Economic History of South Asia Region Since 1 AD
The colonization of India and many other nations in Asia and Africa began with the advent of the Industrial Revolution in Europe which resulted in a major power shift from East to West over the time-span of just a few decades. Prior to the Industrial Revolution, the world depended mainly on agriculture based on human and animal muscle power. Countries with large populations and farmlands had large share of the world GDP. The per capita productivity differences among nations and regions were relatively small. The machine age changed it all. Those who used machines became much more productive and significantly richer than the rest.
In 1000 AD, according to British Economist Angus Maddison, China and India together accounted for more than half of the world GDP (calculated in 1990 dollars in terms of purchasing power parity). By 1600, that share was 51.4%, with China accounting for 29% and India 22.4% of world GDP. A hundred years later, China’s GDP had fallen but India’s went up to 24.4% of world output. By 1820, however, India’s share had fallen to 16.1%. By 1870, it went down to 12.2%. International Monetary Fund (IMF) projections indicate that India’s share of world GDP would be 6.1% in 2015.
In 1 AD, India’s GDP per capita was $450, the same as China’s. But Italy under the Roman Empire had a per capita income of $809. In 1000 AD, India’s per capita income was $450 and China’s $466. But the average of the Islamic Caliphate in Baghdad which ruled West Asia (Turkey, Syria, Iran and Iraq) was much higher at $621. An average citizen of the Abbasid Caliphate was richer than an average Indian or Chinese. In fact, the per capita income in the Abbasid Caliphate was the highest in the world in 1000 AD.
As the European Renaissance began, new centers of prosperity emerged. Italy topped the table in 1500 AD, with per capita income of $1,100, the Netherlands following with a per capita income of $761. The UK was not far behind, with a per capita income of $714. All of these nations were richer than India and China which had per capita incomes of $550 and $600 respectively.
|India Health-Wealth Indicators Source: Gapminder.com|
While India today has the world's largest population of poor, it is still richer than it has ever been in terms of per capita incomes. Indians are also living longer than ever in the country's history; average life expectancy in India has risen from just 23 years in 1800 to 65.5 years now. However, India continues to significantly lag the rest of the world on both economic and social indicators.
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