The Colonial Path of Transition to Capitalism

Infinitely diverse combinations of elements of this or that type of capitalist evolution are possible - Lenin

Marx predicted that the bourgeois “creates a world after its own image” (Marx & Engels 1848: para 27). Yet when we look at the contemporary world we find an enormous divergence between a handful of advanced capitalist countries and the rest of the world. Depending on the context of the literature and discipline, this divergence is identified by a number of dichotomous terms: North–South, East–West, core–periphery, metropole– countryside, developed-underdeveloped, advanced-developing, imperialism-colony, first-world and third-world, and so on. The terms vary, but the observation is near universal. How can one explain this global divergence? Why does the third world not enjoy the standard of living, the economic prosperity, or the democratic and social freedoms that are, relatively speaking, taken for granted in Europe? Has the bourgeois failed in its historical mission of reproducing a world in its own image?

The traditional explanation for this divergence was simply that the developing world was further behind in the evolution of capitalism. Area studies scholars may conclude that the diversity of the histories of various civilisations, or the diversity in the cultures, beliefs, social, and political structures, account for this divergence. Alternatively, the view that the relationship between the developed and developing worlds is the cause of the underdevelopment of the latter, became more prominent. These latter explanations were dominated by Marxist theories of imperialism and dependency theory. It was also argued that the colonial world had a unique mode of production (Banaji 1972, Alavi 1975, 1981, 1982). By the late 20th century, the search for an explanation for this divergence not only led to the emergence of new clusters of theories but even the birth of entirely new disciplines. Development studies and postcolonial studies examine the reason for the failure of markets in modernising the South. Hence, in nearly all fields an opinion exists that there must be something distinct in either the specific articulation or the very kind of capitalism that developed in the global South.

In all this literature on divergence there is a tension between the existence of the general economic laws of capitalism and their inability to achieve the expected results that were achieved in advanced capitalist countries (see Chibber 2013). This paper will revisit the theory of the paths of transition to capitalism. It will argue that the existence of the universal economic laws of capitalism and the results of underdevelopment can be theoretically reconciled within the framework of the colonial path of transition.

Paths of Transition

Capital can take control of diverse pre-capitalist relations and subordinate and remould them through a variety of ways and means. The specific way in which capital took a hold of and remoulded pre-capitalist relations is termed a path of transition. Marxist theory is open to the idea that “infinitely diverse combinations of elements of this or that type of capitalist evolution are possible” (1898: Preface to Second Edition, para 7). While analysing primitive accumulation in Capital Vol. 1 (1885), Marx referred to diverse forms of pre-capitalist agrarian relations. He examined Asiatic, feudal, medieval, clan, community, communal, state, tribal, and primitive squatter relations, as well as peasant allotments and holdings of bonded peasants. In Capital Vol. III, Marx considered the métayage (sharecropping) system of France to be a transitory form and wrote:

As a transitory form from the original form of rent to capitalist rent, we may consider the metayer system, or share-cropping, under which the manager (farmer) furnishes labour (his own or another’s), and also a portion of working capital, and the landlord furnishes, aside from land, another portion of working capital (e.g., cattle), and the product is divided between tenant and landlord in definite proportions which vary from country to country. (1894: Ch 47, pt. 5, emphasis added)

Further in Capital Vol. III (1894), as well as in Theories of Surplus Value (1861), Marx examined the historical forerunners of capitalist ground rent: namely, rent in kind, money-rent, quit-rent, labour service, corvée, and so on. Similarly, Engels investigated how capitalism in agriculture led to the absorption of the peasantry into an urban economy or into rural capitalism (Engels 1894). Lenin explained these paths of transition in much the same terms as Marx:

