Question 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.
Answer 1 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.
(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) America’s 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 Europe’s wealth and financed its trade with Asia.
Question 2 Explain how the global transfer of disease in the premodern world helped in the colonisation of the Americas.
Answer 2 By the mid-sixteenth century Europe defeated America not with military power but they (Americans) got killed due to the germs of smallpox brought by Europeans with them. America had been cut off from regular contact with the rest of the world for millions of years. As America’s 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.
Question 3 Write a note to explain the effects of the following:
(a) The British government’s 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.
Answer 3 (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) Rinderpest (a fast spreading disease of cattle plague) arrived in Africa in the late 1880s. It had a terrifying impact on people’s livelihoods and the local economy. It started in East Africa and soon spread to the other parts of the continent. In 1892, it reached Africa’s Atlantic coast and within five years it reached the Cape (Africa’s 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.
3. It strengthened colonial government’s 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) The First World War was the first modern industrial war. It saw the use of machine guns, tanks, aircraft, chemical weapons, etc. Millions of soldiers had to be recruited from around the world and moved to the frontlines on large ships and trains. The scale of death and distruction was beyond imagination.Most of the killed and maimed were men of working age. These deaths and injuries reduced the ablebodied workforce in Europe with fewer members within the family, household incomes declined after the war.
Since men went to battle, women stepped in to undertake jobs that earlier only men were expected to do. The war led to the snapping of economic links between some of the world’s largest economic powers which were now fighting for each other to pay for them. So, Britain borrowed large sums of money from US banks as well as the US public. Thus, the war transformed the US from being an international debtor than international creditor.
(d) In the nineteenth century, colonial India had become an exporter of agricultural goods and importer of manufactures. The great depression immediately affected Indian trade.
1. India’s exports and imports nearly halved between 1928 and 1934.
2. As international prices crashed, prices in India also plunged. Between 1928 and 1934, wheat prices in India fell by 50 per cent.
3. 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. Across India, peasants’ indebtedness increased. However, the depression proved less grim for urban India.
(e) The relocation of industry to low-wage countries stimulated world trade and capital flow. In the last two decades, the world’s economic geography has been transformed as countries such as India, China and Brazil have undergone rapid economic transformation.
Question 4. Give two examples from history to show the impact of technology on food availability.
Answer 4 (i) Faster railways, lighter wagons and larger ships helped move food more cheaply and quickly from faraway farms to final markets.
(ii) The development of refrigerated ships 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. The poor in Europe could now add meat to their diet. Better living conditions and nutritious diet promoted social peace.
Question 5 What is meant by the Bretton Woods Agreement?
Answer 5 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 post-war reconstruction and they started the financial operations in 1947. Decisionmaking 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.
Question 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.
Answer 6 Indentured Indian labourers in the Carribbean—facts—signed a contract stating that they would return to India after working for five years at a plantation; belonged to eastern Uttar Pradesh, Bihar, central India and the dry districts of Tamil Nadu; migrants took up the overseas jobs hoping to escape poverty and oppression in their home villages; migrants were not even informed about the long sea voyages, and some unwilling ones were abducted as well; also known as “the new system of slavery”; harsh living and working conditions; few legal rights; many escaped into the wilds; some developed new art forms for expression; some returned home after the contract period, while others stayed on.
Question 7 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.
Answer 7 Three types of movements or ‘flows’ were identified by the economists within international economic exchanges:
(i) The flow of trade (trade in goods, e.g. cloth or wheat).
(ii) The flow of labour (the migration of people in search of employment).
(iii) The movement of capital (investments). All three flows were closely interlinked and affected peoples’ lives.
Question 8 Explain the causes of the Great Depression.
Answer 8 The Great Depression was caused by a combination of several factors:
(i) 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.
(ii) 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.
(iii) 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 material prices.
(iv) The US attempt to protect its economy in the depression by doubling import duties also gave another severe blow to world trade which aggravated the great depression.
Question 9 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?
Answer 9 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 called—the Group of 77 (or G-77) in order to catch up the development in advanced industrial countries. They demanded:
(i) A new international economic order (NIEO) with actual control over their natural resources.
(ii) More development assistance.
(iii) Fairer prices for raw materials.
(iv) Better access for their manufactured goods in developed countries’ markets.
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?
Answer (i) The first commercial mining of diamonds and gold started in the 1870s and the 1880s.
(ii) By the mid-twentieth century, South Africa became one of the world’s largest producers of gold and diamonds.
(iii) 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.
(iv) South Africa’s 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.
— 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 Africa’s economy has been based on the production and export of minerals, which, in turn, have contributed