Composition and direction of trade
Also called: Volume and direction of trade · Topic: Indian Economy on the Eve of Independence · NCERT: Class 11, Ch 1 "Indian Economy on the Eve of Independence"
Meaning
Composition of trade means what goods a country exports and imports. Direction of trade means which countries it trades with. Together they show how a country's trade is structured. In colonial India, both were shaped by British policies on production, trade and tariffs (taxes on imports and exports).
Example
- Composition: colonial India exported primary products such as raw silk, cotton, wool, sugar, indigo and jute. It imported finished consumer goods such as cloth, and light machinery.
- Direction: Britain kept monopoly control over India's trade. More than half of it was with Britain. The rest was allowed only with a few countries: China, Ceylon (Sri Lanka) and Persia (Iran).
Don't confuse with
- Volume of trade: this is how much a country trades in total. Composition is what it trades, and direction is with whom.