Capital finds the most diverse types of medieval and patriarchal landed property—feudal, ‘peasant allotments’ (i.e., the holdings of bonded peasants); clan, communal, state, and other forms of land ownership. Capital takes hold of all these, employing a variety of ways and methods … Capitalism subordinates to itself all these forms of land ownership: communal-allotment holdings in Russia; squatter tracts or holdings regulated by free distribution in a democratic or a feudal state, as in Siberia or the American Far West; the slave-holding estates in the American South; and the semi-feudal landholdings of the ‘purely Russian’ gubernias. In all these cases, the development and victory of capitalism is similar, though not identical in form … Capital subordinates to itself all these varied forms of land ownership [feudal, clan, communal (and primitive-squatter), state, etc] and remoulds them after its own fashion. (1917, para 14)

In describing the divergence between Western Europe (specifically England and France) and central Europe (Germany and the Austro-Hungarian Empire), Lenin’s own interest was in developing a framework that would help explain the divergence between Europe and Russia. For this purpose, he identified two broad European paths of transition: the Republican path and the Junkers path (Lenin 1898).

In the Republican path, the landlord economy was broken up by revolution. Large land ownership was expropriated by the peasantry through revolutionary means. The relics of serfdom were destroyed and labour-service was uprooted and small peasant farming and commodity production received an enormous impetus. The Republican path was the path of popular revolution that made a clean break with the past. Working people played a significant and active role in this transition. This revolutionary Republican transition was epitomised by the French Revolution.

Although the French Revolution is identified with the archetype of the transformation of feudalism into capitalism, it is, in fact, the exception rather than the rule. In most parts of Europe, capitalism’s spread was a consequence of a revolution from above. Napoleon’s military victories deeply influenced the Prussian landlords (Junkers). Having recognised the military and organisational superiority of the new republican French state, the Junkers undertook a series of reforms to modernise their armies. The modernisation of the army, in turn, led to the modernisation of the economy. Hence, the monarchist bourgeoisie and large landlords played a dominant role in this historical transition. The well-to-do peasants allied themselves with the landlords while the mass of the peasantry are said to have suffered degradation, enslavement, and expropriation on a vast scale. In other words, in the Junkers path the feudal lords slowly metamorphosed into capitalists. In Lenin’s words (1898: Preface to Second Edition, para 7):

The old landlord economy, bound as it is by thousands of threads to serfdom, is retained and turns slowly into purely capitalist, ‘Junker’ economy. The basis of the final transition from labour-service to capitalism is the internal metamorphosis of feudalist landlord economy. The entire agrarian system of the state becomes capitalist and for a long time retains feudalist features.

This argument about the paths of capitalist development was further developed by Barrington Moore Jr. to explain the rise of fascism in the interwar years. He argued in The Social Origins of Dictatorship and Democracy (1966) that while England and France had developed into democratic societies because capitalism there developed through a revolutionary republican path that uprooted feudalism, Germany and the Austro-Hungarian empire, which developed along the Junkers path, were susceptible to fascism because they retained significant economic, political, and cultural aspects of the old feudal order. Hence, the development of democracy and fascism were determined by whether societies developed along the republican path or the Junkers path (Moore 1966). Moore has his detractors and supporters. On the one hand, he was criticised for being economically deterministic. On the other hand, Moore’s comparative approach stimulated new scholarship (for a complete literature review, see Wiener 1975). The idea that the form of a society is not only determined by the rise of a given mode of production but also by the specific path of transition to that mode of production is, in the opinion of this paper, an extremely useful model to understand capitalism in South Asia.

Given that changes in society or history can never be discrete, discontinuous, disjunct, disjoined, or disconnected, the interpenetration of modes of production during a period of transition is inevitable. We also know from history that even historically defeated classes and ideologies continue to stubbornly resist the march of history. Marx gives the example of how even pre-capitalist ‘association of agriculture with manufacture put up a stubborn resistance to the products of the big industries’ (Marx 1894: Ch. 20, para 27). Similarly, contemporary authors have developed the argument that sharecropping ought to be viewed as a transitory path of labour relations (Byres 1983). The southern states of the USA provide an instance of a system of commodity production, private property, along with chattel slavery on plantation colonies (Byers 1996, Post 2003). The Althusserian literature on social-formation as an articulation of two modes of production can also be understood as exploring the interpenetration of two modes of production. The term ‘semi-feudalism’ was developed by Indian Marxists to capture the stubborn resistance of pre-capitalist relations in the Indian mode of production debate (Thorner 1982, Patnaik 1990). Hence, there is already an enormous scholarly precedent on the inevitability of the interpenetration of modes of production.

