India has a long history of engagement with the world economy, which has been discussed frequently in the past, and it has become a commonplace to comment on the increasingly globalized nature of India's economy over the past two decades. As is apparent from the titles of works engaging in such study, the focus has consistently been on the trading worlds of the Indian Ocean.Footnote ¹ In comparison to this now venerable tradition of scholarship that locates the pre-modern Indian economy within the framework of a global history, India has had a relatively minor place in the debate on the ‘Great Divergence’ of the past decade, with only one monograph explicitly on this subject published to date.Footnote ² Prasannan Parthasarathi, the author of this book, also has rather a lot to say about the coastal regions of India in comparison to the inland areas—not surprisingly, since he identifies British imperialism as the main cause of divergence, and the British moved inwards from the coast.Footnote ³ This is not to say that aspects of the Indian economy aside from the littoral regions have not been studied; they most certainly have. But monographic treatment of economic relations in inland regions within a global or comparative perspective has been relatively rare.Footnote ⁴ The reason for this is straightforward enough: insofar as Indian economic history has been considered through the lens of global history, it has been within the framework of ‘connected’ rather than ‘comparative’ history,Footnote ⁵ and the connections for which we have the most (and most easily accessible) sources have been over water rather than overland.

In the following pages I provide an assessment and critique, within a broader comparative context, of Tirthankar Roy's recent monograph, a synthesis of scholarship that aims to provide both an overview and a new interpretation of the economic history of early modern India, and follows in this tradition of focusing on coastal connections and long-distance trade, rather than the regional dynamics of the inland economies of the subcontinent. In the concluding pages of this article, I elaborate on my critique of Roy's work to suggest some possible avenues for future research that could be fruitful in providing an alternative, fresh understanding of the economic history of early modern India. In an earlier work Roy has placed India within the context of the ‘world economy’ and tried to present an overview of Indian economic history in the very long run within a global perspective.Footnote ⁶ However, in the present work he explicitly (and, I think, correctly) seeks to understand the economy of India on its own terms, rather than as one element in a global economic history of the early modern period. Apart from an introduction and conclusion (both exceptionally rich in provocative ideas on the subject), his book has six substantive chapters. The first two survey the political background, discussing state-formation in the eighteenth century and its consequences, including the rise of the Company state in the second half of the century. This is followed by a chapter each on the agrarian economy, conditions of business, urban economies, and, finally, living standards.

Roy has rightly pointed out elsewhere that much of the discourse on global economic history is ‘driven by a need to explain the genesis of world economic inequality’,Footnote ⁷ and here he explicitly wishes to avoid the possible danger of reading India from a European point of view. He is therefore cautious about the ‘Great Divergence’ debate, since it risks using the nineteenth century as a lens through which we perceive earlier periods. Nevertheless, he himself does not escape this trap: his definition of the ‘early modern’ is that it was ‘a preparatory, scene-setting era’.Footnote ⁸ (The incipient colonialism of this period, however, is paradoxically viewed as unimportant, since ‘the transition to colonialism carries no obvious relevance for economic history’.Footnote ⁹) Roy here elaborates on a thesis also advanced elsewhere, namely, that the story of Indian economic history is the story of the changing commercial and political relationships between inland and littoral regions, which were conditioned by the long-distance trade in which the latter engaged.Footnote ¹⁰ The significance of the early modern period (which he defines as the years between 1707 and 1818) lies not in processes of state formation, incipient colonialism, or parallels between Indian history and the histories of other regions, but rather in ‘the relocation of trade and finance from the interior to the coasts, and the rise of a coastal state that was militarily stronger than the coastal states of the past’, a development concomitant with and predicated upon ‘the evolution of Bombay, Madras and Calcutta from the fishing villages that they were in 1600 into the global cosmopolitan business hubs that they became in the nineteenth century, and onwards, vanguards in India's tryst with globalization in the late twentieth century’.Footnote ¹¹

There is nothing wrong with studying the past to understand how the present came into being, but this conception of the ‘early modern’ is problematic not least because it does not really see the period on its own terms. ‘Early modern’ is, in any case, a contentious term; Roy's periodization is conventional within the historiography on India, in which the ‘early modern’ eighteenth century occupies a brief space between the ‘late-medieval’ Mughal and ‘modern’ colonial periods.Footnote ¹² However, it seems to me that even this notion of the early modern would be worth questioning, or at least defending rather more rigorously, as it appears to be based on both a top-down, empire-focused view of India, and on a teleology that can only understand this period as a preliminary to the nineteenth century (and beyond). But—as Rila Mukherjee has recently argued with regard to Bengal, for example—the eighteenth century may in fact be better understood as part of a longer term period of increasing economic complexity going back several centuries.Footnote ¹³ Regardless of how defensible such views might be, it is surely not illegitimate to hope that we ought to study a period in the first instance without imagining it as preparing for a tryst with anything in the future, which process of preparation is in turn understood as the principal defining feature of the period in question. Doing so would mean, among other things, understanding the internal dynamic of the system within that period and how that dynamic came into being, rather than just where it is supposed to have led.Footnote ¹⁴

There are three further issues in Roy's work that, to my mind, arise from an overly modern perspective on this period. First, the focus on long-distance trade as the primary dynamic element in the economy (indeed, for Roy it seems to be the sole such element) denies the possibility of local, regional, and endogenous developments leading to growth. Second, the focus on processes that led to the ‘tryst with globalization’ imposes anachronistic concepts on the period that make the units of analysis far too large: India as a whole, for example, but also only cities of a very large size. Finally, reading ‘the early modern as a time when two orders of capitalism recast their relationship’,Footnote ¹⁵ apart from raising the question of what capitalism is (the term is used frequently, but never defined), also assumes a priori that capitalism is a universal given, already existing in some form before the eighteenth century.

Roy argues that the form of the state and its means of raising revenue were of crucial importance for economic history. This is, for the most part, an unexceptionable view,Footnote ¹⁶ but sits uncomfortably with his argument that colonialism is of no relevance, given that the transition to rule by the British East India Company (hereafter ‘the Company’) represents the rise of a new form of state, the interests of which were different from those of earlier states. Roy does not see the disintegration of the Mughal empire and the formation of successor states in the eighteenth century as having great significance per se (and it is perhaps worth noting that comparable developments can be found elsewhere as well);Footnote ¹⁷ what is more important for Roy is that these processes, while making conditions of business difficult, were complemented by the establishment of a mercantile institution—the Company—as a political power which provided a refuge for business and capital on the peripheries of the former Mughal state. Tax revenues formed the financial basis for Indian states, usually taking the form of a compact between rulers and those who were granted rights to extract surplus from land in exchange for military assistance to the rulers. The latter could have rights in terms of tax revenues (as tax farmers), but—generally lower down the scale—might also have rights of ownership, though none of these rights ever seems to have made the actual cultivators’ claims to use and inheritance less secure. However, while between circa 1200 and circa 1700 there was a single, strong inland state with only limited engagement with the littorals, and a number of peripheral states with merchants engaged in coastal and overseas trade, there was little competition between the two spheres, and also, according to Roy, little integration. From the late seventeenth century, the peripheries of the Mughal empire were becoming increasingly independent and refusing to pay tribute, and this loss of revenue was one of the factors that weakened the Mughal state. The polities in these regions, however, were themselves engaged in warfare with one another and with the inland empire, with the object of gaining land revenues; they had less interest in promoting market integration and the profits of business. Weak rule was not necessarily bad for business, and thus, despite political conflict, business did expand in the centuries before 1800. Nevertheless, warfare did compromise ‘the state's capacity to supply public goods necessary for expansion in economic activity’ and, according to Roy, even before the eighteenth century, the capacity of the states to spend on public goods had been significantly reduced. Partly (at least) for this reason, market integration in the subcontinent as a whole was poor—a conclusion that is based on Roman Studer's recent study.Footnote ¹⁸

