Dadabhai Naoroji, known as the ‘Grand Old Man of Indian Nationalism’, was a prominent early nationalist. He was elected to the Bombay Municipal Corporation and Town Council during the 1870s. Elected to the British Parliament in 1892, he founded the India Society (1865) and the East India Association (1866) in London. He was elected thrice as the President of the INC. Dadabhai Naoroji His major contribution to the Indian nationalist movement was his book Poverty and Un-British Rule of the British in India (1901). In this book, he put forward the concept of ‘drain of wealth’. He stated that in any country the tax raised would have been spent for the wellbeing of the people of that country. But in British India, taxes collected in India were spent for the welfare of England. Naoroji argued that India had exported an average of 13 million pounds worth of goods to Britain each year from 1835 to 1872 with no corresponding return. The goods were in lieu of payments for profits to Company shareholders living in Britain, guaranteed interest to investors in railways, pensions to retired officials and generals, interest for the money borrowed from England to meet war expenses for the British conquest of territories in India as well as outside India. All these, going in the name of Home Charges, Naoroji asserted, made up a loss of 30 million pounds a year.
T he land and revenue reforms implemented by the East India Company since late eighteenth century had its impact on the agrarian conditions in India.
T he growth of heavy machine industries in Britain allowed East India Company to export raw materials from India to Britain and take back the finished products – a process that led to the decline of Indian handicrafts, making the artisans go jobless.
Landless labourers and jobless artisans emigrating to Empire colonies to escape starvation deaths
The unintended result of Western education introduced by the British was the emergence of a new class of educated Indians who strove for the reforms of Indian society.
Factors like the bitter memories of 1857, policy of racial discrimination, repressive measures against dissension contributed to the growth of nationalism.
Modern intelligentsia formed political organisation like Madras Native Association (1852), Madras Mahajana Sabha (1884) and Indian National Congress (1885) to voice their opinions and grievances.
An important role of these leaders was to educate the common mass about the exploitative colonial rule and its impact on their day to day life.
Drain of wealth theory enunciated by Dadabhai Naoroji exposed the British loot of the resources of India.