land revenue and subsidise grain exported to Benares, Fatehgarh, Allahabad, Cawnpur, etc. A Special Commission was appointed in 1807 to superintend the settlement for four years according to the announcement already made and which was to be made permanent.
The Commissioners, Messers. R. W. Cox and Henry St. George Tucker, in their report while admitted the many advantages of a Permanent Settlement expressed themselves averse to immediate conclusion of such a settlement in northern India.
An interesting correspondence took place between the Special Commission and the Government. The Commission pointed out that while it was sensible of the fact that temporary settlements were harassing the people and they offered opportunities for fraud and abuses, it did not think that the country could improve if public taxes were progressively increased, and the individual was not permitted to enjoy any benefit from the execution of greater industry.
The Commissioners thus stated “we submit to your Lordship in Council our deliberate and unqualified opinion that the measure, considered with relation to the Ceded and Conquered Provinces generally, is at this moment unreasonable, and that any premature attempt to introduce it must necessarily be attended with a material sacrifice of the public resources, and may, in particular cases, prove injurious to the parties themselves, whose prosperity it is the chief object of the measure to secure upon durable foundation”. It is obvious the alarm against Permanent Settlement was first sounded in this report and the basis of which was “material sacrifice of public revenues”.
H. Colebrooke pointed out that Government was pledged by its proclamations of 4th July, 1802 and 11th July, 1805 to make the settlement permanent on the expiration of the periods specified in the proclamations. In June 1807 the Governor-General in Council notified to the Zamindars by Regulation X, 1807, that the revenue assessed for the last year of the four-year-settlement would be fixed for ever, and arrangements would be made to obtain sanction of the Court of Directors. The pledge thus solemnly contracted could not go back without forfeiting confidence of the people in the government.
It was also pointed out, interestingly enough, that there was “a very prevalent opinion that the British system of administration is not generally palatable to our Indian subjects. Admitting this opinion to be not unfounded, it follows that while they taste none but the unpalatable parts of the system and while the only boon which would be acceptable to them is withheld the landed proprietors, and with them the body of the people, must be more and more estranged from the Government in proportion to the expectations which they formed, and the disappointment which they will have experienced”.
Colebrooke while declared his concurrence with the Commissioners’ recommendation that “steadiness, moderation and justice should be the features borne by the administration of the Government” he was firmly against abandoning a measure, that is Permanent Settlement of revenue, which had been deliberately resolved on. Similar minutes by another member, Mr. Lumsden, were forwarded to the Court of Directors by Lord Minto with his own opinion that permanent settlement in northern India was of urgent necessity.
The Court of Directors which had once been influenced to sacrifice a prospective increase in their profits by agreeing to Lord Cornwallis’s permanent settlement did not feel like becoming guilty of such generosity for a second time and their policy now was “grasping at the highest revenue and wringing from our peasants the utmost rent”. They replied that “No settlement shall be declared permanent in Cuttack or any other of our provinces till the whole proceedings preparatory to it have been submitted to us, and till your resolutions upon these proceedings have received our sanction and concurrence”. The Court of Directors a few months later wrote, “The object of the present despatch is to caution you in the most pointed manner against pleading us to the extension of the Bengal’s fixed assessment to our newly acquired territories.”
The Governor-General was taken aback at the attitude of the Court of Directors which was a virtual abandonment of the measure which was absolutely necessary for the good of the people of India and had been proclaimed twice unconditionally to the people of India. How could these solemn pledges be violated by the mandate of the Court of Directors? One more note of protest was submitted to the Court of Directors by Lord Minto referring to the economic principles mentioned in the Wealth of Nations by Adam Smith and pleaded for permanent settlement in Northern India. The Court of Directors were obdurate and pointed out that the “desire for the good of the people of India would not be more than to surrender their own profits”.
Lord Minto was succeeded by Lord Moira later made Marquess of Hastings but his distractions in Pindary War, Nepal War as well as Maratha War left the question of permanent settlement of revenue in northern India unattended for some time. When the Maratha War was over the Board of Commissioners in the conquered and ceded districts, i.e., northern India, consisting of Sir Edward Colebrooke and Mr. Trout submitted their report on land settlement of the districts of Moradabad, Bareilly, Shajehanpur and Rohilkhand and once more pressed for permanent settlement of revenue.
