Learn
Games

1.3.2 - A new revenue system

Interactive Audio Lesson

Listen to a student-teacher conversation explaining the topic in a relatable way.

Introduction to Revenue Systems

Unlock Audio Lesson

Signup and Enroll to the course for listening the Audio Lesson

Teacher
Teacher

Let's explore how the British changed the revenue system in India. We had the Permanent Settlement in Bengal, but as colonial control expanded, they needed new methods. Does anyone know why?

Student 1
Student 1

Is it because agricultural prices were rising?

Teacher
Teacher

Exactly! By 1810, prices for agricultural goods started increasing, affecting the income of zamindars in Bengal, which was fixed under Permanent Settlement. Thus, the British wanted a more flexible revenue system.

Student 2
Student 2

So what was the new system they introduced?

Teacher
Teacher

They instituted the **ryotwari settlement**, which involved direct interaction with the ryots, or cultivators. This was a significant shift from their approach in Bengal.

Student 3
Student 3

Did this new method help the farmers?

Teacher
Teacher

Not really. The initial revenue assessments were often too high, forcing many farmers into debt. Remember, 'high demands lead to heartbreak for the ryots.'

Student 4
Student 4

Interesting! Can you summarize the key points we discussed?

Teacher
Teacher

Certainly! The British needed to adjust their revenue systems due to rising agricultural prices. They introduced the ryotwari settlement, which assessed farm productivity directly, but it often led to economic strain on farmers.

Economic Challenges of the Ryotwari System

Unlock Audio Lesson

Signup and Enroll to the course for listening the Audio Lesson

Teacher
Teacher

Now, let’s discuss the economic strain caused by high revenue demands. Why do you think the peasant class struggled with payments?

Student 1
Student 1

Probably because they had to pay high taxes regardless of the crop yield, right?

Teacher
Teacher

Exactly! Despite low yields, their tax obligations remained stringent and often increased due to the reassessments every 30 years.

Student 2
Student 2

What happened if they were unable to pay?

Teacher
Teacher

Failure to pay resulted in borrowed loans from moneylenders, leading to a vicious cycle of debt. Let’s remember an acronym: 'D.E.B.T.' - Debt Erosion Brings Trouble. Can anyone elaborate on this point?

Student 3
Student 3

More loans meant they had to pay back additional interest, which just made their situation worse.

Student 4
Student 4

That sounds like a really harsh cycle they had to face! Can we summarize what we learned?

Teacher
Teacher

Certainly! High revenue demands put immense pressure on ryots, causing widespread indebtedness and creating a relentless loop of economic hardship.

Impact of the Cotton Boom

Unlock Audio Lesson

Signup and Enroll to the course for listening the Audio Lesson

Teacher
Teacher

Next, let's investigate the cotton boom that occurred during the American Civil War. How did that influence the ryots?

Student 1
Student 1

I believe it encouraged more cotton production in the Deccan because the demand was high!

Teacher
Teacher

Correct! Ryots found themselves with access to easier credit because demand shot up. But can anyone see a potential downside?

Student 2
Student 2

What happens when the boom ends? They might be stuck with debt and no income!

Teacher
Teacher

Spot on! The boom didn't last. As American cotton became available again, prices dropped, leaving many ryots deeply in debt. Let's remember a phrase: 'What goes up, must come down.' Can someone summarize this?

Student 3
Student 3

Sure! The cotton boom led to initial prosperity for some, but ultimately it trapped many ryots in overwhelming debt when prices collapsed.

Introduction & Overview

Read a summary of the section's main ideas. Choose from Basic, Medium, or Detailed.

Quick Overview

The British colonial government imposed new revenue systems in India that differed from the Permanent Settlement in Bengal, significantly affecting agricultural practices and peasant lives.

Standard

As British colonial rule expanded, new revenue systems such as the ryotwari settlement emerged, particularly in the Bombay Deccan. Unlike the Permanent Settlement, which fixed revenue permanently, the ryotwari settlement assessed revenue directly from the ryots based on their land's productivity, leading to economic challenges and peasant indebtedness.

Detailed

A New Revenue System

The expansion of British control beyond Bengal brought about a significant shift in India's agricultural taxation methods. The permanent revenue system, revered in Bengal, was seldom adopted in other regions owing to fluctuating agricultural prices and varying economic conditions.