Roy's arguments might have benefited from engagement with the recent work of Jean-Laurent Rosenthal and R. Bin Wong, who point out that in Europe (as in India), warfare was endemic, states spent their revenues on war, and public goods provisions were low. As a result, in Europe, capital-intensive industries moved to cities for the greater protection they offered, causing the price of labour to rise and providing an incentive for innovation, as well as creating financial instruments to service public debt that eventually also made capital itself less expensive—and these were the ultimate reasons for long-term economic growth.Footnote ¹⁹ Thus, ‘the state's capacity to supply public goods’ was in fact not necessary for economic expansion, quite the contrary. There are problems with this thesis that I cannot go into here,Footnote ²⁰ but it is nevertheless an argument that deserves an answer. Rosenthal and Wong compare China (a large and peaceful empire with high levels of public-goods provision and low military expenditures) and Europe (a fragmented region with generally low levels of public-goods provision and high military expenditures). Inserting India into the comparison would have been more than just an interesting theoretical exercise, it would also have been a means of coming to terms with India's own evolution—surely of some relevance for Roy's arguments. The assumption that warfare, because of the resultant lack of provision of public goods by the state, is bad for economic growth, is belied by the example of Europe—thus Rosenthal and Wong—and if this assumption is to be applied to India, it must therefore be rigorously defended. It is, of course, entirely possible that India was quite different from Europe, but Roy does not even consider the problem.Footnote ²¹

According to Roy, the key change came with the establishment of the Company state: this was the first state that was also a merchant company; it was the first coastal state to expand inwards, promote a land market, legislate extensively with regard to business, and collect its own taxes and pay salaried armies instead of relying on military assistance from tax farmers; it was also ‘far more willing than any other [state] to institute laws protecting the interests of capitalists’.Footnote ²² Roy believes—correctly, I think—that these factors are all more significant than any military advantage.Footnote ²³ However, while I do not wish here to engage with what seems to me to be a concerted effort to deny any negative economic effects of colonialism (and indeed assert the opposite), it does need to be reiterated that the fact that the Company was a colonial—foreign—power was almost certainly also an important factor in these developments, and thus the transition to colonialism was crucial. To insist on this does not mean—as Roy argues—to believe that ‘economic trends derive from nothing more substantial than the ethnicity of the rulers’;Footnote ²⁴ the difference between the economic behaviour of the Company state and its indigenous counterparts was not simply a matter of ethnicity. Roy himself says that, unlike the Indian states, the Company sought to ‘neutralize the intermediaries’ in revenue collection, and did so because of low levels of trust.Footnote ²⁵ He states further that ‘being foreigners, the Company did not trust the Indian elite’ and ‘came from a world which had been adapting to constant wars by means of centralization of finances and conscriptions’, unlike Indian states.Footnote ²⁶ This surely suggests that the Company's foreign-ness lay behind at least some of the key changes that the Company introduced, the importance of which Roy rightly stresses—in which case the term ‘ethnicity’ is something of a red herring that simply distracts from the real issue, which is colonialism enforced by a foreign power, and all that it entails.Footnote ²⁷

The net effect of Company legislation and the form of its state was to deprive landlords of military power, while giving them saleable assets (because of competing and overlapping rights to property, there had earlier not been much of a real land marketFootnote ²⁸). It also conferred on itself the ability to pay for its own military functions by means of raising taxes, thus increasing its potential profits from trade, which was now no longer the sole source of revenue to support military operations. In other words—and this is a point that Roy seems to ignore—from a political-economic system based on indigenous ownership of resources and conflict among indigenous parties over the fruits of that ownership, the Company transformed local landowners into people with the ability for capitalistic growth without military and political power. The latter were now concentrated in the hands of a foreign entity, and one which, moreover, maintained its control on the basis of revenues extracted locally, while the profits of its own trade, and the motivations for that trade, were located outside India and driven by political and economic considerations that had little to do with local conditions. What were these motivations and considerations? Is it really legitimate—is it even possible—to grant so much weight to the innovations of the Company and nevertheless view the course of Indian history, and the Company's impact on it, solely from the perspective of India?

Furthermore, although Roy is well aware that the Company was increasingly able to use land revenues to pay for its purchases of export commodities from the last decades of the eighteenth century onwards, he appears to ignore one consequence of this, namely that the Company could now keep far more of the silver it earned from selling Indian exports abroad, which had earlier been used at least in part to pay for these exports.Footnote ²⁹ Thus considerably less money was pumped into the Indian economy relative to how much went out. I am aware that the figures are a matter of some dispute and the conventional view of a ‘drain’ of resources might be in need of some revision, but if it is true that the Company's exports now brought in less specie from abroad than had earlier been the case, this would represents a fundamental change in the way in which India had earlier functioned within the world economy, as an exporter of products and an importer of precious metals.Footnote ³⁰ As Om Prakash has pointed out, the consequences of this would include the fact that however much the Company's policies might have benefited output growth, this could no longer bring about ‘increases in income, output and employment’ to the benefit of Indian producers.Footnote ³¹ In addition, that the Company was—according to Roy himself—more willing than indigenous states to institute laws to protect capitalists surely says something significant about the culture of the political economy in which the Company originated and how that differed from what existed in India. It suggests that capitalism, if not a new phenomenon in India, was at least differently located within the political and cultural spaces of Indian polities and the home of the Company. Insofar as the Company's policies and innovations were of fundamental importance for the course of the economy—and that is the essence of Roy's argument—colonialism was clearly far more than just a matter of ethnicity. It was nothing less than the introduction of a new way of thinking about and regulating economic behaviour, and a reconfiguration of the relationship between those engaged in long-distance trade and producers and intermediary merchants, coupled with a very material impact in terms of the amount of silver introduced into the Indian economy. Roy's explicit theoretical and empirical position regarding the impact of the Company thus does not seem easily compatible with his view that ‘the defining process of change in the economic history of early modern India was not the establishment of the British Empire or the transition to colonialism’.Footnote ³²

Roy himself elsewhere reiterates the point that the existence and growth of the India companies of European countries ‘reflected the consumer boom in Western Europe’ as well as the ‘growing interdependence between the European conquest and the settlement of America, the African slave trade, and the importation of Asian luxuries’.Footnote ³³ Thus we have inevitably the problem of the other end of the trade from India. For this reason, while Roy's claim that the rise of the colonial coastal cities—predicated on long-distance trade mainly with Europe or controlled by European agents—is the key factor in economic transformation is plausible enough, it seems rather disingenuous to examine these processes without any consideration of the European reasons for the presence of European traders in India. If the story of the early modern Indian economic history in this period really is the rise of a mercantile coastal state, we have no option but to understand India as an element in a larger global economy, since that mercantile coastal state—the Company state—was dependent on global trade and the dynamics of economies outside India: its policies were necessarily driven by non-Indian concerns. If the principal element of change in that period was the rise of the Company towns, themselves dependent on the existence of the Company and its policies, in turn themselves dependent on European demand, then the dynamic of the economy of eighteenth-century India was driven by external factors. Trying to understand eighteenth-century India without reference to these is therefore surely impossible.

