IMPERIALISM AND COLONIALISM, World History notes for UPSC, Monopoly Trade and Plunder, Era of Free Trade, Era of Finance Capital, World History
Britain had 4000 million pounds worth abroad. Most international trade was routed through British ships at the turn of the twentieth century. After World War I Britain lost this position to the US. The US became the major dominant capitalist economy. She was now the world’s largest manufacturer, foreign investor, trader and banker and the US $ became the standard international currency. The drain of wealth or the unilateral transfer of capital from India after 1765 amounted to two to three per cent of the British national income at a time when only about five per cent of the British national income was being invested. In the 19th Century India emerged as a major market for British manufacturers and supplied food grains and raw materials. Opium from India was sold in China, enabling Britain’s triangular trade with China. Railways were a major area of investment of capital. Britain’s international balance of payments deficit was handled by the foreign exchange got from Indian exports. British shipping grew in leaps and bounds on the back of its control over India’s coastal and international trade.
India played a crucial role in the development of British capitalism during this stage. British industries especially textiles were heavily dependent on exports. India absorbed 10 to 12 per cent of British exports and nearly 20 percent of Britain’s textile exports during 1860-1880. After 1850, India was also a major importer of engine coaches, rail lines and other railway store. Moreover, the Indian army played an important role in extending British colonialism in Asia and Africa. Throughout this stage the drain of wealth and capital to Britain continued. The Home Charges (India’s payments for receiving “good” administration from Britain) and the interest payments on the Indian Public Debt were important in financing Britain’s balance of payments deficit. Thus the pride and glory underlying the slogan of ‘the sun never sets on the British Empire’ were used to keep workers contented on whose slum dwellings the sun seldom shone in real life. The British Indian army was the only large scale army contingent available to Britain. It was therefore not a surprise that the British Empire in Asia and Africa collapsed once Britain lost control over the Indian army and finances.
If imperialism is what happens in the metropolis, then colonialism is what happens in the colonies. The same system of capitalism that produced development in the Western world created under development in the colony. In this sense imperialism and colonialism are two sides of the same coin.
Typology of colonies: colonies of settlement and of exploitation, inland colonies and overseas colonies, colonies under direct rule and colonies controlled only indirectly. South Africa, Australia, Canada were colonies of white settlers whereas India and Indonesia were colonies exploited economically and politically over centuries. Neo- colonialism is the continuation of colonialism by non-formal means. Economic policies were dictated and military might was harnessed by the imperial power. The US was the foremost neo-colonial power in the later phase. Andre Gunder Frank’s major contribution was followed by those of C. Furtado, Theodore Dos Santosa, Paul Prebisch, Paul Baran, Samir Amin, Immanuel Wallerstein, Arghiri Emmanuel and F.Cardoso. According to the dependency school (Andre Gunder Frank, Samir Amin etc.). A colony would continue to be economically dependent even after achieving political freedom, as long as it remains a part of capitalism-as the capitalist class was incapable of undertaking the task of development. Wallerstain’s world systems approach divided the capitalist world into the centre, periphery and semi-periphery, between which a relationship of unequal exchange prevailed. The core economies of the centre produced high value products and had strong states. The periphery was constrained by low technology and low wages, the state was weak as was the capitalist class and the economy was dominated by foreign capital. The countries on the semi-periphery, like India, were marked by greater control of the state in the national and international market. Economic nationalism was the hallmark of such States. Cultural aspects of colonialism were highlighted by Amilcar Cabral, Franz Fanon and Edward Said. Colonialism is as modern a historical phenomenon as industrial capitalism. It is a well structured whole, a distinct social formation in which the basic control of the economy and society is in the hands of a foreign capitalist class. Colonialism is a specific structure. Colonial economy was neither pre- capitalist nor capitalist, it was colonial, i.e., a hybrid creation. Colonialism was distorted capitalism. Integration with the world economy did not bring capitalism to the colony. Colonialism did not develop social and productive forces, rather, it underdeveloped them.
