Thank you for being here once again. You've just spent a lot of time increasing the subtwo in your body. Let me bring you back to the Rajas kind of thing, the area where there's more action involved. There's some suffering thought in your minds, and it's those suffering thoughts perhaps which will help you out in understanding the dilemmas that India faced. Today I'm going to talk about the dilemmas that India faced in modern times. You've heard about how India was one of the richest countries, Sonika Chidia, etc., etc. Bharat Sonika Chidia Kis Tharae Se Tha, this is a story to be told on some other occasion. Today we start with how India gets in touch with the modern economy, the modern world, and how the contact with the modern world discovers, India discovers that India is lacking in a lot of things. So that is essentially the summary of what I'm going to argue today. What I have done today is that there's so much material to be talked about. You've already done a lot of this in your textbooks, the impact of colonialism on the Indian economy, Indian nationalism, etc. So I'll be moving away from that. I'll presume that there is that basic amount of knowledge, school textbook level knowledge, I'll go beyond that and make an argument which is slightly different from what the school textbook says. And I would suggest that the school textbook that you were taught, that's why it was taught, because there was a hope from the side of the government that you would get up and you would develop a special love for your country. Perhaps that was a hope which was good in the 1950s and the 1960s when the idea of writing school textbooks came up. But today I think there's a different kind of a hope that we have from you, at least people my generation who are halfway through their life and you guys were just about starting in the business, we hope that you'll be able to move forward without the baggage of criticizing, condemning colonialism all the time. So I'm getting out of colonialism altogether and this is what I have to tell you. The first basic fact is in 1810 when the East India Company has established its colonial domination over India. India is still one of the richest countries in the world. Remember East India Company comes to India 50 years before this. So 50 years have passed, but in this 50 years, India has still not been impoverished. India is still one of the richest countries in the world. Almost a quarter of the GDP of the world comes from India at this time. About 30% of the GDP of the world at this time comes from China. India is the next one. Depending on how you calculate it, either India and China are equal or India is superior to China or China is superior to India. It really doesn't matter. I mean, when you are a country which is producing 25% or more of the GDP of the world, you really don't have to sit down and quibble about the one point, the one point was down. This is the time when the East India Company comes and occupies India, becomes the paramount power. Yes, sir? Yes, please do. The rest of the crowd was not producing anything. They were merely consuming things. Most of the stuff would be coming from India and China. Almost everything was being exported from India and China. And because the Chinese were doing most of their consumption internally, they had a huge population even then. Most of the exports that went out to the world were actually coming from India. And because things were being exported from India, and almost nothing was being imported into India, the rest of the world used to crib. The Arabs, the Jews, the Africans, the Europeans were coming to us from the Red Sea side. They would all complain. They would say, this is a one-way flow. Our gold is moving into India. Our everything that we need to buy from India, we have to pay in gold. Because India doesn't want any exchange. Why doesn't India want any exchange? Because there's no market for the goods that they produce. Their goods are shoddy. Their goods are either overly priced or their quality is not good enough. And India takes only gold in return. That's why India is called the golden bird. India is the shaft in which you simply shove gold and you put your hand inside and you pick out something from India. We'll come to the details in one second. By 18, by 1950, when the British have left India, India is making 1% of the GDP of the world. So from 25% of the GDP of the world to 1% of the GDP of the world, quite dramatic down swing for the country. The one big difference that happened, the one big New Corp thing that came to India was the colonial government, the English government. So most people had this tendency to blame the British, blame colonialism, blame the Raj for the economic problems of India. We'll see things how they work out. This is a figure from 1922 to 1940s-wala period. The figure for America and India, the national product for India, the gross national product for India, and the product for America. Figures are approximately the same. Both the countries are doing rather well for themselves and they produce approximately the same amount of goods for India country as compared to the rest of the world. So what happens that soon after this period, soon after the Second World War, America shoots up to a point where it seems almost impossible for India to match up. And why is it that India has actually come down from whatever it was in 1810? There's a small bit of detail that we've already talked about earlier. India was a country characterized by great personal achievements. So even when things were going wrong collectively, individually and privately, there was a large number of people who were doing very well for themselves. There were small groups which were doing very well for themselves across the country in the terms of vis-a-vis the rest of the world. At the same time, India has a large amount of hidden capital which is simply not getting invested. And this surplus capital is being put in temples, in buildings, in gold. Gold being the largest place where Indians like to put capital. The first new thing that happens in the history of India is a contact with Europeans, a deep contact with Europeans. A small contact with Europeans had been there since the time of Chandragupta Maurya. Megastis had come, Greeks had come, Alexander had come, and he had fought with them in Punjab. All those stories are there. Those stories are stories about a small contact. The big contact happens around the 15th, 16th century. And in this contact, it's the first, it is the Portuguese who come in contact with India. Soon thereafter, the Germans, the French, the Dutch, they step in and a little later, it is the English who start getting in touch with India. Most of this contact is through what is now known as the East India companies. Every of these countries, each of these countries has set up a East India company for itself, and they are coming to India to trade and carry material from India outside. The English East India company, which becomes so important in India's history, is actually an anomaly among all these companies. The India trade is a rich trade. Anyone who can come to India goes back with something like 60 to 70 percent, sorry, 60 to 70 times the profit. Though you send three ships to India, only one ship survives the voyage back. You've lost two-thirds of your ships, two-thirds of your men are lost. And that one ship which goes back will bring you 60 times the profit that of the value of the capital you had invested. That is the kind of profit that is available in India. Obviously, everyone wants a pie of it. The Europeans have not seen such a tremendous profit anywhere. Now, such profits happened once in a while in some of the voyages. So it averages out to a tidy 25, 10 to 25 percent profits overall. In from the European point of view, even this 10 to 25 percent profit is extreme because the typical European company is making a profit of 2 percent. A typical European enterprise working in Europe, extremely successful, will make a profit of 4 to 5 percent. So India voyage is a big thing. Everyone wants to participate in this India voyage. The one country which is out of this whole system is the British. So why are the British out of this whole system? Because the British don't have any capital. What great nation? The British don't have enough manpower. At least they don't have enough skilled manpower. The British are like Penduti, Gautke, Hanewale type, completely Fuhar, no scientific knowledge, no technological knowledge, no philosophical knowledge. They are living in a far off island with very little resources. Their life is extremely difficult. So they don't have capital to trade for a trade to India. They don't have enough manpower to trade with India. Moreover, they have decided to participate in that India trade much later. Before that, already the Portuguese, the Dutch, the Germans, the Norwegians, they're already participating in the Indian trade. And all the good people have already been taken up. A good captain, the good seamen, the good vyaparis are already working for those other East India companies. There is no one left who is capable of coming and working for the East India company. East India company, the English East India company is also a very poor pay master. What the English merchants do is this. They say, we can't let go of this great opportunity to trade with India. What we'll do is we'll raise capital by creating a joint stock company. A joint stock company means that you simply make an offer and everyone puts in their capital. So about 500 and odd people put in their capital. You take this money and you then create a legal system. In order to create this legal system, something called a legal persona has to be created. The company has to be given a life, a legal life. And that can only be done by the king. So they approach the king and they give him a lot of goose, saying, please, I may have permission, they don't trade Karnikely. So the East India company is finally formed. As the East India company is formed, everyone knows that the East India company doesn't have enough people to work for the East India company. So they start hiring any nonsense person who's available in the market. So long as you breathe and so long as you are not going to die on the void just like that, please join our ship and let's go and trade with India. It's such a bad situation. Now, you have people who don't know how to trade. You have people who don't know much mathematics. You have people who don't know much language. Writing skills being too poor. And these are some of the lousiest people available in the market for hire. They are the people who nobody has ever hired to trade. These are the guys who have come to your company to become your shippers and your officers and such like. So how do you manage that? It is at this point that the East India company sits down and does a lot of modifications. It does a lot of innovations. One of the big innovations is, remember, this doesn't happen just one day. It happens step by step, it takes a lot of years. One of the big innovations they do is they set up protocols. What are these protocols? They actually sit down and they write long pages of notes. When you go to a port, this is what you should do. A, do this, B, do this, C, do this. When your ship has reached the port, this is how you purchase items and put them in your ship. And then specific questions written over there. FAQs, we call it these days. It is written as FAQ. The rest of Europe looks at these merchants of the East India company and they laugh. This is no way of conducting trade. When you want to conduct trade, you have to work with a trader as an apprentice. You learn how to conduct a trade.  