While the rest of the world was recuperating from the aftermath of the second World War and its consequences, the people of India were subjected, in 1947, to another tragedy of unprecedented proportions, in the form of Partition of India. It was not just a division of civilization, it was also a partition of an ancient civilization, and the partition of an open economy, which had never been closed and divided like this…

The bitter memories of communal violence associated with partition often prevent us from imagining as to what could have happened, had India not been divided in 1947. After all, it was not something that was decided by the will of people on either side of the divide. While it is true that Muslim League had begun to demand a separate State for Muslims, but it was neither the first nor the last such call for a separate political unit on one basis or the other. As far as people of India are concerned, for most of them, it was a fait accompli, just as the British colonization of India and their subsequent exist from India had been. Beyond the cities, where only a small part of India lived, the State and Government hardly had a presence. Most villages were visited by Government officials either for collecting taxes, or if they were serious crimes.

Actually, that was also one of the most important reason for the prevailing indifference of these Indians to annexation of political power by foreigners from the urban and royal elites living in cities and palaces far away from their life.

Division of India, Consequent Migration & Opportunistic Violence that kept spreading

For all those who were unexpectedly caught in the power games played by the nascent political parties with an obliging British establishment and a less than Indian bureaucracy, Partition of India was a bigger event than the exit of the British. After all, for those millions who had to migrate to faraway lands all of a sudden, with little support from anywhere, it was a matter of life and death. One shudders to think, how world will respond today to their miseries if such a thing was to happen today! Yet, what is astonishing, is the ease with which the British masters of India could approve of such a proposition. This decision not only led to the death of over half a million Indians - Hindus, Sikhs and Muslims, but it also laid down permanent divisions in the Indian civilization, which has till then always flown across in this region, without obstructions from the kingdoms and  their monarchs.

1947 brought about a kind of partition and blockade within the Indian civilization, which the Indian civilization had never experienced before, and the consequences of which continue to remain out of public awareness even today, largely due to the preoccupation of everyone with the history of bloodshed and consequent communal divide, which vested interests continue to exploit even today in the name of India Pakistan conflict. The subsequent events in East Pakistan and its liberation from the stranglehold of those who wanted partition in the name of Islam, makes it clear that partition was a result of their political aspirations, for which religion just became an easily available tool. Had the ease of communal division not been available, these forces would have found some other cause to serve their ends.

In many ways, 1947 culminated a process of putting political divisions in place in the Indian civilization, that has been gradually implemented by British since a hundred years or so prior to 1947, largely to serve their own strategic interests. Curzon’s partition of Bengal in 1905, Separation of Myanmar and strict controls and restrictions in movement of people across borders, were all part of this chain that happened a little before that it. Thus, the civilization of India, which has always dominated its political units and kings till then, was increasingly restrained, divided and undermined. Before British, the political borders had always been for the Kings. They meant little for the people, who were often not even concerned with who the King may have been!

Partition of India in 1947 changed all that. It was like dividing a large and rapidly flowing river into parts, by blocking the flow of water. The consequences were significantly adverse for the eco-system of the sub-continent, leading all parts of erstwhile India into disarray. People suffer from these consequences even today, and pay the price of it, in the form of poverty, unemployment, illiteracy, lack of development, conflicts and much more.

Economic Consequences of Partition have obstructed Economic & Human Development

 The communal violence and suffering that the people faced during partition was a one-time event. Two wars between India and Pakistan were also short lived events, as was the subsequent partition of Pakistan and creation of Bangladesh. What continues to endure, however, are the huge economic costs that the people have been paying, and will probably keep paying in the foreseeable future. These costs are primarily in the nature of opportunity cost, or the costs in terms of what we could have achieved, had we not been faced with this catastrophic event.

Throughout history, or at least since the time of Alexander’s failed invasion of India more than two thousand years ago, India has been one of the most prosperous places on this planet … a place where every business of the world wanted to come and trade. It is estimated that India contributed at least one fourth of the global economic production. While this began to change since the beginning of  the industrial revolution in the Europe in last few centuries, the trade between India and Europe continued to be in India’s favour up to the middle of nineteenth century. That should suffice to describe the economic might of Indian civilization.

Till 1820s, even while Europe was reaping the benefits of its industrial bandwagon and even though large parts of India had already come under practical control of British East India Company, the per capita income of an Indian was not less than half of what an average European earned. All this changed drastically during the next hundred years or so, as the ratio of average income of an Indian and a European changed from 1:2 to 1: 10 and reached a nadir of 1:15, in spite of the widespread destruction of Europe during the great wars. By 1947, it was already bad enough largely due to the phenomenon described as ‘drain of wealth” by Dadabhai Nauroji, who was also the first Asian to be a Member of Parliament in United Kingdom, and the first Indian to be a Professor at Elphinstone Institution in 1850.

