The Making of a Global World
The Making of a Global World Summary
The NCERT Class 9 India and the Contemporary World – II Chapter 3 talks about the following topics:
- The Pre-modern World
1.1 Silk Routes Link the World
1.2 Food Travels: Spaghetti and Potato
1.3 Conquest, Disease and Trade
- The Nineteenth Century (1815 – 1914)
2.1 A World Economy Takes Shape
2.2 Role of Technology
2.3 Late nineteenth-century Colonialism
2.4 Rinderpest, or the Cattle Plague
2.4 Indentured Labour Migration from India
2.5 Indian Entrepreneurs Abroad
2.6 Indian Trade, Colonialism and the Global System
- The Inter-war Economy
3.1 Wartime Transformations
3.2 Post-war Recovery
3.3 Rise of Mass Production and Consumption
3.4 The Great Depression
3.5 India and the Great Depression
- Rebuilding a World Economy: The Post -war Era
4.1 Post-war Settlement and Bretton Woods Institution
4.2 The Early Post-war Years
4.3 Decolonisation and independence
4.4 End of Bretton Woods and the Beginning of Globalisation
Indentured labour
A bonded labourer under contract to work for an employer for a specific amount to work for an employer for a specific amount of time to pay off his passage to a new country or home.
Tariff
Tax imposed on a country’s imports from the rest of the world. Tariff are levied at the point of entry i.e. the border or the airport.
Corn Laws
The laws allowing the British Govt. to restrict the import of corn were popularly known as the Corn Laws.
Assembly line production
The assembly line is a manufacturing process in sequential manner to add to a product in sequential manner to create a finished product.
*Globalisation is an economic system associated with the free movement of goods, technology, ideas and people across the globe.
Section I: Pre Modern World
Silk Routes
• There are several silk routes, over land and by sea, knitting together vast regions of Asia, and linking Asia with Europe and northern Africa.
→ Famous Chinese silk cargoes used to travel through these routes.
Food Travels: Spaghetti and Potato
• Noodles travelled west from China to become spaghetti.
• Common foods such as potatoes, soya, groundnuts, maize, tomatoes, chillies, sweet potatoes were only introduced in Europe and Asia after Christopher Columbus discovered Americas.
Conquest, Disease and Trade
• Precious metals from mines of Peru and Mexico enhanced European trade with Asia.
• The Spanish conquerors used the germs of smallpox in the conquest of America.
• Until well into the eighteenth century, China and India were among the world’s richest countries.
• Until the nineteenth century, poverty and hunger were common in Europe.
Section II: The Nineteenth Century (1815-1914)
• In the late eighteenth century, growth in the population increased the demand for food grains in Britain.
• The imported food into Britain more cheaply than it could be produced within the country.
• Industrial growth took place in Britain which led to higher incomes meaning more food imports.
• It was transported by railway and by ships.
• Food is only an example. Products such as cotton, rubber, coal also had same fate.
Role of Technology
• The railways, steamships, the telegraph were important inventions that transformed nineteenth-century world.
• After the introduction of new technology, namely, refrigerated ships animals were slaughtered for food at the starting point and then transported to Europe as frozen meat.
Late nineteenth-century Colonialism
• European conquests of Asia and Africa as colonies.
• Belgium and Germany became new colonial powers.
• The US became a colonial power in the late 1890s by taking over some colonies earlier held by Spain.
Rinderpest, or the Cattle Plague
• Rinderpest is a fast spreading cattle plague which hit Africa in the late 1880s.
• It was carried by infected cattle imported from British Asia and destroyed 90 percent of the livestock.
• The colonial governments now strengthen their power and to force Africans into the labour market.
Indentured Labour Migration from India
• Indentured Labour was a bonded labourer under contract to work for an employer.
• In the nineteenth century, thousands of Indian and Chinese labourers went to work on plantations, in mines, and in road and railway construction projects around the world.
• Recruitment was done by agents by providing false information about the work and location.
• On arrival at the plantations, labourers found living and working conditions harsh.
• It was abolished in 1921.
Indian Entrepreneurs Abroad
• Indian entrepreneurs, some bankers like Nattukottai and Chettiars financed export of agriculture to Central and South-East Asia.
→ They even followed the Europeans to Africa.
• Industrial Revolution in England changed the balance of trade between England and India.