Key Changes

  1. New Revenue Settlements: After the year 1810, agricultural prices began to rise, resulting in increased earnings for zamindars in Bengal. To further maximize state revenues, the British implemented temporary revenue settlements in newly annexed territories like the Bombay Deccan instead of the permanent system.
  2. Influence of Economic Theories: The ideas of economist David Ricardo, primarily focused on taxation of agricultural surplus, influenced British officials. They believed substantial taxation on landowners was crucial to prevent their transition into non-productive rentiers.
  3. Ryotwari Settlement: This new settlement engaged directly with the individual ryots (cultivators), which differed from the zamindar-centric model. Revenue was calculated based on average yields per land type, with assessments conducted every 30 years, allowing revenue rates to be increased regularly.
  4. Economic Strain on Peasants: The initial revenue demands placed immense pressure on ryots, leading to mass migration, desertion of villages, and escalating debts. Poor agricultural yields increased the default rate, forcing many peasants into borrowing cycles with moneylenders.
  5. Consequences of High Revenue Demand: The repercussions of high taxation during famine years resulted in a devastating impact on peasant livelihoods. The economic efforts to expand cultivation further stretched financial resources, leading to increased loans and poverty.
  6. Cotton Boom and Subsequent Collapse: The cotton boom sparked by the American Civil War appeared to offer a respite, but the return of American cotton and collapsing prices left many cotton producers in severe debt.

In conclusion, the new revenue system revolutionized agricultural finance in India, leading not only to economic pitfalls for the peasants but also to widespread agrarian unrest, which would later manifest in revolts.

Youtube Videos

Colonialism And The Countryside: One Shot | CBSE Class 12 Boards | History | Anushya Kumar
Colonialism And The Countryside: One Shot | CBSE Class 12 Boards | History | Anushya Kumar
colonialism and countryside || Chapter-10 History class12 || Successmindsetbymridula
colonialism and countryside || Chapter-10 History class12 || Successmindsetbymridula
Class 12 History Chapter-10 Colonialism and the Countryside Full NCERT Explanation CBSE CUET/ CUCET
Class 12 History Chapter-10 Colonialism and the Countryside Full NCERT Explanation CBSE CUET/ CUCET
COLONIALISM AND THE COUNTRYSIDE - Full Chapter in 30 Min | Class 12th HISTORY
COLONIALISM AND THE COUNTRYSIDE - Full Chapter in 30 Min | Class 12th HISTORY
Colonialism and The Countryside - Full Chapter Explanation | Class 12 History Chapter 10 | 2022-23
Colonialism and The Countryside - Full Chapter Explanation | Class 12 History Chapter 10 | 2022-23
A Revolt in Countryside - Colonialism and the Countryside | Class 12 History Chapter 10 (2022-23)
A Revolt in Countryside - Colonialism and the Countryside | Class 12 History Chapter 10 (2022-23)
Colonialism and Countryside One-shot with ANIMATION | Class 12 History Chapter 9
Colonialism and Countryside One-shot with ANIMATION | Class 12 History Chapter 9
Colonialism and The Countryside - Full Chapter Explanation | Class 12 History Chapter 10 | 2024-25
Colonialism and The Countryside - Full Chapter Explanation | Class 12 History Chapter 10 | 2024-25
CBSE Class 12 History | History Mapping | One Shot | Map Work | Revision Series | By: Aditya Jha
CBSE Class 12 History | History Mapping | One Shot | Map Work | Revision Series | By: Aditya Jha
Colonialism and the Countryside Class 12 Quick Revision & Mind Map | Class 12 History By Anita Mam
Colonialism and the Countryside Class 12 Quick Revision & Mind Map | Class 12 History By Anita Mam

Audio Book

Dive deep into the subject with an immersive audiobook experience.

Expansion of British Rule and New Revenue Systems

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

As British rule expanded from Bengal to other parts of India, new systems of revenue were imposed. The Permanent Settlement was rarely extended to any region beyond Bengal.

Detailed Explanation

As the British got control over more areas, they needed to collect taxes, known as revenue, from the land. In Bengal, they decided to fix these taxes permanently. However, this approach wasn’t applied everywhere else. The reason for not continuing the Permanent Settlement in other regions was partly because after 1810, agricultural prices rose. This meant that zamindars (the landowners) in Bengal were making more money from their harvests, but the British could not collect more taxes since the tax rate was fixed.

