Write in detail the nature and impact of Economic Nationalism.

Answer:

Nature: Economic nationalism was the study and criticism of British economic policies by Indian leaders in the second half of the 19th century.

• Dadabhai Naoroji, in Poverty and Un-British Rule in India, put forward the ‘drain theory’: India’s wealth was flowing to England as salaries, pensions, interest and Home Charges without any return.
• Justice M. G. Ranade studied Indian economics and stressed industrialisation; R. C. Dutt wrote The Economic History of India; G. V. Joshi and G. K. Gokhale also criticised British policies.
• They showed that free trade ruined Indian handicrafts, heavy land revenue impoverished farmers, and India was kept as a supplier of raw materials and a market for British goods.

Impact:

• Educated Indians understood that British rule was the root cause of India’s poverty; the myth that British rule was a blessing was broken.
• It gave the national movement a strong economic base and helped the Indian National Congress raise economic demands.
• It inspired the Swadeshi and Boycott movement (1905), the use of Indian goods and the starting of Indian industries, banks and insurance companies.
• It united people of all classes against colonial exploitation and prepared the way for the demand for self-rule.