Punjab considerable amounts of land were being taken over by moneylenders
in lieu of mortgage defaults. This undermined the landowning castes that the
British traditionally relied on for political support, revenue and military
recruitment. The 1900 Punjab Alienation of Land Act forbade the passing of
land from agricultural to non-agricultural castes (Ali, 2003). This left India not
with extractive or settler-type institutions but with a bewildering, complex and
overlapping variety of property rights. Single pieces of property could be
simultaneously subject to claims based on formal ownership, informal
purchase, tenancy, inheritance, sub-letting and actual occupancy. This has
been a key long-run problematic legacy of British colonialism in India and has
hindered the transition of a small-scale agricultural economy to one based on
the amalgamation of plots for large-scale mechanized agriculture and the
transfer of land usage for urban industrialization (Khan 2010).
There is good evidence that colonial institutions did persist into the post-
colonial era in India, in accordance with the predictions of Acemoglu et al.
But, contrary to Acemoglu et al.,it is not possible to characterize India as
solely extractive or settler. Those areas where the British had strengthened the
tax-collecting authority of traditional landlords underperformed those areas
where property rights were given to individual cultivators until long after inde-
pendence. The reason is probably that in areas where the British government
gave property rights to a few landlords, political and legal institutions were
more extractive and were used for the benefit of the few as compared with non-
landlord areas where property rights were given to the mass of cultivators
(Banerjee and Iyer, 2005; Kapur and Kim,2006).
This mix of settler and extractive efforts can also be seen in infrastructure.
Between 1860 and 1920 the number of railway-track miles increased from 838
to 37,029 in British India (Hurd,1975; Habib, 2006:42). The impact of the rail-
ways in integrating British India as a single economic entity was famously
praised by Karl Marx. Railways promoted the growth of European-style insti-
tutions and organizations. The railway-based postal system was started under
Dalhousie (1848–56) and the number of letters and packets carried increased
from 85 million in 1869 to 1,043 million in 1914. The Indian National
Congress,which eventually led the independence movement and became the
first ruling party of independent India, met for the first time in Bombay in
1885, relying on the railways to bring delegates from the provinces. The grow-
ing Indian press depended on railways for their circulation. They railways
connected up the main metropolitan areas and helped to create a national
market for bulk goods. There is good evidence that fluctuations in commodity
prices and inter-state/regional price differentials both declined over the course
of the nineteenth century and that this process was explained by the expansion
of the railway system (Hurd, 1975; Habib, 2006:41). The railways also
enhanced the extractive powers of the state. The motivation for railway build-
ing was not benevolence but to ensure (after 1857) that troops could move
quickly from ports to the interior, between urban areas and to the borders with
Afghanistan to meet a supposed Russian threat. The railways also assisted in
Colonialism 189