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The Making of a Global World

Syllabus Trade and Globalisation. (a) Expansion and integration of the world market in the nineteenth and early twentieth century. (b) Trade and economy between the two Wars. (c) Shifts after the 1950s. (d) Implications of globalisation for livelihood patterns. Case study: The Post-War International Economic Order, 1945 to 1960s.

Facts that Matter

Globalisation started with trade, migration of people in search of work and the movement of capital. The silk routes are good examples of pre-modern trade and the cultural links between remote parts of the world. The silk routes were the routes through which trade and cultural mingling of far-flung parts of the world took place. China was known for the trade of the silk since ancient period. Chinese silk cargoes used to travel through these routes and from there it got its name the silk routes. Later Chinese pottery, textiles and spices from India and Southeast Asia also travelled the same routes. In return, precious metals like gold and silver flowed from Europe to Asia. Trade and cultural exchange always went hand in hand. Several silk routes helped in linking Asia with Europe and northern Africa. Buddhism which emerged from eastern India also spread in several directions through interconnecting points on the silk routes only. Food is a good example of long-distance cultural exchange. Traders and travellers introduced new crops to the lands they travelled. For instance spaghetti and noodles. It is believed that noodles travelled west from China to become spaghetti. Pasta of Arab 5

travelled to Italy. Many of our common foods such as potatoes, soya, groundnuts, maize, tomatoes, chillies, sweet potatoes, were introduced in Europe and Asia after America was discovered. For centuries before, the Indian Ocean had known a vibrant trade with goods, people, knowledge, customs, etc. But the introduction of new sea route to Asia found by European sailors in the sixteenth century adversely affected the trade through Indian Ocean. By the mid-sixteenth century Europe defeated America not with military power but they got killed due to the germs of small pox brought by Europeans with them. As Americas original inhabitants were living in isolation for long, they had no immunity against these diseases that came from Europe. Smallpox proved to be a deadly killer for them. It spread deep into the continent, killed and devastated the whole community, thus paving the way for European conquest. Until the nineteenth century the condition of Europe was miserable. Poverty and hunger were common. Cities were crowded. Deadly diseases, religious conflicts and religious dissenters were widespread. So thousands of Europeans migrated to America. Till the eighteenth century, China and India were among the worlds richest countries. They were supreme in Asian trade. But from the 15th century China is said to have restricted overseas contacts and retreated into isolation. And gradually the trade moved westwards and Europe emerged as the centre of world trade.

Three types of movement or flows were identified by the economists within international economic exchanges. The flow of trade (trade in goods, e.g. cloth or wheat). The flow of labour (the migration of people in search of employment). The movement of capital (investments). All three flows were closely interlinked and affected peoples lives. The 19th century Britain lacked self-sufficiency in food. It was because of the uncontrolled growth of population and expansion of urban countries. As a result Prices of food grains increased. People started importing food from other countries where it was cheaper. The government restricted the import of corn under the provision of laws called Corn Laws. The industrialists and urban dwellers opposed the corn laws and demanded their abolition. Finally the Corn Laws were abolished which brought a lot of changes in the British economy. Food could be imported into Britain at much cheaper rate than before. British agriculture failed to compete with imports. Vast areas of land were left uncultivated. Thousands of men and women became unemployed. This led to migration of people to the cities or overseas.

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 As food prices fell, the consumption in Britain rose. It further led to faster industrial growth in Britain, higher incomes and more food imports. To meet the high demand of Britain several steps were taken. Lands were cleared and food production was expanded in Eastern Europe, Russia, America and Australia. Railways were needed to link the agricultural regions to the ports. New harbours were built and old ones were expanded to ship the new cargoes. New homes and settlements were built to settle the workers. Capital flowed from the financial centres like London. The demand for labour led to more migration. (Nearly 50 million people emigrated from Europe to America and Australia in the nineteenth century). Thus by the 1890, a global agricultural economy started with some complex changes in labour movement patterns, capital flows, ecologies and technology. Food was now brought from thousands miles away. It was grown by agricultural workers on lands after clearing the forests. Lands were cultivated not by peasants owning this land but by hired workers brought from distant lands. Railways, ships, new ports, etc were introduced or built for transportation. Food was transported by railway and by ships. The workers were paid very low and they were from Asia, Africa and the Caribbean. Some changes occurred in west Punjab also. Irrigation canals were built by the British Indian government to transform desert lands into fertile agricultural lands in order to grow wheat and cotton for export. The Canal Colonies (the areas irrigated by the new canals) were settled by peasants from other parts of Punjab. Cotton cultivation expanded worldwide to feed British textile mills. Role of Technology The important inventions like the railways, steamships and the telegraph triggered the economic growth in nineteenth-century. Colonisation stimulated new investments and improvements in transport: faster railways, lighter wagons and larger ships helped move food more cheaply and quickly from faraway farms to final markets. Meat which was an expensive luxury beyond the reach of the European poor became affordable and its demand increased. Development of a new technology namely refrigerated ships made this possible. They enabled the transport of perishable foods over long distances. Animals were now slaughtered for food at the starting point (America, Australia or New Zealand) and then transported to Europe as frozen meat. This reduced shipping costs and lowered meat prices in Europe. Demand increased drastically as now it was much more affordable.

