The British rule that started descending on Andhra’s many regions from 1765 become more pronounced in the early 19th century. With the new rule came new policies that saw the regulation of a number of economic sectors, namely agriculture and manufacturing. As agriculture and post-harvest processing activities were already a mainstay across the state, the implementation of these policies saw a gradual, yet steady shift in Andhra’s economic landscape.
For one, there was a disintegration of the traditional investment-led growth which saw families reinvesting their surpluses into newer lands and other capital assets. This was due to dwindling incomes that came with the migration to commodity type crops (for example indigo, a type of plant that was heavily demanded in Europe for the making of blue dye) which were imported by Britain at relatively low prices, heavy taxation on local producers and high prices that had to be paid for imported finished goods which took the place of locally made goods. Surpluses made on family owned farms and post-harvest processing activities were not sufficient to be recycled into purchases of more capital assets, and as such, limited the expansion of capital in the hands of people, and at times eroded existing assets as debt levels rose.
Understanding the Economy
As land and fixed productive assets did not expand at the same rate as the population did, the ratio of capital to labour stated declining among producer-capitalist classes, resulting in a large number of people with little or no land or capital assets to work with. This marks one of the most unfortunate phenomena that is characteristic of not only areas where interventionist economic policies such as high taxes and price ceilings stifle the natural expansion of capital in the hands of producer-capitalist classes especially within land-owning agrarian communities, but is a naturally occurring condition in areas which had been preceded by times of rapid population growth, usually due to advancements in agricultural techniques and other technologies that realize huge surpluses in local produce, but which are not accompanied by similar growth rates in the per capita capital ownership because of scarcity of resources, and also due to the emergence of unfair financial arrangements that trap land owners in high interest rates and long term debts.
What’s Capital? Capital is cash, jewellery, buildings, factories, equipment, machines, infrastructure, land, mobile assets such as vehicles and other productive assets that are combined with human labour to produce goods and services. Wealth of a person includes all these productive assets, and these assets are typically inherited from parents to children. The difference between productive assets (capital) and non-productive assets is that the former enables you to produce goods or services to be sold while the latter is used for personal consumption. A house which can be rented or a pressing machine that can print newspapers are both assets that will give a person a stream of future income. One’s own expensive pair of jeans or a home entertainment system are not productive assets because one cannot earn any income from this.
What hence ensued is the displacement of a large segment of the agrarian communities. The shrinking of percapita capital meant that descendants and the extended family members of land owning agrarian families must start seeking employment elsewhere – something that people who are used to working on family-owned lands and assets do not have a natural predisposition to.
This time period coincides with the onset of the rule of the British Raj in India which started around 1850s. During this time, Andhra Pradesh was under the dominance of the Asaf Jahi Dynasty which lasted over 200 years from 1724 to 1948. Mir Tahniat Ali Khan Afzal-ud-Daula, Mir Mahboob Ali Khan and Mir Osman Ali Khan ruled from 1857 to 1869, to 1911 and to 1948 respectively as the 5th, 6th and last Nizams of Hyderabad during this time span.
Prior to the Asaf Jahi Dynasty, Andhra Pradesh was ruled by the Qutb Shahi Kings, known as the Rulers of the Deccan. A number of eight kings ruled between 1518 to 1687. Their rule ended with the attack by Mughal emperor, Aurangzeb in 1687, which saw Hyderabad becoming a Mughal province. It was later consolidated under the governance of Nizam-ul-Mulk, along with Aurangabad, Bidar, Bijapur, Berar and Adilabad which marked the beginning of the Asaf Jahi Dynasty in 1724. Despite 80% of the population being Hindus, both dynasties, helmed by Muslim kings, thrived for over 400 years.
Image By Illustrated London News [Public domain], via Wikimedia Commons
This article was first published here.