This is not written on paper.  But the East India company merchants, the directors of the East India company are very firm about this. Finally, they are able to publish a book which is 90 pages thick. This 90 pages thick book has to be read by every person who joins the East India company. They have to actually, after a while, they have to pass a test on that book. The inheritors of the East India company's legacy, which our government officials test, through their selection, then they are trained and they have to pass a test before they can join service. This entire system is set up by these English merchants. And they have to pass this test. Then they are given an opportunity to join the ship and come to India. And then they have to maintain a detailed logbook about what they are doing. Now it is from those detailed logbooks that the historian is able to reconstruct the history of the trading of the East India company. Not only that, the East India company says that we will divide our work in departments. No one has thought about this division of departments. What is a good trader? A good trader is someone who knows how to make a purchase, how to make a sale, how to approach the politicians, how to give goose to the politician, how to fight with the local opponents, how to undercut your enemy. Is sorry, is sorry, a single person should know. That is what a good trader is. The East India company guys say, no, no, no, no, it's not like that. The 24 directors, each director has got a department and each department does its work. These things, these individual entities are called departments. It is almost as if they are working in a government. And of all these departments, there's one department called the audit department. The audit department remains with us till today. The audit department investigates every action that has been done. Has it been done according to proper protocol? Now, everyone who has been laughing at the East India company suddenly discovers that the East India company is producing a consistent profit of 25%, excuse me. Everyone else is making a profit of 9% or 10%. Once in a while, they go up to 600. But the East India company makes a consistent profit of 25%. If it makes a consistent profit of 25%, then you look at the East India company and you wait for an opportunity for it to trip. The East India company ships are going to all collapse sometime. There, sailors are going to at some point run away, go off to Africa and start a company of their own. There, sailors may get cheated by the local people. There are a large number of crises, situations that can happen. And somehow, every crisis situation results in the East India company coming out tops. The English company is the only company which makes consistent profits. The rest of the European world starts wondering, is there something wrong with this? So you would imagine that the rest of the European world would follow the structure of the East India company. No, that is not how things happen. Having seen the success of the East India company, they all attributed to luck and they attributed to the hanky-panky which the East India company does. The East India company is a seriously hanky-panky company from the point of view of the traders. What the East India company does, one small story that I would like to share with you is about how the East India company starts its business in India. Jahangir is the emperor. You need the emperor's permission in order to conduct your business. The Portuguese and the French and the Dutch are already in the Mughal court and the Mughal court is this huge place where the emperor sits on a takat and everyone else just hangs around in front and beyond the hall, near the gate, there's the duarpal. So first you have to bribe the duarpal to enter the hall. Then you have to bribe the various ministers and officers hanging around here so that you can get closer to the emperor. And finally, when you reach the emperor, you need a permission of one of the big mantris sitting next door to actually address the emperor. And you have to bribe this guy also. After you bribe this whole lot of people along the way, you have to wait for the emperor to listen to what you want to say, actually understand what you are requesting from the emperor and then order one of the officers to take a decision. The typical is, and this is something which a large number of these officers, the European officers who are attending the emperor's court, they write in their memoirs. They say, the typical is that after having bribed everyone and after having talked to the emperor, the emperor says, yes, we'll look into it, we'll see. Those of you who have ever got an opportunity to talk to politicians and the people of the government, you will discover this is the standard response even today. All that it means is you get lost. It doesn't mean anything more than that. So no work is getting done. And let's keep that for the next one when we talk about the medieval times when Bharat is Sone Gichirya. Remember, it's Sone Gichirya that we are talking about. This guy is the Sone Gichirya who wants to get rid of a punk. The English East India Company is represented by a fellow called Thomas Rowe. He's a doctor. The story goes that Thomas Rowe, the emperor's daughter was burnt by some boiling water. So Thomas Rowe gave her a jar of Vaseline or a jar of coal tar or something, depending on which version of the story you have seen as a consequence, he had a special connection and then the emperor was very happy and he was given permission to conduct a trade in India. Actually, Thomas Rowe writes something very different. In his own reports that he's sending to the company, he says, I went to the court and I just stood there. Nothing happened. I just stood there and watched. No one even noticed my existence. He says, he gives a lot of negative descriptions of the entire court, saying ki hathakoi, kisi koi, suntani, koi, kisi kitara, dektaani. Then he says that one day I noticed that while the court was assembled here and all decisions were being taken here, actually the decisions which resulted in action used to be taken from a separate door. That door led to the parde ke piche wala hissa, waha begam bethha karthi thi. Toh jo log decision lena chahathe thi, action karwala decision lena chahathe thi, wo piche chahathe thi. Begam se unki baat hoti thi, per wo baharate thi, akshan ho jata tha, kam poora ho jata tha. He says, I only bribed one person over there. The fellow who was controlling that axis. I knew that the begam takes a decision. Now Thomas Rose knows that a begam takes a decision because he comes from England where women are taking decisions. They already have a queen who is extremely powerful and very well loved.  Women are the ones who control the strings of empire. He bribes the officers, gets access to the begam. The begam says okay, the English will be allowed to trade. The small thing before us is this. While everyone is struggling according to the standard norms of the times, the representatives of the English East India Company have actually tried to figure out what is the process of decision making, unpacked the process, and then used it towards to their own benefit. As they use it to their own advantage, we notice that the East India Company has taken a step in the direction of creating an ecosystem, which helps the East India Company work. And this is not the first time. A little while later, 150 years later, 200 years later when the Mughal Empire would be about to collapse. When the Mughal Empire is collapsing and all the Mansabdars, that is the officers of the state are doing whatever they want to do. And most of the time, whatever they want to do means the officers of the state. Simply don't pay revenue back. They charge revenue from everyone, but they don't pay revenue back to the emperor in Delhi. So it's the English company which goes off to the king, the emperor, and says, look here, let's have a deal. You give us a Ferman, we'll pay you a lump sum amount of 3000 rupees per year.  And that is the Ferman given by Farukhsir, and that is what enables the East India Company to grow rapidly after 1700 and after 1718. The thing is, East India Company does not believe in conducting trade for trade's sake. The East India Company makes serious efforts to create an ecosystem. Last time when we met, we had been talking about the importance of creating these ecosystems for economic growth. The fact that someone has domain knowledge about how to do things, that is completely insufficient. The big thing is, do you have the necessary soft skills to translate this domain knowledge into making a profit? And the profit may not necessarily come from the kind of thing that you're hoping to do, it can come from anywhere. So you have to be ready to transfer your domain knowledge to something new and start doing that. This is something which the East India Company does, and one of the things that the East India Company we notice is that the East India Company keeps on redefining its role. So after having got permission to trade with India, as its trade starts growing, it discovers that the greatest obstruction to its trade is not the Mughal Emperor, the greatest obstruction is the Portuguese. Why the Portuguese? Because the Portuguese at some time have discovered that participating in trade is falto. This is protection racket, Bolta, you're familiar what a protection racket is? Give me money, otherwise I'll beat you. That is a protection racket. The Portuguese discover that they have got big ships. They have got control over the sea lanes. So they establish chungi-nakas on the seas. And any ship which wants to come from Arabia, Kenya, Eastern Africa, South Africa to India has to pay chungi to the Portuguese. And if they don't pay chungi to the Portuguese, the Portuguese are going to bombard that ship. Everyone else, the Arabs, the Jains, the Siddhis, all the other traders of who are coming to India, they start paying to the Portuguese. The East India Company makes