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 Better living conditions and nutritious diet promoted social peace within the country and support for imperialism abroad. Late 19th century European conquests produced many painful economic, social and ecological changes through which the colonised societies were brought into the world economy. Rinderpest or the Cattle Plague. In the 1880s, in Africa Rinderpest (a fast spreading disease of cattle plague) had a terrifying impact on peoples livelihoods and the local economy. It started in East Africa and soon spread to the other parts of the continent. In 1892 it reached Africas Atlantic coast and within five years it reached the Cape (Africas southernmost tip). It spread through an infected cattle imported from British Asia to feed the Italian soldiers invading Eritrea in East Africa. Effects of rinderpest on Africans Rinderpest killed 90 per cent of the cattle. The loss of cattle destroyed African livelihoods. It strengthened colonial governments power and Africans were forced into the labour market which earlier they were reluctant to do due to abundance of land and wild stock. European colonisers thus conquered and subdued Africa. The example of indentured labour migration from India also show the two-sided nature of the 19th century world. It was a world of faster economic growth as well as great misery. Indentured labour migration from India started in the nineteenth century. Thousands of Indian and Chinese labourers migrated to work on plantations, in mines, and in road and railway construction projects around the world. In India, indentured labourers were hired under contracts of five years for plantation work in the regions like Caribbean Islands (mainly Trinidad, Guyana and Surinam), Mauritius and Fiji. They used to come from the regions like eastern Uttar Pradesh, Bihar, central India and the dry districts of Tamil Nadu. They would return back home once the contract was over. Indenture was nothing but a new system of slavery. Living and working conditions were harsh. Few legal rights were given to the labourers. But workers discovered their own ways of surviving. They developed new forms of individual and collective self-expression by blending different cultural forms. In Trinidad the annual Muharram procession became a riotous carnival called Hosay (for Imam Hussain) in which workers of all races and religions joined. Chutney music popular in Trinidad and Guyana is another creative contemporary expression of the post-indenture experience. Indians such as Shivnarine, Chanderpaul and Ramnaresh Sarvan were from indentured labour migrants from India. Indias nationalist leaders opposed the system of indentured

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labour migration calling it abusive and cruel and after a long wait it was abolished in 1921. With the increase in demand of growing food and other crops the need for the capital also arose. Large plantations borrowed from banks and markets. But poor peasant couldnt do so. Shikaripuri Shroffs and Nattukottai Chettiars were amongst the many groups of bankers and traders who financed export agriculture in Central and Southeast Asia, using either their own funds or those borrowed from European banks. They had a sophisticated system to transfer money over large distances and developed indigenous forms of corporate organisation. Indian Trade, Colonialism and the Global System. Due to the economic policy of the British imposition of tariffs on cloth imports into Britain, the inflow of fine Indian cotton began to decline and the British manufacturers flooded the Indian market. Impact of the First World War (1914-18) on the world. The First World War was fought between two power blocsthe Allies (Britain, France and Russia) and the Central Powers (Germany, Austria-Hungary and Ottoman Turkey). It lasted more than four years. During this period the whole world experienced economic and political instability and another disastrous war. This war was the first modern industrial war as it saw the use of machine guns, tanks, aircraft, chemical weapons, etc. on a large scale. Millions of soldiers had to be recruited from around the world and moved to the frontlines on large ships and trains. 9 million died and 20 million injured. Household incomes declined after the war. Industries were restructured to produce war-related goods. After the war Britain failed to recapture its earlier position of dominance in the Indian market, and to compete with Japan internationally. Britain was burdened with huge external debts from the US. Unemployment increased drastically after the war due to the closing of industries making war equipments. Many agricultural economies were also in crisis. Wheat production in Canada, America and Australia expanded dramatically and declined in Eastern Europe. Grain prices fell, rural incomes declined, and farmers fell deeper into debt. However, recovery was quicker in the US. The war helped boost the US economy. One important feature of the US economy of the 1920s was mass production. A wellknown pioneer of mass production was the car manufacturer Henry Ford. He recovered the high wages by repeatedly speeding up the production line and forcing workers to work ever harder. Car production in the US rose from two million in 1919 to more than five million in 1929. The Great Depression began from 1929 and lasted till the mid-1930s. Production, employment, incomes and trade declined disastrously.

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 Agricultural regions and communities got affected badly because the fall in agricultural prices was greater and more prolonged than the prices of industrial goods. Agricultural overproduction was a major problem. This was made worse by falling agricultural prices which further led to the decline in agricultural incomes. The farm produce decayed due to lack of buyers. When the crisis started the US withdrew the loans which affected the rest of the world. Several major banks failed and currencies collapsed such as the British pound sterling. In Latin America the agricultural and raw material prices declined. The US in order to protect its economy in the depression doubled the import duties which gave a severe blow to world trade. US banks cut the domestic lending and called back loans. Farmers failed to sell their harvests, households ruined, and businesses collapsed. Those who failed to repay what they had borrowed were forced to give up their homes, cars and other consumer durables. Unemployment soared and the US banking system collapsed. Banks became bankrupt and were forced to close. Thus the Great Depression affected the society, politics and international relations. Impact of the Great Depression on India. In the nineteenth century, as colonial India was an exporter of agricultural goods and importer of manufactures, Indian trade immediately got affected due to the great depression. Indias exports and imports nearly halved between 1928 and 1934. Prices in India fell terribly. Between 1928 and 1934, wheat prices in India fell by 50 per cent. Though agricultural prices fell sharply but the colonial government did not reduce revenue demands. It eventually affected the peasants. Across India, peasants indebtedness increased. The depression proved less grim for urban India. Middle-class salaried employees found themselves better off. The Second World War was fought between the Axis powers (mainly Nazi Germany, Japan and Italy) and the Allies (Britain, France, the Soviet Union and the US). It continued for six years. It was fought in many places, over land, on sea, in the air. Death and destruction was enormous. 60 million people were killed and millions were injured. Several cities destroyed by aerial bombardment or relentless artillery attacks. The war caused an immense amount of economic devastation and social disruption. In order to preserve economic stability and full employment in the industrial world, the post-war international economic system was established. To execute the same, the