From this literature, we may conclude that a transitory path may be relatively stable as an intermediate, complex social formation based on two sets of economic relations and surplus extraction that develop during the transition from one mode of production to another. Hence, a transitory path may be a structured articulation of two distinct modes of production existing side by side or one atop the other. Or it may be a hybrid or combination of elements of two distinct modes of production. But at the most general level, this paper would argue that a transitory path is any social formation where there is any kind of combination of two or more forms of surplus extraction.

Moreover, transitions from one mode of production to another occur over long historical periods. The transition from hunting and gathering to settled agriculture itself took thousands of years. Hence, if one accepts the notion of a transitory path, one must be equally open to the possibility that such paths may survive for long historical periods, especially in the context of slowly changing productive forces. Few today doubt that the world is in transition, or has been in transition, from pre-capitalist to capitalist relations. Yet no historian could deny that the transition to capitalism (even in Europe alone) itself constitutes an entire historical period. It is also possible that societies that are in one kind of transition become embroiled in yet another change in their mode of production. For instance, the Bolshevik revolution occurred in a society that was still in transition to capitalism.

A path of transition, therefore, cannot be distinguished from modes of production on the basis of their relative stability. In some senses, societies are constantly in transformation and transition and therefore can simultaneously retain features of the old and the new. But one path of transition can be distinguished from another by the distinct way in which the new emerges from the old. Paths of transition can be distinguished from modes of production and each other by the specific way in which old and new modes of surplus extraction combine and diverge from each other.

Finally, one may or may not read into the concept of a path of transition an a priori historical teleology. However, there is nothing in the concept of a transition that necessarily or inevitably ties one to a teleology. A non-teleological understanding would not be premised on reading the facts from an a priori end point of history; it is the very opposite. It would derive the concepts from an examination of the tensions and contradictions between two modes of production in transition. Perhaps it would begin to develop a theory, or theories, of transition on the grounds of a non-teleological historical materialism (Balibar 1970, Wolpe 1980). While a general theory of transition is beyond the scope of this paper, the concept of a transitory path can aid in our understanding of the transition to capitalism in South Asia.

Three Distinctive Features of South Asia’s Colonial Path

South Asia’s transition to capitalism occurred under British colonial rule. Hence it requires little illustration to negate the view that capitalism did not emerge in South Asia through a popular bourgeois democratic revolution along the lines of the French revolution. The Junkers path, one the other hand, seems to enjoy certain superficial similarities to South Asia’s colonial transition. Both these transitions are forms of capitalism-from-above and therefore retain significant features of pre-capitalist modes of production.

On closer examination, however, South Asia’s transition is also very clearly distinct from the Junkers path. South Asia made the transition to capitalism under foreign domination. Colonial rule led to an economic system developed to siphon surplus to Britain, leading to the fusion of capitalism with the ancient Indian mode of production. While these features by no means exhaust all the points of divergence, they do point to three fundamental ways in which the transition in South Asia diverged from European paths of transition.

It is not possible in the following section to present an entire analysis of these three aspects. Nor is it possible to give an overview of all the literature produced on each of these subjects since these aspects are the subjects of vast scholarship in several fields of study. The aim here is to highlight how these aspects distinguish India’s capitalist development from all European paths of transition.

Foreign Domination

The first and most important distinguishing feature of South Asia’s transition to capitalism is the occupation of India by a foreign power. The colonial state that emerged out of the British East India Company (BEIC) principally safeguarded the political, economic, and cultural interests of a British bourgeoisie.

