Prelude: Company Rule in India
Although the British East India Company had administered its factory areas in India—beginning with Surat early in the 17th century, and including by the century's end, Fort William near Calcutta, Fort St George in Madras and the Bombay Castle—its victory in the Battle of Plassey in 1757 marked the real beginning of the Company rule in India. The victory was consolidated in 1764 at the Battle of Buxar (in Bihar), when the defeated Mughal emperor, Shah Alam II, granted the Company the Diwani ("right to collect land-revenue") in Bengal, Bihar, and Orissa. The Company soon expanded its territories around its bases in Bombay and Madras: the Anglo-Mysore Wars (1766–1799) and the Anglo-Maratha Wars (1772–1818) gave it control over most of India south of the Narmada River.
Earlier, in 1773, the British Parliament granted regulatory control over East India Company to the British government and established the post of Governor-General of India, with Warren Hastings as the first incumbent. In 1784, the British Parliament passed Pitt's India Act which created a Board of Control for overseeing the administration of East India Company. Hastings was succeeded in 1784 by Cornwallis, who promulgated the 'Permanent Settlement of Bengal' with the zamindars.
At the turn of the 19th century, Governor-General Wellesley began what became two decades of accelerated expansion of Company territories. This was achieved either by subsidiary alliances between the Company and local rulers or by direct military annexation. The subsidiary alliances created the Princely States (or Native States) of the Hindu Maharajas and the Muslim Nawabs, prominent among which were: Cochin (1791), Jaipur (1794), Travancore (1795), Hyderabad (1798), Mysore (1799), Cis-Sutlej Hill States (1815), Central India Agency (1819), Kutch and Gujarat Gaikwad territories (1819), Rajputana (1818), and Bahawalpur (1833). The annexed regions included the North Western Provinces (comprising Rohilkhand, Gorakhpur, and the Doab) (1801), Delhi (1803), and Sindh (1843). Punjab, Northwest Frontier Province, and Kashmir, were annexed after the Anglo-Sikh Wars in 1849; however, Kashmir was immediately sold under the Treaty of Amritsar (1850) to the Dogra Dynasty of Jammu, and thereby became a princely state. In 1854 Berar was annexed, and the state of Oudh two years later.
The East India Company also signed treaties with various Afghan rulers and with Ranjit Singh of Lahore to counterbalance the Russian support of Persia's plans in western Afghanistan. In 1839, the Company's effort to more actively support Shah Shuja as Amir in Afghanistan, led to the First Afghan War (1839-42) and resulted in a military disaster for it. As the British expanded their territory in India, so did Russia in Central Asia with the taking of Bukhara and Samarkand in 1863 and 1868 respectively, and thereby setting the stage for The Great Game of Central Asia.
In the Charter Act of 1813, the British parliament renewed the Company's charter but terminated its monopoly, opening India to both private investment and missionary work. With increased British power in India, supervision of Indian affairs by the British Crown and parliament increased as well; by the 1820s, British nationals could transact business under the protection of the Crown in the three Company presidencies. In the Charter Act of 1833, the British parliament revoked the Company's trade license altogether, making the Company a part of British governance, although the administration of British India remained the province of Company officers.
Starting in 1772, the Company began a series of land revenue "settlements," which would create major changes in landed rights and rural economy in India. In 1793, the Governor-General Lord Cornwallis promulgated the permanent settlement in the Bengal Presidency, the first socio-economic regulation in colonial India. It was named permanent because it fixed the land tax in perpetuity in return for landed property rights for a class of intermediaries called zamindars, who thereafter became owners of the land. It was hoped that knowledge of a fixed government demand would encourage the zamindars to increase both their average outcrop and the land under cultivation, since they would be able to retain the profits from the increased output; in addition, the land itself would become a marketable form of property that could be purchased, sold, or mortgaged. However, the zamindars themselves were often unable to meet the increased demands that the Company had placed on them; consequently, many defaulted, and by one estimate, up to one-third of their lands were auctioned during the first three decades following the permanent settlement. In southern India, Thomas Munro, who would later become Governor of Madras, promoted the ryotwari system, in which the government settled land-revenue directly with the peasant farmers, or ryots. Based on the utilitarian ideas of James Mill, who supervised the Company's land revenue policy during 1819-1830, and David Ricardo's Law of Rent, it was considered by its supporters to be both closer to traditional practice and more progressive, allowing the benefits of Company rule to reach the lowest levels of rural society. However, in spite of the appeal of the ryotwari system's abstract principles, class hierarchies in southern Indian villages had not entirely disappeared—for example village headmen continued to hold sway—and peasant cultivators came to experience revenue demands they could not meet.