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United Nations Monetary and Financial Conference was held in July 1944 at Bretton Woods in New Hampshire, USA. The Bretton Woods conference: Established the International Monetary Fund (IMF) to deal with external surpluses and shortages of its member nations. The International Bank for Reconstruction and Development (popularly known as the World Bank) was set up to finance postwar reconstruction. The IMF and the World Bank are referred to as the Bretton Woods institutions or sometimes the Bretton Woods twins. Decision-making authority was given to the Western industrial powers. The US was given the right of veto over key IMF and World Bank decisions. The Bretton Woods system was based on fixed exchange rates. The Bretton Woods system opened an era of unique growth of trade and incomes for the Western industrial nations and Japan. World trade grew annually. The growth was stable, without large fluctuations. Developing countries invested vast amounts of capital, importing industrial plant and equipment featuring modern technology. After the Second World War, many parts of the world were still under European colonial rule and it took over the two decades for the colonies in Asia and Africa to become free independent nations. When they became free they faced many other problems such as poverty, lack of resources. Economies and societies were handicapped for being under colonial rule for long periods. The IMF and the World Bank were designed to meet the financial needs of the industrial countries. As most developing countries were not much benefited from the fast growth therefore they formed a group calledthe Group of 77 (or G-77). They demanded A new international economic order (NIEO) with actual control over their natural resources. More development assistance. Fairer prices for raw materials. Better access for their manufactured goods in developed countries markets. End of Bretton Woods and the Beginning of Globlisation. From the 1960s the rising costs of its overseas involvements weakened the USs finances and strength. Eventually this led to the collapse of the system of fixed exchanged rates and the introduction of a system of floating exchange rates. Multinational corporations (MNCs) are large companies that operate in several countries at the same time. The first MNCs were established in the 1920s. The worldwide spread of MNCs was a notable feature of the 1950s and 1960s. This was partly because high import tariffs imposed by different governments forced MNCs to locate their manufacturing operations and become domestic producers in as many countries as possible.

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Flow-Learning
The Making of a Global World
Silk routes Indentured labourers Globalisation Multinational corporations (MNCs) Development of Technology

Words that Matter

Silk Route. The route taken by traders to carry silk cargos from China to the West. Dissenter. One who refuses to accept established beliefs and practices. Indentured labour. A bonded labourer under contract to work for an employer for a specific amount of time, to pay off his passage to a new country or home. Tariff. Tax imposed on a countrys imports from the rest of the world. Tariffs are levied at the point of entry, i.e. at the border or at the airport. Fixed exchange rates. When exchange rates are fixed and the governments intervene to prevent movements in them. Floating exchange rates. These rates fluctuate depending on demand and supply of currencies in foreign exchange markets, in principle without interference by governments. Coolies. Indian indentured labourers were referred to as coolies in the Caribbean islands.

QUESTIONS FROM TEXTBOOK

Write in Brief
Q. 1. Give two examples of different types of global exchanges which took place before the seventeenth century, choosing one example from Asia and one from the Americas. From Asia: (i) Chinese silk cargoes used to travel through the silk routes. (ii) Later Chinese pottery, textiles and spices from India and Southeast Asia also travelled through these routes. (iii) In return, precious metals gold and silver flowed from Europe to Asia. (iv) For centuries before, the Indian Ocean had known a vibrant trade with goods, people, knowledge, customs, etc.

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Q. 2. Ans.

Q. 3.

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(v) Silk routes helped in linking Asia with Europe and northern Africa. (vi) Buddhism which emerged from eastern India also spread in several directions through interconnecting points on the silk routes only. From the Americas: (i) Americas vast lands and abundant crops and minerals began to transform trade and lives everywhere from the 16th century. (ii) Precious metals, particularly silver, from mines located in present day Peru and Mexico also enhanced Europes wealth and financed its trade with Asia. Explain how the global transfer of disease in the pre-modern world helped in the colonisation of the Americas. By the mid-sixteenth century Europe defeated America not with military power but they got killed due to the germs of small pox brought by Europeans with them. America had been cut off from regular contact with the rest of the world for millions of years. As Americas original inhabitants were living in isolation for long, they had no immunity against these diseases that came from Europe. Smallpox proved to be a deadly killer for them. It spread deep into the continent, killed and devastated the whole community, thus paving the way for European conquest. Write a note to explain the effects of the following: (a) The British governments decision to abolish the Corn Laws (b) The coming of rinderpest to Africa (c) The death of men of working-age in Europe because of the World War (d) The Great Depression on the Indian economy (e) The decision of MNCs to relocate production to Asian countries. (a) The British government finally abolished the Corn Laws which brought a lot of changes in the British economy: 1. Food could be imported into Britain more cheaply than it could be produced within the country. 2. British agriculture failed to compete with imports. 3. Vast areas of land were left uncultivated. 4. Thousands of men and women became unemployed. 5. This led to migration of people to the cities or overseas. (b) In the 1880s, in Africa Rinderpest (a fast spreading disease of cattle plague) had a terrifying impact on peoples livelihoods and the local economy. It started in East Africa and soon spread to the other parts of the continent. In 1892, it reached Africas Atlantic coast and within five years it reached the Cape (Africas southernmost tip). It spread through an infected cattle imported from British Asia to feed the Italian soldiers invading Eritrea in East Africa. Effects of rinderpest on Africans 1. Rinderpest killed 90 per cent of the cattle. 2. The loss of cattle destroyed African livelihoods.