The most important institutions of the colonial state were the army and the bureaucracy. Army officers made up the largest percentage of the British colonial elite and the military always had absolute priority in the allocation of resources in colonial India. About a quarter of the British army was kept in India during the first half of the nineteenth century (Marshall 1997). These British officers commanded an army of over 200,000 Indian sepoys (Kaminsky 1979).¹

Approximately a thousand British bureaucrats, collectively called the Indian Civil Service (ICS), provided the executive machinery to rule a society of more than 300 million Indians. It was the ICS that collected the land taxes necessary to maintain this army. The ICS was divided into covenanted that were contractually protected and uncovenanted posts. The white British covenanted civil servants occupied all the higher posts while the lower rungs of the administration were occupied by Indian civil servants. Until the first World War, about 95% of the ICS officers were British. It was only after 1922 that an equal number of Indians was recruited to the service. They were instilled with the ‘habit of authority’ and were referred to as the ‘steel frame’ of British rule in India (Beaglehole 1977, Marshall 1997). Other princely states were controlled through a system of residents or political agents (Fisher 1984). For further reading on the Indian Civil Service, one can refer to Dewey (2003) and Gilmour (2007). Maddison (2001: 111) writes that:

There were only 31,000 British in India in 1805 (of which 22,000 in the army, and 2000 in civil government). In 1931, there were 168,000 (60,000 in the army and police, 4000 in civil government and 60,000 employed in the private sector). They were never more than 0.05 per cent of the population.

For such a small elite to rule over one of the most populous regions of the world also required ideological hegemony. As Memmi wrote, the colonialist ‘endeavors to falsify history, he rewrites laws, he would extinguish memories … [anything] to succeed in transforming his usurpation into legitimacy’ (Memmi 1991: 96). This transformation of ‘usurpation into legitimacy’ was accomplished through a series of narratives extolling the civilising mission of European rule (Major 1999).²

For this purpose, a native colonial intelligentsia is necessary. The British introduced Western thought and culture in India from 1830 onwards. These measures principally included teaching three things: the English language, modern law, and modern administration. This process gathered pace after 1860, when the railways system was laid down and foreign trade increased (Bellenoit 2007, Stokes 1973). The purpose of these reforms was, in the famous words of Macaulay, member of the Supreme Council of India (1835),

...to form a class who may be interpreters between us and the millions whom we govern, – a class of persons Indian in blood and colour, but English in tastes, in opinions, in morals and in intellect.

At the same time as these state-led educational processes unfolded, capitalist economic development also spontaneously generated an indigenous bourgeois class. The South Asian bourgeois developed in close connection with British colonial rule, and, as a result, overtime colonial rule resulted in the creation and emergence of a Westernised indigenous intelligentsia and bourgeoisie.³

The working people of India, however, remained largely outside the Westernised educational system. Various studies demonstrate that overall literacy levels remained below 10 percent till the end of the nineteenth century (Chaudhary 2007a: 1). Among the women and the lower castes, illiteracy was as high as 99 percent in the early twentieth century (Haggerty 1969).⁴

On the one hand, there is historical irony that Macaulay’s proclamation that the day the Indians demanded European institutions would be ‘the proudest day in English history’ came true (House of Commons in 1833). On the other hand, the fact that the ideological instruments with which colonialism was overthrown were forged ‘not by the offended, but by the offender himself’, is a form of historical retribution (Marx 1857). Whether or how the success and the limitations of the nationalist movement were connected to the contradiction of opposing British rule under the class hegemony of an indigenous bourgeoisie remains the subject of scholarship amongst South Asian scholars to this day. Nonetheless, this vast literature itself suggests that South Asia’s transition to capitalism through foreign domination distinguishes it from European transitions to capitalism.

Siphoning the Surplus

This paper stands with the scholarship that argues that India was integrated into the world capitalist market in a manner that was principally beneficial to Britain. Though one cannot dismiss the noteworthy empirical and other criticisms of the exaggerations of anti-colonial historiography, the paper nonetheless espouses the view that the structural logic of capitalism ‘binds in a single interconnected process the development of capitalism in the metropolitan centre with the political control and economic exploitation of the colonies’ (Mukherjee 1985: 172). The principal purpose of empire is and has always been the economic exploitation of the colonies.