The government again wrote to the Court of Directors of the solemn pledges given by the Government in its regulations of 1802 and 1805, without entering into any discussion on the fiscal advantages of the permanent settlement of revenue. Mr. Dowdeswell on the eve of his retirement from India after a long period of distinguished service spoke in no uncertain terms that “the position, then, which I maintain, is that the faith of government was irrevocably pledged to the great body of the people to extend them the benefits of a Permanent Settlement …at the expiration of ten years………..”
Armed with reports and minutes of the Board of Commissioners of Mr. Dowdeswell, Colebrooke, Stuart, Adam and Fendall, the Governor-General Lord Hastings made a final appeal to the Court of Directors for that measure of Permanent Settlement which had been solemnly promised by the British Government and “which was needed for the prosperity of the people”.
“The Directors of a trading Company, now owners of an empire, refused the proposals of Lord Hastings with a curtness which betrayed how little real regard they entertained for the happiness of the people when their own pecuniary interests were concerned”. All ideas of a Permanent Settlement was thus abandoned in 1921 end settlements were made with landlords where they existed and with Village Communities where they held land in common tenancy. Revision of the settlement was made village by village and estate by estate and as an estate was called a mahal in the Indian language, the settlement in northern India came to be known is Mahal-wari Settlement.
Revenue demand was not to be enhanced unless it was found that landlords’ profits exceeded one fifth of that demand. The Zamindars and others with whom land was settled were to be left a net profit of 20% of the amount of the jumma i.e., government revenue demand. “Thus in an estate with u rental of £ 1200, the State demand was to be raised to £ 1000 so as to leave to the landlord £ 200 or one fifth of the State-demand. The State-demand was thus to be over 83% of the rental estates”.
The revenue collectors were empowered to grant lease to cultivators specifying the rent payable by them. Where land was held by cultivators in common tenancy the State-demand might be 95% of the rent i.e., surplus over cost of production.
The revenue collectors were also empowered to try suits between the landlord and the tenants, to determine the rents payable, to adjust accounts between them and decide all matters connected with lands, rents, leases, and all engagements between the landlords and the tenants.
Impact on the Ryots:
The first comprehensive land Act of Northern India was passed twenty years after Northern India came under the Company. The land settlement was replete with defects which reacted on the economic fortune of the agrarian people of northern India.
The land Act of Northern India:
(i) Prescribed no equitable standard of rents payable by cultivators except the judgment of the revenue Collector,
(ii) Prescribed no equitable margin of profits for landlords except a bare 17% of the rental. Despite frequent professions “to guard against an excessive demand” and “to take only a share of the net rent” it swept away the entire rental of the country, leaving the landlords and cultivators equally impoverished.
(iii) It made capital formation impossible and precluded any improvement in the material condition of the people,
(iv) It fixed no limit to the State-demand in future and recurring settlement and with even fresh settlement the revenue demand was enhanced.
“The System broke down ultimately by reason of its own harshness. It was not until the time of Lord Bentinck that the agrarian people had any relief.
High assessment affected rural solvency, and the ideological implications of the two land systems—Zamindari and Ryotwari—resulted in much social disorder and many changes in the rural hierarchies. It produced great deal of individual misery and stifled initiative.”
Impact of the British Land System on the Agrarian Society in India:
The impact of the British revenue settlement was somewhat different in cases of Zamindari and Ryotwari settlements. The areas where a permanent settlement was made with Zamindars, there came about considerable changes in the character of the landowning class which reacted adversely on the peasantry.
The Zamindari system led to an increase in non-rural and absentee landlords and the relation between the landlords and the cultivators suffered. Changes in ownership of land rapidly increased the area of cultivation but the cultivators themselves did not benefit in any way.
Another important adverse-affect of Zamindari system was the tendency to acquire larger and larger estates by the landlords which increased the number of landless labourers, mainly due to eviction.
But the most serious effect of the British revenue settlement was that it helped to petrify the existing agricultural techniques and it was not until the middle of the nineteenth century that the government did anything in this regard.
Under the Ryotwari settlement also the same results were seen as in the case of Zamindari settlement except comparatively small number of eviction on failure of payment of specified revenue.
The overall impact upon the agrarian society of different parts of India was greater impoverishment due to high assessment, lack of opportunity to accumulation of wealth and. stifling of initiative for any improvement of agriculture. Agriculture remained backward, the cultivators became poorer, landless labourers increased with the progress of time, absentee landlordism drained out whatever wealth was produced in rural areas into towns, leaving the agricultural society bogged in a miserable existence.