4.2 The Permanent Settlement: Features, Advantages & Disadvantages

I. Introduction – Historical Context of the Permanent Settlement

Origin and Evolution

• The Permanent Settlement, also known as the Zamindari system, was a pivotal land revenue arrangement in colonial India.
• Introduced by Lord Cornwallis, the Governor General, in 1793, it marked a significant shift in the British approach to revenue collection in India.
• This system was also referred to as Istamarari (Sthayi) Bandobast System.
• The primary objective behind its introduction was to streamline the revenue collection process and ensure a steady flow of income to the British East India Company.
• It was initially implemented in regions like Bengal and Bihar and was later extended to areas such as Madras and Varanasi.

Significance in Colonial India

• The Permanent Settlement played a crucial role in reshaping the socio-economic landscape of colonial India.
• By recognizing Zamindars as the landowners, it altered the traditional land ownership patterns, turning many cultivators into tenants.
• The system was designed to provide the British with a fixed and regular income, thereby reducing the administrative burden of frequent revenue reassessments.
• The Zamindars were given the responsibility of collecting rent from the cultivators and remitting a fixed share to the British authorities.
• This arrangement led to the emergence of a new class of loyal intermediaries who were economically and politically aligned with the British colonial interests.

Overview of Land Revenue Systems in British India

• Prior to British rule, land revenue was a primary source of income for kings and emperors. The ownership pattern of land underwent several changes over centuries.
• During the era of kingship, lands were divided into Jagirs, which were allotted to Jagirdars. These Jagirdars further subdivided the land and allocated it to subordinate Zamindars.
• The Zamindari system was just one of the several land revenue systems that existed in India during British rule. Other prominent systems included the Ryotwari and Mahalwari systems.
• While the Zamindari system was predominant in regions like Bengal, Bihar, and Orissa, the Ryotwari system was more prevalent in South India, and the Mahalwari system was introduced in North-West India.
• Each of these systems had its own set of features, advantages, and challenges, but they all aimed at maximizing revenue collection for the British East India Company.

II. Origin and Implementation

Background of the Permanent Settlement

• The Permanent Settlement, often referred to as the Zamindari system, emerged as a revolutionary land revenue arrangement during the British colonial rule in India.
• The primary motivation behind its introduction was to establish a systematic and predictable method of revenue collection, ensuring a consistent flow of income to the British East India Company.
• This system aimed to bring stability to the revenue collection process, reducing the administrative challenges associated with frequent reassessments and fluctuations in income.
• The British East India Company sought to create a loyal class of intermediaries, the Zamindars, who would facilitate the revenue collection process on their behalf, bridging the gap between the colonial administration and the local cultivators.

Need and Rationale

• Prior to the introduction of the Permanent Settlement, the British faced numerous challenges in revenue collection, primarily due to the absence of a standardized system and the vast diversity of land ownership patterns across India.
• The fluctuating nature of agricultural yields, combined with the diverse traditional land revenue systems, made it difficult for the British to predict and ensure a steady revenue stream.
• The Permanent Settlement was envisioned as a solution to these challenges, providing a fixed framework for revenue collection and minimizing uncertainties.
• By recognizing Zamindars as the primary landowners and entrusting them with the responsibility of collecting rent from cultivators, the British aimed to simplify the revenue collection process and ensure regularity in payments.

Key Architects: Role of Lord Cornwallis

• Lord Cornwallis played a pivotal role in the conceptualization and implementation of the Permanent Settlement.
• As the Governor General during the late 18th century, Cornwallis recognized the need for a streamlined revenue collection system that would benefit both the British administration and the local populace.
• Under his leadership, the Permanent Settlement Act was introduced in 1793, marking the formal establishment of the Zamindari system in selected regions of India.
• Cornwallis’s vision was to create a win-win situation where the British would receive a fixed share of the revenue, while the Zamindars, in recognition of their landownership rights, would retain a portion of the collected rent.

