The following were the effects of the Great Depression on the Indian economy.
(a) The depression in economy immediately affected Indian Trade, as India’s exports and imports nearly halved between 1928-1934.
(b) Agriculture prices fell sharply and the colonial government refused to reduce revenues.
(c) Peasants producing for the world markets were worst hit.
(d) Raw jute was produced, processed in the industries to make gunny bags. Its exports collapsed and prices fell by 60%. Peasants of Bengal fell into debt traps.
(e) Peasants used up their savings, mortgaged lands and sold their precious jewellery to meet their expenses.
