The Drain of wealth
The drain of wealth refers to constant flow of wealth form India to England for which India did not get an adequate return. The theory was first highlighted by Dada Bhai Naroji in late 19th and early 20th century. He wrote about the drain in his work England debt to India, Poverty of India and Poverty and Un-British rule in India. Along with Naroji, RC Dutt in his work The Economic History of India highlighted the idea of drain. The theory was supported by VC Roy, GK Gokle, MG Ramade, G Subramania Iyer, Lala Lajpat Rai and Sakaram Ganesh Desuaka. Sakram Ganesh was a close associate of Aurobindo Gosh. He published a book title Desher Katha in which he describe the British commercial and industrial exploitation of India and called the British rule upon India the result of hypnotic conquest of the mind. Sir S. Subramania Iyer popularly known as Grand old man of South India also supported the theory along John Sullivan who said "Our system acts very much like a sponge, drawing up all the good things from the banks of Ganges and squeeze them down in the banks of Thames". The major components of the drain of wealth are:
- Home charges i.e. the expenditure incurred in England by British government on behalf of expenses in India.
- The money transfer to British companies to gain their industrial and other form of infrastructure in India.
- Remittances to England by the Europeans living in India.