Discuss the Economic Reforms by Moderates

The economic ideology adopted by the Moderates can be described as one that adopts the salient features of liberal and conservative preferences for the economy. The moderates in India believed that British rule in India would be beneficial for the upliftment of the society and the economy, early in the 19th century, Indian intellectuals supported British rule and believed it would modernize their country. They were referred to as moderates since they used legal and peaceful means to fulfill their aims.

They only targeted the political class with their efforts. Later, when growth in new sectors was slow but overall, the nation was underdeveloped and regressing, they grew disenchanted with the rule. This shift in perception prompted researchers to delve deeper into the realities of British rule and its effects on individuals.

Drain of Wealth Theory

The Drain Theory, which Dadabhai Naoroji first proposed, properly depicted the true intentions of the British government. The Drain Theory, which revealed the reality of the British Rule in India and its dual objectives, was first presented in Dadabhai Naoroji’s book “Poverty and un-British Rule in India.” 

• The economic critique also focused on the drain idea. It was stated that a sizable portion of Indian money would go toward the wages and pensions of British officers, as well as house expenses and army maintenance costs. 
• The drain hypothesis was popular among nationalist political agitations during the Gandhian era because it was simple enough for poor peasants to understand.
• There were other economists who identified as moderates such as Justice MG Ranade, a contemporary to Dadabhai Naoroji whose contributions asserted the importance of industrial development. 
• RC Dutt is another stalwart whose comprehensive study into the impact of the British rule from 1757. The other notable members of the moderate movement were GV Joshi, G Subramaniam Iyer, Gopal Krishna Gokhale, and Prafulla Chandra Ray. 

Revolution of the Moderates

They protested against the  British policies intended to make India a consumer of British manufactured goods and a source of raw materials. It was thought that industrialization would solve all of the issues associated with poverty. Therefore, in order to understand how industrialization was impacted by international trade, railroads, currency, tariffs, and labour laws.

• They were also adamant that India’s industrialisation depended more on domestic capital than on foreign money. The exploitation of India by foreign capital would only stifle domestic capital.
• The efforts of the moderates and economists weakened the public’s faith in the goodness of British rule. The moderate leaders who had previously pledged their allegiance to British rule started spreading the seeds of discontent and insurrection. 
• They protested against the  British policies intended to make India a consumer of British manufactured goods and a source of raw materials. 
• The nationalists raised that development of India would happen only when the political power would be in the Indian hands. The years 1875–1905 served as the foundation for the modern Indian national movement and a time of developing national awareness.

The efforts taken in the moderate movement has been the influence for some of the most integral movements in the struggle for independence and for the formation of the country post-independence. The observation made by Dadabhai Naoroji that it would require the use of Indian capital was majorly used for the benefit of the empire rather than the domestic economy, therefore the use of Indian Capital is to be strictly used for the benefit of India, creating the foundation for the swadeshi movement. After the success of the independence movement, the Nehruvian political ideology formed based on Fabian Socialism. 

Demands of the Moderates

The moderates could be the first time a revolutionary force was dissenting against the colonial government through peace, policy and negotiation.

• The channel the moderates chose to sit on the same table as the British was through penetrating the higher offices in the colonial governmental system. 
• This explains why the Indian National Congress was standing for “No Taxation without representation” after 1892, first step towards demanding control over the finances and legislation.
• The economic criticism that was raised against the British were based on three areas: Trade, Banking, and Industry.
• The early nationalists believed that the political repercussions of foreign capital investment were no less detrimental because a country’s political enslavement was an inevitable result of foreign capital infiltration. Foreign rule was maintained because foreign capital investment gave rise to vested interests that sought security. 

Therefore they opposed extensive capital imports in the railways, plantations, and industries and only permitted them where there was a dearth of Indian funding. Through tariff protection and direct government assistance, the moderates of India wanted the modern capitalist industries in India to develop in a manner similar to those in Britain.