Colonialism is a social formation in which different modes of production coexist from feudalism to petty commodity production to agrarian, industrial and finance capitalism. Unlike capitalism, where the surplus is appropriated on the basis of the ownership of the means of production, under colonialism surplus is appropriated by virtue of control over state power. One basic feature of colonialism is that under it the colony is integrated into the world capitalist system in a subordinate position. Colonialism is characterized by unequal Exchange. The exploitative international division of labour meant that the metropolis produced goods of high value with high technology and colonies produced goods of low value and productivity with low technology. The colony produced raw materials while the metropolis produced manufactured goods. Unequal exchange, external integration and internal disarticulation, drain of wealth, and a foreign political domination may be understood as the four main features of colonialism. The colonial state is integral to the structuring and functioning of the colonial economy and society. It is the mechanism by which the metropolitan capitalist class controls and exploits the colony. The colonial state serves the long term interests of the capitalist class of the mother country as a whole, not of any of its parts. Under colonialism all the indigenous classes of the colony suffer domination. The colonial state guaranteed law and order and for its own security from internal and external dangers. It suppressed indigenous economic forces hostile to colonial interest. The colonial state actively fostered the identities of caste and community so as to prevent national unity. The colonial state relied on the whole on domination and coercion rather than leadership and consent. There were three distinct stages of colonialism. The stages were the result of the following factors:
- The historical development of capitalism as a world system;
- The change in the society, economy and polity of the metropolis;
- The change in its position in the world economy and lastly;
- The colony’s own historical development.
First Stage: Monopoly Trade and Plunder
The first stage had two basic objectives. In order to make trade more profitable indigenously manufactured goods were to be bought cheap. For this competitors were to be kept out, whether local or European. Territorial conquest kept local traders out of the lucrative trade while rival European companies were defeated in war. Thus, the characteristic of the first stage was monopoly of trade.
Secondly, the political conquest of the colony enabled plunder and seizure of surplus. For example, the drain of wealth from India to Britain during the first stage was considerable. It mounted to 2 to 3% of the National Income of Britain at that time. Colonialism was super- imposed on the traditional systems of economy and polity. No basic changes were introduced in the first stage.
Second Stage: Era of Free Trade
The interest of the industrial bourgeoisie of the metropolis in the colony was in the markets available for manufactured goods. For this it was necessary to increase exports from the colony to pay for purchase of manufactured imports. The metropolitan bourgeoisie also wanted to develop the colony as a producer of raw materials to lessen dependence on non-empire sources. Increase of exports from the colony would also enable it to pay for the high salaries and profits of merchants. The industrial bourgeoisie opposed plunder as a form of appropriation of surplus on the ground that it would destroy the goose that laid the golden eggs. In this stage changes in the economy, policy, administration, social, cultural and ideological structure were initiated to enable exploitation in the new way. Capitalists were allowed to develop plantations, trade, transport, mining and industries. The system of transport and communications was developed to facilitate the movement of massive quantities of raw materials to the ports for export.
Third Stage: Era of Finance Capital
Large scale accumulation of capital in the metropolis necessitated search for avenues for investment abroad. These interests were best served where the imperial powers had colonies. This led to more intensive control over the colony in order to protect the interests of the imperial power. A major contradiction in this stage was that the colony was not able to absorb metro- politan capital or increase its exports of raw materials because of overexploitation in the earlier stages. A strategy of limited moderni- zation was implemented to take care of this problem. The conquest of Africa took place in the last decades of the nineteenth century. Till as late as 1880 only 20 per cent of Africa had come under European rule. The first phase, 1880-1919, was one of conquest and occupation. The colonial system was consolidated after 1910. The second phase, 1919-35, was that of the independence movements. The third stage was from 1935 onwards. The impact of colonialism in Africa was tremendous. The self sufficient African economies were destroyed, transformed and subordinated by colonial domination. Class differentiation in African society occurred as a result on the impact of colonial domination. The links of African countries with each other and with other parts of the world were disrupted. European powers reduced the economies of Africa to colonial dependencies through the power of finance capital. The loans for the Suez Canal enmeshed Egypt in debt.
The imperialist school of thought would have it that Africans welcomed colonial rule. Social Darwinism justifies colonialism by arguing that the domination over the weaker races was the inevitable result of the natural superiority of the European race. The positive effects of colonialism, if any, were byproducts; they were clearly not consciously intended. The negative impact was huge and in all shares, with long lasting legacies. For example, ethnic conflicts which paralyzed many parts of Africa today are rooted in the arbitrary superimposition of territorial boundaries on an essentially tribal society.