a few payments and then it says, no, no, no, this is unfair. We are going to fight the Portuguese, we are going to hit them. And the East India Company becomes the first company to arm its ships. Merchant vessels don't carry weapons. The East India Company ships become some of the most well-armed ships in the world. The East India Company immediately decides that big ships can only be made in India. So it starts making its big ships in India. As it starts making its big ships in India, it's the Indian shipwrights who are making the ships of the East India Company. It produces cannons, loads them in the ship, takes permission of the king. Because remember, civilians cannot use weapons. It is illegal for civilians to use weapons for any purpose. So you need the permission of the sovereign in the case of the East India Company, the English King, in order to use your weapons in the situation of war. So they take that permission and for that they have to goos allow the English King, which is what they do. But they end up being the masters of the sea lanes. As they become masters of the sea lane in Asia, the Arabian Sea, they transfer this knowledge to Europe. And gradually they become masters of the Atlantic Sea as well. They become a military power. As they become a military power, they discover the times have changed. And in these changed times, Europe has started producing industrial machines and industrial goods. And the East India Company, every other East India Company collapses. Once industrial production starts in Europe, then they don't need so many goods from Asia anymore. Asia consumption, items of consumption lose their market, European market. So every other East India Company collapses. The English East India Company simply transforms itself. First, its first transformation is that it starts using military power to control the producers in India. The battle of Palasi that happens in Bengal. Bengal is already by 1757, amounting to more than three fourths of the total produce in which the East India Company is dealing. So the East India Company now uses military power to occupy Bengal and establish control over the producers which can sell the goods to Europe. So that it can get the goods at Sastadam. Soon thereafter it discovers that even this trade is not sufficient for Europe. So it starts transforming itself into a landlord. It becomes, by 1757, it is mostly cotton cloth. And even for that, the East India Company decides that it has got a special kind of cloth. You see, the Indians are the best producers of cloth in the world. But Indian cloth is of very high value. The Indian cloth is of such high value that Europeans cannot afford this cloth. The normal European market does not have enough money to pay for Indian cloth. So the East India Company starts making an effort at teaching the weavers of India how to produce a low quality cloth. Now this low quality cloth that is being produced by the weavers for the East India Company cannot be sold in the Indian market. Yogi Hindustan ka jo gareeb se gareeb tam insaan hai, wo bhi itna gatiya kapra nahi pahimta. So the Europe, peace goods which are being produced for the East India Company, they don't sell in the Indian market. And the East India Company then insists that the peace goods should be made according to specifications. Remember, it's already used to specifications. And this time it lays down specification. Lombay itni honi chahiye, wazan itna hona chahiye, ghathe smithni padhi honi chahiye. And it starts insisting that everything should be according to what the specification is, otherwise the maal will be sent back. Gradually by the 1760s, 1770s we discover that jaha jaha East India Company ki factory thi, factory that is the warehouse of the East India Company. Jaha jaha East India Company ki factories thi, uske aspas weavers ke settlements develop karna shudu ho jaaptein. The history of Bengal, the history of deindustrialization that you people have read, the weavers lost their livelihood. This is this weaver, the fellow who is producing for the East India Company, he loses his livelihood. He is pushed out of the, out of existence altogether, once the East India Company becomes a predatory company, because as its profits start collapsing, it starts demanding that the weaver sell for less. But cloth is just one of the items. Otherwise the East India Company is trading in something like 200 kinds of items from India. This includes alcohol, this includes minerals, this includes metals, this includes fancy goods. This includes, I should have brought you that small thing. This includes nariel. Nariel is an item of great desire in Europe. Nariel ko sabat nariel ko India se export kiya jata hain. Aur is nariel ka upar se chilka otarke jo uska keval shell hain, usko silver mein, gold mein, usko madha jaata hain. Aur usko fere hap apne, drawing room has started coming into existence by now. Usko fere hap apne drawing room mein rakhte ho. Kirtni khub surat cheez dekhoh hain, India se lekar hain. East India Company is trading in all these things. Spices, of course, are part of the East India Company's trade. They've been part of the East India Company's trade for a long time. But by 1757, 1760s, cloth is the maximum amount of, occupying the maximum amount of space from the East India Company. As the industrial revolution starts growing, the East India Company's trade is under pressure, yet the trade that the East India Company does with Europe, India between Europe and India, that trade is big enough for the trade to still thrive. And that is the reason why when we look at the figures for 1800 and 10, the figure with which we started today's lecture, we notice that India is still producing so many goods of high value, which the East India Company covets, which the East India Company wants to trade with Europe. The reason for that is that the European weavers, the Indian empires react to the Portuguese and others, they didn't, oh, I should have told you a little bit about here. This thing about our misadventure with Aurangzeb, if we story the Hanna, the Europeans are fighting over the trade with India, East India Company has come and the East India Company is trying to dominate everything. And of course, this trade that is going on between the Europeans and India is very important for the European economies. The East India Company has meanwhile collected enough power for itself, it has defeated the Portuguese, and then it says, why not put pressure on the people of India? So around the 1790s, sometime over there, the East India Company blocks the port of Surat and says, Abhidha go Portuguese, your protection racket run Karthe, and the East India Company says, if you don't allow us to trade according to our terms, we won't allow any trade to happen from Surat. The Surat port has been blockaded, the entire trade between India and Arabia and Africa has been stopped, the East India Company ships are standing over their guard, anything which moves from here will destroy it. When you do this in Europe, it effectively results. This is a trade embargo, this effectively results in the national economy collapsing. The East India Company, now we have information from the logs of the East India Company. The East India Company says, Das din ho gaya embargo ko lagai we, wo to kuch bhi nahi hua, ek mahi na ho gaya embargo ko abhi bhi kush nahi hua. So then we tried attacking the port, so when we tried attacking the port, so they responded back with bigger guns as our ships had to come back. Jab enough time has passed and the East India Company discovers that it is making a loss, it sends its khabaris to the port to figure out ke ho kya raha hai. It turns out that the trade between the Europeans and the Indians amounted to just 3% of the total trade of being conducted over there. East India Company, from the Indian point of view, does not matter. The Indian traders are trading over land. They are not trading through the sea. The sea trade is of such a small value. When the East India Company has taken over almost 75% of its cloth from Bengal, when the East India Company's trade is dominated by the cloth being produced in Bengal, the East India Company makes most of its purchases from a trading town called Murshidabad, which is the capital of Bengal of those times. Murshidabad se East India Company leti hai 1 million pounds worth of goods, saal bhar mein. Murshidabad se Indians purchase 15 million pounds worth of goods for trading with the rest of the country. East India Company doesn't matter. No one in India cares for the East India Company. All that changes, all that changes so suddenly and dramatically in the 1780s, 90s, and the early 19th century, that I can only imagine that Indians don't know what hit them. It hit them so suddenly. It simply could not figure out kya burlap kasi aara hai. The first thing that happens by 1810, 1811, when the industrial revolution starts maturing in Europe, is that Europe starts producing goods which are far superior to the goods in India. Europe doesn't need these goods anymore. The demands in Europe change. Some items in which this is most clearly visible is in metals and in cloth. In metals, we have the example of zinc. India was the largest producer of zinc almost throughout history. Since the second century BC, which would be 2200 years ago, India has been producing zinc. India is one of the most important producers of zinc in the world. There's some small stories about zinc being available in other parts of the world, but people who have studied the history of zinc, they say ki yeh stories faltu hai, kyi sara ka sara zinc India se produce ho kyaata tha. Zinc ko produce karne mein, we are told that there's a problem. The problem is that between melting to evaporating, there's just a difference of three degrees. Two degrees. So this is something which simply disables people from taking out zinc, extracting zinc from the ore. The Indians produced a technology in which they had these retorts. This is one of the retorts, which had a hole at the bottom and you heated the retort from the top. So as soon as the zinc melted, it simply came down, you could extract it and zinc was extremely important because if you have a part of a copper culture, you added zinc to copper and you started making equipment which was far sturdier than what otherwise would have been possible. So it made your culture, your society so much the more powerful. This in India, most of it is produced in the area of Mewar around Udaipur. Zawar gao hai, jiske tiri nadike kinaare, jaha ki sbse bade sites mile hai, smelters of zinc. Some of it, so much, so many retorts were being used over here that some of the people constructed houses of used retorts. Zinc is an important item that is being exported from India. Iron is another important item that is being exported from India. The world today, people have forgotten that iron was so important to produce from India because the most important kind of iron, the Damascus steel, is known as Damascus steel. Actually it was Indian iron. Indian iron which would be taken to Damascus from Damascus, it would be sent to the rest of the world. This iron was produced essentially in procedures of this variety. Furnace iron producer ki, sorry, 21st century mein bhi kuch tribes hai jo ki abhi bhi aise iron produce kar rahe hai. This is how they make it. This is the iron that would be exported to the rest of the world. Weapons would be made out of it. Some examples of weapons that you can see if you go to the Chhatrapati Shivaji museum over here in Bombay. Ye akbar ji ka shield hai. Saat mein talware hai akbar ki. Neche ye Aurangzeb ki talware hai. This is Aurangzeb's talware. Talware pe likha hua hai ki Aurangzeb ki talware hai. Therefore we know ki Aurangzeb ki talware hai. Na isko zang lagti hai, na iski dhar jaati hai. Isko banana bhi bahut aasaan hota hai. Those of you who have had a look at those katana swords from Japan, you know how complicated it is to make that kind of a sword. These are not swords of that complicated variety. And yet they're about as powerful as anything that you could possibly have in the market. This is the Jirai Bhaktar once again made up of iron. Na isme zang laga hai, na ye khraab hua hai, na kuch hua hai.  