Land revenue settlements constituted a major administrative activity of the various governments in India under Company rule. In all areas other than the Bengal Presidency, land settlement work involved a continually repetitive process of surveying and measuring plots, assessing their quality, and recording landed rights, and constituted a large proportion of the work of Indian Civil Service officers working for the government. After the Company lost its trading rights, it became the single most important source of government revenue, roughly half of overall revenue in the middle of the 19th century. Since, in many regions, the land tax assessment could be revised, and since it was generally computed at a high level, it created lasting resentment which would later come to a head in the rebellion which rocked much of North India in 1857.
 Indian Rebellion of 1857
The rebellion began with mutinies by sepoys of the Bengal Presidency army; in 1857 the presidency consisted of present-day Bangladesh, and the Indian states of West Bengal, Bihar and UP. However, most rebel soldiers were from the UP region, and, in particular, from Northwest Provinces (especially, Ganga-Jumna Doab) and Oudh, and many came from landowning families. Within weeks of the initial mutinies—as the rebel soldiers wrested control of many urban garrisons from the British—the rebellion was joined by various discontented groups in the hinterlands, in both farmed areas and the backwoods. The latter group, forming the civilian rebellion, consisted of feudal nobility, landlords, peasants, rural merchants, and some tribal groups.
After the annexation of Oudh by the East India Company in 1856, many sepoys were disquieted both from losing their perquisites as landed gentry in the Oudh courts and from the anticipation of any increased land-revenue payments that the annexation might augur. Some Indian soldiers, misreading the presence of missionaries as a sign of official intent, were persuaded that the East India Company was masterminding mass conversions of Hindus and Muslims to Christianity. Changes in the terms of their professional service may also have created resentment. As the extent of British jurisdiction expanded with British victories in wars and with annexation of territory, the soldiers were now not only expected to serve in less familiar regions (such as Lower Burma after the Second Burmese War in 1852-53), but also make do without the "foreign service," remuneration that had previously been their due.
The civilian rebellion was more multifarious in origin. The rebels consisted of three groups: feudal nobility, rural landlords called taluqdars, and the peasants. The nobility, many of whom had lost titles and domains under the Doctrine of Lapse, which derecognised adopted children of princes as legal heirs, felt that the British had interfered with a traditional system of inheritance. Rebel leaders such as Nana Sahib and the Rani of Jhansi belonged to this group; the latter, for example, was prepared to accept British paramountcy if her adopted son was recognized as the heir. The second group, the taluqdars had lost half their landed estates to peasant farmers as a result of the land reforms that came in the wake of annexation of Oudh. As the rebellion gained ground, the taluqdars quickly reoccupied the lands they had lost, and paradoxically, in part due to ties of kinship and feudal loyalty, did not experience significant opposition from the peasant farmers, many of whom too now joined the rebellion to the great dismay of the British. Heavy land-revenue assessment in some areas by the British may have resulted in many landowning families either losing their land or going into great debt with money lenders, and providing ultimately a reason to rebel; money lenders, in addition to the British, were particular objects of the rebels' animosity. The civilian rebellion was also highly uneven in its geographic distribution, even in areas of north-central India that were no longer under British control. For example, the relatively prosperous Muzaffarnagar district, a beneficiary of a British irrigation scheme, and next door to Meerut where the upheaval began, stayed mostly calm throughout.
 Effects on economy
|"A significant fact which stands out is that those parts of India which have been longest under British rule are the poorest today. Indeed some kind of chart might be drawn up to indicate the close connection between length of British rule and progressive growth of poverty."|
|— Jawaharlal Nehru, on the economic effects of the British rule, in his book The Discovery of India|
In the second half of the 19th century, both the direct administration of India by the British crown and the technological change ushered in by the industrial revolution, had the effect of closely intertwining the economies of India and Great Britain. In fact many of the major changes in transport and communications (that are typically associated with Crown Rule of India) had already begun before the Mutiny. Since Dalhousie had embraced the technological change then rampant in Great Britain, India too saw rapid development of all those technologies. Railways, roads, canals, and bridges were rapidly built in India and telegraph links equally rapidly established in order that raw materials, such as cotton, from India's hinterland could be transported more efficiently to ports, such as Bombay, for subsequent export to England. Likewise, finished goods from England were transported back just as efficiently, for sale in the burgeoning Indian markets. However, unlike Britain itself, where the market risks for the infrastructure development were borne by private investors, in India, it was the taxpayers—primarily farmers and farm-labourers—who endured the risks, which, in the end, amounted to £50 million. In spite of these costs, very little skilled employment was created for Indians. By 1920, with the fourth largest railway network in the world and a history of 60 years of its construction, only ten per cent of the "superior posts" in the Indian Railways were held by Indians. The Indian railways system, by 1900, provided India with social savings of 9% of India's national income (about 1.2 billion rupees).