Colonialism in South-East Asia lasted five centuries, from the late fifteenth to the mid twentieth century. Even after the heyday of the spice trade, South-East Asia remained important as a supplier of basic raw materials like oil, rubber, metals, rice, coffee, tea and sugar. The impact of colonialism in this region was considerable, even on countries like Thailand, which did not formally become colonies. Traditional forms of government disappeared, trading patterns were disrupted and the rich cultural tradition of these regions were destroyed.
Wallerstein would have it that there was a basic paternalism which ran through the philosophies of all the colonial powers. But this basic paternalism expressed itself in very different forms, depending on the history and national character of the colonial powers. From the beginning there was a sparseness and economy about British colonial policy. The British used trading companies to acquire colonies, insisted that colonies be self sustaining and varied the political structure in each of the colonies to suit local needs. “This, then, is the classic contrast between Africa’s two colonial powers, Britain and France: Britain-empirical, commercial, practicing indirect rule, keeping Africans at a distance, verging on racism; France- Cartesian in its logic, seeking glory, practicing direct administration, acting as apostle of fraternity and anti-racism.” In practice the differences were not so clear in fact, there were parallel degrees of political, social and economic discrimination in two settler territories like Kenya and Algeria. There was also parallel absence of legal discrimination. In Britain civil servants were nonpartisan whereas in France junior civilians were political.
There were broadly four types of decolonization:
(1) Self government for white settler colonies as it happened in Canada and Australia.
(2) Formal end to empire followed by independent rule as in India.
(3) Formal empire replaced by informal empire or neo-colonialism as in Latin America.
(4) Mere change of imperial masters- in Indo- China when the French reluctantly left, the US move in.
The explanations of decolonization have been classified as follows:
- The nationalist approach
- International context approach
- Domestic constraints approach
In the nationalist view indigenous resistance and anti imperialist struggle led to independence. According to D.A. Low, the primary factor behind the end of empire was anti-imperialist movements-the metropolitan response only influenced the nature of this confrontation, not the outcome. The British imperialists presented the unraveling of empire as an orderly and rational process but the messy reality was much less consistent and unavoidable, as John Darwin has pointed out. In short, far from a planned withdrawal from empire, there was the irreversible erosion of position as imperial powers struggled to retain power by one means or another, conciliation or repression.
According to the approach highlighting the international context of decolonization, empires could not survive in the new world order after the Second World War. The changed international climate was reflected in the Atlantic Charter issued by the Allies during the War which called for the independence of colonial people. The United Nations General Assembly went a step further in 1960 in its Declaration on the granting of independence to colonial countries and people. It sharply condemned colonial rule as a denial of fundamental human rights in contravention of the UN Charter.
This international approach attributes the end of empires to the opposition of the US and USSR to ‘old style imperialism’. The US and USSR had nothing to gain from the older imperial powers, such as Britain and France, retaining their colonies. They had everything to gain from the end of empire as this enabled these two emerging superpowers to establish their influence over the newly independent countries of Asia and Africa. The metropolitan or domestic constraints approach focuses on how the colony became too big a burden on the mother country. In this explanation the end of empire is seen as a political choice made under pressure of domestic constraints and calculations of national interest. The mother country’s will to rule slackened once empire became too much of a nuisance, financially, militarily and in international relations. Historians John Gallagher and other scholars in the imperialist tradition argued that British imperial interests in India were declining, that India no longer fulfilled its role in the maintenance of imperial interests in the fields of either defence or commerce or finance and that, in fact, over the years it had become a liability for the British.
Another factor was the post war expansion of the welfare state. Decolonization gathered pace once social reform became a priority and empire began to be perceived as a drain on resources. The twentieth century was the era of decolonization. At the end of the twentieth century the world was no longer Eurocentric. The twentieth century had seen the decline and fall of Europe, which had been the centre of power, wealth and western civilization at the beginning of the century. In the first decade of the twentieth century the nationalists posed a challenge in Asia and Africa. They were encouraged by the ability of Japan, a small Asian country, to inflict a crushing defeat on Russia, a European power, in 1905. Some of the well known leaders of the national movements were Sun Yat Sen in China, Arabi Pasha in Egypt and Bal Gangadhar Tilak in India. These movements were led, in this stage, by English educated middle class elites whose demand for a say in the running of their countries was changing into a demand for independence.