I will suggest below that a better way of understanding early modern India on its own terms (and I agree that we must at least attempt to do so) would be to begin by examining its internal dynamic, which would mean ignoring, for the moment, the ‘tryst with globalization’ and working our way up from the level of the village through to local, regional, and inter-regional structures of economic behaviour and patterns of exchange. Here a global perspective may be useful, but in this instance more in a comparative sense than because of global connections: looking at comparable developments elsewhere can be stimulating in terms of the questions we ask about India as well. For example, much of the research on European economic history circa 1200–circa 1800 in the past few decades has stressed the significance of processes of rural commercialization and their relationship to ‘proto-industry’ and urbanization, and the role of these factors in bringing forth ‘modern economic growth’. Transformations in these elements of the economy are arguably as important as overseas trade, perhaps more so, and more still needs to be done—certainly with regard to India—in order to determine the relationship of the impacts of overseas trade to these more local developments.Footnote ³⁴ Rather than thinking of Indian economic history in a global context solely as a matter of connections, comparing the internal dynamics of a single Indian region with that of a single region elsewhere is likely to prove more fruitful in terms of furthering our understanding both of India's economies, and of processes of economic change more generally.

With respect to the nature of India's internal economies, both rural and urban, Roy's examination of ‘the agrarian order’, and even of towns, while providing useful surveys of the scholarship, nevertheless suffers from the fact that he views these elements of the economy very much from the top down, from the perspective of long-distance trade. He sees little evidence for any significant change for most peasants in either direction in the eighteenth century, though he suggests that for the wealthier peasants and village headmen, a process of ‘gentrification’ took place as these people gained secure and saleable property rights under Company rule. He argues that the coastal zones, being more stable and benefiting from commerce, allowed for population growth and local commerce, but in the inland regions, political turmoil disrupted infrastructure and limited exchange economies. Roy does believe that in some areas, like Bengal, there was a quickening of the long-distance commodities trade. He concedes that there was a ‘penetration of commerce and credit in the agricultural economy’, and that, at least in northern and central India, ‘the main form of change [. . .] arose not from institutional reforms, but from the market’.Footnote ³⁵ Nevertheless, these developments, driven by local and regional markets and patterns of consumption, seem to be of little interest to him: the markets he is concerned with are those that engaged in long-distance trade. But the ‘penetration of commerce and credit in the agricultural economy’ and the changes arising ‘from the market’ were surely crucial in transforming the nature of India's regional economies; any theory regarding economic change in the eighteenth century must take the long-term histories of regional commercialization into account. Indeed, as Kumkum Chatterjee has stated, it is the rural market economy and the networks of small towns, both of which conveyed goods from primary producers to the main inland and maritime centres of consumption, that ‘constituted the basic level on which big business, whether oceanic or inland, rested’.Footnote ³⁶ It is therefore impossible to understand the latter without more detailed analysis of the former. Once again, the example of Europe is instructive: it is precisely local, regional, and inter-regional trade that are now seen to have been at the heart of economic growth in the early modern centuries, and it does not seem unlikely that India would have been similar. The relationship between agrarian commercialization and both overseas trade and economic growth more broadly needs far more attention, not least because that overseas trade which is so important for Roy's thesis would not have been possible without the regional specialization, productivity, and regional and inter-regional commerce that allowed for so much specialized textile production for overseas markets.

Roy's lack of interest in the significance of local and regional commerce is all the more surprising, given his claim that, until the late eighteenth century, foreign trade ‘simply did not matter on a quantitative scale’.Footnote ³⁷ He is aware that there was a great deal of inland trade, as well as a great deal of inter-regional trade along the coasts; he acknowledges also that the specialized textile-producing regions needed to be provisioned with grain and raw materials. Coastal, textile-exporting regions were dependent on inland areas (often several hundred miles distant) for their raw materials;Footnote ³⁸ they were also often characterized by high degrees of specialization in production and a concomitant dependence on exchange. All of this necessarily implies high levels of rural commercialization (and probably market dependence) even in inland regions, coupled with production for the market just as much as, if not more than, for subsistence. Indeed a number of scholars have demonstrated that in all the regions studied so far the agrarian economy was, even at the village level, heavily monetized, commercialized, and market-oriented; thoroughly infused by credit-dependency especially at the lower levels of society; and also probably market-dependent in the sixteenth, seventeenth, and eighteenth centuries.Footnote ³⁹ Moreover, it is not just the littoral regions where we find dense networks of local trade and market-dependent specialization of production: even landlocked Rajasthan and Punjab were, at least from the seventeenth century onwards, characterized by high levels of local commercialization, regional and inter-regional trade, and the market-dependence of producers engaged in growing cash crops such as opium, cotton, tobacco, and indigo.Footnote ⁴⁰ Indeed, levels of commercialization in the eighteenth century are thought to have been high enough even in arid Rajasthan for one scholar to characterize it as ‘one of the most vibrant commercial economies of contemporary India’.Footnote ⁴¹ It is true that data for inland regions in the eighteenth century are often patchy, but this fact should, if nothing else, caution us from erecting theories of economic change that completely ignore these issues. Given what we know of the sixteenth and seventeenth centuries, and our knowledge of the high and growing levels of exports in the eighteenth century—which implies a great deal of production for the market in inland areas too—it would seem logical to suggest that there was a very high level of commercialization inland in the eighteenth century as well, and thus that the dynamics of internal trade, production, and commercialization are key to any understanding of India in this period.

Roy may be right in saying that the shift in importance in favour of overseas trade is the key transformative moment in Indian economic history,Footnote ⁴² but quite apart from the fact that, as we have already seen, this shift needs to be understood in relation to the foreign aspect of that trade, such high levels of overseas trade would not have been possible without a great deal of integration with production and supply chains linking the hinterlands with the regions where cloth was produced and the port cities from where it was exported. This suggests that before we can truly assess the importance of overseas trade and the Company towns, we need a better understanding of the endogenous structures and trends of the Indian economy as well. What sort of inland production patterns and exchange networks were in place that enabled the quickening of overseas trade? What were the origins of these networks, and to what extent was this to do with the influence of the European companies? Given that such exchange networks and even high levels of commercialization were already to be found by the later sixteenth century in many regions, even if we accept the thesis that the Company state and its cities were of crucial importance, it seems likely that longer term patterns of production and exchange were also significant in allowing those cities to thrive—and come into being in the first place. There is, in other words, a tension between an argument for continuity—which finds expression in Roy's belief that colonialism was not important, since it was ‘a dependent element in a larger process of transformation of livelihoods that had begun before 1700 and gathered pace towards 1800’Footnote ⁴³—and his proposition that the Company's cities, institutions, and economic policies were the crucial fact effecting change. Furthermore, Roy's view—that there was little integration between the littorals and the inland regions—would appear to need some refinement, given the dependence of the former on the produce of the latter.