• Indian handicraft and agriculture were destroyed and Britain enjoyed a trade surplus with
India.
→ Their exports increased and imports decreased.
Section III: The Inter-war Economy
• The First World war was the first modern industrial war.
• During the war, industries were restructured to produce war-related goods.
• The war transformed the US from being an international debtor to an international creditor.
Post-war Recovery
• After the war was over, the production reduced and unemployment increased.
Rise of Mass Production and Consumption
• In the US, war recovery was quicker.
• ‘Assembly line’ method introduced by Henry Ford soon spread to the US and were also widely copied in Europe in the 1920s.
• Mass production lowered the costs and prices of engineered goods.
• There was a housing and consumer boom in the 1920s, which ultimately led to the Great Depression of 1929.
• Markets crashed in 1929 and led to the failure of banks and the crisis affected other countries.
→ By 1933, over 4000 banks closed and between 1929-32 about 110,000 companies collapsed.
India and the Great Depression
• India was also affected by the Great Depression.
• Indian exports and imports declined extensively, prices fell.
• Bengal jute growers suffered the most.
• Large scale migration took place from villages to towns and cities.
Section IV: Rebuilding a World Economy: The Post-war Era
• The Second World War broke out a mere two decades after the end of the First World War and once again, it led to destruction.
• After the USA and the USSR emerged as superpowers.
Post-war Settlement and the Bretton Woods Institutions
• To ensure a stable economy a framework was agreed upon at the United Nations Monetary and Financial Conference held at Bretton Woods in New Hampshire, USA.
• It established the International Monetary Fund (IMF) and the World Bank.
• The International Monetary Fund (IMF) to deal with external surpluses and deficits 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.
• The IMF and the World Bank commenced financial operations in 1947.
• Bretton Woods System was based on a fixed exchange rate.
• National currencies were pegged to the American dollar at a fixed rate.
• Decision-making in these institutions is controlled by the Western industrial powers largely by the US.
Decolonisation and Independence
Many countries in Asia and Africa became independent nations, supported by UNO and NAM.
• Group of 77 or G-77 was organised by developing countries to demand a new international economic order (NIEO) which would give these countries real control over their national resources, raw materials, manufactured goods in their markets.
• MNCs or multinational companies were established in the 1950s and 1960s and operated in several countries.
MCQ
Question 1:
What was the Bretton wood system?
(a) Post war the military system
(b) Post war political system
(c) Post war international economic system
(d) None of these
Question 2:
What did indentured labour mean?
(a) Cheap Labour (b) Free Labour
(c) Bonded Labour (d) None of these
Question 3:
What were ‘Canal Colonies’?
(a) Large Colonies (b) Sea Ports
(c) Large Canals (d) Irrigated areas
Question 4:
Which food traveled west from china to be called “Spaghetti’?
(a) Soya (b) Groundnuts
(c) Potato (d) Noodles
Question 5:
Which disease spread like wild fire in Africa in the 1890’s?
(a) Cattle plague (b) Small pox
(c) Pneumonia (d) None of these
Question 6:
Which was the Tabled city of gold?
(a) Peru (b) Mexico
(c) El Doeodo (d) Spain
Question 7:
Who adopted the concept of assembly line to produce automobiles?
(a) Samuel Morse (b) Henry Ford
(c) T. Cuppla (d) Imam Husain
Question 8:
The Descendants of indentures workers is a Noble Prize winning writer is-
(a) Bob Morley (b) V. S. Naipaul
(c) Amartya Sen (d) Ram Naresh Sarwan
Question 9:
The great Depression begin in
(a) 1927 (b) 1928
(c) 1929 (d) 1930
Question 10:
The Chutney music popular in-
(a) North America (b) South America
(c) Japan (d) China
Question 11:
Rinderpest is a?
(a) Cattle disease in Africa (b) Cattle disease in China
(c) Cattle disease in India (d) Cattle disease in Russia
Question 12:
Which of the following is not a economic exchange?
(a) Flow of Labour (b) Flow of Capital
(c) Flow of Knowledge (d) Flow of Trade
Answers: 1. ( c ) 2. ( c ) 3. ( d ) 4. ( d ) 5. ( a )
6. ( c ) 7. ( b ) 8. ( b ) 9. ( c ) 10. ( b )
11.( a ) 12.( c )
Question :
What was the importance of the Indian trade for the British?