The rush of technology was also changing the agricultural economy in India: by the last decade of the 19th century, a large fraction of some raw materials—not only cotton, but also some food-grains—were being exported to faraway markets. Consequently, many small farmers, dependent on the whims of those markets, lost land, animals, and equipment to money-lenders.. More tellingly, the latter half of the 19th century also saw an increase in the number of large-scale famines in India. Although famines were not new to the subcontinent, these were particularly severe, with tens of millions dying, and with many critics, both British and Indian, laying the blame at the doorsteps of the lumbering colonial administrations.
Taxes in India decreased during the colonial period for most of India's population; with the land tax revenue claiming 15% of India's national income during Mogul times compared with 1% at the end of the colonial period. The percentage of national income for the village economy increased from 44% during Mogul times to 54% by the end of colonial period. India's per capita GDP decreased from $550 in 1700 to $520 by 1857, although it had increased to $618 by 1947
The 1909 Map of Indian Railways, when India had the fourth largest railway network in the world. Railway construction in India began in 1853.
The Agra canal (c. 1873), a year away from completion. The canal was closed to navigation in 1904 in order to increase irrigation and aid in famine-prevention.
Lord Ripon, the Liberal Viceroy of India, who instituted the Famine Code
 Beginnings of self-government
The first steps were taken toward self-government in British India in the late 19th century with the appointment of Indian counsellors to advise the British viceroy and the establishment of provincial councils with Indian members; the British subsequently widened participation in legislative councils with the Indian Councils Act of 1892. Municipal Corporations and District Boards were created for local administration; they included elected Indian members.
The Government of India Act of 1909 — also known as the Morley-Minto Reforms (John Morley was the secretary of state for India, and Gilbert Elliot, fourth earl of Minto, was viceroy) — gave Indians limited roles in the central and provincial legislatures, known as legislative councils. Indians had previously been appointed to legislative councils, but after the reforms some were elected to them. At the centre, the majority of council members continued to be government-appointed officials, and the viceroy was in no way responsible to the legislature. At the provincial level, the elected members, together with unofficial appointees, outnumbered the appointed officials, but responsibility of the governor to the legislature was not contemplated. Morley made it clear in introducing the legislation to the British Parliament that parliamentary self-government was not the goal of the British government.
The Morley-Minto Reforms were a milestone. Step by step, the elective principle was introduced for membership in Indian legislative councils. The "electorate" was limited, however, to a small group of upper-class Indians. These elected members increasingly became an "opposition" to the "official government". The Communal electorates were later extended to other communities and made a political factor of the Indian tendency toward group identification through religion.
 World War I and its aftermath
World War I would prove to be a watershed in the imperial relationship between Britain and India. 1.4 million Indian and British soldiers of the British Indian Army would take part in the war and their participation would have a wider cultural fallout: news of Indian soldiers fighting and dying with British soldiers, as well as soldiers from dominions like Canada and Australia, would travel to distant corners of the world both in newsprint and by the new medium of the radio. India’s international profile would thereby rise and would continue to rise during the 1920s. It was to lead, among other things, to India, under its own name, becoming a founding member of the League of Nations in 1920 and participating, under the name, "Les Indes Anglaises" (The British Indies), in the 1920 Summer Olympics in Antwerp. Back in India, especially among the leaders of the Indian National Congress, it would lead to calls for greater self-government for Indians.
In 1916, in the face of new strength demonstrated by the moderate nationalists with the signing of the Lucknow Pact and the founding of the Home Rule leagues, and the realization, after the disaster in the Mesopotamian campaign, that the war would likely last longer, the new Viceroy, Lord Chelmsford, cautioned that the Government of India needed to be more responsive to Indian opinion. Towards the end of the year, after discussions with the government in London, he suggested that the British demonstrate their good faith – in light of the Indian war role – through a number of public actions, including awards of titles and honors to princes, granting of commissions in the army to Indians, and removal of the much-reviled cotton excise duty, but most importantly, an announcement of Britain's future plans for India and an indication of some concrete steps. After more discussion, in August 1917, the new Liberal Secretary of State for India, Edwin Montagu, announced the British aim of “increasing association of Indians in every branch of the administration, and the gradual development of self-governing institutions, with a view to the progressive realization of responsible government in India as an integral part of the British Empire.” Although the plan envisioned limited self-government at first only in the provinces – with India emphatically within the British Empire – it represented the first British proposal for any form of representative government in a non-white colony.
