Ignorance and sluggishness do not keep the Hindu farmer in a worse condition than is his own class in other countries; the small area of his holdings, excessive taxation, and lack of capital are continually dragging him backward. Eighty per cent of the people of India depend upon agriculture for their sole support. They live on the soil and by the soil. In former times India was also the home of flourishing cottage industries, that helped to increase the income of its enormous rural population. The invasion by English manufactures, caused by the selfish English fiscal policy for India, has completely uprooted the fabric industries of the Indian villages, a change which in turn has driven the entire people to the land for their livelihood, thereby bringing the total ruin of their economic prosperity. Lack of moral stamina in the people, overpopulation, ignorance or sluggishness of the agricultural class are thus not the real causes of India’s poverty. The economist who wishes to determine the cause of any country’s poverty will have to ask himself the same questions which the Hindu historian, R. C. Dutt, asked in regard to India a quarter of century ago. “Does agriculture flourish? Are the finances properly administered, so as to bring back to the people an adequate return for the taxes paid by them? Are the sources of national wealth widened by a Government anxious for the welfare of the people?” If it is true that in the same ratio as English power advanced in India economic prosperity of the country began to decline, we might as well inquire into the nature of British rule in India. We shall restrict our inquiry to the answers of the following two questions: “Why England acquired India?” and “Why England holds India?” It is a fact that England first came in contact with India through the medium of a trading company, whose object in establishing its trade stations in the Eastern country was profit-making. It is asserted that the British rulers of India have been guided in their work of governing the country by altruistic and humanitarian motives of a high quality. To what extent this claim of the English nation is founded on facts we shall examine presently. In any case such humanitarian principles as may have inspired the English rule in India, were of a much later origin. The primary reason for which England established its connections with its Eastern dependency was one of pure commercial greed. At the time when the East India Company was organized in England the people of Europe had not been trained in the use of such terms as “altruism” and “civilizing the backward peoples.” These high-sounding epithets are products of much later times. The minds of the Directors of the East India Company were ruled by thoughts of large dividends and big profits.