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3. It strengthened colonial governments power and Africans were forced into the labour market which earlier they were reluctant to do due to abundance of land and livestock. 4. European colonisers thus conquered and subdued Africa. (c) 1. The first world war was the first modern industrial war. It saw the use of machine guns, tanks, aircraft, chemical weapons, etc. 2. Millions of soldiers had to be recruited from around the world and moved to the frontlines on large ships and trains. 3. 9 million died and 20 million injured. 4. Most of the killed and maimed were men of working age. These deaths and injuries reduced the able-bodied workforce in Europe with fewer members within the family, household incomes declined after the war. (d) 1. Industries were restructured to produce war-related goods. 2. Production, employment, incomes and trade declined disastrously. 3. Agricultural regions and communities got affected badly because the fall in agricultural prices was more than the fall in the prices of industrial goods. 4. Agricultural overproduction led to the falling agricultural prices which further led to the decline of agricultural incomes. When the farmers tried to expand production to maintain their income, it worsened the surplus in the market and led to more downfalls in the prices. 5. The Farm produce decayed due to lack of buyers. Thus the Great Depression affected the society, politics and international relations. In the nineteenth century, colonial India had become an exporter of agricultural goods and importer of manufactures. Indian trade immediately got affected due to the great depression. 1. Indias exports and imports nearly halved between 1928 and 1934. 2. As international prices crashed, prices in India also plunged. 3. Between 1928 and 1934, wheat prices in India fell by 50 per cent. 4. Peasants and farmers suffered more than urban dwellers. Though agricultural prices fell sharply, the colonial government refused to reduce revenue demands. Peasants producing for the world market were the worst hit. (e) The relocation of industry to low-wage countries stimulated world trade and capital flow. In the last two decades the worlds economic geography has been transformed as countries such as India, China and Brazil have undergone rapid economic transformation. Q. 4. Give two examples from history to show the impact of technology on food availability. Ans. 1. Faster railways, lighter wagons and larger ships helped move food more cheaply and quickly from faraway farms to final markets. 2. The development of refrigerated ships enabled the transport of perishable foods over long distances.

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Q. 5. Ans.

Animals were now slaughtered for food at the starting point (America, Australia or New Zealand) and then transported to Europe as frozen meat. This reduced shipping costs and lowered meat prices in Europe. The poor in Europe could now add meat to their diet. Better living conditions and nutritious diet promoted social peace. What is meant by the Bretton Woods Agreement? In order to preserve economic stability and full employment in the industrial world, the post-war international economic system was established. To execute the same, the United Nations Monetary and Financial Conference was held in July 1944 at Bretton Woods in New Hampshire, USA. The Bretton Woods conference established the International Monetary Fund (IMF) to deal with external surpluses and shortages of its member nations. The International Bank for Reconstruction and Development (popularly known as the World Bank) was set up to finance postwar reconstruction and they started the financial operations in 1947. Decision-making authority was given to the Western industrial powers. The US was given the right of veto over key IMF and World Bank decisions. The Bretton Woods system was based on fixed exchange rates. The Bretton Woods system opened an era of unique growth of trade and incomes for the Western industrial nations and Japan. World trade grew annually.

Discuss
Q. 6. Imagine that you are an indentured Indian labourer in the Caribbean. Drawing from the details in this chapter, write a letter to your family describing your life and feelings. Attempt yourself on the basis of the details given in your textbook. Explain the three types of movements or flows within international economic exchange. Find one example of each type of flow which involved India and Indians and write a short account of it. Three types of movement or flows were identified by the economists within international economic exchanges: 1. The flow of trade (trade in goods, e.g. cloth or wheat). 2. The flow of labour (the migration of people in search of employment). 3. The movement of capital (investments). All three flows were closely interlinked and affected peoples lives. Explain the causes of the Great Depression. The Great Depression was caused by a combination of several factors: 1. Agricultural overproduction was a major factor. As a result agricultural prices fell. As prices fell and agricultural incomes declined, farmers tried to expand production. This increased the volume of goods in the market. The situation got worsened in the market. Prices fell down further. Farm produce rotted for a lack of buyers. 2. In the mid-1920s, many countries financed their investments through loans from the US. US overseas lenders got panicked at the sign of trouble and withdrew their amount. Countries that depended on US loans now faced acute financial problem.

Ans. Q. 7.

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Q. 8. Ans.

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Q. 9. Ans.