A book on the economy of India that sees these more local aspects of the economy only as functions of and subsidiary to the Company-driven growth of export-oriented coastal cities is, to my mind, necessarily incomplete; and a book that gives such a cursory treatment to the internal economies of India's regions when these might have no obvious and immediate connection to global trade, while possibly fulfilling the function of a ‘business history’, cannot really deserve the title of an ‘economic history of India’ as a whole. While it is almost certainly the case that British commercial interests had a massive impact on the trajectory of the Indian economy from circa 1750 onwards, focusing on this aspect tells us little about the ways in which endogenous factors might have been influencing or causing alternative trajectories, and how these trajectories were aided or interrupted by the British—and this is a point of crucial importance not just with regard to the ‘Great Divergence’ debate, but also for our understanding of what the Indian economies were during the eighteenth century, and the dynamic relationships operating within them, matters surely as important as the question as to what the economy of ‘India’ was ultimately to become.

Roy's discussion of towns suffers from a similarly skewed focus, reading their history from the future backwards, with only long-distance trade centred on very large towns seeming to have any real significance. His argument is that the period saw the rise of Bombay, Madras, and Calcutta, which were—unlike the principal earlier urban centres—primarily commercial rather than garrison towns. Now, at least Masulipatnam and Surat had long been towns that one must by any standard characterize as commercial; and one should not forget that the Company towns Roy believes were the way of the future were also the headquarters of the Company's armies and thus the locus of its military might and certainly garrison towns as well. Similarly, Roy argues that the shift in economic weight to these three cities signifies a ‘change from political towns to business towns’,Footnote ⁴⁴ but he himself sees the significance of this period as one in which mercantile power on the littorals began to expand politically inland: the new ‘business towns’ were therefore, even by Roy's own argument, of necessity also political towns, insofar as they were the seats of the Company's growing political power.

For the most part Roy avoids discussing towns with a postulated population of less than 100,000, and tends to focus on very large cities with over 200,000 inhabitants. This mirrors his treatment in his previous monograph, where, in his discussion of Vijayanagara (fourteenth to sixteenth centuries), he claims that it was ‘quite small’, with a population of at most 60,000.Footnote ⁴⁵ Small by what standards? Certainly, if compared to modern Indian cities, 60,000 is nothing, but is modern India an appropriate comparandum? By 1600, Europe had only six cities with over 80,000 inhabitants, mainly in the Mediterranean; by 1800, in all of Europe, there were only nine cities with populations of over 160,000, and only three with populations of over 320,000; in India, there were already three cities with over 400,000 inhabitants by 1700.Footnote ⁴⁶ India clearly had more very large cities than Europe. This suggests significant rural surplus production coupled with a great deal of town–country interdependence (a subject Roy largely ignoresFootnote ⁴⁷) and rural commercialization—but urbanization need not be an indication of long-term economic trends. It is worth noting that in Europe, with regard to the number of cities with at least 10,000 inhabitants, as well as the total urban percentage of the population, the Mediterranean regions come out ahead of northwestern Europe at least until 1750 if not 1800; and the Netherlands had a higher rate of urbanization than England and Wales, even in 1800. But the Mediterranean regions were not the motors of long-term growth in Europe (and, indeed, after a peak circa 1100–circa 1500, these regions have consistently been at the lower end of levels of economic development in Western Europe even to this day). The Industrial Revolution took place in England, not the Netherlands; and with regard to almost all the standard indicators of economic development, the regions that had higher urbanization rates than England in 1700 lagged quite far behind the latter throughout the nineteenth century. This suggests that a focus on urbanization, and in particular on very large cities, might be misleading in the context of India as well. If very large cities are not very good predictors of long-term economic trends, perhaps what we should be looking at more closely are the relationships between these cities and smaller towns and the countryside, the nature of town–country relations in general, and the role of smaller towns and markets within the economy.

Although Roy is aware that there were indeed many such smaller market towns that were nodes on a ‘vast grain trading network’,Footnote ⁴⁸ he does not consider the consequences of such a network for the economic structures of the region overall, nor the deeper histories behind this network. The recent decades of scholarship on Europe have demonstrated the huge significance of lower-order cities; even ‘quite small’ towns with only 60,000 people would have required extensive hinterlands for their provisions and the raw materials that fuelled their manufactures, which demand would in turn have had a very significant impact on the nature of the economies of the surrounding rural regions, not least with respect to levels of commercialization and possibly market dependence.Footnote ⁴⁹ Moreover, it is possibly of some significance that in Europe, the regions that eventually entered into a cycle of sustained economic growth were characterized by cities with relatively weak political control over their hinterlands, whereas the regions where cities had greater control (which were also more heavily urbanized earlier) tended towards slow growth or stagnation.Footnote ⁵⁰ How does this compare with the situation in India? Would it be fair to state, on the basis of what we know regarding patterns of urbanization and commercialization, that the economies of India were either declining or heading to stagnation, a fate averted only by the intervention of the Company (as Roy appears to suggest), or rather that India too was on a path to modern economic growth, interrupted by colonialism (as Parthasarathi believes)? In other words: does the trajectory of Indian economic history suggest that there was already an earlier divergence, if not in terms of living standards, then at least in terms of structures that would cause an eventual divergence in other things as well—or is it the case, rather, that India (or regions in India) were participants in a global ‘Great Convergence’ in terms of economic growth?

Only in his final substantive chapter does Roy explicitly connect his own work with the ‘Great Divergence’ debate, discussing the agrarian system and standards of living. Like most other contributions to this debate, Roy's chapter on these issues is also bedevilled by highly speculative data. He believes there is no evidence for decline or growth as an effect of colonialism; this would accord with his thesis that colonialism had no negative impact on the rural economy. The sources are, however, quite ambiguous, and, as Roy points out, the issue is quite complicated because we do not always know what precisely is being measured: rice in husk or husked rice, for example. Roy's arguments are valid only if one assumes—as he does, though on what basis it is not clear—that the earlier yields are consistently for rice in husk, and the later yields are husked rice. Given that we do not know either way, surely the possibility that it could be the other way round needs acknowledgement?Footnote ⁵¹ Roy believes that there was, by the end of the eighteenth century, some de-commercialization in the interior regions, and little change anywhere in living standards; commercial coastal zones were ‘far removed’ from inland ‘de-commercialized agricultural zones’; and these ‘two worlds were not deeply connected, nor interdependent’.Footnote ⁵² But, given that demand for raw materials and comestibles in the coastal zones did not decline, and arguably increased to the extent that export output increased, and given that this demand would have to be satisfied at least in part by means of supplies from inland areas, Roy's conclusion that there was a retreat in the eighteenth century in the inland regions, with cultivation ‘in a large area of the subcontinent’ increasingly oriented towards subsistence ‘or production for small local markets’, thus seems unconvincing.Footnote ⁵³ Others have argued that at least with regard to some regions of the subcontinent, ‘this was hardly an economy that had to be “forced” into relations of exchange: it was to a large extent reproduced by them’.Footnote ⁵⁴ This was an economy in which ‘most inhabitants of the advanced, commercial regions were reliant upon trade to meet their daily needs’ and ‘there was little production purely for subsistence’.Footnote ⁵⁵ Indeed, Ghulam Nadri has recently suggested, with regard to Gujarat, that a top-down model of the economy is fundamentally flawed: at the local level, this region's economy was highly commercialized, standards of living were high, and despite some contraction in the 1720s and 1730s, Gujarat belies the notion of the eighteenth century as a period of decline; in fact, it was a period of growth in output and possibly rising living standards, with decline only setting in under colonial rule, from around the end of the eighteenth century.Footnote ⁵⁶ We have seen already that there had in fact long been deep connections and interdependence between the littorals and regions inland, and there seems to be little evidence that coastal zones were now suddenly able to produce all that they had earlier obtained from inland regions; it thus seems likely that reports of inland decline might be exaggerated.