Ek din kya hua dunya badal ghi. Aur jab angrejo ne 1823 mein, lohe ke aadhar pe Sahagpur Gaon hai, Madhya Pradesh mein, jo ki iron producing centre maana jaata tha ek same mein. Waha pe ek bridge banaya lohe ka. That consumed almost the entire iron that they could lay hands on. This is about 1820s. By now, the demand for iron in the world is not in terms of kilos, it is in terms of tons. And very soon the Europeans come up with a device that you have one smelter. Isme dalokura, yaha se loha nikalo. Jitna India saal bhar mein banata tha, uttana aap ka Bessemer converter ek lot mein banata hai. There's simply no way in which the Indian market could survive. India lost its market for salt, for zinc, for copper, for manganese, for virtually everything that India was known for. By 1820, 1830, the world did not need that item anymore. In the Indian markets, the Indian producers simply vanished and they didn't know what to do with that because they didn't have any other skills. However, around the same time, there were some new things which started being important. One was salt peter, as the demand for barood increased in the world. Salt peter, which was produced in India, which was supposed to be the best salt peter in the world, iski demand aana shiroogi. There were two castes which used to make the salt peter, Nonyas and the lovean castes. These castes still make salt peter the same old fashioned way by burning wood and grass. Iska market Bhartarha and the East India Company established considerable domination in this market. The East India Company discovered that Indigo, which was cultivated, there were some Indigo plants in every village. But if you could cultivate it properly and process it properly, there was a huge market in Europe. The Europeans didn't need Indian cloth anymore, but that dirty cloth that the European mills were producing, if you added a little bit of Indigo to it, it became shining white. So there was a great demand for Indigo. So they started producing Indigo in India, asking Indian farmers to produce Indigo for them. That would result in a very complicated relationship between the English and the Indigo farmer in, especially in Eastern India, that is part of what Indian history is. We won't go into that. But the Indigo farmer collapsed when the Aniline dyes were discovered in the 1850s. As soon as Aniline dyes were discovered in the 1850s, one wad of Aniline dye could be equivalent to the entire produce of India for the entire year. And now the world did not need this costly item. The Europeans discovered that the world needed opium. So the East India Company started asking India, virtually every Indian village produced opium, some opium for local consumption. But now they started producing opium on an industrial scale. They opened up new areas, Nimach, Kajoelaka, Malvaka in Madhya Pradesh. That was opened up for opium cultivation. They started experimenting with tea and coffee in India. These were the new drinks that had come in and they needed more supplies. They started experimenting with rubber. They started experimenting with all these things and creating a new kind of economy for themselves, an economy in which they would push Indians to doing things which Indians did not necessarily want to do. One of the areas where Indians started stepping in was the production of cotton textiles and jute. These were the two areas where Indians responded positively. The production of cotton textile was done by the Indian cotton merchants. Bombay was the big port from where all raw cotton was being exported to Europe and the cotton textile trader discovered that it is very easy to convert this cotton into yarn. It takes 5 lakh rupees to invest and you can set up a yarn factory for yourself. So, spinning mills. So, in a little while, they started setting up spinning mills. Soon they discovered that it was possible for them to also have a parallel weaving mill. So, they started creating weaving mills by the 1860s, 1870s. In a span of just about 15-20 years, India was producing as much cotton textile in India as India needed. There was now serious competition that the European merchants who were bringing in cotton would face. The Lancashire and Manchester Mill Owners Association started demanding that some restriction be placed on Indian manufacturers. Abhithak vo ye rag aalapa karte the ki there should be free trade. There should be total freedom to trade for anyone anywhere. Now, as soon as they discovered that the Indian producers were producing more cotton textile, they stepped in and they said, no, no. Countervailing duties should be imposed on Indian goods. Goods produced in India have an unfair advantage over goods produced at Lancashire. What happens for a producer in Lancashire? You first purchase cotton from India. You ship it to Lancashire. You convert it into cloth. You ship the cloth back to Bombay. Then you ship it to the local areas. This is unfair because the Indian merchant, all that he needs to do is purchase cotton locally manufacture cloth locally and sell it locally. So the Indian merchant kupana tax lagna chah ye. And the government of India obliged and said, ha, tax lagna chah ye. The Indian merchants did not think that they should get together and fight the government of India on this. They simply hunkered down and they started complaining about it. They started moaning about it. Why did they not start objecting seriously? Why did the government object? Oh, the government was that of the English. The government of the English would oblige like this again and again and again. Just to help the Lancashire people. The Lancashire people at some point said that the mills of India have an unfair advantage because their labor is very cheap. In India, even after all this is going on, even after the Indian economy is close to collapse, food in India is very cheap. So if food in India is very cheap, it means that the Indian workers wage can be very low. Not only that, because food is very cheap, because the wage is sufficient to bring the worker enough food, there are no strikes in India either. So the English manufacturer says, this is very unfair. You will have to put some restriction on the workers. So the first restriction that is put on workers is, ye bachyoko mil mein kaam karna bandh karo. The typical Indian worker is someone, basically a farmer who has left his fields, come to Bombay or come to Nagpur or come to Ahmedabad for the season. With his wife and child, the children work in the mill, the wife works in the mill and he works in the mill. The English manufacturers say, this is unfair, this should be stopped. So new laws are made to put restrictions on all this. The government eagerly obliges these Europeans saying that here restrictions, bilkul, humanitarian restrictions, they are meant for the benefit of the workers. The moment you start bringing in laws of this variety, the mill owners now want to, now the cost of labor has gone up. So the mill owners start creating exploitative situations for workers. The moment exploitative situations for workers are created, by the 1870s, you have a surge in strikes across the mills. So wo sara labor trouble jo ki abhita kheerop mein hua karta tha, wo labor trouble India mein bhi shuru ho jaata hai. The Indian mills, despite all this, farmers ke apna khech hor ke jaata tha. Farmer apna khech hor ke isli jaata hai because farming in most of these areas, Madhachwara, et cetera, area is a seasonal occupation. It is not a year-long occupation. Most of the fields in India produce just one crop a year.  Whether you're producing rice or whether you're producing wheat, you don't have work for most of the year. And therefore if a jor dhanda is available and a digital job is available in a local mill, which has come up. And what is the work that you're going to do in the mill? You're approximately going to do the same kind of work that you would have done at home. Jo aap ghar pe charkha chala rahe hote, aap usi ke slightly modified form mill mein kaam kar rahe ho. These are not very modern mills, haan pashalo. Paise thot jaada mil jaega.  