Earlier, at the onset of World War I, the reassignment of most of the British army in India to Europe and Mesopotamia had led the previous Viceroy, Lord Harding, to worry about the “risks involved in denuding India of troops.” Revolutionary violence had already been a concern in British India, and outlines of collaboration with Germany were being identified by British intelligence; consequently in 1915, to strengthen its powers during what it saw was a time of increased vulnerability, the Government of India passed the Defence of India Act, which allowed it to intern politically dangerous dissidents without due process and added to the power it already had – under the 1910 Press Act – both to imprison journalists without trial and to censor the press. Now, as constitutional reform began to be discussed in earnest, the British began to consider how new moderate Indians could be brought into the fold of constitutional politics and simultaneously, how the hand of established constitutionalists could be strengthened. However, since the Government of India wanted to check the revolutionary problem, and since its reform plan was devised during a time when extremist violence had ebbed as a result of increased governmental control, it also began to consider how some of its war-time powers could be extended into peace time.
Consequently in 1917, even as Edwin Montagu announced the new constitutional reforms, a sedition committee chaired by a British judge, Mr. S. A. T. Rowlatt, was tasked with investigating revolutionary conspiracies and the German and Bolshevik links to the violence in India, with the unstated goal of extending the government's war-time powers. The Rowlatt committee presented its report in July 1918 and identified three regions of conspiratorial insurgency: Bengal, the Bombay presidency, and the Punjab. To combat subversive acts in these regions, the committee recommended that the government use emergency powers akin to its war-time authority, which included the ability to try cases of sedition by a panel of three judges and without juries, exaction of securities from suspects, governmental overseeing of residences of suspects, and the power for provincial governments to arrest and detain suspects in short-term detention facilities and without trial.
With the end of World War I, there was also a change in the economic climate. By year’s end 1919, 1.5 million Indians had served in the armed services in either combatant or non-combatant roles, and India had provided £146 million in revenue for the war. The increased taxes coupled with disruptions in both domestic and international trade had the effect of approximately doubling the index of overall prices in India between 1914 and 1920. Returning war veterans, especially in the Punjab, created a growing unemployment crisis and post-war inflation led to food riots in Bombay, Madras, and Bengal provinces, a situation that was made only worse by the failure of the 1918-19 monsoon and by profiteering and speculation. The global influenza epidemic and the Bolshevik Revolution of 1917 added to the general jitters; the former among the population already experiencing economic woes, and the latter among government officials, fearing a similar revolution in India.
To combat what it saw as a coming crisis, the government now drafted the Rowlatt committee's recommendations into two Rowlatt Bills. Although the bills were authorised for legislative consideration by Edwin Montagu, they were done so unwillingly, with the accompanying declaration, “I loathe the suggestion at first sight of preserving the Defence of India Act in peace time to such an extent as Rowlatt and his friends think necessary.” In the ensuing discussion and vote in the Imperial Legislative Council, all Indian members voiced opposition to the bills. The Government of India was nevertheless able to use of its "official majority" to ensure passage of the bills early in 1919. However, what it passed, in deference to the Indian opposition, was a lesser version of the first bill, which now allowed extra-judicial powers, but for a period of exactly three years and for the prosecution solely of “anarchical and revolutionary movements,” dropping entirely the second bill involving modification of the Indian Penal Code. Even so, when it was passed the new Rowlatt Act aroused widespread indignation throughout India and brought Mohandas Gandhi to the forefront of the nationalist movement.
Meanwhile, Montagu and Chelmsford themselves finally presented their report in July 1918 after a long fact-finding trip through India the previous winter. After more discussion by the government and parliament in Britain, and another tour by the Franchise and Functions Committee for the purpose of identifying who among the Indian population could vote in future elections, the Government of India Act of 1919 (also known as the Montagu-Chelmsford Reforms) was passed in December 1919. The new Act enlarged both the provincial and Imperial legislative councils and repealed the Government of India’s recourse to the “official majority” in unfavorable votes. Although departments like defense, foreign affairs, criminal law, communications and income-tax were retained by the Viceroy and the central government in New Delhi, other departments like public health, education, land-revenue and local self-government were transferred to the provinces. The provinces themselves were now to be administered under a new dyarchical system, whereby some areas like education, agriculture, infrastructure development, and local self-government became the preserve of Indian ministers and legislatures, and ultimately the Indian electorates, while others like irrigation, land-revenue, police, prisons, and control of media remained within the purview of the British governor and his executive council. The new Act also made it easier for Indians to be admitted into the civil service and the army officer corps.
