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Vidya Pitre

The railway policy was meant to serve British economic and political interest. This is not to mean that the Indian Railways have not contributed to the transport sector. In these 150 years, it has achieved a great deal. But not what it promised.

THE Indian Railways has surely come a long way in its 150-year journey. When the British helped establish the railway network in the late 19th century, they viewed the impact of railways on India as beneficial. They argued that it would eradicate poverty and famine. By stimulating internal and external trade, it could emerge as a powerful agent in bringing about prosperity.

But where are we in the 21st century? Far from becoming a prosperous nation, India has dwindled further into being one of the poorer nations. Trade and industry suffer from poor policy and planning. Look at the rail transport system itself. Increasing fares, inefficient administration, old and rickety rakes that contribute to a most unpleasant journey... Is this what the British intended for India?

Indian leaders were sceptical about the establishment of Indian Railways right from the beginning. Dadabhai Naoroji observed that the country's misfortune was that it did not derive the benefits as other countries did. G. V. Joshi noted that the economic results of railways had been detrimental to the country's growth. R. C. Dutt believed that the overall effects of railways were not been beneficial. Justice Ranade concluded that whatever benefits railways conferred, it had not cured the weaknesses that had crippled India.

The first harmful effect of railways, according them, was the damage caused to industrial activity. The transport revolution had ruined the existing carrying trade, enabling England to undersell its cheap products. Instead of giving an upward push, railways gave a downward push. India became increasingly ruralised and transformed into an agricultural colony. It destroyed local indigenous industries and made people dependent on agriculture. As G. S. Iyer observed, "Every additional mile of the railways drove a fresh nail into the coffin of one industry or another".

Further, government expenditure on guaranteed interest acted as a subsidy to the foreign trader. In other words, it acted as a drain. It involved remittance in the form of interest as well as profit as the capital and ownership were foreign. Another criticism was that it facilitated the export of foodgrains, leading to depletion of surpluses. Stimulation of commercial crop also led to diversion of land to cash crops. The policy favoured foreign trade at the expense of internal trade. The rate structure was devised to suit the interest of foreign trade.

All this criticism did not arise from conservatives. In fact, most of them were champions of modern industry. But they concluded that the rail construction project was devised to assist British enterprise in exploring natural resources, to penetrate the vast market. It not only provided an outlet to England's steel industry, but also served as a channel for safe and profitable investment of British capital.

The usefulness of the railways depends on a country's productive power. In other words, railways per se could not give birth to industry and generate economic expansion. Certain other conditions were necessary, especially in view of the limited resources. Industry should have been the priority over transport. The reversal of this trend led to increase of debt. Further, it amounted to heavy loss of exchange on account of guaranteed interest at the contracted fixed rate of exchange and payment in the pound sterling on debt contracted by railways in the London money market.

Finally, in this debate, railways and irrigation became rivals. Each was offered as the solution against recurring famines. The two competed for the allocation of limited famine resources. The total expenditure on major and minor irrigation amounted to Rs 43 crore. As against this, the outlay on the railways amounted to Rs 359 crore. The 1897 famine intensified this controversy.

Critics argued that it was more important to strengthen the irrigation network than the railways. Irrigation was a far more effective and reliable remedy against famines than railways. Railways were only a palliative to mitigate the effects of famine. Irrigation went to the root of the problem. It had tremendous potential to increase the foodgrain production. Irrigation works also were financially remunerative, yielding profit of 6-9 per cent, while the railways showed deficit. Irrigation canals as means of transport, as an alternative to railways, could also be considered.

Despite such a strong case, the government neglected irrigation development. However, this outburst of criticism created pressure on government, leading to appointment of irrigation commissions and an increase in outlay on irrigation, though inadequate.

The policy ignored Indian needs and was meant to serve British economic and political interest. This is not to mean that the Indian Railways have not contributed to the transport sector. In these 150 years, it has achieved a great deal. But not what it promised. If at all, it was detrimental to trade, at a time when the economy was in a fledgling stage.

The rail transport sector should have developed simultaneously with the country's irrigation and agricultural sector.

The event of advent of railways, therefore, is a landmark in India's economic and political history. It is not surprising that in the 21st century, there is growing water scarcity from all parts of the country.

It is time there is an informed political debate about the course of economic development, over the last one and half century, and the role the railways have played.

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