And one of the big things that would be there for a number of farmers, they would be able to pay their laggan because laggan has to be paid in cash. And the farmer who does not have the facility of coming to Bombay or Kanpur or Ahmedabad, the farmer of the Bundelkhand region, even though Bundelkhand at this time is producing the maximum amount of wheat in the world, the productivity per acre is the maximum. This Bundelkhand farmer is not able to pay the laggan on time every year. And as a consequence, this farmer is, jese aajkal ke aapko dukh bari khania Bundelkhand ke farmer ke sunne ko milti hain. By 1870s, 1880s, ishi tarah ke dukh bari khania Bundelkhand ke farmer ke hame sunne ko milna, shuru ho jaati hain. When it comes to a time when the farmer who has got an option, the Bundelkhand farmer doesn't have an option. When the farmer who has an option is pressed, as happens in the famine of 1875 in the Pune area, the farmers of the Deccan they rebel and this is known as the Deccan rebellion. In this rebellion, they attack the Mahajans, they burn the account books of the Mahajans, it becomes a major war, but the farmers then approach the English government for protection against the money lender. The money lender becomes the sign of their oppression. The English government is not yet the sign of their oppression. I mean, the English government is supposed to be fair and protective. Why don't the Indian traders go out? If you will keep this question pending for the next lecture, because it has to do with how we developed in ancient and medieval times, what were the norms along with the Indian traders were developing? Why did they not want this additional profit? The same logic that works for the farmer, why does the guy come to the city? Same logic will work for the Indian trader, why does he not go and trade this? So that is the logic which takes us into the medieval times and ancient times. Keep that pending, we'll tackle it at greater length next time that we meet. Thing is this, the Indian manufacturer, when we look at the cotton textile industry, we notice that the Indian manufacturer has responded quickly, effectively, and in a manner in which he can effectively challenge the domination of the English in this business. Jute, a new fiber-educated Indian market, we introduce there. Jute has been in use in India often on locally, but by 1850s, they start suggesting that jute can effectively replace hemp, linen, which is in use in Europe as the fiber for packing industrial goods. And they persuade the manufacturers at Dundee in Ireland to use jute, which is coming from India, to experiment making cloth out of jute, making bags, guinea sacks, and such like out of jute, and they discover that it is possible for them to oust hemp altogether. By 1860s, when the hemp producers of America start facing trouble because of the civil war, the Indian jute manufacturers simply start occupying the market 100%. There's a problem with the Indian jute manufacturer, selling his products in Britain. The problem is that the British manufacturer is hesitating in purchasing goods from Indian traders. So they simply hire Englishmen to do the trade for them. India by the 1890s is the monopoly producer of jute packing in the world. It is also being produced in Spain, Russia, a little bit of it is produced in America, but they simply are not able to compete with the kind of goods that are coming from India. The small point is just like the cotton textile trade where Indians found an opportunity for themselves and used it effectively, the same goes in the case of jute. We see the same story in the case of iron. Iron, modern manufacture, the traditional manufacture, which we were so happy about earlier, that ended in 1810, 1811. That ended so much that people forgot about how this iron was made and what this iron was all about. Later on, people would have to do research on the matter. But the modern kind of iron production techniques, the English East India Company experimented with it from the 1820s. One experiment failed. The company put in more money. A second experiment failed. They put in more money. The third experiment failed. And at that point, a fellow who had been trading in textile still now, Jamshedji Tata, comes up and he takes technology from America and he says, British technology won't work in India. You need American technology. And he gets professional surveys, scientific surveys done and finally sets up his iron industry in what today is known as Jamshedpur. The industry is successful. It becomes one of the dominant iron producers in the country. Around the same time, the government of India, despite saying the government should not interfere in markets and not become producers, the government of India itself makes efforts to make iron because the demand for iron in India is tremendous at this time. India is also industrializing. You need a lot of iron for making bridges, roads, railway lines and it's costly to import iron from England. But the investment of the British government by now does not yield results. The one iron company which is yielding results, positive results and making profits is Tata's company. Indians start taking to production in a big way in other areas also. The one area where things start moving is the chemical industry. Chemical industry like the cotton textile industry requires a small amount of capital and the profits are not humongous but they are sufficiently good and nationalism becomes part of the growth of industries in India. Mahatma Gandhi, at the same time, Mahatma Gandhi says that you should take care of the farmer, you should take care of the poor, et cetera. But that is one part of the nationalism story. The bigger part of the nationalism story is the development of industries in India, especially chemical industries. This is Subhash Chandra Cotton Mills Limited which has been set up. They are producing cotton cloth and Rabindranath Tagore is participating in an advertisement campaign saying it's ke kapde ko khain na chahiye. Godrej starts making toilet soaps. Toilet soaps, Rabindranath Tagore comes forward and says Godrej ke toilet soaps, sabse baya toilet soaps hote hain. I use them. They are better toilet soaps than what you can get from England. England se jy soap aata hai, wo laks aata hai or peers soap aata hai. Godrej ka soap is competing against those soaps. W.C. Roy, Dr. W.C. Roy comes up with a medicine. This is the Roya Pilla. Yeah, people from Calcutta tell me that this medicine is still available in the market. It is supposed to cure all sorts of insanities and hysterias and all sorts of mental illnesses. And Guru Deva with the Nath Tagore endorses this medicine also. The heart is broken. Roya Pilla ke goot leke dekhna. Some Indians step into the financial world set up insurance companies, banking companies. Some of the story of banking and insurance is slightly more complicated, so we leave that. But new research is going on and someone discovers that neem extract is very important. Margosa extract is very important for hygiene. So they start making soap out of Margosa. And that soap is still available in the market. Some of you might have used it. If you haven't used this soap till now, please go out and use this soap. Nationalist soap tha nationalist soap hai. Aap me se kuch log jo Eastern India se aate hoge or Northern India se aate hoge yadi kuch jal jaye to aapko boroline istimal karna chahiye. Boroline is also being produced by the national movement. The national movement is not about wearing khadi and doing gharib ka seva. The national movement is about making money, setting up industries and moving forward, making India richer and richer. This is a small set of detail that we need to keep in mind. Those of you who've done economics will look at it more closely. Those of you are not interested in figures of this variety, please take my word for it. When we say that India was at a loss in its terms of trade, et cetera, vis-a-vis the British during colonial times, this is what the trade figures tell you. India is consistently making a profit during its contact with colonialism, trade profits. And the first time India makes serious losses, trade losses is only after independence. So, what happens soon after independence? Why does the figure go to minus 97.6? It was plus 66.1 just before that, that second-last figure over here. So, Chanak, see these are just figures which tell you keep balance of trade, the amount of goods that are being exported and the amount of goods that are being imported, and the price of those, economists, what they say is, if you want to look at the health of an economy, you have to look at these figures, the difference between what is the value of exports and the value of imports, and that relatively gives you how strong any economy would be internally. An economy which is able to export more, remember that Sone Ki Chidiya Wali Shikaya? Sone Ki Chidiya Wali Shikaya, because it was a total export-oriented market, nothing was being imported. Now here, that situation is gone, but still there's a reasonable amount of goods that are being exported. There's a reasonable amount of products that are going out. By 1930, India is not importing European cloth anymore. 1931, 32 major civil disobedience movement, in which Mahatma Gandhi Ji says, that the British should burn their cloths. The British should burn their cloths. Use the food only. Most of the cloths that are being burned that is the cloth produced in India. By the East India Company in India? The East India Company is gone now. By, this is the East India Company goes off at this time. Now the East India Company has been dissolved. It's sorry, it's lost power, and by 1974 it would be dissolved. So, but it is now a new contact that India has with the British Raj. And the British are creating an economy for India. India has already been subjugated. The Indian economy is not a producer economy anymore. The Indian economy is an exporting economy of agricultural variety. It is exporting agricultural raw material. It is exporting raw cotton. Instead of cloth, it is exporting wheat. It is exporting rice. It is exporting coffee and sugar. It is exporting, it is importing coal. It is importing iron. So, it is exporting low value items. It is importing high value items. And yet, the value of exports is slightly more than the value of imports. If India goes to the negative at this time, that is because something that is known as government charges. Private remittances, private individuals who are earning their income in India, the civil service, the army, they are exporting money out. And India doesn't get any benefits in return. So, when you say that India is running at a loss, you are essentially counting those things. But today our objective is not about whether India was at a loss or India was at a profit because of its British connection. Today our objective is talking about the producers of India, the manufacturers of India, how these people are doing, what these people are doing. And our simple point at this point is that the Indian manufacturer, despite all the tremendous opposition that they had to face during British times, they still are able to manage a decentish kind of profit for India. They are able to create new opportunities for themselves. The one thing that they are not able to do however is, they are not able to modernize in a big way. They are not able to modernize in a big way. And that effectively means as soon as independence happens and India and after independence, if the American economy booms, the British economy stops growing, but the Americans start booming. The new kind of production techniques which the Americans bring in, India simply not able to cope with any of that. India is simply out of sync on that. And that requires a new way of thinking, a new way of organizing your own society. And instead, India gets caught in some kind of a problem. I can only speculate what happens. One part of the speculation could be that India as a consequence of partition, India became extremely depressed. A country which had been doing reasonably well for itself, even under colonial domination. The experience of that peculiar partition creates negativities within the country. And the country does not know how to cope with these negativities. We have the small example of Punjab, where you have a rehabilitation minister called Pratap Singh Khairon, who steps in and he says, I don't care what your personal problems are. Punjab may a significant body of population is refugees. And he says, I don't care what your personal problems are. From tomorrow on, you will have to work.  