Which of the following statements are correct? 1. British 'trade surplus' with India in the nineteenth century meant that the value of British exports to India was much higher than the value of British imports from India. 2. India played a crucial role in the late-nineteenth-century world economy by helping Britain balance its deficits. 3. Britain grew opium in India and exported it to China and, therefore, for a while after the 1820s, opium became India's single largest export. 4. The nineteenth century saw export of Indian raw materials decline, and that of manufactured goods increase. Select the answer using the code given below:
- (a)1 and 2 only
- (b)3 and 4 only
- (c)1, 2, 3 and 4
- (d)1, 2 and 3 only
Correct — D, statements 1, 2 and 3 only. Through the nineteenth century the value of British exports to India far exceeded the value of British imports from India, giving Britain a 'trade surplus' with India, so the first statement is right. Britain used that surplus to settle its trade deficits with other countries, so India helped Britain balance its deficits and thereby played a crucial role in the late-nineteenth-century world economy, so the second statement is right. Britain grew opium in India and shipped it to China, and from the 1820s opium became, for a time, India's single largest export, so the third statement is right. The fourth statement is the exact reverse of what happened: across the century the export of Indian raw materials rose sharply (raw cotton alone climbed from about 5 to 35 per cent of exports) while exports of Indian manufactures declined. Since only statements 1, 2 and 3 are correct, the answer is 1, 2 and 3 only.
- (a)1 and 2 only — Leaves out the true third statement — opium, grown in India and sold to China, did become India's single largest export for a while after the 1820s.
- (b)3 and 4 only — Includes the false fourth statement and drops the true first and second; in fact Indian raw-material exports rose while manufactures fell, the opposite of statement 4.
- (c)1, 2, 3 and 4 — Wrongly accepts the fourth statement — the nineteenth century saw Indian raw-material exports increase and manufactured-goods exports decline, not the reverse.
In the colonial economy Britain ran a trade surplus with India while running deficits with other trading partners; the Indian surplus was used to square those deficits within a multilateral settlement system, making India pivotal to Britain's global balance of payments.
This is drawn straight from the NCERT account of the making of the global world. The single false option (statement 4) inverts a well-documented shift — India was turned into an exporter of raw materials and a market for British manufactures, not the other way round.
- Britain's exports to India exceeded its imports from India, so Britain held a 'trade surplus' with India, which it used to balance deficits with third countries.
- Between 1812 and 1871 the share of raw cotton in India's exports rose from about 5 per cent to 35 per cent, while exports of Indian manufactures fell.
- Opium grown in India was exported to China; from the 1820s it became, for a while, India's single largest export, financing Britain's tea imports from China.
- India's trade surplus also helped meet the 'home charges' — remittances, pensions and debt-interest payments made to Britain.
- Reading statement 4 as true — raw-material exports rose and manufactures fell, the opposite of what it claims.
- Doubting the opium statement — opium really was India's single largest export for a period after the 1820s.
Set as a which-statements-are-correct code question — the decision hinges on spotting that the raw-material-versus-manufactures statement is reversed.
The staple commodities of export by the English East India Company from Bengal in the middle of the 18th century were
- (a) Raw cotton, oil-seeds and opium
- (b) Sugar, salt, zinc and lead
- (c) Copper, silver, gold, spices and tea
- (d) Cotton, silk, saltpetre and opium
Answer(d) Cotton, silk, saltpetre and opium — mid-18th-century Bengal supplied the Company with textiles, saltpetre for gunpowder and opium for the China trade.
Both concern the commodity structure of colonial India's exports — the UPSC question identifies cotton, silk, saltpetre and opium as the East India Company's staple Bengal exports, overlapping directly with this item's point about opium and raw-material exports.
- practice — not a real PYQ
During the nineteenth century, Britain maintained a 'trade surplus' with India mainly by:
- (a)importing more from India than it exported
- (b)exporting more to India than it imported from India
- (c)banning all Indian exports
- (d)trading only in gold
Answer(b) exporting more to India than it imported from India — the excess value of British exports over imports created the surplus, used to balance deficits elsewhere.
- practice — not a real PYQ
From the 1820s, which commodity grown in India and exported to China became, for a while, India's single largest export?
- (a)Indigo
- (b)Raw cotton
- (c)Opium
- (d)Tea
Answer(c) Opium — Britain grew opium in India and sold it to China, financing its tea imports; it briefly became India's largest export.