Geographical Spread: Initial Implementation and Later Extensions

• The Permanent Settlement was first rolled out in the provinces of Bengal and Bihar, regions that were of significant economic importance to the British.
• These areas were chosen for the initial implementation due to their rich agricultural potential and the existing influence of Zamindars in the local socio-economic structure.
• Witnessing the success and stability brought about by the system in these regions, the British administration decided to extend the Permanent Settlement to other parts of India.
• Subsequently, the system was introduced in areas such as Madras and Varanasi, further expanding the geographical reach of the Zamindari system.
• Over time, the Permanent Settlement became one of the primary land revenue systems under British rule, coexisting with other systems like the Ryotwari and Mahalwari in different parts of the country.

III. Features of the Permanent Settlement

Definition and Core Principles

• The Permanent Settlement, commonly known as the Zamindari system, was a land revenue arrangement introduced by the British in India during the late 18th century.
• At its core, the system aimed to establish a fixed and predictable method of revenue collection, ensuring a consistent flow of income to the British East India Company.
• The system recognized Zamindars as the primary landowners, entrusting them with the responsibility of collecting rent from cultivators and remitting a fixed share to the British authorities.
• This arrangement was designed to provide stability to the revenue collection process, reducing uncertainties and administrative challenges associated with frequent reassessments.

Zamindari System: Role and Responsibilities of Zamindars

• The Zamindari system was characterized by the recognition of Zamindars as the primary intermediaries between the British administration and the local cultivators.
• As landowners, Zamindars held significant influence and authority over vast tracts of land and the cultivators who worked on them.
• Their primary responsibility was to collect rent from the cultivators, ensuring timely payments and maintaining records of landholdings and transactions.
• In return for their services, Zamindars were allowed to retain a portion of the collected rent, providing them with a steady source of income.
• They also played a crucial role in maintaining law and order within their territories, acting as local administrators and arbitrators in disputes.

Revenue Distribution: Division between British and Zamindars

• One of the defining features of the Permanent Settlement was the fixed division of revenue between the British East India Company and the Zamindars.
• The British authorities determined a fixed sum that the Zamindars were required to remit annually, irrespective of the actual amount collected from the cultivators.
• This arrangement ensured a steady and predictable flow of income to the British, reducing the risks associated with fluctuating agricultural yields and market conditions.
• Zamindars, on the other hand, benefited from any surplus revenue collected over and above the fixed sum, incentivizing them to maximize collections and improve agricultural productivity.

Patta System: Written Agreements and Specifications

• The Patta system was an integral component of the Permanent Settlement, providing a formalized framework for land transactions and ownership records.
• A Patta was essentially a written agreement that specified the terms and conditions of land ownership, including the amount of rent to be paid, the boundaries of the land, and any other relevant details.
• It served as a legal document, ensuring clarity and transparency in land transactions and providing a basis for resolving disputes.
• The system was designed to protect the rights of both the Zamindars and the cultivators, ensuring that all parties were aware of their obligations and entitlements.

Hereditary Rights: Succession and Transfer of Land Ownership

• The Permanent Settlement recognized the hereditary rights of Zamindars, allowing them to pass on their landholdings to their descendants.
• This provision ensured continuity in land ownership patterns, providing stability and predictability to the revenue collection process.
• Zamindars were also allowed to sell or transfer their landholdings, subject to certain conditions and regulations laid down by the British authorities.
• The recognition of hereditary rights further strengthened the position of Zamindars within the socio-economic hierarchy, ensuring their loyalty and cooperation with the British administration.