3. The withdrawal of US loans affected the rest of the world in many different ways. In Europe it led to the failure of some major banks and the collapse of currencies such as the British pound sterling. In Latin America and elsewhere it intensified the slump in agricultural and raw matrial prices. 4. The US attempt to protect its economy in the depression by doubling import duties also gave another severe blow to world trade. Explain what is referred to as the G-77 countries. In what ways can G-77 be seen as a reaction to the activities of the Bretton Woods twins? After the Second World War, many parts of the world were still under European colonial rule and it took over two decades for the colonies in Asia and Africa to become free independent nations. When they became free they faced many other problems such as poverty, lack of resources, etc. Economies and societies were handicapped for being under colonial rule for long periods. The IMF and the World Bank, often referred to as the Bretton Woods twins, were designed to meet the financial needs of the industrial countries. As most developing countries were not much benefited from the fast economic growth of western countries, therefore they formed a group calledthe Group of 77 (or G-77) in order to catch up the development in advanced industrial countries. They demanded 1. A new international economic order (NIEO) with actual control over their natural resources. 2. More development assistance. 3. Fairer prices for raw materials. 4. Better access for their manufactured goods in developed countries markets.

Project
Find out more about gold and diamond mining in South Africa in the nineteenth century. Who controlled the gold and diamond companies? Who were the miners and what were their lives like? 1. The first commercial mining of diamonds and gold started in the 1870s and the 1880s. 2. By the mid-twentieth century, South Africa became one of the worlds largest producers of gold and diamonds. 3. Gold was first mined by Europeans in 1886 near Johannesburg. Five major sources of gold were the Bushveld, Transvaal, Witwatersrand, Northern Cape, and Western Cape. 4. South Africas diamond mining industry dates back to 1867, when diamonds were discovered near Kimberley, now in the Northern Cape. Major sources of gem-quality diamonds were the Kimberley diamond fields in Gauteng, the Free State, and along the Atlantic coast. People who controlled the diamond companies: Cecil Rhodes who arrived in South Africa at the age of 16 and eventually gained control over most of the mines through his De Beers Consolidated Company.

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 Barney Barnato, the son of a London pub owner who arrived in 1873 at the age of 21 with a small amount of cash and forty boxes of cheap cigars which he used to buy mining claims. Alfred Beit, the son of a Hamburg merchant who arrived in 1875 and stayed on to organise the consolidation of small mines so they could be exploited with heavy mining equipment. The De Beers Consolidated Mines Company controlled most diamond mining in South Africa. Since the late 19th century, South Africas economy has been based on the production and export of minerals, which, in turn, have contributed significantly to the countrys industrial development.

MORE QUESTIONS SOLVED

I. MULTIPLE CHOICE QUESTIONS Choose the correct option: What was the term used to describe Indian indentured labour? 1. (a) Porter (b) Juggler (c) Coolie (d) Rickshaw puller 2. Which country was a major supplier of wheat in the world market? (a) Africa (b) Eastern Europe (c) North America (d) Asia 3. Who is considered a pioneer in the field of mass production of cars? (a) Henry Morton Stanley (b) Ebenezer Howard (c) Barry Parker (d) Henry Ford 4. What were the Corn Laws? (a) Laws to restrict the import of corn (b) Laws to restrict the export of corn (c) Laws to restrict the export and import of corn (d) None of the above 5. When did the global agricultural economy start? (a) 1894 (b) 1892 (c) 1890 (d) 1891 6. What was Rinderpest? (a) An epidemic spreading due to growth of cattle (b) A fast spreading disease of cattle plague (c) A disease spreading due to grazing of cattle (d) None of the above 7. IMF stands for what? (a) International Military Force (b) International Monetary Fund (c) Indian Monetary Fund (d) Indian Monetary Force 8. What does the word America describe? (a) North America (b) South America (c) Caribbean (d) All the above

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What were Americas original inhabitants known as? (a) Indian Americans (b) American Indians (c) Red Indians (d) Native Indians What was El Dorado? (a) The fabled city of gold (b) The famous dreamland for many (c) An imaginary land (d) The fabled city of diamond Americas original inhabitants had no immunity against diseases like smallpox. Why? (a) They were physically very weak. (b) They were illiterate and tired in filthy surrounding. (c) They lived in isolation for millions of years. (d) They were too poor to eat good food. What proved a deadly killer for Americas original inhabitants? (a) Rinderpest (b) Measles (c) Tuberculosis (d) Smallpox ......... and ......... were among the worlds richest countries till the 18th century. (a) North America, South America (b) China, India (c) China, Japan (d) India, Mexico What does the flow of labour mean? (a) The migration of people in search of employment (b) The migration of people in search of a comfortable life (c) The migration of people in search of wealth (d) The migration of people in search of good education Consumption of food rose in the late eighteenth century Britain. What was its reason? (a) Food prices fell (b) Population grew (c) Food prices increased (d) All the above The Canal Colonies were ......... (a) The areas irrigated by the new canals (b) The areas having several dams (c) The colonies where poor people lived (d) The colonies where canal workers lived Europeans found ......... in Africa. (a) An abundant labour force (b) A shortage of labour (c) Many deadly diseases (d) An acute shortage of electricity Chutney music was popular in ......... (a) Trinidal (b) Guyana (c) Surinam (d) Trinidad and Guyana Why did the inflow of fine Indian cotton begin to decline? (a) Tariffs were imposed on cloth imports into Britain. (b) Indian weavers were no longer interested in weaving.

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20.

