Wars Fought Abroad, Prices Paid at Home: The Economic Legacy of WWI and WWII in Colonial India

Manan Kumar

Abstract: This study explores how World War I and World War II despite being battled not on the Indian terrain primarily designed the financial, social and institutional course for colonial India. The research paper asserts that the imperialistic British Empire altered colonial India into an economic and logistic ground for its transnational war machinery through coercive taxes and tariffs, war loans, deficit financing and the accumulation of sterling balances that immobilised India's foreign exchange assets. During the two World Wars: price controls, grain procurement and logistical failures activated market distortions, culminating in the Bengal Famine of 1943. Alongside, labour mobilisation and migration, industrialisation-based bottlenecks, and scarcity-driven "accidental industrialisation" modified labour markets and the industrial revolution. This case study analysis further explores provincial imbalances and long-run structural transitions in India's post-independence planning. Across the board, these battles functioned as outer shocks that produced internal transformations, demonstrating how conflicts fought abroad imposed enduring economic burdens on colonial India.

Keywords: Colonial Indian economy, World War impact on India, Bengal Famine 1943, Wartime industrial change, British imperial policy, Sterling balances, Deficit financing, Labour markets, Industrial distortions, Accidental industrialisation and Invisible battlefield

How to Cite?: Manan Kumar, "Wars Fought Abroad, Prices Paid at Home: The Economic Legacy of WWI and WWII in Colonial India", Volume 14 Issue 12, December 2025, International Journal of Science and Research (IJSR), Pages: 1752-1761, https://www.ijsr.net/getabstract.php?paperid=SR251218125205, DOI: https://dx.doi.org/10.21275/SR251218125205