Permanent Settlement | Social Studies (SST) Class 8 PDF Download

The Need for Improving Agriculture

• With the drastic fall in agriculture, it was difficult for the company to collect as much revenue as it wanted. To secure proper revenue from the land, the Company devised several policies which would ensure regular revenue income and would also force the people to look after the land so as to improve the agricultural output.
• Some of these systems are the Permanent Settlement, the Mahalwari system, and the Munro system.
• To ensure that the Company secured revenue from the land, they introduced a revenue system in 1793 known as the Permanent Settlement.

Permanent Settlement

• Landlords, or Zamindars, were recognized as the owners of the land. They were given hereditary rights of succession to the lands under them.
• The Zamindars could sell or transfer the land as they wished.
• The Zamindars’ proprietorship would stay as long as he paid the fixed revenue at the said date to the government. If they failed to pay, their rights would cease to exist and the land would be auctioned off.
• The amount to be paid by the landlords was fixed. It was agreed that this would not increase in the future (permanent). 
• The fixed amount was 10/11th of the revenue for the government, and 1/10th was for the Zamindar. This tax rate was way higher than the prevailing rates in England.
• The Zamindar also had to give the tenant a patta, which described the area of the land given to him and the rent he had to pay the landlord.

The Problem of Permanent Settlement

The system of permanent settlement created problems for everyone involved.

• The Company expected that they would be tempted by higher income; the new zamindars would take effort to improve the land for cultivation. However, that did not happen. The revenue was fixed so high that most zamindars could not meet the demand and had to lose their rights to the property. Others were forced to sell off parts of their lands to pay the revenue in auctions.
• In the early 19th century, agricultural production improved, and the market prices rose. This meant that there was an excess income from agriculture. However, due to the principle of a fixed revenue, the Company could not benefit from the agricultural boom.
• The zamindars were still not interested in improving the land. Some had already lost their rights, while others saw this settlement as a way to secure more money without investment as they realized that as long as they rented their land to peasants, they did not have to invest for the improvement of the land.
• The worst effect was seen on the farmers who were forced to pay high rent. Failing to pay the rent got them evicted. This forced them to take loans from moneylenders. Even with high rents, the peasants had no rights on the land.

Mahalwari Settlement

After realizing the problems with the Permanent Settlement System, the company officials came up with a new system of revenue collection called the Mahalwari System. This was done mostly in the North-Western Provinces of the Bengal Presidency.

• The Mahalwari system was introduced in 1822 by Holt Mackenzie. Later, the system was reformed during the period of William Bentick (1833).
• This system recognized villages as important social institutions. The revenue collectors thus directly dealt with the village through representatives.
• Under the Mahalwari system, the land revenue was collected from the farmers by the village headmen on behalf of the whole village (and not the zamindar).
• The entire village was converted into one bigger unit called ‘Mahal’ and was treated as one unit for the payment of land revenue.
• The revenue under the Mahalwari system was to be revised periodically and not fixed permanently.
• The revenue was collected by the village headman or the village leaders and the ownership rights rested with the peasants only. 
• The state share of the revenue was sixty-six percent of the rental value and the settlement was agreed for thirty years. The Mahalwari system laid down the concept of average rents for different classes and types of soils.
• In contrast to the Permanent Settlement System, the income to be paid was not fixed and could be inspected intermittently.

The Munro System

In the British territories in the south, there was a similar move away from the idea of permanent settlement. The new system that was devised came to be known as the "ryotwar" (or ryotwari).

• This system of land revenue was instituted in the late 18th century by Sir Thomas Munro, Governor of Madras in 1820.

Sir Thomas Munro

• This was done in the Madras and Bombay areas, as well as Assam and Coorg provinces.
• In this system, the peasants, or cultivators, were regarded as the owners of the land. They had ownership rights, could sell, mortgage, or gift the land.
• The taxes were directly collected by the government from the peasants.
• The rates were 50% in the dryland and 60% in the wetland.
• The rates were high, and unlike the Permanent System, they were open to being increased.
• If they failed to pay the taxes, they were evicted by the government.
• Ryot means peasant cultivators.
• Here there were no middlemen as in the Zamindari system. But, since high taxes had to be paid only in cash (no option of paying in kind as before the British) the problem of moneylenders came into the show. They further burdened the peasants with heavy interests.

Problems of Excessive Revenue Demand

Within a few years after the new systems were imposed, it was clear that all was not well with them. Driven by the desire to increase the income from land, revenue officials fixed too high a revenue demand. Peasants were unable to pay, riots fled the countryside, and villages became deserted in many regions. Optimistic officials had imagined that the new systems would transform the peasants into rich enterprising farmers. But this did not happen.

Growing Indigo in India

• Indigo is a crop grown to be used as a dye for its rich color. Indigo was in high demand all over Europe for dyeing, which can only be grown in temperate regions. 

• The British realized the demand for the crop and forced the farmers in India to grow indigo. This was done in two elaborate ways, namely the Nij System and the Ryoti System.
• In the Nij system, the farmer's own land was cultivated for indigo. Due to scarcity of land and high labor demands of cultivation, it was very difficult for the farmers to make a profit.
• In the Ryoti framework, ranchers were given development credit for development. The farmers were also given land for cultivation. 
• However, due to the low selling price of indigo, loss of land due to indigo cultivation, and a brutal system of loaning, the farmers were not satisfied with this system.