Now you are in Karnal and in Karnal you will have to learn how to live in a hut.  There's no shop for you in Karnal, but there's a road being constructed. Please go to the roadside, become a Majdur over there and some money. When you come back in the evening, you will get your food only if you have got money with you. The government is not going to feed you for free. The government of Punjab puts pressures of this variety on the people and surprisingly in five years, there are no refugees in India, sorry, in Punjab. In contrast in Bengal, in Bengal the refugees come and the whole society is looking after the troubles of the refugees. You know, you have to give them some kind of closure. You know, you have to look after them.  You know what happened to their women. You know what happened to their children. You know what happened to their property.  By 1980s, we still see Bengali refugees in India who have not grown any further than what they were in 1947. Punjab has grown out of that. My small suspicion is that Punjab, Bengal to their extreme cases, but the rest of the country also suffered from some negativities as a consequence of the partition. And the people of India, the politicians of India did not recognize that there was a serious psychological problem over there. So that psychological problem needed different strategies to overcome them and make people set up and start working. That was one opportunity we perhaps lost out. So how that could be done, that is something for us to figure out. Aaj ki parasiti, of course, badal gayi hai. People are in upswing. The mood is very positive. So let's keep our fingers crossed and see how things work. So for today, that is what it could be. Yes, please. In that, it was written that when Vasudeva Mahadeva came by the sea route to South Africa, so from South Africa, he killed South Africa, he could reach. But from there to India, there was a push which exported him by a Ujjara people called Khaan. And that time itself, that Ujjara people had so much business with South Africa and the ships what he had, he had two bigger ships which were almost 40 times what Vasudeva Mahadeva was. And he was exported to a place in India. To ask the ship building industry in India at that time, much bigger than European companies. Two bits, thank you. One is that the general question is that the general comment is that when Vasco Degama comes to India, Vasco Degama himself writes that as he crosses the Cape of Good Hope, he's escorted by Kana, Kana Bhai, he's escorted him. He's an Indian merchant who's trading with Africa. Who's got his ships? The ships of the Indian merchant is much larger. I'll tell you the sizes. Vasco Degama's ship is 35 feet long. Your elephant boat is the ship of Vasco Degama. The Indian ship is 300 feet long. Your medium-sized ship was the size of a proper modern ship. The question of course is, was Indian ship building very big? Yes, Indian ship building was very big. Along with Indian ship building, there was Chinese ship building which was very big. The Indian technology for ship building was completely different from the European technology for ship building. Indian ships did not use Kila. Indian ships used lashings. Kila jabap lagatio, lakri ka keela lagatio wo sard jata hai, loe ka keela lagatio wo sard jata hai. Jab aap lashing karteo to ap kya karteo? Aap lakri ko leke jord deteo. Aar usko jord de ke baada aap usko rassi se kashke baam deteo. Chai aap san ki rassi lo, chai aap jood ki rassi lo, chai aap narial ki rassi lo, whatever is available locally. You tie it very tight.  As the wood expands, the contact between the boards becomes tighter and tighter. The rope shrinks. And as the rope shrinks, it pulls everything tighter. This boat does not leak. In contrast, the boat which the Europeans were making, you cut strips, you hammer the strips onto the infrastructure, and you use nails to do it. This would leave gaps between the boards. Now these gaps would have to be filled with coal tar, rassi ko coal tar mila hai. Jax pero wali stories padhi hai na, dekhi hai na filme. To lag bag us tar hai ka, waha pe situation hua karta tha. The big East India man, the big trading ship was manufactured in India. It was not being manufactured in London. It would be manufactured in India, and then it would be taken there. The Indian ship rights would be doing all this. It was only in the mid 19th century when the Industrial Revolution grew much more beyond everyone's imagination that it became possible for people to make better ships in Europe. Indian ship rights were good. The question of course is, if you were so good, if you had so much product to offer, why did you not occupy the market? Why did you just back off and you say, it really doesn't matter? Now that is something which is a matter of wonderment. Historians have looked at that question, but have seldom come up with an answer. We have speculations. We can at the moment speculate. There's a small problem with the subject of history in India. History is taken by students who know nothing about anything else in the world. Because they know nothing about the world, so the questions that they ask are also very limited kind of questions. It would be good if people who have not done history join the history subject. Research in history doesn't require very technical skills. I mean, you just need to know a little bit of scientific analysis, logic, and you are good as a historian, and you should be able to tell a story well. Why did these merchants not expand? Why did those shipwrights not manufacture ships which were dominating the world? About the Chinese, we are told. The Chinese general took his ship from the coast of China to the coast of South Africa, and then he was called back because the Chinese emperor thought that if you expand like this, there will be some admirals, some generals who will grow too powerful to control. And therefore, he had the entire ship demolished, sorry, the entire fleet demolished. China shall not expand on to the seas. Now, that was not the question for India at all ever. The Indian king never felt threatened by the sea trade. In fact, the sea trade was a very positive trade for South India, where the Cholas took their ships to Southeast Asia. They took their ships to Israel. They took their ships to South Africa. They took their ships to Madagascar. So, why did they not expand any further? This is a question which bothers me and I would like to explore it at some length the next time that we meet. The one more thing that you need to keep in mind is this. That Indians are not being hemmed in by the caste system. Many people have told us that the caste system debarred Indians from business, debarred Indians from production, debarred Indians from XYZ. All my knowledge says that the Indian caste system did not do any of these things. The caste system existed. The caste system made a distinction between people. The caste system was inhuman. The caste system created hierarchies of a very negative sort. But did the caste system debar people? Answer, my tentative answer is, you'll have to give me some examples that it did debar people. What happens with the caste system and how people produce in the caste system? We'll talk about that also in some detail the next time that we meet. We had communications. Why did India itself organize at the right time? And that you asked this question. The question is, why did the Indian manufacturers not modernize? What were the Indian manufacturers doing when the rest of the world was modernizing and becoming so much more efficient? It connects with that earlier question about, how can you have a state which is so inefficient? The answer is, no, it was not efficient enough to make the state collapse. Yeti, Mereko, whatever level of inefficiency with which I am working, I'm still generating enough profits. It will be very difficult for you to convince me that what I'm doing is wrong and I should improve myself. And the ambassador story is that. The car which you haven't seen, the car in which you have never traveled and hopefully will not be able to travel at all because the ambassador now is gone. The ambassador car comes in and the Hindustan Motors, the big nationalist producer of India, the big nationalist industrialist of India, the fellow whose family is part of the national movement in a big way, they become the producers of the ambassador motor car. And the government of India at one point sits down and does a calculation. And it says India has a demand for 500 cars. This is around 1958, 59. Around 500 cars is the demand for cars in India. And therefore, no one should be allowed to produce more cars. Ambassador is already producing 200 cars. Fiat Archuca, Fiat Standard and Fiat Company, they are saying that we will also produce. So they disallow anyone else from investing in car manufacture. The ambassador car is one of the clunkiest cars that ever is produced in the world.  