How had the 'First World War created economic problems in India? Explain with examples.

Explanation

The economic effects of the First World War were:
(i) The First World War led to huge expenditures in defence. These expenditures were to be financed by increasing the taxes and by raising custom duties.
(ii) During the time of the First World War, crop failure resulted in acute shortage of food.
(iii) During the war, the food prices increased, they almost doubled between 1913 and 1918. This increased the hardships of the people of India.
(iv) Villages were called upon to supply soldiers. At some rural places, the colonial government forced people to join the army. It caused widespread resentment and anger amongst the people. It set the stage for the Great Depression.
(v) There was spread of influenza epidemic which contributed to the hardships of the people. The war weakened the gold standard.