Correct Option
The correct option is 1 and 3 only.
Explanation
The decline of indigenous handicraft industries in India was a direct result of the systematic de-industrialization policy pursued by the British colonial administration. The primary objective was to reduce India to a mere exporter of raw materials and a consumer of finished industrial products from Britain.
Statement-wise Analysis
- Statement 1 is Correct: The collapse of the traditional handicraft sector resulted in the displacement of a vast number of artisans and craftsmen. Since the modern industrial sector was not sufficiently developed to absorb this workforce, it led to massive unemployment and underemployment. These displaced artisans were forced to fall back on agriculture, increasing the burden on land.
- Statement 2 is Incorrect: The decline of handicrafts was caused by the influx of cheap, machine-made goods from Britain. Consequently, the domestic market faced an oversupply of British manufactured goods, not locally made goods. The production of local goods shrank because they could not compete with the lower prices of imported machine-made products.
- Statement 3 is Correct: The colonial trade policy, characterized by duty-free imports of British goods and heavy tariffs on Indian exports, made British products cheaper in the Indian market. This price advantage, coupled with changing consumer tastes, led to a significant increase in demand for British manufactured goods at the expense of domestic products.
Key Takeaway
Key Takeaway: The decline of Indian handicrafts led to structural unemployment (de-industrialization) and the "ruralization" of the economy, transforming India into a market for British finished goods and a supplier of raw materials.