And yet it continues in India till the 1980s, 1990s. In the 1990s, finally the ambassador motor market ends in Maruti 800. Maruti 800 becomes popular. People start insisting, bade sahab start insisting yam bhi chhotisi maruti mein chale chahenge par ambassador mein hum nahi batheenge. People start investing 2 lakh rupees to purchase a maruti rather than 1.5 lakh rupees to purchase an ambassador. And it takes a while even after that for the people of India to stop purchasing the ambassador motor car. The ambassador company doesn't learn even then. Finally, when the ambassador companies wound up 2007 or their abouts, they still insist that they had a good product in hand. It's an absolutely amazing thing. A guy who was producing enough profit, it was enough profit for the family, it was enough profit for the 500 and odd workers that were employed over there. There is this factory in Calcutta. They were quite happy with that. At some point perhaps people need a boot on their backsides. That boot on the backside never happened in India. What did the traditional producer do? All this English East India company coming in, foreign cloth coming in, more efficient cloth coming in, cheaper cloth coming in, et cetera, et cetera. Excuse me. What fiction is this? The Indian women would not touch a cloth that has been produced in Ambil. Indian women are some of the most choosy women of the world. They will sit down and they will look at saris and dhoti's for two hours. And imagine, is dhoti's design 100% unique or not? Dabhi aap Calcutta chale jao, Kanpur chale jao, Dillipurani Dilli chale jao, to aap ko yeh experience milega. Maharashtra meh experience nahi hota. They will sit down for two hours trying to figure out ki meri dhoti unique honi chahiye. Now a machine made dhoti is not going to be unique. So they don't buy the machine made dhoti. They only buy handmade dhoti's and the handmade dhoti manufacturer survives. He thrives. In fact there was a Marxist historian called Amir Bakshi. Amir Bakshi was working as a PhD student on private investment in India. And he's basically Marxist, the big Marxist story is that the English came to India, capitalism exploited India, capitalism destroyed India, producers, et cetera, et cetera. Amir Bakshi starts his thesis, that's his book is his thesis. He starts his thesis by saying, while the European capital and European manufacturers came to India, they did not destroy anything in India. That is the first chapter of his book. And when the book was written, Indian historians were aghast, ek to bandha Marxist, uske baad hui yeh kaha hai ki Indian manufacturers go kuch nahi wa. Second thing that you need, you need in order to, for the foreign goods to come and compete in India, you need access to the Indian market. These guys don't have access to the Indian market. The Indian market is huge and the roads are few. So most of the places, most of the time, it is only a local manufacturer who will be able to give you goods. We, as late as the 1980s, we had come across towns and villages where the only iron that you could procure was the iron made by that fellow by hand. The only way you could make your iron rim for your Belgadi was by asking a local lohaar to hammer a rim for you. To wa aap uske liye lohe ka tokada leke jaate the, wa us lohe ke tokade se koot koot ke rim banake aapki Belgadi me lagaya kartata. That was great modernization of those times. As late as the 1970s, 1980s, ye hamne khod apni aapko se dekhawa hai, we have lived through that. I come from Madhya Pradesh, Bundelkant, reasonably backward area where modernity hit us only in the last 10, 15 years, not before that. The third thing that you need, the first thing was taste, consumer taste. The second thing is the market. The third thing is the variety of demand that comes from India.  Even the lota, if you check out your Google searches on lotas from Purana Times, the lota had a lot of designs on it. And each of these designs has to be unique. Me apne parivaar me wo lota nahi rakhne wala jat tumare parivaar me main dekhawa hai. Tumara lota achha hai. Ma uski baat nahi kar raha hai. Ma apni liye aakse lota banau gana. Mera lota banane ke liye bande ko ek special lota banake mujko de na padeega.  So that Banda doesn't need to sell me a second lota. But then he'll sell it to my children, my grandchildren, or to a new family which has come and settled over there. Also remember, the Indian market is ever expanding. By 1911, India has the largest population growth in the world. New consumers are being added to the market on a daily basis. And each of them has sufficient money to buy these things. We are not rich. We can't compete with the kind of consumption that is happening in America and Britain. As a student, I could not afford a pair of jeans because a pair of jeans cost 1500 rupees. 1500 rupees was what was the price for the entire B.S.C. course in Sagar University. I mean, So only the very rich would be wearing these jeans. And to fight for the jeans? Oh, what are you talking about? The jeans are something to run on a daily basis. So this is how life would be. So we did not have money of that variety, but we had enough of the local things going that the local producers really didn't need to change. They could continue with them. In fact, I would, tomorrow I have a small video that I have found on YouTube. I would like to bring that video to show how saints are being extracted in India in the 1950s and the 1960s and now. And they're using the same process, the same technique that was in use in the time of Gautam Buddha. The same technology is being used. The same equipment is being used. How do we recognize? You must have read stories about people finding Harappan things in Haryana all the time. So how does this farmer know these Yogusne kheet mekhoda ye Harappan artifact there? He knows it because he's using the same artifact today. It's manufactured the same way. It looks the same thing. He knows everything about it. All that is changed is the small design that is on it. The design is old, so he recognizes it as an old thing and he reports it to the government of India saying ke mujhe parane samay ke cheeji mili hui hai. That is the diversity of the market. This diversity of the market was experienced in 2008. When the downturn hit the Indian economy, the Indian economy ko bhi thoda sa asar hua tha. Even at that time, most of the small towns and villages of UP, Bihar were not harmed. Baharashtra mein uska bahuta asar hota hai kyunki Maharashtra is very well connected with the world market. Madhya Pradesh ke kuchi lakko mein asar hota hai. Andhra mein nahi hota hai, Karnataka mein nahi hota hai, Tamil Nadu mein hota hai, Kerala mein bahut jada hota hai. UP aur Bihar mein toh bo bhi nahi hota hai. World market kahi bhi chala jaai, jo local producer aur local manufacturer hota hai, wo wahi ka wahi bata raita hai. He's not producing dramatic profits for himself, but he's producing enough for himself and the rest of the society. Can we keep that pending with that other question? Because that requires a big answer and we will need to go into geography a little bit. And I'm glad that you mentioned this because then we can start off the next time that we meet, we can start off by talking about what was India. Because when we're talking about India, India, India, you connected with the first things that I was talking the last time. In fact, when I was talking to Professor Kavi Arya long ago on what kind of lectures these should be, I said that the first thing we should be talking about is Kanhaiya and his Azadhi.  Toh ye jo, jab wo Azadhi ki baate krte toh wo bahar baat, thoda questioni ke baat nikal kyaata ki they all say, India toh exists nahi krta. So what is this India jo exists nahi krta because everyone is very different and how this India exists nahi krta ke baad bhi India exists krta tha. So what is this structure? This actually is connected with the diversity of the economy, the diversity of the people and there is some unity. It is definitely not a cultural unity. So what is that unity? We shall talk about that the next time that we meet. The problem is the textile mills started collapsing a little bit, you see somewhere in the 1950s, 60s, the time when the government of India was saying that India only needs 500 motor cars. The government of India also sat down and the planning commission made detailed calculations. I don't know what was the basis of their calculations but some of my teachers were part of the planning commission of those times and they always said ki tumhe kabhi batayin ke ki kyaa hum krte tha, par aaj nahi batata hain. Uske baat toh nahi kabhi bataya nahi, hum bhi bool gaye, hum bude ho gaye, wo chal bashe. Toh mamla rahe gya. But they all, because now we have documentation, the documentation definitely tells us that there was something which was very wrong in the manner in which the people, the planners of India distrusted the market and distrusted the people of India in the decision making capabilities. The people do not have the capacity to make rational, reasonable, market oriented decisions. So part of that was, embajde company to ek thi, uska dosra issa jo tha wo ye tha ki they would not allow modernization of the production processes. The idea was that if you modernize production processes, there's going to be a loss of jobs. This thing that if you modernize, it's going to create more jobs, maybe in a newer field, maybe in the same field, this idea had yet not sunk into the Indian mind. So they disallowed that. As they disallowed that, there was a demand because prices were rising. There was a demand from the side of the workers to increase the wages. Demand for higher wages meant that there's going to be a strike, there's going to be some kind of workers action in the mills and the mills are concentrated in Bombay, Ahmedabad, Kanpur and Nagpur. So it's easy for these workers to strike. Also the idea on how to conduct a strike, how to organize a strike that has come into existence, people know how to do it very efficiently and effectively. At the same time, the organized trade union movement knows that you cannot do these strikes because there is something unfair about such a strike. There's something unfair about the manner in which the mill has not been allowed to modernize. There is something unfair about, there's something unfair about everything. And the one thing that cannot be done in order to sort out the unfairness is to go on a strike. So the CPI, the CPM, the Congress, the Shiv Sena, the BJP, they simply would not participate in strikes on these matters. There would be other Chota Chota strikes, but nothing big. Around this time, there was a trade union leader, a new trade union leader came into the scene. This was a person called Dutta Samant. He was a doctor. Dr. Dutta Samant, who operated in the Vile Parle area and looked after the mill workers, he was genuinely upset with the manner in which the trade union leaders had abandoned the mill workers. And his contention was that you cannot sacrifice the interests of the mill workers at the altar of capitalism, at the altar of profit, and at the altar of making the mill function. So there came a time when Dr. Dutta Samant on a small issue, he started a strike. This small strike quickly spread across the mills of Bombay and all the mills were shut down. These mills had already not modernized. The government had said modernization. We won't let them do it. So mill owners, the Dire Dire says, capital siphoned off and started putting it in other businesses. And around this time, when the strike started, unlike what would have happened in earlier occasions when black leg workers would be asked to join and make the mill run, unlike last occasions when the police would step in and crush the strike and make the mill run once again, during the Dutta Samant struggle, no one did anything. The strike was a very successful strike. The strike lasted, I think, about two years. And as the strike lasted, the mills of Bombay they simply rusted away. In Bombay, you cannot leave iron. You know, Akbar ka jow bakhtar tha, wothut tayaar hai, par jow milki machine ho katam ho jaati hai. So when the strike was finally broken, it was withdrawn by the Dutta Samant. You went and opened your mill, you discovered that there was just a lot of rusting machinery all around. The mill owner said, this can't work. Then came a new system of how to make the mill owner, how to give some money to the workers. In the meanwhile, workers who had