Examples & Analogies

Imagine a store that has fixed prices for its products. If the general price of groceries goes up and the store doesn’t change its prices, the store won’t make more money even though its suppliers may be earning more. In the same way, fixed revenue meant the British lost out on potential higher income from the land if it became more productive.

Influence of Economic Theories on Revenue Policy

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

When officials devise policies, their thinking is deeply shaped by economic theories they are familiar with. By the 1820s, the economist David Ricardo was a celebrated figure in England.

Detailed Explanation

Officials in India were influenced by economic ideas developed back in England. In the 1820s, David Ricardo proposed that a landowner should only obtain the average rent of the land. If the landowner earned more than this amount, then the state should take some of that surplus as tax. Essentially, this new way of thinking about land revenue influenced British policies in India, leading them to reconsider how to collect taxes in a way that was different from the fixed amount established in Bengal.

Examples & Analogies

Consider a farmer who grows apples. If during a good year, he harvests a lot more apples than normal, David Ricardo’s theory suggests that he should give some of those extra apples to the local government. This idea influenced how the British thought about collecting taxes from landowners in India.

The Ryotwari Settlement Explained

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

The revenue system that was introduced in the Bombay Deccan came to be known as the ryotwari settlement. Unlike the Bengal system, the revenue was directly settled with the ryot.

Detailed Explanation

In contrast to the zamindars' system in Bengal, the ryotwari system allowed the British to collect revenue directly from the individual farmer (ryot). The government would estimate how much revenue the farmer could pay based on the quality of the land, and this amount could change every 30 years based on land surveys. This means that the farmer's tax was not fixed forever, creating a more direct financial relationship between the British government and the farmers.

Examples & Analogies

Imagine a gym where instead of charging a flat fee for a lifetime membership, it charges you based on your usage every month. If you work out a lot, you might pay more, but if you only visit occasionally, you pay less. This is similar to how the ryotwari system worked: the revenue amount was flexible and based on individual circumstances.

Peasant Debt and the Consequences

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

The first revenue settlement in the Bombay Deccan was made in the 1820s. The revenue that was demanded was so high that in many places peasants deserted their villages and migrated to new regions.

Detailed Explanation

When the British collected revenue in the Deccan, they set the rates quite high, which made it tough for many farmers to pay. In areas where the soil was poor or there were droughts, the burden was even greater. Unable to pay the taxes, many farmers chose to leave their villages and seek better opportunities elsewhere, contributing to significant migration patterns during this period.

Examples & Analogies

Think of it like a family who cannot afford the home mortgage due to sudden job loss. They may have to leave their house and move to a different city where they can find new employment. This is what happened to many farmers: they couldn’t meet the revenue demands and had to leave their farms behind.

Impact of Famine and Economic Crisis

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

By the 1830s the problem became more severe. Prices of agricultural products fell sharply after 1832 and did not recover for over a decade and a half.

Detailed Explanation

In the 1830s, agricultural prices dropped significantly, which meant that what farmers could earn from their crops decreased dramatically. At the same time, there was a severe famine that affected the Deccan region, causing many farmers to lose their livestock and the ability to feed their families. This culminated in mounting unpaid taxes, plunging farmers into deeper financial trouble.

Examples & Analogies

Imagine a market where the prices of all commodities suddenly drop. If a farmer sells their produce but cannot earn enough money to buy food or cloth for their family, they may face dire situations. This combination of low prices and famine created a perfect storm of hardship for the farmers.

The Cycle of Indebtedness

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

Inevitably, they borrowed. Revenue could rarely be paid without a loan from a moneylender. But once a loan was taken, the ryot found it difficult to pay it back.

Detailed Explanation

With the pressure of high taxes and dwindling income, farmers often turned to moneylenders for loans just to survive. However, these loans came with high interest rates, and as farmers struggled to pay them off, they fell deeper into debt. This cycle made it increasingly difficult for farmers to regain their footing, leading them into a perpetual state of borrowing.

Examples & Analogies

It's like a credit card debt that keeps growing because you cannot pay off the original amount. The more you use credit to make day-to-day purchases, the further you sink into debt. Similarly, farmers were forced into this loop where they kept borrowing just to meet basic needs.