India’s imperial commitments were three-fold: firstly, to provide a market for British goods; secondly, to financially sustain the British Empire’s interests; and thirdly, to maintain a large number of British troops, raised from Indian revenue, to be used as an imperial fire-brigade (Tomlinson 1982: 134). For these purposes, surplus from India was siphoned to Britain through a variety of avenues, ranging from remittances (whether in the shape of gifts or salaries), unequal exchange, interest charges, capital repayments, gifts, contributions to the British Empire, and so on.

The anti-colonial movement drew its legitimacy from the claim that Britain had drained India of resources and wealth. Hence, there is already a long succession of scholarly writing on this subject. Firstly, there are the early nationalist and Marxist scholars such as Dadabhai Naoroji, R. C. Dutt, M. G. Ranade, M. N. Roy, and R. P. Dutt. While much of the precise figures of this nationalist writing were challenged (see Morris 1963), the argument was continued with improved empirical work by Marxist scholars such as Bipan Chandra, Toru Matsui, Tapan Raychaudhuri, Irfan Habib, Aditya Mukherjee, and so on.

Naturally, it is difficult to even estimate the total value of surplus that moved from South Asia to Britain in the entire colonial period because it was transferred through a variety of ways. Nor are the exact amounts relevant for the largely theoretical purpose of this paper. Maddison conservatively estimates that the drain was about 0.9 to 1.3 percent national income between 1868 to the 1930s (2001: 115). Habib broadly estimates that approximately 5 to 10 percent of the gross domestic product of India was transferred to Britain over two centuries (1985, 304–46).⁵

What is pertinent to this study is that the extraction of surplus slowed down the accumulation and development of capitalism in India but had the opposite effect in England (see Mukherjee 2010). While British colonialism no doubt was resulting in the process Marx described as primitive accumulation (that is, the formation of labour-power and capital), the simultaneous process of surplus extraction implied that the imbalance between the metropole and the colony in terms of economic development continued to increase for two centuries. Consequently, India’s share of world GDP fell from 24.4 percent in 1500 to 3.1 percent in 1950 (Maddison 2007: 641).

It is this extraction of surplus during the period of colonialism that caused India to stagnate. Maddison (2001: 92) shows that despite the introduction of capitalist economic relations (that is, private property in land), the pattern of growth rates of India demonstrate no appreciable change from the precolonial to the colonial period. The only significant change occurs with the end of colonial rule. The figures are a frightful vindication of Marx’s view that the Indians will not reap the fruits of the new elements till they have overthrown British rule (1853).

There has been a long debate amongst Marxists to form a theory of unequal exchange (see for instance Agarwala 1989, Amin 1976, Barrientos 1991, Floto 1989, Joseph and Tomlinson 1991, Nakajima and Izumi 1995, Persky 1992, and Schweickart 1991). While the proportionate value of Indian exports kept falling between 1917 and 1947, there is no conclusive evidence that this was the trend throughout the colonial period (see Appleyard 2006). However, when Britain came under balance of payment pressure in the last period of colonial rule, it was India that footed the bill (see Mukherjee 2008).

There is conclusive evidence that the British used the colonial state to press any advantage against India that was disproportionately beneficial to the British. This was made possible by exercising a state-enforced monopoly on all international trade with India. The Registry Act of 1815 imposed a 15 percent duty on ships built in India. The Act stipulated that goods from the south and east of the Cape of Good Hope could only be traded in British ships; that three-fourths of the crew or seven mariners per hundred tonnes of goods would have to be British; and that only those ships would be allowed to port in London whose masters were British (Sangwan 1995: 138). From 1840 to 1886, India’s foreign seaborne trade increased more than eight-fold but, because of these regulations, it remained a British monopoly and played a vital role in their balance of payments (Seal 1968).

Capitalist Exploitation without Capitalism

What does two centuries of British colonial domination without any significant growth imply about the mode of production of colonial India? Let us first turn back to Marx’s discussion of transitional forms.