been out of job for two years, they had started other jodh dhandar, they had started other businesses. They lived in the same chal of the mill, but now they've had a komcha, they had started a small shop of their own. Some of them had returned to their villages. Remember these were originally village workers, farmers, small farmers would come to Bombay to start working in labor, is labor in the mills. All these people, they've moved away like that. And by 1982, there were no Bombay textile mills anymore. Textile mills had just vanished from Bombay. Today you go across Bombay and you'll discover these huge plots of mills just lying there. Some of them have been converted into modern office and housing complexes. The most successful strike in India resulted in the collapse of the most important industry in India. The result of that collapse was that a new manufacturer emerged, something known as Vimal. Reliance industries came up. Reliance industries set up their Patal Ganga plant and they grew dramatically. That story is a different story altogether. What I've been working on about this is inspiring stories. Inspiring stories for us. I don't know where we are going to resonate with each of these things that we talk about. But it's nice to know that sometime in the past there were things like Ujrati merchants who accompanied Pasco Dagama here, who had been shipped 10 times this week. When we go and see our national monuments, we see some amazing feats like the Sanctuary of Konara. How is that big, not the San temple, but the Tanjore temple? The 80 tons, the huge stone on it, the Brideshwara temple. To the west for inspiration and all the great things are happening there and there and there and so on. So I find it very inspiring to look at these kind of stories as to what is our true identity, right? Which now can perhaps blossom, given a totally new environment, given a totally new set of circumstances, where we might be able to do something really impressive. And we are seeing signs of this in places like what's happening in Isiru for instance. That's another story. And what's happening in various parts of the economy, the IT industry has come up for instance. So I like the way that his story kind of gives us a context that we can draw from in our own life and future. And it becomes more and more interesting as we go along. Do you agree? Okay, so next time it will be a little more science or... A little bit of history of mathematics, metallurgy, medicine, thrown in and a little bit of trade at industry. Yeah. These are the questions which give me ideas to what I should be talking about the next time that we meet. Thank you so much. Thank you very much.


Hello. Welcome to the session on LRU and optimal page replacement policies. Here LRU stands for least recently used. My name is Zayanan Patil, working as assistant professor in computer science and engineering department, Balchan Institute of Technology, Solaapur. At the end of this session, students will be able to explain LRU and optimal block replacement policies and solve the problems and calculate heat ratio for these methods. So before coming to LRU, in the previous video lecture, we were discussed the first in first out method. In that method, the block which was replaced first into the cache memory that was replaced to that was deleted to replace the new block in a main memory. But in this method, this policy selects for replacement of block that was least recently accessed by processor. That is, the blocks which are existed in the cache, among them the block which was least recently accessed by the processor that is deleted and replaced the new block. And in this policy, it is assumed that the block which was least recently accessed by the processor is not referenced in the future. Based on that assumption, this policy is implemented to increase the heat ratio. In this LRU implementation that each block in the cache memory is associated with an counter called as age register, which indicating the block which is least recently accessed by the processor. This is the example considering a paging system in which M1 has a capacity of 3 pages. That is M1 refers to the cache memory which sizes 3 pages and that executing application require the 5 distinct pages 1, 2, 3, 4 and 5. These pages are accessed in different stream. So, this is the stream required to execute the application and the answer is, so this is the status of the cache memory at different stages. Initially, the block 2 needs to be transferred from main memory to the cache memory. So, first 2 there is all blocks are empty. So, 2 will be placed here. Next 3 need to be accessed. So, 3 is not existed in the cache memory and the next block is free. So, 3 is placed here. Next 2 need to be accessed. 2 is already existed in the cache. So, no need to access the 2. So, cache heat occurs and 3 is marked with a star indicating that the 3 is least recently used. And 1 need to be accessed. So, 1 is not existed in the cache and there is a empty block. So, 1 is placed here. And next 5 need to be accessed. So, first we will check for the 5 is existed or not. No. And it need to be replaced anyone of these blocks because the cache memory is full here. So, that 5 is replaced with the least recently used block that is 3. So, now this is the status and the 2 is marked with a star indicating the least recently used block. And 2 needs to be accessed. So, 2 is already existed in the cache. So, the cache heat occurs and the 1 is marked as the least recently used. And 4 need to be accessed. The 4 is not existed in the cache. 4 is replaced with the 1. And 5 need to be accessed. So, 5 is already existed in the cache. So, no need to access the cache heat occurs and the least recently used is marked with a star. Next the block 3 needs to be accessed. So, 3 is not existed. So, it is replaced by 2 and 4 is marked as least recently used. And next 2 needs to be accessed. So, 2 is not existed. So, it is replaced by 4 and the 5 is marked as the least recently used. And 5 need to be accessed. So, 5 is already existed in the cache. So, cache heat occurs and next 2 need to be accessed. So, 2 is already existed in the cache. The cache heat occurs. So, after end of this process we will calculate the heat ratio that is total number of heat occurs that is 5 divided by total number of access. The heat ratio is 0.416. Next is the optimal replacement policy. So, this policy selects for the replacement of block which would not be used for the longest duration of time in the future. So, in this method it is assumed that. So, if we use the block which is if we delete the block which is not used for longest duration in the future then that will improve the heat ratio based upon that assumption this is implemented. Now, this is time to reflect. So, repeat the previous example for optimal replacement policy that is previous example is this one is the previous example. So, same example we are considering for the optimal replacement policy here. So, now we are familiar with how to perform that replacement policy, but in the optimal replacement policy based upon the point mentioned in the optimal replacement policy we are considering and performing the replacement process. Now, pause the video and perform the replacement method. Answer is so here. So, again for that example this is the blocks accessed in this stream. Initially that cache memory will be empty here we are not indicating any of these blocks with the star because we do not know which block needs to be deleted because if we need to replace any block we are observing the future list based upon the future list we are deleting. So, we are not indicating in advance any of the block to be deleted. So, first two need to be accessed. So, it is placed in the first block next three needs to be accessed it is placed in the second block next two. So, two is already existed. So, cache hit occurs here next one need to be accessed. So, it is empty block and one is not existed in the cache. So, one is replaced here and next the five need to be accessed five need to be accessed. So, we are observing two three one in the future list. So, that two three one two is here three is here. So, one is not present here. So, one is replaced with five and next the two need to be accessed two is already existed. So, that the cache hit occurs here. So, that two three five the cache hit occurs next four need to be replaced the four is observed in this cache memory four is not present in this memory. So, that four need to be accessed and it should be replaced. So, we are observing two three five in the future list which is not used in the longer duration that is deleted. So, two three five. So, five is required here three is required and two is required here. So, before two five and three is required. So, two is replaced and four that in place of two the block four is replaced and next five need to be accessed. So, that five is already existed in this cache memory. So, five is replaced no need to access the five and the cache hit occurs and next the block three needs to be replaced. So, that three is already existed in the cache memory the cache hit occurs next two need to be accessed. So, if the two need to access we need to replace any one of these block because the two is not existed in the cache memory. So, at this time so, we are observing four three five in the future list we will observe four three five. So, five is required and four and three is not required. So, while replacing two we are going to replace instead of any one of these blocks. So, that is four is not required. So, four the two is replaced with the first block that is four is not required and five is required. So, we cannot and instead of three and four anyone can use. So, first block four is used here and next five need to be accessed. So, five is already existed in the cache. So, that is why the five is that cache hit occurs and next two need to be accessed. So, two is already existed in the cache. So, that cache hit occurs. So, at the end of this process again we are calculating the heat ratio. So, that is again the heat ratio equals to that number of hits divided by the total number of access. So, the heat ratio equal to six divided by twelve here six is the number of hits. So, that is total number of hits is six and divided by the total number of access. The total number of access is twelve. So, six divided by twelve is 0.5. So, now if we compare the first in first out method and the least recent use method and the optimal replacement policies we are getting the more heat ratio. So, that is that heat ratio is increased in this method that is 0.5. In the previous method it was less than 0.5. So, according to this problem that we conclude that that optimal replacement policies will give that increased heat ratio compared to the previous two methods. So, these are the references I have used. Thank you.