A greater number of Indians were now enfranchised, although, for voting at the national level, they constituted only 10% of the total adult male population, many of whom were still illiterate. In the provincial legislatures, the British continued to exercise some control by setting aside seats for special interests they considered cooperative or useful. In particular, rural candidates, generally sympathetic to British rule and less confrontational, were assigned more seats than their urban counterparts. Seats were also reserved for non-Brahmins, landowners, businessmen, and college graduates. The principal of “communal representation,” an integral part of the Minto-Morley reforms, and more recently of the Congress-Muslim League Lucknow Pact, was reaffirmed, with seats being reserved for Muslims, Sikhs, Indian Christians, Anglo-Indians, and domiciled Europeans, in both provincial and Imperial legislative councils. The Montagu-Chelmsford reforms offered Indians the most significant opportunity yet for exercising legislative power, especially at the provincial level; however, that opportunity was also restricted by the still limited number of eligible voters, by the small budgets available to provincial legislatures, and by the presence of rural and special interest seats that were seen as instruments of British control. It scope was however, servely dissatisfactory to the Indian political leadership, famously expressed by Annie Beasant as something "unworthy of England to offer and India to accept"
 1930s: Government of India Act (1935)
In 1935, after the Round Table Conferences, the British Parliament approved the Government of India Act of 1935, which authorised the establishment of independent legislative assemblies in all provinces of British India, the creation of a central government incorporating both the British provinces and the princely states, and the protection of Muslim minorities. At this time, it was also decided to separate Burma from British India in 1937, to form a separate crown colony. The future Constitution of independent India would owe a great deal to the text of this act. The act also provided for a bicameral national parliament and an executive branch under the purview of the British government. Although the national federation was never realised, nationwide elections for provincial assemblies were held in 1937. Despite initial hesitation, the Congress took part in the elections and won victories in seven of the eleven provinces of British India, and Congress governments, with wide powers, were formed in these provinces. In Great Britain, these victories were to later turn the tide for the idea of Indian independence.
 World War II
With the outbreak of World War II in 1939, the viceroy, Lord Linlithgow, declared war on India’s behalf without consulting Indian leaders, leading the Congress provincial ministries to resign in protest. The Muslim League, in contrast, supported Britain in the war effort; however, it now took the view that Muslims would be unfairly treated in an independent India dominated by the Congress. The British government—through its Cripps' mission—attempted to secure Indian nationalists' cooperation in the war effort in exchange for independence afterwards; however, the negotiations between them and the Congress broke down. Gandhi, subsequently, launched the “Quit India” movement in August 1942, demanding the immediate withdrawal of the British from India or face nationwide civil disobedience. Along with all other Congress leaders, Gandhi was immediately imprisoned, and the country erupted in violent demonstrations led by students and later by peasant political groups, especially in Eastern United Provinces, Bihar, and western Bengal. The large war-time British Army presence in India led to most of the movement being crushed in a little more than six weeks; nonetheless, a portion of the movement formed for a time an underground provisional government on the border with Nepal. In other parts of India, the movement was less spontaneous and the protest less intensive, however it lasted sporadically into the summer of 1943.
With Congress leaders in jail, attention also turned to Subhas Bose, who had been ousted from the Congress in 1939 following differences with the more conservative high command; Bose now turned to the Axis powers for help with liberating India by force. With Japanese support, he organised the Indian National Army, composed largely of Indian soldiers of the British Indian army who had been captured at Singapore by the Japanese. From the onset of the war, the Japanese secret service had promoted unrest in South east Asia to destabilise the British War effort, and came to support a number of puppet and provisional governments in the captured regions, including those in Burma, the Philippines and Vietnam, the Provisional Government of Azad Hind (Free India), presided by Bose. Bose's effort, however, was short lived; after the reverses of 1944, the reinforced British Indian Army in 1945 first halted and then reversed the Japanese U Go offensive, beginning the successful part of the Burma Campaign. Bose's Indian National Army surrendered with the recapture of Singapore, and Bose died in a plane crash soon thereafter. The trials of the INA soldiers at Red Fort in late 1945 however caused widespread public unrest and nationalist violence in India.