Marx observed that in ancient civilisations usurers and merchant capital existed before the capitalist mode of production. Referring to the Indian usurer and ryot, Marx writes that this is an example of ‘capitalist exploitation without the capitalist mode of production’ (A Contribution to the Critique of Political Economy, MECW, Vol. 34: 119). The capitalist mode of production only comes to exist with the creation of wage-labour and the resulting subsumption of the labour process to capital. Moreover, it is only these latter processes that bring about the productivity gains associated with capitalist modernisation. Even more significantly, Marx writes that such forms of exploitation not only exist before the capitalist mode of production; they can also exist with and can be generated by the capitalist mode of production itself. This “extraneous produce” of the capitalist mode of production places labour in unfavourable and sterile conditions, and, therefore, cannot produce any advance in the instruments of labour. Hence, the “means of production do not develop into capital, and labour does not develop into wage labour” (MECW, Vol. 34, 119).

In light of these observations, let us examine the mode of surplus extraction by the British colonial state. After the British East India Company (BEIC) was victorious in a series of battles between 1757 and 1764, the Mughal emperor Shah Alam II granted them the right to collect land revenue (called Diwani) in Bengal, Bihar, and Orissa. However, in the 1770s, the ruthlessness with which the BIEC collected land-revenue terribly exacerbated the Bengal famine that wiped out nearly a third of the population. In turn, the mass starvation of millions resulted in a dramatic drop in the collection of land revenue. This drop in revenue compelled the BEIC to introduce a more efficient and rational method of collection. Thus, in 1793, the British introduced the first Permanent Settlement Act.

The Permanent Settlement Act brought about commercial farming on private property. The registration of land converted jagirdars, zamindars, and ryots—rural possessors of land—into landowners (Jha 1980). Between 1794 and 1819, the buying and selling of land increased dramatically (Cohn 1961: 621; Islam 1979). Numerous intermediaries emerged resulting in the fragmentation of land holdings. By the late nineteenth century, ‘88.5 percent of the 110,456 permanently settled estates of Bengal and Bihar were less than 500 acres in size’ (Sarkar 1983: 33). Cash crops such as sugarcane, opium, and indigo were rapidly introduced (Sen 1992), resulting in the appreciation of land prices and the simultaneous drop in the production of food crops (Cohn 1961: 621). From 1893 to 1945, while cash crops increased by over 80 percent, food crops declined by 7 percent (Kedia 1987). By the early 20th century, the British developed new irrigation facilities and canal colonies with a view to increase the output of commercial farming (Gilmartin 1994). By the 1920s, 10 million acres of land were irrigated by government canals (Agricultural Statistics of Punjab 1937). This commercialisation of agriculture has been documented by historians such as Bharadwaj (1985), Mody (1982), Raj et al. (1985), and Washbrook (1994).

Hence, while the British bestowed formal property rights to the zamindar or the ryot, the principal source of revenue for the state from 1757 till the mid-1920s remained the land tax. The subsumption of the labour process by capital is mainly formal. The actual labour process was carried on, as before, with the traditional means of production and unfree labour. The colonial administration destroyed the rights based on custom and practice associated with the village community, and, in their place, provided legal sanction and wide-ranging despotic powers to the zamindars. For instance, Regulation VII of 1799 (known as the Haftam) gave the zamindars the power to confiscate and sell the crops, cattle, or other properties—without any judicial intermediation—when recovering arrears from defaulting tenants. The zamindars could summon the defaulting tenants to their katchahris (self-made courts controlled by zamindars) and keep them confined in fetters until the arrears were paid. If tenants ran away with their family or property, the zamindar could impose community fines on the entire village or villages. Moreover, rent could be enhanced by the zamindar to any level, without any regard to previous customs. Regulation V in 1812 even gave zamindars the power to create their own permanent settlements by leasing out their land, for any period, to any number of intermediaries who would have the right to auction the land in case of non-payment of arrears. Various other forms of pre-capitalist coercion were also available such as abwab,⁶ nazrana,⁷ begar⁸, selami⁹, and so on; these remained in place as well. A detailed exposition of these oppressive practices is contained in Cooper (1983). It is only with the Green Revolution in the 1960s that Indian scholars begin to argue whether capitalism is beginning to replace pre-capitalist relations in Indian agriculture (see Thorner 1982). Even in contemporary Pakistan, more than half of the labour force employed in agriculture is non-waged (Rahman 2012: 146–165).

