Question

Describe the implications of First World War on the economic and political situation of India.

Answer 1

1. The war created new economic and political conditions.
2. Defence spending increased significantly, and the government financed it by taking out war loans.
3. To repay these loans, taxes were increased, customs duties were raised, and income tax was introduced.
4. The prices of goods rose sharply and nearly doubled between 1913 and 1918, making life difficult for common people.
5. Many villagers and farmers were forcibly recruited into the British army.