IV. Comparison with Other Revenue Systems

Distinction between Permanent Settlement and Mahalwari System

• The Permanent Settlement and Mahalwari System were two distinct land revenue systems introduced by the British in India, each with its unique features and methodologies.
• Fixed vs Periodic Revenue Revision: One of the primary distinctions between the two systems was the approach to revenue assessment. While the Permanent Settlement fixed the land revenue for an indefinite period, the Mahalwari System allowed for periodic revisions, typically every 20 to 30 years. This meant that while the revenue demand in the Permanent Settlement remained constant, it could be revised in the Mahalwari System based on changing agricultural yields and economic conditions.
• Role of Village Headman: In the Mahalwari System, the village headman or the collective body of cultivators played a significant role in revenue collection. They were responsible for distributing the revenue demand among individual cultivators and ensuring timely payments to the British authorities. This was in contrast to the Permanent Settlement, where the Zamindars acted as the primary intermediaries for revenue collection.

Ryotwari System: Direct Payment by Farmers

• The Ryotwari System was another prominent land revenue system introduced by the British, primarily in regions of South India.
• Unlike the Permanent Settlement, where the Zamindars acted as intermediaries, the Ryotwari System established a direct relationship between the British administration and the individual cultivators or ‘Ryots’.
• Direct Payment by Farmers: In this system, each farmer was recognized as the owner of his plot of land and was directly responsible for paying the land revenue to the British authorities. There was no intermediary like the Zamindar to collect and remit the revenue on behalf of the cultivators.
• Rights and Responsibilities of Individual Cultivators: The Ryotwari System empowered individual cultivators by recognizing their ownership rights over the land. However, this also came with the responsibility of ensuring timely payment of land revenue. The system was designed to be more flexible, with revenue assessments based on the actual productivity of the land, allowing for revisions based on changing agricultural yields.

V. Advantages of the Permanent Settlement

Benefits for the British

• The Permanent Settlement was not just a revenue collection mechanism but also served strategic and administrative purposes for the British colonial rulers.
• Increased Crop Production: One of the primary advantages of the Permanent Settlement for the British was the potential for increased agricultural production. By fixing the revenue, the British hoped that Zamindars would be incentivized to invest in land development and agricultural improvements, leading to higher yields.
• Easier Administration: The system simplified the administrative process for the British. By dealing with a limited number of Zamindars rather than numerous individual cultivators, the British could streamline revenue collection and reduce administrative overheads. This was especially beneficial in vast territories like Bengal, where managing individual landholdings would have been a logistical challenge.
• Creation of a Loyal Class of Zamindars: The Permanent Settlement was also a strategic move to create a loyal class of intermediaries. By recognizing the Zamindars as the primary landowners and entrusting them with significant responsibilities, the British hoped to foster loyalty and ensure the stability of their rule. This was crucial in a period when the British were still consolidating their hold over India and needed local allies to maintain order and control.

Economic Implications

• The economic implications of the Permanent Settlement were profound, both for the British East India Company and for the larger Indian economy.
• Revenue Stability and Predictability: From the perspective of the British East India Company, the most significant advantage was the stability and predictability of revenue. With a fixed revenue system in place, the Company could reliably forecast its income from land revenues, allowing for better financial planning and resource allocation. This stability was crucial for the Company, which had significant financial obligations both in India and back in Britain.
• Furthermore, the predictability of revenue meant that the British could focus on other administrative and governance tasks without the constant pressure of revenue fluctuations. This stability also had ripple effects on the broader Indian economy, as it provided a degree of economic certainty in regions under the Permanent Settlement.

VI. Challenges and Criticisms

Unreasonable Assessment

• The Permanent Settlement system, while aiming to provide stability in revenue collection, was not without its flaws. One of the primary criticisms was the manner in which land revenue was assessed.
• Arbitrary Taxation: The revenue rates set under the Permanent Settlement were often arbitrary, without a clear basis on the actual productivity or value of the land. This led to situations where the land’s potential revenue and the actual tax imposed on it were mismatched. The lack of a systematic and scientific approach to revenue assessment meant that many Zamindars were burdened with unrealistic revenue demands.

