Question

Choose the correct option to summarise 'Drain of Wealth'.

• A. Continuous exchange of resources between India and Britain.
• B. Continuous transfer of resources from Britain to India favouring both nations.
• C. Continuous transfer of resources from India to Britain without any favourable returns to India.
• D. Continous transfer of resources from India to Britain benefitting India over a long period of time.

Answer 1

The correct option is C Continuous transfer of resources from India to Britain without any favourable returns to India.

The 'Drain of Wealth' theory is an economic critique of colonialism. It suggests that the Raj exploited India as a source for cheap raw material and a market for expensive finished goods from Britain. As Britain's industries flourished, Indian industries declined. Essentially, wealth from India was used to boost Britain's economy with no benefit to India.