The Making of a Global World 

How did Silk Routes link the world? 

1. The name ‘silk routes’ points to the importance of Westbound Chinese silk cargoes along this route. 

2. Historians have identified several silk routes, over land and by sea, knitting together vast regions of Asia, and linking Asia with Europe and northern Africa. 

3. Chinese pottery also travelled the same route, as did textiles and spices from India and Southeast Asia. In return, precious metals – gold and silver – flowed from Europe to Asia. 

4. Early Christian missionaries, early Muslim Preachers, and Buddhism almost certainly travelled this route. 

Explain how the global transfer of disease in the pre-modern world helped in the colonisation of the Americas.  

1. The Portuguese and Spanish conquest and colonisation of America was decisively underway by the mid-sixteenth century. 

2. European conquest was not just a result of superior firepower. In fact, the most powerful weapon of the Spanish conquerors was not a conventional military weapon at all. 

3. It was the germs such as those of smallpox that they carried on their person. 

4. Because of their long isolation, America’s original inhabitants had no immunity against these diseases that came from Europe. Smallpox in particular proved a deadly killer. 

5. Once introduced, it spread deep into the continent, ahead even of any Europeans reaching there. It killed and decimated whole communities, paving the way for conquest. 

• Causes of The Great Depression: 

1. Agricultural Overproduction and Falling Prices: Agricultural regions and communities were particularly affected by the Depression. The fall in agricultural prices was greater and more prolonged than that in the prices of industrial goods. Agricultural overproduction remained a problem, and as prices fell, farmers tried to expand production to maintain their overall income, leading to a glut in the market and further pushing down prices. 

2. Impact of US Loans: In the mid-1920s, many countries financed their investments through loans from the United States. However, when the Depression hit, US overseas lenders withdrew their loans, causing a crisis in countries that depended on these loans. The withdrawal of US loans had a global impact, leading to the failure of major banks in Europe, the collapse of currencies like the British pound sterling, and intensifying the slump in agricultural and raw material prices in Latin America and elsewhere. 

3. US Protectionist Policies: In response to the Depression, the US government doubled import duties to protect its economy. This move dealt another severe blow to world trade, exacerbating the economic downturn in other countries. 

4. Impact on the US Economy: The United States, being an industrial country, was severely affected by the Depression as well. Falling prices and the prospect of depression led US banks to slash domestic lending and call back loans. As a result, farms could not sell their produce, households faced ruin, and businesses collapsed. The consumerist prosperity of the 1920s disappeared, and unemployment soared. 

5. Banking System Collapse: The US banking system itself collapsed as banks were unable to recover investments, collect loans, and repay depositors. Thousands of banks went bankrupt and were forced to close, leading to a significant number of bank closures by 1933. 

These factors, including agricultural overproduction, the impact of US loans, US protectionist policies, the decline of the US economy, and the collapse of the banking system, all contributed to the Great Depression's catastrophic declines in production, employment, incomes, and trade across the world. 

• Impacts of the Great Economic Depression on India: 

1. Impact on Trade: The depression had a significant impact on Indian trade. India's exports and imports were severely affected, almost halving between 1928 and 1934. International prices plummeted, leading to a sharp decline in prices of Indian goods, including agricultural products like wheat. 

2. Agricultural Sector Suffering: Peasants and farmers were among the worst hit by the depression. Agricultural prices fell sharply, but the colonial government refused to reduce revenue demands, leading to further distress for those producing for the world market.

3. Jute Industry Crisis: The jute producers of Bengal faced a crisis as gunny bag exports collapsed, causing the price of raw jute to crash by more than 60 percent. This led to increased indebtedness among jute growers, as they borrowed money with the hope of higher prices in the future.

4. Increased Peasant Indebtedness: Across India, peasants' indebtedness increased as they used up their savings, mortgaged lands, and sold precious items to meet their expenses during the Depression.

5. Gold Exports and Impact: In these tough economic times, India became an exporter of precious metals, notably gold. Although this helped speed up Britain's recovery, it did little to alleviate the suffering of the Indian peasants.

6. Rural Unrest and Civil Disobedience: The depression led to unrest in rural India, culminating in Mahatma Gandhi launching the civil disobedience movement in 1931.

7. Mixed Impact on Urban India: Urban India experienced contrasting effects. Those with fixed incomes, such as town-dwelling landowners receiving rents and middle-class salaried employees, found themselves better off due to falling prices. On the other hand, the depression led to economic difficulties in rural areas.

8. Industrial Investment: Industrial investment in India grew as the government extended tariff protection to industries under the pressure of nationalist opinion. This was likely an attempt to bolster the domestic economy during the Depression. 

• Economic Conditions of India: 

1. Growth and GDP: India's economy has been experiencing robust growth, making it one of the fastest-growing major economies globally. Its diverse GDP composition is driven by key sectors such as services, manufacturing, and agriculture.

2. Key Sectors: The services sector, including IT, finance, tourism, and healthcare, contributes significantly to India's GDP. The manufacturing sector has seen substantial expansion and foreign investment, while agriculture remains a vital sector employing a large portion of the population.

3. Inflation: India faces fluctuating inflation, necessitating careful monetary policies by the Reserve Bank of India (RBI) to control price stability and economic growth.

4. Unemployment: Managing unemployment, especially among the youth, is a prominent challenge for India's economic policymakers. Government initiatives for skill development and job creation are ongoing to address this issue.

5. Fiscal and Monetary Policies: The Indian government uses fiscal policies like taxation and public spending, while the RBI employs monetary measures like interest rates and liquidity adjustments to manage the economy effectively.

6. Foreign Investment: India attracts foreign investment due to its large consumer base, skilled workforce, and improving business environment. Efforts like "Make in India" aim to facilitate and promote foreign direct investment (FDI) across sectors.

7. Trade: India actively engages in both imports and exports, with a focus on reducing trade imbalances and enhancing its position in global trade. Export-oriented policies support sectors like software, textiles, and pharmaceuticals.

• Economic Conditions of the U.S.: 

1. Growth and GDP: The United States boasts the world's largest economy, with consistent growth and a wide range of industries driving its GDP.

2. Consumer Spending: Consumer spending is a key driver of the U.S. economy, influenced by factors like employment rates, wages, and consumer confidence.

3. Labor Market: The U.S. labour market is dynamic, accommodating a significant and diverse workforce across various sectors and industries.

4. Stock Market: The U.S. stock market serves as a critical indicator of market sentiment and economic performance, impacting investor behaviour and corporate decisions.

5. Monetary Policy: The Federal Reserve manages monetary policy, using tools like interest rates and open market operations to control inflation and support economic growth.

6. Fiscal Policy: The U.S. government influences the economy through fiscal measures, including taxation and public spending, to stimulate demand and promote economic growth.

7. Trade and Tariffs: The U.S. plays a major role in international trade, with its trade policies and tariffs significantly impacting various industries and global economic relations.

8. Technological Advancements: The U.S. leads in technological innovation, fostering advancements that drive productivity and competitiveness across sectors.

9. Income Inequality: The U.S. faces challenges related to income distribution and social disparities, which impact economic mobility and social cohesion.

10. Government Debt: Managing significant government debt remains a critical concern, with policymakers working to balance public investments and fiscal responsibility.