The First World War further fuelled nationalist discontent. The War effort had meant increased exploitation of colonies for raw materials, manpower and taxes and nationalists naturally questioned why the colonies should bear this burden. In 1919 when a new international order was emerging in Europe the national movements in the colonies underwent a transformation in a mass direction. In India this change was brought by Mahatma Gandhi; China had the May 4th Movement; in Turkey Kemal Ataturk rose to power, and in Indonesia the national movement reached a membership of 2.5 million. Difference emerged between the old imperial powers like Great Britain and the newer ones like the US and Japan, on whether the old order should continue at all, and if so in what form? This stance of the newer world powers encouraged nationalists greatly. In the years after the Russian revolution the process of colonial emancipation and decolonization went much further. Anti-imperialist activity was fuelled because of the world wide depression of 1929. Sharpening of conflict as in Egypt and India and victory of Republican ultras under De Valera in the Irish elections of 1932 were belated anti- colonial reactions to the economic breakdown. The impact of the depression was the loosening of links between the colony and the metropolis, which encouraged independent capitalist growth in the colony.
World War II showed up Great Britain as a second fiddle to the US in the Anglo American alliance. After 1945 the US and Russia became the two superpowers.
In the third world, the Second World War had caused great upheavals, political and economic. Within years of the end of the War many colonies gained independence, but often after protracted disagreement, encouraged by the imperial power, on the contentions issue of distribution of power, leading to partition and civil war. Various areas of troublesome conflict in the 1970s and 80s, Middle East, Cyprus, South Africa, Kashmir, Sri Lanka, were legacies of British decolonization.
There are also significant differences between, for example, French and British decolonization. For example, if the British maintained strategic, political and cultural interests in its erstwhile colonies through the Commonwealth, the cultural integration was the mode of association preferred by the French. The French had no mechanism like the British Commonwealth to ease the transition of colonies to independence. Whereas the liberation of India from British colonial rule set off a chain reaction of independence in other British colonies, such as Burma and Ceylon, France continued to cling to its colonial possessions. France refused to see the writing on the wall in Indo-China. By 1945 there were popular revolts against the French in many parts of Vietnam, which then came under communist control, with the help of the quite remarkable Vietnamese guerrilla army. The French were conclusively defeated in the battle of Dien Bien Phu in 1954.
Indian independence in 1947 was followed by independence in Burma in 1948 and Ceylon in the same year. Malaya gained independence nine years later. Ghana gained independence under Kwame Nkrumah in 1957. Togo, Cameroon, Somalia and Nigeria became independent in 1960. In 1964 all seven British East and Central African colonies, Somaliland, Tanganyika, Uganda, Zanzibar, Nyasaland and Northern Rhodesia became independent. Botswana and Swaziland followed in 1966. Britain was not willing to hand over power in Kenya because of white settlers there and hence got embroiled in suppressing a protracted and violent revolt, such as the Mau.
The French colonies of Morocco and Tunisia gained independence in 1956. In contrast, independence was completely ruled out for Algeria as it was seen as an integral part of France. This short sighted policy was to lead to a bloody war, as in Vietnam. In Africa local autonomy was granted in 1956 but the colonies were placed in a union, termed the French Community, strictly controlled by France. Eight colonies in French West Africa, four in French Equatorial Africa and Madagascar gained independence in 1960. Thus there were three different policies followed by the French in Africa. In the words of Immanuel Wallerstenin, “as a result of their special Framework of thinking concerning the colonies, the British were the first to begin the process of decolonization.” They accepted national independence as a legitimate objective. They were anxious to avoid a repetition of what happened in America in their other settler colonies, Canada, Australia and New Zealand. “The French concept of constitutional advance was to draw colonies closer to France, not push them farther away.” French Africans were elected to legislative bodies. The British associated Africans with local bodies whereas the French associated Africans with French bodies. The British sought to maintain influence in their colonies after the end of empire by encouraging their ex-colonies to follow the Westminster model of parliamentary government with its multi party system. The French did not care what form of government was adopted, their concern was with cultural rather than political influence. The British and French opposed federations in French West and Equatorial Africa as the nationalists were behind them whereas the British worked towards federation as they would be useful in the post- independence situation. There were differences between the British and French perceptions of the role of the civil service. In Britain, civil servants were nonpartisan whereas in France junior civilians were political. However, this made little difference after independence. Yet, the outcome of these very different policies of the British and French was the same. Widespread economic and political discontent in Africa led to the uniform collapse of empire across British and French colonies. This seriously questions the view that French and British Africa were poles apart.
Indian independence had an amazing demonstration effect. The achievement of independence in India triggered off a wave of similar developments across Africa and Asia.