The Cotton Boom and Its Consequences

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

In 1857 the Cotton Supply Association was founded in Britain, and in 1859 the Manchester Cotton Company was formed. Their objective was “to encourage cotton production in every part of the world suited for its growth.”

Detailed Explanation

During the period of increasing global demand for cotton due to the American Civil War, British manufacturers sought alternative sources for cotton, with an emphasis on India. They organized efforts to encourage cotton production in India as a means to stabilize their supplies. This led to a rapid increase in cotton cultivation in the Bombay Deccan, often with promised loans to local farmers to expand cotton fields.

Examples & Analogies

Consider a sudden global demand for a popular snack. A company might rush to find local farmers to grow the ingredients they need quickly. Just like this, the British needed cotton and turned to Indian farmers to ramp up production, often promising support yet creating dependencies.

The Unraveling of the Cotton Boom

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

While the boom lasted, cotton merchants in India had visions of capturing the world market in raw cotton, permanently displacing America.

Detailed Explanation

As demand for Indian cotton surged due to less supply from America, many Indian merchants became optimistic and expected that cotton production would be a profitable venture. However, once normal supplies from America resumed after the Civil War, the demand for Indian cotton dropped, leading to a devastating crash for cotton farmers in India who had expanded their production based on false expectations.

Examples & Analogies

Think of a restaurant that becomes very popular. They might hire more staff and expand their menu to match the demand. If suddenly a new restaurant opens that offers similar food at a lower price, the first restaurant might find itself struggling to keep customers. This mirrors what happened to the Indian cotton farmers when American cotton supplies came back.

Conclusions on the New Revenue System

Unlock Audio Book

Signup and Enroll to the course for listening the Audio Book

The Deccan Riots Commission produced a report that was presented to the British Parliament in 1878, providing historians with a range of sources for the study of the riot.

Detailed Explanation

Following the revolts in the Deccan, the British government set up a commission to investigate the causes. Their findings were documented in a report which provided detailed accounts of the farmers' woes and explored the relationship between the farmers and moneylenders. This report has become a significant resource for historians studying this period, revealing the complexities of peasant life under colonial rule.

Examples & Analogies

Consider a school that investigates a protest held by students. They gather testimonies, documents, and interviews to understand the issues at play. Just as these investigations provide clarity on student grievances, the Deccan Riots Commission’s report helped to illuminate the struggles faced by farmers.

Definitions & Key Concepts

Learn essential terms and foundational ideas that form the basis of the topic.

Key Concepts

  • Economic Dependency: The reliance of ryots on moneylenders due to high revenue demands and falling agricultural prices.

  • Revenue Assessment: How the ryotwari system directly assessed revenue needs based on land type and productivity.

  • Impact of Agricultural Changes: Shifts in agricultural practices leading to significant impacts on peasant economies.

Examples & Real-Life Applications

See how the concepts apply in real-world scenarios to understand their practical implications.

Examples

  • The transition from zamindars to direct ryot assessments marked a significant change in how agricultural taxes were handled.

  • The cotton boom during the American Civil War shows how global events can create short-term economic shifts that put local farmers at risk.

Memory Aids

Use mnemonics, acronyms, or visual cues to help remember key information more easily.

🎵 Rhymes Time

  • High demand, low land, farmers in a bind, revenue schemes unkind.

📖 Fascinating Stories

  • Imagine a ryot planting seeds with care, yet facing debts that seem unfair, with each harvest bringing fragile hopes, he falls deeper into the moneylender's ropes.

🧠 Other Memory Gems

  • R.Y.O.T. - Revenue Yearly On Time: highlights the idea of direct revenue collection.

🎯 Super Acronyms

C.B.C. - Credit Booms, Crashes hinting at the boom and bust nature of economic reliance on cash crops.

Flash Cards

Review key concepts with flashcards.

Glossary of Terms

Review the Definitions for terms.

  • Term: Permanent Settlement

    Definition:

    A land revenue system established in Bengal where the revenue owed was permanently fixed.

  • Term: Ryot

    Definition:

    A cultivator or peasant who directly works the land.

  • Term: Ryotwari Settlement

    Definition:

    A system of revenue collection where taxes were directly assessed on cultivators, rather than through intermediaries.

  • Term: Zamindar

    Definition:

    A landowner who collected rents from tenants and paid taxes to the state.

  • Term: Indebtedness

    Definition:

    A state of having too much debt or owing more than one can repay.