Answer :
Trade Surplus – Britain had a Trade Surplus with Indian. Britain used this Surplus to balance its trade deficit with other countries.
Home Charges – Britain’s trade Surplus in India also helped to pay the so called home charges that included private remittance home by British officials and traders, interest payments on India’s external debt and pensions of British officials in India.
Major Supplier of cotton – India remained a major supplier of raw cotton to British which was required to feed the cotton textile industry of Britain.
Supplier if indenture workers – Many indenture workers from Bihar, U.P., central India migrated to other countries to work in mines and plantations.
Question :
How Bretton Woods System Worked?
Answer :
The international monetary system is the system linking national currencies and monetary system.
The Briton woods system was based on fixed exchange rates. In this system the national currencies were pegged to the dollar at a fixed exchange rate.
The Bretton woods system inaugurated an era of unprecedented growth of trade and incomes for the western industrial nations.
Question :
What were the effects of the British Government’s decision to abolish the Corn Laws?
Answer :
Food could be imported into Britain more cheaply than it would be produced within the country.
British agriculture was unable to compete with imports. Vast Areas of land were left uncultivated and people started migrating to cities or other countries.
As food prices fell, consumption in Britain rose. Faster industrial growth in Britain also led to higher incomes and therefore more food imports.
Around the world in Eastern Europe, Russia, America and Australia land were cleared and food production expanded to meet the British demand.
Question :
What were the advantages of invention of refrigerated ship?
Answer :
This reduced the shipping costs and lowered meat prices in Europe.
The poor in Europe could now consume a more varied diet.
To the earlier, monotony of Bread and Potatoes many, not all could add meat, butter or egg.
Better living conditions promoted social peace within the country and support for imperialism abroad.
Question :
Explain the impacts of the First World War?
Answer :
It was the first modern industrial was which involved industrial nations.
Machine guns, tanks, aircraft, chemical weapons etc., are used on a massive scale.
Unthinkable death and destruction.
Most of the people killed and injured were man of working age.
Declined the household income.
Men were forced to join in the war.
Women slapped into undertake jobs which they were not used to.
Question :
What were the effects of the great Depression on the Indian economy?
Answer :
The economy depression immediately affected Indian Trade, as India’s exports and imports nearly halved between 1928 – 1934.
Agriculture prices fell sharply, but the colonial government refused to reduce revenues. Peasants producing for the world markets were worst hit.
Raw jute was produced, processed in the industries to make gunny bags. Its exports collapsed and prices fell by 60% peasants of Bengal fell into debt traps.
Peasants used up their savings mortgaged lands and sold their precious jewelry to meet their expanses.
Question :
19th century indenture has been described as a ‘New system of slavery’. Explain.
Answer :
In the 19th century, hundreds of thousands of Indians and Chinese laborers went to work on plantations in mines and in mines and in road and railways construction projects around the world.
In India, indentures laborers were hired under contracts which promises return travel to India after they had worked for five years on plantations.
Gradually in India cottage industries declined, land rents rose, land were cleared for mines and plantations. All this affected the lines of the poor. They failed to pay their rents become indebted, and were forced to migrate in search of work.
The main destinations of Indian indentured migrants were the Caribbean islands, Trinidad, Guyana, Surinam, Mauritius, Fiji and Ceylon and Malaya.
Recruitment was done by agent engaged by employers and paid small commission.
Question :
“One important feature of the US economy in the 1920’s was mass production.”
Explain.
Answer :
A well-known pioneer of mass production was the car manufacturer, ‘Henry Ford’.
He adopted an assembly line technique of a slaughter house.
He realized that the ‘Assembly line’ method would allow a faster and cheaper way of producing vehicles.
This method forced workers to repeat a single task mechanically and continuously
This was a way of increasing output per worker by speeding up the pace of work.
This doubling go daily wages was considered ‘best cost – cutting decision’ he had ever made.
1. Give two examples of different types of global exchanges which took place in the seventeenth century, choosing one example from Asia and one from the Americas.
Solution: The following are examples of cross-cultural exchanges from Asia and the Americas:
a.The Silk Route (Asia): The silk routes are a good example of cross-cultural trade and connectivity between distant parts of the world. The name ‘silk routes’ points to the importance of West-bound Chinese silk cargoes along this route.