Since growth in India was, according to Roy, caused by the rise of the Company towns and by Company policies, from a ‘business history’ perspective, colonialism seems to have been, in Roy's view, a good thing. But recent scholarship has also stressed the negative impacts of the Company state on the Indian economy, specifically on Indian producers. Increasing output notwithstanding, the latter now operated in a more closed market, rather than in a more-or-less free market where they could sell to competing buyers, as had earlier been the case.Footnote ⁵⁷ It has been argued that despite perhaps increasing production, the Company's influence was not in fact beneficial: the rise in production did not lead to a rise in producers’ income, but rather the opposite, because of the coercive conditions of labour and the loss of freedom to access the benefits of increased production.Footnote ⁵⁸ (If yields did in fact decline in the nineteenth century, it could relate to a contraction of agricultural productivity in response to shrinking markets caused by artisanal producers losing access to some of the potential profits of their output and thus having less purchasing power than before.) Therefore, while increasing output might have been good for business—the Company's business—because it might have induced growth and thus profits for the Company, whether it was good for the economy—which I suggest should be understood as the economic lives of the people actually engaged in production and consumption, rather than simply aggregate growth—is another matter, which Roy largely leaves aside.Footnote ⁵⁹ Roy's arguments therefore need to be contrasted with the alternative view that would suggest that in many regions (including at least the Coromandel coast, Gujarat, and Bengal; and possibly also inland zones like parts of Rajasthan), the pre-colonial system itself produced some amount of growth in output and relatively high standards of living, while the rise of the Company to political supremacy caused a decline in the latter, even if aiding the former. Furthermore, at least in Gujarat, growth continued on the basis of a strong internal dynamic and because the Company did not, in the eighteenth century, enjoy quite the same level of control as it did elsewhere: growth and a high living standard here were certainly aided by the export trade, but not by Company policies, which, Nadri argues, in fact caused economic decline as the Company began to exercise more control.Footnote ⁶⁰

Parthasarathi and Roy have provided us with the two most ambitious interpretations of the economy of early modern India in recent years; while they disagree on most things, it is striking that both view the Indian economy very much from the outside in, as it were, rather than from the village upward, and that both also view the eighteenth century from the perspective of the nineteenth—Parthasarathi explicitly, because of the subject of his work, and Roy implicitly, though he does not seem to believe that this is what he is doing. It seems to me that a more fruitful approach to understanding pre-colonial Indian economies would be to turn further inward and attempt to understand the internal dynamic of early modern India by taking a longer perspective, not with regard to the eighteenth century alone, but rather seeking to elucidate patterns of local and regional trade, and commercialization over a period of several centuries. Only by this means can we ascertain the extent to which the eighteenth century really was a break with the past, and what sort of break it was. Furthermore, while turning away from an excessive focus on processes of state formation and break-up is indeed a useful exercise, there is no economic history that is not also political: these aspects of the European presence in India are thus necessarily of prime importance. But it is not just politics that impinge on economic behaviour: even cultural preferences and changes in them can affect consumption, for example, which in turn also has an impact on the economy as a whole. So it is important that we do not just think of the economy in terms of aggregate ‘growth’ or ‘decline’ from the point of view of indicators such as output, revenues, and the fate of large merchant companies; rather, we must try to understand local patterns of consumption, production, and exchange, and how these relate to various other factors not just economic, but also political, cultural, social, ideological.

The main substantive points of my critique of Roy have concerned a set of closely related issues. To begin with, there is a teleological perspective that leads to anachronistic analytical categories and objects of study. This produces, inter alia, a top-down approach that appears to view economic history as synonymous with ‘business history’ and does not, in my view, give enough importance to modes of consumption, patterns of demand, and changes in household economic behaviour as motors of economic transformation. It also leads to a focus on ‘India’ that is, to my mind, misleading and inappropriate for the period, not least because it brings with it a lack of attention to the dynamics of local, regional economies. Finally, there is a lack of clarity regarding what ‘capitalism’ was and how it might relate to this period. In the following pages, I develop on this critique, proposing some avenues for future research that might lead to what would be, to my mind, a more inclusive and nuanced understanding of the economy of the Indian subcontinent in this period, and also how it might be understood both on its own terms and within a global framework.

Let us begin with the problem of precisely what period it is that we should examine. The concept of ‘early modernity’ is manifestly fraught with problems, but rather than go over the pros and cons of such terminology yet again, it seems to me a more fruitful exercise to think of how to delineate particular historical periods, whatever we might choose to call them. At least with regard to political history, the Mughal empire conveniently provides a period of its own for northern India, and the apparent hiatus between the decline of this empire and the rise of the British might well be legitimately viewed as a separate epoch—as Roy does, following most scholarship on India. There are two problems with this approach, however. The first is that the extent to which the changing political circumstances of the eighteenth century actually transformed economic structures at all, or even most levels of society, is far from clear. Certainly it seems to be the case that, with regard to levels of commercialization, productivity, and inland and overseas trade, at least the Coromandel coast, Bengal, and Gujarat were continuing along trajectories that had lengthy prior histories. Given the way in which these regions were dependent on other regions further inland (and even on each other) for their raw materials, whatever disruption the political turmoil caused, it might not be sufficient to label this as a distinct period in terms of economic history.Footnote ⁶¹ While the British political takeover of Bengal did lead to significant changes, these only took effect in the last third of the century, and it is not clear that this third needs to fit into the same period as the rest of the century. In the case of Gujarat, Nadri is, to my mind, convincing in showing that for most of the century, the British had a relatively minimal influence on the course of the economy.Footnote ⁶²

In any case, even if the political history of the Mughal empire and its successors did indeed have sufficient impact on economic history to have a place in periodization, what about the rest of the subcontinent? According to Muzaffar Alam and Sanjay Subrahmanyam, the Mughal state's fiscal and military relationship to about a third of the lands nominally in its grasp was quite tenuous,Footnote ⁶³ and much of southern India was never even formally under Mughal control. Many regions that did eventually come under the Mughal umbrella did so rather late, and Roy himself believes that the economies of these littoral regions were more focused on trans-oceanic trade than connections with the inland regions—the heartlands of the empire. So is a periodization based on the chronology of the empire really appropriate for all of ‘India’? If the littoral regions of the subcontinent looked overseas, and had long done so, perhaps they are in need of a different kind of periodization. Here perhaps we should recall K. N. Chaudhuri's argument that for the economies of the Indian Ocean a new period began with the very different habits and conditions established by the beginnings of European trade there from circa 1500.Footnote ⁶⁴ Even if the ‘early modern’ period (or whatever one wishes to call it) in northern India really does lie between the crumbling of Mughal domination and the beginnings of the Raj, it is not necessarily the case that such a periodization is equally appropriate for all of the subcontinent. Reading back a unity, even in this respect, from the perspective of later history is a way of thinking best abandoned.