With Indian independence in 1947, it was all supposed to change. Change it did… but the heavy costs of partition ensured that people were condemned to another era of under-development and poverty, while the State actors, and many of the none-State actors acting in collusion with the States, kept spending the precious resources that were needed by the people, in a mindless conflict.

Partition caused massive Destruction of Economy between 1947-50

More than 15 million people were directly displaced by partition, being forced all of a sudden to move lock, stock and barrel to a new territory. The astonishing failure of British administration, with all its resources, including the mighty armed forces and large police force, allowed opportunistic miscreants to target the hapless migrating masses on both sides, at times, with inhuman cruelty. These incidents of violence incited reactionary violence, gradually leading to a spiral of hatred on both sides that the administration and bureaucracy of that time seems to have left completely to its own fate.

More than half a million perished during this man made tragedy, actually far more than what would have been the case had the League actually carried out its threats of inciting communal violence. Almost 5% of the population was affected, and rendered homeless. Apart from the human tragedy, the loss of economy was also of unprecedented proportion, coming as it was, after the stress of wars and the Bengal famine. Instead of the after-war recovery, which the rest of the world was enjoying at that time, India and Pakistan may have lost anywhere between 5 to 10% of their national wealth and resources, including skilled and unskilled workforce, in this enormous tragedy.

Indigenous Agro-industries were the First Casualty of Partition

Undivided India was a single economy, and a common market, and the territories that now fell in different countries of India and Pakistan were economically interdependent. As a result of partition, 70% of raw jute grown in East Bengal was of little use, since most of the processing mills were on the Indian side. Nearly same was the story with several other products, though on a lower scale.

Break-down of Business Networks and Markets

The political division of India came with borders that blocked the movement of goods as well as people, perhaps for the first time in the history of Indian civilization, where borders have always remained porous for trade and business. These borders continue to remain largely non-porous, even after seven decades, even while such borders have been destroyed long back in other places like Europe.

What it meant was that all of a sudden there were three closed markets, instead of a large and open market that the Indian civilization had always been since ancient times. The regional trade blockades prevent all three countries from reaping the benefits from globalization in subsequent decades, simply because closed border also closes access to rest of the world.

Military Expenditure diverted Precious Scarce Resources

India, Pakistan and Bangladesh – all have been guilty of spending enormous resources on preparing for potential escalation of conflict during the last seven decades. These scarce resources were badly required by their already suffering people. It may be worth remembering that a very large part of this money went to Western Governments and Multinational Companies supplying arms and ammunition to all three countries. Greater the escalation of conflict, more the arms sale to the region! The defense spend by India is over 2.5% of GDP every year. For Pakistan it is over 3% and Bangladesh a little less than 2.5%. Compound these amounts for seventy years, and it is not difficult to see what we have lost.

Long Term Costs of Continuous Conflict

As conflicts, including terrorism, continue to prosper in the region due to India-Pakistan conflict, significant costs continue to be imposed on the economy, mainly in the form of opportunities of economic development that are lost. Border areas suffer more, since they could have prospered more from free trade in the region. Political uncertainties continue to haunt the economy, especially in places that are affected more, like Kashmir or Baluchistan.

There have also been enormous non-economic consequences, which in turn obstruct economic development. The most important of them was the change in balance of power between India and China, the two great civilizations of the East that have never before come into a confrontation with each other. Development of Mao’s nationalism in an integrated Chinese State under communist leadership gave it an edge over India primarily because of the division of the latter.

Together, India, Pakistan and Bangladesh carry more resources than China, but the divided economies and their failure to grow at a pace at which the rest of the world grew meant that Chinese economy today is more than four times the size of the combined economy of the three countries that came out of undivided India.

Today, the Chinese economy has an annual GDP of US$11.2 trillion. The size of economies of India, Pakistan and Bangladesh are US$2.26 trillion, 0.28 and 0.22 trillion, making a total of US$ 2.76 trillion. Per capital GDP of a Chinese today is more than US$ 8100, while that of a person in Bangladesh, Pakistan and India are US$ 1350, 1475 and 1700 respectively. An average Chinese is more than five times prosperous his counterpart, in stark contrast to what it was in 1947.

Perhaps, what Chinese economy is today, is the best economic indicator of what the people of India, Pakistan and Bangladesh have lost since 1947 in terms of opportunity cost. Without doubt, a very large part of this has been lost, directly or indirectly, due to the partition that was unleashed on them in 1947, and which continues to haunt them, at least economically.

This is the real cost of partition of India ….. even if most people suffering from it do not even realize it!