Oppression of Tenants

• The system’s structure placed the onus of revenue collection on the Zamindars, who in turn, had to collect from the actual cultivators or tenants.
• High Tax Rates: To ensure they met the fixed revenue demands set by the British, many Zamindars imposed high tax rates on their tenants. This often resulted in tenants having to part with a significant portion of their produce, leaving them with minimal profits.
• Coercive Collection Methods: In cases where tenants were unable to meet the high tax demands, Zamindars often resorted to coercive methods to ensure collection. This included forced evictions, confiscation of property, and even physical violence. Such practices further strained the relationship between Zamindars and tenants and led to widespread discontent among the agricultural community.

Absentee Landlordism

• Another significant challenge of the Permanent Settlement was the rise of absentee landlords.
• Indifference to Land Productivity: Many Zamindars, especially those who lived in urban areas or other regions, showed little interest in the actual productivity of their lands. Their primary concern was ensuring that the fixed revenue was collected, regardless of the land’s actual output.
• Reliance on Middlemen: Absentee landlords often relied on middlemen or local agents to manage their lands and collect revenue. These middlemen, looking to maximize their profits, further exploited the tenants, leading to a cycle of oppression and economic hardship for the actual cultivators.

Financial Strain on Zamindars

• While the Permanent Settlement system was designed to benefit the Zamindars by recognizing them as the primary landowners, it also placed significant financial burdens on them.
• High Fixed Revenue Demands: The British administration’s insistence on a fixed revenue amount meant that Zamindars had to ensure this amount was collected year after year, regardless of external factors like droughts, floods, or other natural calamities. This often led to situations where Zamindars, unable to meet the revenue demands, faced severe penalties, including the confiscation of their lands.

VII. Socio-Economic Impact

Effects on Peasants

• The Permanent Settlement system brought about significant changes in the lives of the peasants.
• Economic Hardship: The high fixed revenue rates imposed on the zamindars were often passed down to the peasants. This led to increased financial burdens on the peasants, many of whom were already living on the edge of subsistence.
  • The peasants had to pay their rents regardless of the agricultural output, leading to situations where they had to sell their produce at a loss just to meet the revenue demands.
  • Crop failures, which were not uncommon, further exacerbated their economic woes.
• Dependence on Moneylenders: To meet the high revenue demands, many peasants had to borrow money. This led to a rise in the influence and power of moneylenders in rural areas.
  • The peasants often fell into debt traps, where they borrowed money at exorbitant interest rates and found it impossible to repay.
  • Over time, this led to many peasants losing their lands to these moneylenders, further deepening their economic hardships.

Shift in Land Ownership Patterns

• The Permanent Settlement system led to a significant shift in land ownership patterns in the regions where it was implemented.
• Rise of Absentee Landlords: As the revenue demands were high and fixed, many traditional zamindars, unable to cope with the financial pressures, sold their lands to urban-based merchants and moneylenders.
  • These new landowners rarely had any direct connection with the land or its cultivation. They were more interested in extracting the maximum revenue rather than the well-being of the peasants or the productivity of the land.
  • This led to a situation where the actual cultivators of the land had little to no say in its management.
• Decline of Traditional Landowners: Many traditional landowners, who had been cultivating and managing their lands for generations, found themselves unable to cope with the new revenue demands.
  • Many were forced to sell their lands or were dispossessed due to non-payment of revenues.
  • This led to a decline in the influence and power of traditional landowning classes in rural areas.

Impact on Agricultural Productivity

• The Permanent Settlement system had a profound impact on agricultural productivity in the regions where it was implemented.
• Lack of Investment: As the revenue demands were high and fixed, both the zamindars and the peasants had little surplus left for investment in the land.
  • This meant that there was little to no investment in improving irrigation, introducing new agricultural techniques, or buying better quality seeds.
• Lack of Innovation: The system did not provide any incentives for the zamindars or the peasants to introduce new agricultural techniques or crops.
  • The focus was on meeting the revenue demands rather than increasing agricultural productivity.
  • This led to a stagnation in agricultural practices, with many regions continuing with traditional and often outdated methods of cultivation.