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(c) British people stopped using Indian clothes. (d) None of the above. The first World War made the United States ......... (a) an international debtor (b) an international creditor (c) a very poor country (d) a very powerful country Henry Ford was a/an ......... (a) well-known car manufacturer (b) well-known fighter in the First World War (c) explorer (d) Business man In India, the Great Depression proved less severe for ......... (a) rural people (b) factory workers (c) urban people (d) highly educated The IMF and the World Bank are referred to as the ......... (a) International monetary institutions (b) International banks (c) Great industrial powers (d) Bretton Woods institutions 1(c) 2(b) 3(d) 4( a) 5(c) 6(b) 7(b) 8(d) 9(b) 10(a) 11(c) 12(d) 13(b) 14(a) 15(a) 16(a) 17(b) 18(d) 19(a) 20(b) 21(a) 22(c) 23(d)

II. SHORT ANSWER TYPE QUESTIONS Q. 1. What attracted Europeans to the late nineteenth century Africa? What problem did they face? Ans. Africa had abundant land and a relatively small population. For centuries, land and livestock sustained African livelihoods and people rarely worked for a wage. In late-nineteenth century Africa there were few consumer goods that wages could buy. Europeans got attracted to Africa due to its vast resources of land and minerals. They came to Africa hoping to establish plantations and mines to produce crops and minerals for export to Europe. But there was an unexpected problema shortage or labour. Africans had no reason to work for wages and this posed a problem to Europeans. Q. 2. What did European employers do to retain the African labour? Ans. European employers used the following methods to recruit and retain labour: (a) Heavy taxes were imposed which could be paid only by working for wages on plantations and mines. (b) Inheritance laws were changed so that peasants were displaced from land. Here it is worth mentioning that only one member of a family was allowed to inherit land. As a result of this, others were pushed into the labour market. (c) Mine workers were also confined in compounds and not allowed to move about freely.

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Q. 3. Ans.

Write in brief about indentured labour. [Imp.] In the nineteenth century thousands of Indian and Chinese labourers migrated to work on plantations, in mines, and in road and railway construction projects around the world. In India they were hired under contracts for five years for plantation work and they would return back home once the contract and work was over. Most Indian indentured workers came from the present-day regions of eastern Uttar Pradesh, Bihar, central India and the dry districts of Tamil Nadu. The circumstances that took shape in the mid-19th century compelled them to migrate. Cottage industries declined, land rent rose, lands were cleared for mine and plantations. All this affected the lives of the poor people. Many believed indenture was nothing but a new system of slavery as the living and working conditions of labourers were harsh and they had few legal rights. Q. 4. What benefits did the British get by having a trade surplus with India? [V. Imp.] Ans. During the 19th century, British manufactures flooded the Indian market. Food grain and raw material exports from India to Britain and the rest of the world increased. But the value of British exports to India was much higher than the value of British imports from India. Thus, Britain had a trade surplus with India. Britain used this surplus to balance its trade deficits with other countries that is, with countries from which Britain was importing more than it was selling to. By helping Britain balance its deficits, India played a crucial role in the late19th century world economy. Britains trade surplus in India also helped pay the so-called home charges that included private remittances home by British officials and traders, interest payments on Indias external debt and pensions of British officials in India. Q. 5. Explain three major features of global agricultural economy that had taken shape towards the close of the 19th century. (CBSE 2009) Ans. By 1890, a global agricultural economy started with some complex changes in labour movement patterns, capital flows, ecologies and technology. Major features of the global agricultural economy towards the close of the 19th century: (i) Food was now brought from thousands miles away. (ii) It was grown by agricultural workers on lands after clearing the forests to meet the British demand in East Europe, Russia, America and Australia. (iii) Lands were cultivated not by peasants owning this land but by hired workers brought from distant lands. (iv) Railways, ships, new ports, etc. were introduced or built for transportation. (v) Global agricultural economy which was earlier self sufficient rural society transformed into an industrial city with more demand for food. (vi) The workers were paid very low and they were from Asia, Africa and the Caribbean. Q. 6. Throw light on the Indian entrepreneurs abroad. Ans. With the increase in demand for food and other crops the need for the capital also arose. Large plantations borrowed from banks and markets. But poor peasant couldnt do so. Shikaripuri Shroffs and Nattukottai Chettiars were amongst the many groups of bankers and traders who financed export agriculture in Central and Southeast Asia, using either their own funds or those borrowed from

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Q. 7. Ans.

Q. 8. Ans.

Q. 9. Ans.

Q. 10. Ans.

European banks. They had a sophisticated system to transfer money over large distances, and developed indigenous forms of corporate organisation. Every coin has two sides goes aptly with globalisation. Considering the same mention any two positive as well as negative sides of globalisation. Good effect of globalisation: Globalisation resulted in greater competition among producersboth local and foreign. This improved the quality of the product and lowered the prices. Bad effect of globalisation. For a large number of small producers and workers globalisation posed major problems. These producers were not able to face the competition from large foreign producers and hence several production units shut down. What were the Corn Laws? Why were they soon abolished and how did it affect the British economy? From the late eighteenth century population increased, the urban centres expanded and industries also grew. This increased the demand for food grains in Britain pushing up foodgrain prices. Under pressure from landed groups, the government restricted the import of corn. The laws allowing the government to do this were known as the Corn Laws. The industrialists and urban dwellers opposed the Corn Laws and demanded its abolition. The Corn Laws were abolished which brought a lot of changes in the British economy. (a) Food could be imported into Britain at much cheaper rate than before. (b) British agriculture failed to compete with imports. (c) Vast areas of land were left uncultivated. (d) Thousands of men and women became unemployed. (e) This led to migration of people to the cities or overseas. Under what circumstances Europe emerged as the centre of world trade? Till the eighteenth century, China and India were among the worlds richest countries. They were supreme in Asian trade. (a) However, from the fifteenth century, China is said to have restricted overseas contacts and retreated into isolation. Chinas reduced role and the rising importance of the Americas gradually moved the centre of world trade westwards. (b) Europe now emerged as the centre of world trade. Why was G-77 formed by the developing countries? [V. Imp.] Most developing countries did not benefit from the fast growth the Western economies experienced in the 1950s and 1960s. Therefore they organised themselves as a group popularly known as the Group of 77 or G-77 and demanded a new economic order (NIEO). The NIEO was for them a system that would give them: (a) Actual control over their natural resources. (b) More development assistance. (c) Fairer prices for raw materials. (d) Better access for their manufactured goods in developed countries markets.

