The exploitative colonial rale created a damaging effect on almost every sphere of Indian Economy. As a result, India faced major economic challenges at the time of independednce such as:
1. Low Agricultural Productivity:
During the colonial rule Indian agricultural sector was exploited by the British to serve their own interest. As a result, Indian agricultural sector experienced stagnation, low level of productivity and lack of investment in technology, fertilizers and irrigation facilities. This resulted in poor condition of landless farmers and peasants. Commercialization of agriculture created shortage of food gains in India.
Thus, the immediate concern for India was to develop its agricultural ., sector and its productivity to become self – reliant and ensure food security for people. Some v of the immediate reforms needed at die time of independence were abolition of zamindari system, heed of land reforms, reducing inequality of land ownership and upliftment of the peasant’s apart from increasing the use of fertilizers and better technology.
2. Under-developed Industrial Sector:
India Med to develop a sound industrial base during the colonial rule. There was a need of huge capital investments, infrastructure, human skills, technical know – how and modern technology for industrialization. Further, due to stiff competition from the British industries, India’s domestic industries had failed to sustain.
Thus, development of small scale and large scale industries simultaneously while facing capital shortage was matter of concern for india. The need to increase the share of industrial sector to India’s GDP was one of the important economic challenges for India.
3. Inadequate Infrastructure:
Although, the British brought about significant infrastructural development in the country, but k was done only for serving their interests and was not sufficient to improve the performance of Agricultural and industrial sector in the country. Also, there was a need to upgrade and to modernize the existing infrastructure to enhance connectivity.
4. Poverty and inequalities
India was trapped in the vicious circle of poverty and inequality. The colonial rule drained out a significant portion of India’s wealth to Britain. Consequently, majority of India’s population was living in abject poverty. Economic inequalities were present across the country due to the different economic classes that had emerged due to British policies like zamindari system.