Trade and cultural exchange always went hand in hand. Early Christian missionaries almost certainly travelled this route to Asia, as did early Muslim preachers a few centuries later.
b.Food from the Americas: The food that is part of our staple diet today like potatoes, soya, groundnuts, maize, tomatoes, chillies, sweet potatoes etc. were not known to our ancestors until the accidental discovery of the Americas by Christopher Columbus.
These foods only made it to Europe and the rest of the world after this monumental discovery of the new continent.
2. Explain how the global transfer of disease in the pre-modern world helped in the colonisation of the Americas.
Solutions: The global transfer of disease in the pre-modern world helped in the colonization of the Americas. The reason was that the native Americans were not immune to the diseases that the European settlers brought with them. The Europeans were to a certain extent immune to the effects of diseases like smallpox due to centuries of exposure, but the native Americans had no such defence against this disease, as they were isolated from diseases native to the old world.
At times, settlers deliberately practised biological warfare on the natives by giving items laced with smallpox germs as ‘gifts of friendship’. The disease was far more effective in wiping out entire tribes and communities without having to resort to firearms.
3. Write a note to explain the effect of the following:
- The British government’s decision to abolish the corn laws
- The coming of rinderpest to Africa
- The death of men of working-age in Europe because of the World War
- The Great Depression on the Indian Economy
- The decision of MNCs to relocate production to Asian countries
Solution:
- The British government’s decision to abolish the Corn Laws was due to pressure from the landed groups, who were unhappy with the high price of food and the cheap inflow of agricultural products from Australia and America. As a result, many English farmers left their profession and migrated to towns and cities. Some went overseas. This indirectly led to global agriculture and rapid urbanization, a prerequisite of industrial growth.
- 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. Within five years, it reached the Cape of Good Hope (Africa’s Southernmost tip) by which it had killed 90 % of the cattle population in that part of Africa. It spread through infected cattle imported from British Asia to feed the Italian soldiers invading Eritrea in East Africa. Using this situation to their advantage, colonizing nations conquered and subdued Africa by monopolizing scarce cattle resources to force Africans into the labour market. The Africans were forced to work for a wage due to the loss of their livelihood due to the effect of Rinderpest.
- The First World War was the first modern industrial war. It saw the use of machine guns, tanks, aircraft, chemical weapons etc on a massive scale. To fight such a war 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 destruction was unlike any other conflict in the modern era. Most of the killed and maimed were men of working age, the deaths and injuries of these men drastically reduced the able-bodied workforce in Europe. Within fewer members within the family, household incomes declined after the war. Thus women stepped in to do the jobs that were earlier done by men. It increased the role of women led to a demand for equal status in society. It made the feminist movement even stronger.
- In the nineteenth century, colonial India had become an exporter of agricultural goods and importer of manufactures. The impact of the Great Depression in India was felt especially in the agricultural sector. It was evident that the Indian economy was closely becoming integrated into the global economy. India was a British colony and exported agricultural goods and imported manufactured goods. As international prices crashed so did the prices in India. The wheat prices in India fell by 50 % between 1928 and 1934.
- Wages were relatively low in Asian countries like China. Thus, they became lucrative destinations for investment by foreign MNCs competing to dominate world markets. The relocation of industry to low-wage countries stimulated world trade and capital flow.
Impact of MNC’s decision to relocate production in Asian Countries was as follows:
a. It provided a cheap source of labour for MNCs
b. It stimulated world trade and increased capital inflow in the Asian Countries
c. The local population now had a greater choice of goods and services along with prospects of greater employment opportunities for them.
4. Give two examples from history to show the impact of technology on food availability.
Solution:
- Improved transportation systems: Improved transportation systems helped the foods get delivered on time to the markets without any harm. Faster railways, lighter wagons and larger ships helped move food cheaply and quickly from faraway farms to final markets.
- Refrigerated ships: The development of refrigerated ships enabled the transport of perishable foods over long distances. Animals were slaughtered for food at the starting point -in 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 which was monotonous with only bread and potatoes.
5. What is meant by the Bretton Woods Agreement?
Solution: 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 financial post-war reconstruction and they started the financial operations in 1947.
Under the agreement, currencies were pegged to the price of gold, and the U.S. dollar was seen as a reserve currency linked to the price of gold. Decision-making 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.