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Q. 11. The first World War was a war like no other before. Explain. Ans. The First World War was a war like no other before. The fighting involved the worlds leading industrial nations which now had immense control over modern industry to inflict the greatest possible devastation on their enemies. This war was the first modern industrial war, in which machine guns, tanks, aircrafts, chemical weapons etc. were used on a large scale. To fight the war, millions of soldiers from around the world were recruited. They moved to the frontlines on large ships and trains. About 9 million people died and about 20 million got injured. Most of the killed and maimed were men of working age. As a result household incomes declined sharply after the war. Q. 12. How were indentured labourers recruited? Describe. Ans. Indentured labourers were recruited by agents whom the employers engaged and paid a small commission. Many migrants agreed to take up work hoping to escape poverty or oppression in their native villages. Agents also tempted the migrants by providing false information about final destinations, modes of travel, the nature of the work and living and working conditions. Often labourers were not even told that they were to undertake a long sea voyage. The migrants who were less willing were sometimes forcibly abducted by the agents. III. LONG ANSWER TYPE QUESTIONS Q. 1. Give a comparative study of the life and conditions in Asia and Europe in the 18th century. [V. Imp.] Ans. Until well into the 18th century, China and India were among the worlds richest countries. They were supreme in Asian trade. However, from the 15th century, China is said to have restricted overseas contacts and retreated into isolation. Slowly and steadily the importance of Americas increased and the centre of world trade moved westwards. Europe now emerged as the centre of world trade. On the other hand until the 19th century, poverty and hunger were common in Europe. Cities were overcrowded and deadly diseases were widespread. Religious conflicts were common and religious dissenters were presecuted. Thousands therefore fled Europe for America. Q. 2. What role did technology play in shaping the nineteenth century world? Or Explain the role of technology in flourishing the trade during the late nineteenth century. (CBSE 2010) Ans. (a) The important inventions like the railways, steamships and the telegraph triggered the economic growth in nineteenth-century. (b) Colonisation stimulated new investments and improvements in transport. (c) Faster railways, lighter wagons and larger ships helped move food more cheaply and quickly from faraway farms to final markets. (d) The development of refrigerated ships helped in many ways. It enabled the transport of perishable foods over long distances. (e) Animals were now slaughtered for food at the starting point (America, Australia or New Zealand) and then transported to Europe as frozen meat. (f) This reduced shipping costs and lowered meat prices in Europe. Demand increased drastically as now it was much more affordable. Better living conditions and nutritious diet promoted social peace.

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Q. 3. Explain the effects of the Great Depression on the world. Ans. (a) Production, employment, incomes and trade declined disastrously in most parts of the world. (b) Agricultural regions and communities got affected badly because the fall in agricultural prices was greater and more prolonged than that of the prices of industrial goods. (c) Agricultural overproduction led to the fall in agricultural prices which further led to the decline of agricultural incomes. When the farmers tried to expand production to maintain their income, it worsened the surplus in the market and led to more downfalls in the prices. (d) The farm produce decayed due to lack of buyers. Households were ruined and businesses got collapsed. (e) When the crisis started US withdrew the loans which affected the rest of the world. Many major banks and currencies collapsed such as the British pound sterling. (f ) In Latin America the agricultural and raw material prices declined. (g) The US was also the industrial country most severely affected by the depression. (h) US banks cut the domestic lending and called back loans. ( i) Those who failed to repay what they had borrowed were forced to give up their homes, cars and other consumer durables. (j) Unemployment soared and the US banking system collapsed. Thus the Great Depression affected the society, politics and international relations. Q. 4. Discuss the impact of the First World War on the world economy. Ans. 1. During the First World War, industries were restructured to produce warrelated goods. Entire societies were also recognised for war. All able-bodied men went to battle and women stepped in to undertake jobs that earlier only men were expected to do. 2. The World War led to the snapping of economic links between some of the worlds largest economic powers because they were now fighting each other to pay for them. 3. Britain borrowed large sums of money from US banks as well as the US public in order to fight the war. The war thus transformed the US from being an international debtor to an international creditor. 4. The war had led to an economic boom, that is, to a large increase in demand, production and employment. When the war boom ended, production contracted and unemployment increased. 5. Many agricultural economies were in crisis. Before the war, eastern Europe was a major supplier of wheat in the world market. When this supply was disrupted during the war, wheat production in Canada, America and Australia expanded dramatically. But once the war was over, production in eastern Europe revived and created a glut in wheat output. As a result, grain prices fell, rural economies declined and farmers fell into debt.

