Plot of world gdp growth versus Indian gdp growth
There is much historical work on the Indian economy under British rule. The top line summary is indicated in the graph above, while the world grew quickly from 1800 to 1950 (per capita gdp more than tripling), India stayed exactly where it was. Plenty of reasons have been offered, but India’s troubles in this time come down to two reasons:
- A lack of natural resources necessary for industrial growth.
- British racial attitudes that deemed Indians unworthy of human investment.
The period I am more interested is the time between 1965 and 1982. The world experienced a surge in output in this time. South Korea went from around the same GDP per capita as India, to 7 times India’s output.