6. Imagine that you are an indentured Indian labour in the Carribean. Drawing from the details in the chapter, write a letter to your family describing your life and feelings
Solution: Dear Ma and Pa,
My work as an indentured labourer Jamaica is far from a walk in the park. Through this letter, I want to tell you about my life here.
When the contractor hired me, he was quite economical with the truth about the living and working conditions. To say nothing of the kind of work and place of work.
We have very few rights, with the contractor living up to the behaviour standards expected of them in the Carribean -extremely harsh. He treats us like animals since we are a minority and thus easy targets for his wrath. Accidents are common in the sugar plantations in Jamaica. One time I saw a worker burnt alive when the liquid sugar we were boiling accidentally spilt on him. Since he cannot work with his third-degree burns, the contractor saw it fit to throw him out without any due wages paid. We don’t have any rights to speak or to express our dissatisfaction about the working conditions. And if we do, we will face the overseer’s whips.
Whenever I do not attend my work, I am liable to be to jail. There is a lot of work at the plantations with a heavy workload and less time to finish it all.
In case of unsatisfactory work, my wages are cut. If there is hell on earth it certainly is this. I know my writing will cause you anguish but rest assured there is the talk of new laws underway to protect labourers like us. Thus, this situation will pass soon.
7. Explain the three types of movements or flows within the international economic exchange. Find one example of each type of flow which involved India and Indians, write a short account of it.
Solution: The three types of movements or flows within the international economic exchange are trade flows, human capital flows and capital flows or investments. These can be explained as—the trade in agricultural products, migration of labour, and financial loans to and from other nations.
- The flow of trade (trade in goods, e.g. cloth or wheat):
India was a hub of trade in the pre-modern world, and it exported textiles and spices in return for gold and silver from Europe.
Fine cotton was produced in India and was exported to Europe. With industrialization, British cotton manufacture began to expand and industrialists pressurized the government to restrict cotton imports and protect local industries. As a result of the tariffs that were imposed on cloth imports, the inflow of fine Indian Cotton began to decline.
- The flow of labour (the migration of people in search of employment):
In the field of labour, indentured labour was provided for mines, plantations and factories abroad, in huge numbers, in the nineteenth century. This was an instrument of colonial domination by the British. Indentured labourers were hired under contacts which promised return travel to India after they had worked five years on their employer’s plantation. The living conditions were harsh and the labourers had little protection of the law or from it as they had little rights.
- The movement of capital (investments) :
Lastly, Britain took generous loans from the USA to finance the World War. Since India was an English colony, the impact of these loan debts was felt in India too. Food and other crops for the world market required capital. Large plantations could borrow it from banks and markets.
8. Explain the causes of the Great Depression
Solution: The Great Depression was a result of many factors:
- Agriculture overproduction was a major problem. As a result, agricultural prices fell. As prices fell, so did agricultural incomes. This increased the volume of goods in the market. The situation got worsened in the market. Prices fell down further. Farm produce began to rot due to the lack of buyers.
- Prosperity in the USA during the 1920s created a cycle of higher employment and incomes. It led to a rise in consumption and demands. More investment and more employment created tendencies of speculations which led to the Great Depression of 1929 up to the mid-1930s. The stock market crashed in 1929. It created panic among investors and depositors who stopped investing and depositing. As a result, it created a cycle of depreciation.
- The withdrawal of US loans affected the rest of the world in many different ways. In Europe, it led to the failure of the major banks and the collapse of major currencies such as the British pound sterling. Some of the banks closed down when people withdrew all their assets, leaving them unable to invest. Some banks called back loans taken from them at the same dollar rate, in spite of the falling value of the dollar.
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?
Solution: 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.
As colonies, many of the less developed regions of the world had been part of Western empires. The policy of the Bretton Woods twins tilted more in favour of the developed nations of the Western world. Now, ironically, as newly independent countries facing urgent pressures to lift their populations out of poverty, they came under the guidance of international agencies dominated by the former colonial powers.
Therefore these colonies organised themselves as a group – the Group of 77 (or G-77) – to demand a new international economic order (NIEO). By the NIEO they meant a system that would give them real control over their natural resources, more development assistance, fairer prices for raw materials, and better access for their manufactured goods in developed countries’ markets.
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