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Q. 5. Ans.

The First World War helped boost the US economy. Explain how. [V. Imp.] The First World War boosted the US economy. The US became an international creditor. After a short period of economic trouble in the years after the war, the US economy resumed its strong growth in the early 1920s. One important feature of the US economy of the 1920s was mass production. The move towards mass production had begun in the late 19th century, but in the 1920s it became a characteristic feature of industrial production in the US. A well-known pioneer of mass production was the car manufacturer Henry Ford. He adopted the assembly line method of production which would allow a faster and cheaper way of producing vehicles. Mass production lowered costs and prices of engineered goods. As wages of workers increased, they could now afford to purchase durable comsumer goods such as cars. There was also a spurt in the purchase of the refrigerators, washing machines, radios etc. all through a system of hire purchase. There was also a boom in house construction and home ownership, financed by loans. The housing and consumer boom of the 1920s created the bases of prosperity in the US. Large investments in housing and household goods seemed to create a cycle of higher employments and incomes, rising consumption demand, more investment and yet more employment and incomes.

Q. 6. Ans.

What industrial practices were adopted by Henry Ford to speed up the production of cars? How did he retain the workers? [V. Imp.] Henry Ford adopted the assembly line method in order to produce vechicles in a faster and cheaper way. The assembly line forced workers to repeat a single task mechanically and continuously at a pace dictated by the conveyor belt. This was a way of increasing the output per worker by speeding up the pace of work. Standing in front of a conveyor belt no worker could afford to delay the motions, take a break or talk with his workmate. As a result Henry Fords car came off the assembly line at three-minute intervals. At first workers at the Ford factory found it difficult to cope with the stress of working on assembly lines in which they could not control the pace of work. So they quit in big numbers. Ford then doubled the daily wage. At the same time he banned trade unions from operating in his plants. Henry Ford recovered the high wage by repeatedly speeding up the production line and forcing workers to work ever harder. Soon he found that his decision to double the daily wage as the best cost-cutting decision he had ever made. What were the main sources of attraction for Europeans to come to Africa in the late nineteenth century? How did they exploit their resources? [CBSE (F) 2010] Africa had abundant land and relatively small population. For centuries, land and livestock sustained African livelihoods and people rarely worked for a wage. In the late nineteenth century, Europeans were attracted to Africa due to its vast resources of land and minerals. Europeans came to Africa hoping to establish plantations and mines to produce crops and minerals for export to Europe. But there was a shortage of labour in Africa.

Q. 7. Ans.

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Employers used many methods to recruit and retain labour. Heavy taxes were imposed which could be paid only by working for wages on plantations and mines. Inheritance laws were changed so that peasants were displaced from land: only one member of a family was allowed to inherit land, as a result of which the others were pushed into the labour market. Then came rinderpest, a devastating cattle disease. It killed 90 per cent of the cattle. The loss of cattle destroyed African livelihood. Planters, mine owners and colonial governments now successfully monopolised what scarce cattle resources remained; to strengthen their power and to force Africans into the labour market. IV. SOURCE-BASED QUESTIONS Read the extract (Source A) taken from NCERT Textbook page 89 and answer the questions that follow: The testimony of an indentured labourer Extract from the testimony of Ram Narain Tewary, an indentured labourer who spent ten years on Demerara in the early twentieth century: ... in spite of my best efforts, I could not properly do the works that were allotted to me ... In a few days I got my hands bruised all over and I could not go to work for a week for which I was prosecuted and sent to jail for 14 days. ... new emigrants find the tasks allotted to them extremely heavy and cannot complete them in a day. ... Deductions are also made from wages if the work is considered to have been done unsatisfactorily. Many people cannot therefore earn their full wages and are punished in various ways. In fact, the labourers have to spend their period of indenture in great trouble ... Source: Department of Commerce and Industry, Emigration Branch, 1916 (i) What is meant by indentured labour? What were the main destinations of Indian indentured migrants? Ans. (ii) What do you know about their living and working conditions? (i) Indentured labour refers to a bonded labourer under contract to work for an employer for a specific period of time, to pay off his passage to a new country or home. The main destinations of Indian indentured migrants were the Caribbean Islands (mainly Trinidad, Guyana and Surinam) Mauritius and Fiji. (ii) Living and working conditions of indentured labourers were very harsh. They had few legal rights.

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V. PICTURE-BASED QUESTIONS Observe the picture below taken from NCERT Textbook page 98 and answer the questions that follow:

Ans.

(i) Name the building in Soviet Russia which was devastated in the Second World War. (ii) When did this war break out? Between which two powers was this war fought? (i) Stalingrad. (ii) The Second World War broke out in the year 1939. It was fought between the Axis powers (mainly Nazi Germany, Japan and Italy) and the Allies (Britain, France, the Soviet Union and the US).

TEST YOUR SKILLS

1. 2. 3. 4. 5. 6. 7. 8. 9. What does globalisation mean? What factors contributed to its rise? Why were the Europeans attracted to Africa in the 19th century? What measures were taken for liberalisation of Indian economy? What do you mean by the silk routes? What was their importance? Write a short note on indentured labour and their social and economic condition. Explain what you mean when you say that the world shrank in the 1500s. What led to the migration of Indian indentured labourer to other countries? Write a note on India and the Great Depression. What forced the British Government to abolish the Corn Laws?

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