We should recall further that the land area now encompassed by Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka is an area as large and geographically diverse as the modern European Union.Footnote ⁶⁵ To read its history as a progress towards the globalization of modern India would be like trying to understand the varied histories of eighteenth-century Europe as simply a stage in a unitary process leading to the European Union today. And while it is certainly the case that one can write an economic history of pre-modern Europe, those who seek to understand, for example, the rise of the Golden Age Dutch economy, or the British Industrial Revolution, quite rightly see no reason to include any analysis of, say, Sicily, or Denmark, in their work. This is, of course, once again because of modern national (and linguistic) boundaries embedded within historiographical traditions, which can, for Europe as well, be debilitating. The economic histories of southern Germany and Switzerland, for example, were inextricably linked between the sixteenth and the nineteenth centuries, national boundaries notwithstanding. Nevertheless, there is an important point here, namely that individual regions of the Indian subcontinent, particularly those that were not really united under one polity, or not for very long or very effectively, might have historical trajectories that need much closer examination as discrete entities before we try and fit them into a larger pattern for the whole of the subcontinent. Furthermore, it might be analytically valuable to examine different regions under different chronological rubrics, which would have to be chosen on the basis of a coherent internal logic within the histories of those regions, rather than because of factors not necessarily of the greatest import to them within the period concerned.

While economic history should proceed from the regional perspective upwards, it certainly can also be a very useful exercise to try and understand a larger macro-region. How we define this macro-region, however, should be based on a historically appropriate understanding of the relationships and histories of the regions within it. An excellent example is given by Chris Wickham's magisterial study of the social and economic history of a number of regions that had been part of the Roman empire.Footnote ⁶⁶ What unites the regions he examines—Italy, France, Spain, western North Africa, Egypt, Syria, Greece and Asia Minor, England, Denmark, and Ireland—is not, however, the fact that they were latterly part of a modern unit ‘Europe’ (many of them manifestly are not); rather, it is the fact that all but two had been a part of the Roman empire, and the two exceptions—Denmark and Ireland—are chosen precisely for the reason that they had not been within this empire, but lay on its borders and thus provide comparanda for understanding how social and economic transformations took place within this period in regions that had been united by the fiscal, legal, and military framework of the empire, and in two regions which had not been so linked. This geographical framework makes rather more sense for the period concerned, because of a unity in its prior history, than would an approach to that period under the rubric of ‘Europe’ or ‘western Europe’ that would leave out the former Roman provinces of North Africa or Egypt, but include Scandinavia and Germany, most of which had never been Roman provinces. My point is that we should try and build up a notion of a macro-region on the basis of a past that somehow held it together, rather than because of later unity. To what extent, and for precisely which period, do either the Mughal empire or later versions of ‘India’ (British or post-Independence) genuinely provide such a unifying framework for all the regions that are now conventionally studied under the rubric of ‘early modern India’?

Most scholarship on the pre-colonial Indian economy has, de facto, some interest in another region, since economic historians have been largely concerned with long-distance trade. Here the deficit is often the lack of attention given to the other end of that trade, without which the true nature of its dynamic cannot be understood. But beyond this form of connected history, there is also some value to comparative history. There is no necessary opposition between regional analysis and economic history within a global framework, but there are different gains to be had from looking at connections, and a comparative perspective. Thinking of economic history in terms of inter-regional or trans-oceanic connections can obscure what was happening at the regional level—the developments that actually made the long-distance connections possible. In contrast, the value of a comparative approach is that it can help us to pose new questions, or ask old questions in new ways, and open our eyes to fresh interpretive possibilities. This is not, I must stress emphatically, an exhortation to understanding the history of the Indian subcontinent through the lens of Europe; one could equally well compare regions in India with others in China, or Japan, or Iran, or the Ottoman empire.Footnote ⁶⁷ Many regions around the world went through processes by which they experienced demographic and economic growth; increasing specialization of production; greater levels of involvement in local, regional, inter-regional, and long-distance trade; growing market dependence; and higher levels of consumption. These developments did not take place in all regions within larger macro-regions, however, and here Kenneth Pomeranz's notion of ‘core regions’ is useful: he argued that there were, across Eurasia, a number of zones that shared many of these developments, which were in turn, if not brought into being, then at least influenced by their geography—an argument advanced in rather more detail by Bas van Bavel with regard to the Low Countries.Footnote ⁶⁸ By examining comparable developments in different regions, we may be able to come closer to understanding the causal factors behind those developments, precisely by taking into account the differences.Footnote ⁶⁹ I suggest, therefore, that we should first identify and understand the ‘core regions’ of the Indian subcontinent individually, in comparison with each other and perhaps ‘core regions’ elsewhere, while also comparing them with those regions that might appear not to be ‘core regions’. They need to be examined from within their own geographical and historical context; this will reveal the relative importance of endogenous factors, and the extent to which connections with other regions (in the subcontinent or elsewhere) might have influenced the dynamics of their economies. Only in this manner can we slowly fit together the pieces—individual regions and their internal and external relationships—of the jigsaw puzzle that is the set of historical processes leading to modern economic growth, or ‘capitalism’.

Roy's project is explicitly to understand the economic history of India as a process by which the relationships between what he calls ‘two distinct capitalisms’,Footnote ⁷⁰ one based inland, the other on the coast, changed, eventually allowing these two capitalisms to converge. What precisely is meant by capitalism is never defined in his economic history of early modern India; somewhat surprisingly, turning to his chapter in the Cambridge History of Capitalism does not prove very enlightening either.Footnote ⁷¹ The ‘two orders of capitalism’ referred to in his monograph appear to be synonymous with the ‘two orders of commercial enterprise, one based on land and the other ocean bound’, described in this chapter;Footnote ⁷² capitalism seems to be nothing more than commercialization, or, more specifically, long-distance trade. To be sure, Roy does acknowledge that there are different definitions of capitalism, but he is not particularly interested in elaborating on why any of them might be more or less appropriate, except for one, which he summarily rejects. This is the Marxist definition of capitalism as a mode of production, which is unacceptable because relations of production are ‘too tied to specific production sites to be quite portable’.Footnote ⁷³ Nor can this problem be avoided by tying capitalism specifically to Europe: ‘such an approach would not find favor today’.Footnote ⁷⁴

Doubtless Roy is right that thinking of capitalism as uniquely European would not find favour today, but what is gained by talking about ‘capitalism’, rather than ‘trade’ or ‘commercialization’, if one does not differentiate between these terms? By this I do not mean that we need to adopt the mode-of-production definition, but simply that if we wish to use a more specific term, it should have a more specific meaning, otherwise the terminology becomes valueless and should be abandoned. Trade has existed as far back in history as the evidence will take us, but its importance within historical societies has not always been the same—which in itself suggests that there really are differences between societies characterized by more or less exchange, and thus we should not bundle all of them together. There is therefore no reason not to be open to the possibility that particular socio-economic formations are not necessarily universal, but might be historically specific to particular times and places. There is certainly no reason to believe in a teleology of capitalist development anywhere, whether in Europe or Asia. There is also no reason why we should not be able to accept that capitalism might be historically specific to Europe, or to a particular region of Europe, or to particular regions within Europe and Asia (or any other continent for that matter), but not other regions also within Europe and Asia. In other words: rather than beginning with the a priori assumption that the modern capitalist world was the inevitable outcome of world history, we should look at things from the other angle: where did different regions start out from, and how and why did they change?