Hence, while the colonial government began the process of primitive accumulation (that is, ‘divorcing the producer from the means of production’ (Marx 1887)), it simultaneously strengthened pre-capitalist forms of surplus extraction. The principal source of income for the colonial state was land revenue that was extracted from a technical foundation of peasant production working under unfree labour conditions. Colonial India was characterised by commodity production and private property in land but on the basis of unfree caste-based labour relations. The mode of production of colonial India, therefore, fits in perfectly with Marx’s description of ‘capitalist exploitation without a capitalist mode of production’ (MECW: Vol. 34, 119). This helps explains why, despite the creation of private property that was meant to usher in an era of capitalist advance, India exhibited no significant growth in terms of the productivity of labour for over 200 years of colonial rule.

Conclusion

This essay began by asking why Marx’s prediction, that the bourgeoisie would create a world after its own image, didn’t come true; why despite the creation of the institutions of European capitalist relations—such as private property, commodity production, a money economy, and so on—significant gains in economic or social terms failed to occur in colonial India. Why were the so-called universal economic drives of capitalism absent in colonial India?

This paper argues that the shape of any given capitalist society is determined by the specific transitory path through which capitalism emerges out of pre-capitalist relations. In the case of India, the specific transitory path combined domination by a foreign power with the extraction of surplus on the basis of private property and unfree labour.

Had capitalism developed in India out of a revolutionary republican path, pre-capitalist relations such as the caste system and zamindari would have been broken up by a social revolution. The relations of the Mughal mode of production and large land ownership would have been destroyed by a peasant revolution. A capitalist mode of production would have emerged out of small peasant farming. And the post-colonial superstructure of South Asia would have reflected not a colonial aftertaste but the same democratic flavour that is associated with the French Revolution.

However, the continuing dominance of unfree labour under a brutal regime of surplus extraction that was principally beneficial to a foreign power led to a very different result. While this maelstrom of capitalist exploitation led to many peasant uprisings, wars of national liberation, nationalist anti-colonial movements, and anti-imperialist struggles, peasant movements mostly fought to win back the rights based on custom. These revolts did not shatter the zamindari or the caste system that was protected by the colonial state. Instead, South Asia experienced capitalist exploitation without the capitalist mode of production within the context of colonial rule. In fact, it is only after British rule was overthrown that the transition to the capitalist mode of production began.

Moreover, the continuing existence of a pre-capitalist unfree labour regime and its glacially slow metamorphosis into wage relations accounts for the continuing influence of pre-capitalist ideology in the politics of all of South Asia (for example, Hindutva and Islamic fundamentalism). Its existence is not merely an autonomous ideological remnant of the pre-capitalist mode of production: it is rooted in the political economy of capitalist exploitation without capitalism.

There is no doubt that British colonial rule also introduced a number of new elements into the economic landscape of India. Railways, steamships, telegraphs, printing press, modern science, education, and administration became the forerunner for modern industry and resulted in the recruitment of a small industrial labour force (Desai 1966, Misra 1961, Morris 1960, Mukherjee 1970, Thorner 1947, 1955). However, the speed and the form of the introduction of these new elements was determined principally by the costs and benefits to British capitalist interests (Stokes 1973). Hence, the colonial path could not change the technical basis of the mode of production as such.

Last but not least, this colonial transition to capitalism incurred a frightful human cost. In the words of Ira Klein, ‘millions suffered “death by development”’ (Klein 2000). Davis writes: ‘[i]f the history of British rule in India were to be condensed into a single fact, it is this, that there was no increase in India’s per capita income from 1757 to 1947’ (Davis 2001). Colonialism introduced capitalist exploitation but the peculiar path of this introduction was itself a fetter on the capitalist mode of production in India. The ‘predatory conqueror’ dominated the ‘fugleman of modernity’.

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