VIII. Legacy and Abolition

Post-Independence Reforms

• Abolition of Zamindari System
  • The zamindari system was a significant land revenue collection system in India.
  • Zamindars were autonomous or semi-autonomous rulers of provinces.
  • They held the right to collect tax on behalf of imperial courts or for military purposes.
  • The British recognized them as landowners and proprietors.
  • The system was abolished in independent India soon after its creation.
  • The First Amendment of the Constitution of India amended the right to property, leading to the system’s end.
  • In East Pakistan (now Bangladesh), the East Bengal State Acquisition and Tenancy Act of 1950 ended the system.
  • The abolition aimed to empower small farmers and reduce economic disparities.
• Land Redistribution
  • The British era saw the East India Company establish itself by becoming zamindars of areas like Calcutta, Sultani, and Govindpur.
  • They later acquired the 24-Parganas and, by 1765, controlled Bengal, Bihar, and Orissa.
  • The Permanent Settlement in 1793 made zamindars proprietors of their land in return for a fixed annual rent.
  • If zamindars failed to pay rent, parts of their estates were acquired and auctioned, leading to a new class of zamindars.
  • The British continued to bestow royal and noble titles to loyal zamindars, elevating their status.
  • The zamindari system’s abolition led to land redistribution efforts to ensure equitable land ownership.

Comparison with Contemporary Land Revenue Systems

• Mughal Era
  • The term “zamindar” came into use during the Mughal reign.
  • Zamindars belonged to the nobility and formed the ruling class.
  • Emperor Akbar granted them mansabs, and their domains were treated as jagirs.
  • The Mughal Era did not differentiate between princely states and zamindari estates.
  • Zamindars collected revenue primarily from the Ryots (peasants).
• British Era
  • The British adopted the existing zamindari system in the north.
  • They recognized zamindars as landowners and required them to collect taxes.
  • The East India Company initially became zamindars of certain regions before expanding control.
  • The Permanent Settlement made zamindars proprietors of their land.
  • The British era saw the rise of new zamindars due to land auctions.

Long-term Impacts on Indian Agriculture and Rural Economy

• Economic Impact
  • The zamindari system influenced the economic structure of rural India.
  • Small farmers faced challenges due to the dominance of zamindars.
  • The abolition aimed to empower these farmers and reduce economic disparities.
• Agricultural Productivity
  • During the Mughal era, zamindars engaged in wars and rarely focused on land improvements.
  • The British era saw limited investment in agricultural innovation due to the zamindari system.
  • The abolition of the system aimed to promote agricultural growth and innovation.
• Cultural and Architectural Contributions
  • Zamindars played a significant role in regional histories.
  • They were patrons of the arts, promoting literature and architecture.
  • Notable contributions include the Tagore family, which produced India’s first Nobel laureate in literature, Rabindranath Tagore.

IX. Conclusion

The Permanent Settlement, introduced in 1793 by the East India Company, aimed to resolve the agrarian crisis by fixing land revenue and granting landholders proprietorial rights, anticipating increased agricultural investment. However, operational challenges and a lack of understanding of Bengali agriculture led to its shortcomings. The system inadvertently empowered zamindars, transforming them into a conservative interest group with significant influence. While it created a land market and introduced plantation-style farming, the power dynamics it established persisted, influencing rural politics and land reforms well into the 20th century, leaving a lasting legacy on India’s agrarian landscape.

1. How did the features of the Permanent Settlement influence the socio-economic dynamics of Bengal and Bihar during the colonial period? (250 words)
2. Assess the comparative advantages and challenges of the Permanent Settlement in relation to the Ryotwari and Mahalwari systems. (250 words)
3. Evaluate the long-term impacts of the Permanent Settlement on post-independence land reforms and rural economy in India. (250 words)