In addition to these points, I would suggest that it is indeed useful to be more specific about what capitalism is before affirming its existence in any particular historical context; if capitalism was always everywhere, the term has no particular analytical value. I should think everyone would agree that one of the fundamental features—perhaps even the defining feature—of a capitalist socio-economic system is a commitment to, indeed a compulsion for, continuous growth, both aggregate economic growth in terms of gross domestic product, and a growth in profits, with the latter driving the former and itself deriving from expanding output. This in turn, at least in the capitalist economies of the past two centuries, has tended to be predicated on a continuous increase in total factor productivity that has itself, beyond a point, been dependent on technological innovation. Growth often tends to be seen in terms of production, productivity, and trade, but the things that are produced and traded need to be consumed. I would say therefore that a further key component of capitalism is the existence of consumer demand, and the size and character of the mass market in which this demand is expressed and satisfied.Footnote ⁷⁵ A key issue is what one might call the ideology of consumption, which may result in household economic behaviours geared to higher productivity that should lead to higher incomes and thus greater abilities to consume—as well as causing aggregate economic growth. In trying to define a particular historical economy in a given period, as well as the trends within that economy within that period, we surely need to understand the nature of consumption, the levels of effort expended in order to increase consumption, and the extent to which the economic ideology of the period in question was oriented towards profit-maximization and growth.

In this context, Jan de Vries's theory of an ‘Industrious Revolution’ in early modern Europe might be stimulating for research on Indian history as well. De Vries argues (drawing primarily on English sources) that both higher consumption levels and growing productivity are a result of an increase in ‘industriousness’: people working harder because of a desire to increase levels of household consumption.Footnote ⁷⁶ This appears to be connected to the rise (among the elites) of an ideology of growth and profit-maximization, which was to be attained by, inter alia, increasing both productivity and consumption among the non-elites as well. A number of studies have confirmed both that many households did indeed increase their productivity in order to attain higher incomes, and that non-elite households did increase their consumption of non-subsistence commodities.Footnote ⁷⁷ Furthermore, there was an active creation of new consumer desires—not least for the imports that were transforming European economies—that had a significant impact both on increasing demand and providing incentives for households to try and satisfy that demand, and on the rise of import-substitution industries.Footnote ⁷⁸ It appears to be the case that both de Vries's ‘Industrious Revolution’ and the related creation of fashion, consumer culture, and new forms of demand, really were new developments: neither a desire to increase consumption significantly beyond need (as a principal driving force behind the economic behaviour of a majority of households), nor the ideology of growth and profit maximization (as the predominant economic ideology) are historical constants. Both represented a move away from earlier ideologies: from what one might call a subsistence- and leisure-oriented mode of consumption, in which there was no perceived need to keep increasing levels of consumption (and hours worked in order to enable it) beyond a certain low level exceeding basic needs;Footnote ⁷⁹ and, with regard to exchange, from a ‘moral economy’, the first objective of which was to provide for people's needs, with profits coming second.Footnote ⁸⁰ Whether or not we wish to designate the conjunction of these various developments as ‘capitalism’, it appears to be an empirical fact that the socio-economic-ideological formation they bring about was in fact historically specific (at least within Europe), arising within a particular period in time, and possibly only in specific regions.

There is a further aspect to the growth of consumption and the ‘Industrious Revolution’ that is not considered by de Vries. Very large numbers of people had to increase household productivity not because of new desires, but simply to subsist: as a result of loss of access to land, a process of proletarianization forced people onto the labour market, which in turn made labour cheaper and caused people to need to work more, not in order to increase their consumption, but simply for the sake of their social reproduction; the rapidly growing import-substitution textile industry provided employment for many of these families.Footnote ⁸¹ It is certainly not the case that most historical societies have been characterized by a majority of their populations being dependent on the market for all or most of their subsistence needs: a further historically specific element for a definition of capitalism. This process was not by any means independent of the other form of ‘industriousness’ de Vries discusses; there was arguably a symbiotic relationship between the two, as the growing proletarianization of large numbers of people also created a larger market to consume the results of the increasing productivity arising out of ‘industriousness’, while also providing a cheap and growing labour force (many of whom were in the manufacturing sector) that enabled the production of commodities for a mass market on a much greater scale.

Nor were these processes unique to England. For example, Govind Sreenivasan's profound micro-history of a set of south German villages shows that between the later fifteenth and the early eighteenth centuries, there was a massive growth in the numbers of people without access to enough land for subsistence; these people tended to survive by means of wage labour, growing and spinning flax on smallholdings, or weaving, and many were forced to emigrate. The peasants with full holdings, meanwhile, were compelled to enter into heavy debts just to be able to inherit their properties. This meant that they needed to sell the region's vast grain surplus on the market, leading to a massive growth in exports, mostly destined for northern Switzerland.Footnote ⁸² Here, the grain fed both the towns and the expanding populations of the countryside (many of whom were immigrants to the area) who were engaged in rural industry—one way in which those suffering from this process of proletarianization could survive. Rudolf Braun has shown, with regard to these handworkers in Switzerland, that they in turn cultivated new kinds of consumption habits, and thus provided a market not just for grain, but also for other comestibles and manufactured goods—including imported ‘drug foods’.Footnote ⁸³ These processes together, therefore—and across a national boundary!—combined to increase market dependence, commercialization, and the production and consumption of various kinds of commodities, a cycle of economic growth that continued in both regions through the processes of industrialization in the nineteenth century.

The similarities with regions in India will be obvious: here too we have evidence of zones of specialized agricultural production, processes of rural proletarianization, including growing indebtedness—both noted by Irfan Habib as beginning already by the seventeenth century, as was the case also in England and GermanyFootnote ⁸⁴—and links across great distances and sometimes political boundaries, between areas of primary production and those engaged in manufacture. Rural society was, as we have seen, in many regions thoroughly permeated by market relations, indebtedness, and the use of money. Agriculture was often aimed at the market, and even among the wealthier peasants with more land, purely subsistence-oriented production is unlikely to have been common. Given such comparable developments between at least some regions in India and some regions in Europe, it might well prove fruitful for researchers on India to consider some of the questions posed for Europe. Was there an ‘Industrious Revolution’ in pre-colonial India?Footnote ⁸⁵ What do we know about ideologies relating to economic behaviour at various levels of society in pre-colonial India, and to what extent, and in what ways, did they change? Were there similar processes of proletarianization taking place that created an ever larger market for subsistence commodities, that could thus have fuelled growth in the latters’ production? We have had rather a lot of studies on patterns of long-distance trade, primarily in cotton textiles, but what changes took place in the production and trade of other commodities: raw cotton, but equally, food grains and other comestibles?Footnote ⁸⁶ What sort of patterns of consumption and local, regional, and inter-regional trade existed within India, and how did these change? Insofar as they did change, to what extent did European contact influence consumption within India, and the economic behaviours of Indians that enabled their consumption? Maxine Berg has argued that ‘consumerism was a main driver of the global interconnections that ultimately fostered Europe’s, and especially Britain’s, lead over Asia after the later eighteenth century’.Footnote ⁸⁷ Is it really the case that this kind of consumerism was uniquely European? There is no necessary reason why a change in economic behaviour—growing productivity because of a desire to consume more and new commodities—should be a uniquely European phenomenon and, indeed, some studies have suggested that it was not.Footnote ⁸⁸ Particularly important in this respect is the significance not just of cotton, but also of ‘drug foods’: tobacco, tea, coffee, and sugar, the desires for all of which, it has been argued, had a massive impact on consumer behaviour, patterns of exchange, and therefore also economic development in many European regions.Footnote ⁸⁹

The conventional view is that Europeans exported cloth and spices from India, and (at least before circa 1750) brought only specie; this is not, however, the whole truth. Anyone with the least familiarity with Indian cuisine will know how ubiquitous are the potato and chilli, and, to a lesser extent, the tomato; we should recall that these, like tobacco (certainly a ‘drug food’), were European imports. How and why did consumption habits change to make them an integral part of the Indian diet, and when did this happen? Were any of these commodities already important—in terms of cultivated area given over to them, percentage of household expenditures spent on them, volume of trade—in the eighteenth century?Footnote ⁹⁰ Is it possible that these commodities, and their adoption within Indian culture, might be linked to an ideology of ‘industriousness’, by which people began to alter their production patterns, and perhaps increase productivity, in order to consume new desirable commodities?Footnote ⁹¹

Adopting this kind of perspective on the economy makes it clear that understanding the changing dynamics at the household level must be the basis of economic history. While the ways in which the bulk of the population lived were certainly affected by the kinds of macroeconomic developments Roy is interested in, it is also very likely that the reverse was equally true. The effect of individual households on the economy of either the region or the macro-region might be miniscule, but the cumulative impact of the consumption habits of millions of households is likely to be very significant indeed. It is precisely for this reason that so many get excited by the Indian middle class today: all those televisions and washing machines and mobile phones to be sold! Mutatis mutandis, the same is true for the eighteenth century: all that cloth and grain (and potatoes, tobacco, and chilli?) to be sold—which means, of course, that those commodities had to be produced, transported, marketed, to and from more or less specialized regions of production operating under greater or lesser levels of interdependence. All of this could have had a huge impact on the economy as a whole. Such an argument might sound implausible for a pre-modern economy oriented towards subsistence production, but we have seen that it is not really tenable to characterize the pre-colonial Indian economy in such a manner. The mass market, depending on its size, could certainly have had an equal or larger impact on the economy as elite or foreign demand. Christopher Dyer has suggested that in England, by as early as circa 1300, ‘the combined surplus of a million [non-elite, mainly peasant and artisanal] households would have exceeded the expenditure of the approximately 30,000 wealthy lay and clerical households’.Footnote ⁹² As I have pointed out above, because of processes of proletarianization in the eighteenth century, levels of rural market dependence also rose in England, creating a larger mass market not just for ‘new’ luxuries (such as sugar), but also subsistence commodities. Thus the impact of the surplus and demand of non-elite households noted by Dyer would only have grown. Given what we know about the high levels of market-dependence and commercialization in pre-modern India, it surely of some importance to ask whether here too there were the beginnings of such a mass market of consumers of subsistence goods, and what its consequences might have been in terms of its effect on structures of production and distribution.

One of the crucial tasks in understanding the progress of any pre-modern economy is surely the nature of any such domestic mass market, the relationship of the consumer demand it represented to both elite demand and production for export, and the relative and combined impact of these factors in transforming the economy.Footnote ⁹³ In other words, we need to understand better both the extent, and the causes and consequences of processes leading to social and economic differentiation among the rural population—still the majority of the people—in pre-colonial India, and how these developments might relate to the issues that have been the focus of most of the research on the Indian economies of this period: long-distance trade, mainly in manufactured goods. These sorts of questions can really only be grappled with on a broad base of regionally focused studies of socio-economic dynamics at the very local level; without such a basis, any overarching theory is not really likely to be plausible. Micro-histories of individual regions are a fundamental necessity both for their intrinsic interest, and as a prerequisite to grand schemes for understanding a particular period. The insufficiency of such studies is a significant deficit in the field. Neeraj Hatekar comments, in his recent review of Parthasarathi's Why Europe Grew Rich, that before such broad claims as Parthasarathi's regarding the pre-colonial Indian economy can be advanced (and this is true equally of Roy's work), ‘region-specific studies are needed to bring together whatever archival sources exist in order to obtain a better understanding of the economic dynamics of eighteenth-century India as a whole’. He concludes: ‘India is rather rich in regional archives. They have not been used as extensively as they ought to be. Detailed regional studies of the diverse Indian regions, exploring the complex interplay of state power, markets, people's livelihoods, and the challenges posed by the ecology, among other things, is perhaps the only way forward.’Footnote ⁹⁴ I can only concur.Footnote ⁹⁵

Of course, addressing these questions need not provide us with an answer as to whether any region of pre-colonial India was capitalist, or becoming capitalist, nor whether any capitalist growth was interrupted by colonialism. These counterfactual debates on potentiality are—and here Roy and I agree—ultimately pointless.Footnote ⁹⁶ It would be more useful to examine the economy in question without an eye to the future, though by all means with alert attention to the presence or absence of certain characteristics that could indicate, at the very least, substantive and important changes in economic behaviour, or shifts towards economic structures that look more like what obtained later rather than earlier (and I certainly do not mean to suggest that those I have enumerated above are the only ones worth thinking about). Whether or not we choose to call these characteristics ‘capitalism’ is a different, and not particularly relevant, matter. Indeed, setting aside thoughts of potential capitalism, regardless of the definition—and thus also abandoning the approach to the period as one in which ‘two orders of capitalism recast their relationship’—might be as helpful as laying aside an understanding of ‘early modern’ as a period leading to a ‘tryst with globalization’. Either approach presumes a telos of some sort, whether interrupted or not, which is not the most helpful way of approaching any historical period or question. In any case, even in the case of European regions where the issue of colonial intervention does not arise, there are really no clear markers, a century before whenever we choose to date the beginnings of capitalism, that predict a capitalist future.Footnote ⁹⁷

As I hope the previous pages have shown, there are a wide range of approaches and questions that could (and, I believe, should) be asked of the economic history of the late pre-colonial centuries in the Indian subcontinent. All of them could help us understand India's regions in those centuries within their own varied contexts, arising from their own pasts, without thought of the future. These approaches could also help us gain a more holistic view of the economy, less overwhelmingly conditioned by long-distance trade and the history of big business. The fact of colonialism cannot be ignored, and so the question as to what might have happened in its absence will remain moot. The avenues for future research that I have proposed will not help us address that counterfactual. But, close to seventy years after the end of British rule, it is probably time for the field of economic history to move out of the shadow of the Raj, and therefore also move beyond the tired debates regarding potentiality and the colonial impact. Posing new questions will allow us both to come to a more accurate and holistic understanding of the economies of the Indian subcontinent in terms that are not anachronistic, and enable us to comprehend the nature of these economies within a wider, global context of varying but often comparable historical trajectories.