Read the passage and answer the question:

Before the 1860s, three-fourths of raw cotton imports into Britain came from America. British cotton manufacturers had for long been worried about this dependence on American supplies. What would happen if this source was cut off? Troubled by this question, they eagerly looked for alternative sources of supply.

When the American Civil War broke out in 1861, a wave of panic spread through cotton circles in Britain. Raw cotton imports from America fell to less than three per cent of the normal: from over 2,000,000 bales (of 400 lbs each) in 1861 to 55,000 bales in 1862. Frantic messages were sent to India and elsewhere to increase cotton exports to Britain. In Bombay, cotton merchants visited the cotton districts to assess supplies and encourage cultivation.

Which of the following was a 'problem' associated with cotton expansion in India during the decade of 1860s?

1- India did not have a suitable soil for cotton cultivation.
2- India did not have a climate favourable to cotton cultivation.
3- Sahukars were unwilling to extend long-term loans.
4- For a large majority of peasants, cotton expansion meant heavier debt.

Choose the correct answer from the given options:

4

The correct answer is Option 4 - 4

4- For a large majority of peasants, cotton expansion meant heavier debt (Out of the given options, this is the problem associated with cotton expansion in India during the decade of 1860s).

The other three options were not a problem as those statements are false:

1- India HAD a suitable soil for cotton cultivation.
2- India HAD a climate favourable to cotton cultivation.
3- Sahukars were WILLING to extend long-term loans.

In 1857 the Cotton Supply Association was founded in Britain, and in 1859 the Manchester Cotton Company was formed. Their objective was “to encourage cotton production in every part of the world suited for its growth”. India was seen as a country that could supply cotton to Lancashire if the American supply dried up. It possessed suitable soil, a climate favourable to cotton cultivation, and cheap labour.

When the American Civil War broke out in 1861, a wave of panic spread through cotton circles in Britain. Raw cotton imports from America fell to less than three per cent of the normal: from over 2,000,000 bales (of 400 lbs each) in 1861 to 55,000 bales in 1862. Frantic messages were sent to India and elsewhere to increase cotton exports to Britain. In Bombay, cotton merchants visited the cotton districts to assess supplies and encourage cultivation. As cotton prices soared (see Fig. 10.15), export merchants in Bombay were keen to secure as much cotton as possible to meet the British demand. So they gave advances to urban sahukars who in turn extended credit to those rural moneylenders who promised to secure the produce. When there is a boom in the market credit flows easily, for those who give out loans feel secure about recovering their money.

These developments had a profound impact on the Deccan countryside. The ryots in the Deccan villages suddenly found access to seemingly limitless credit. They were being given Rs 100 as advance for every acre they planted with cotton. Sahukars were more than willing to extend long-term loans.

While the American crisis continued, cotton production in the Bombay Deccan expanded. Between 1860 and 1864 cotton acreage doubled. By 1862 over 90 per cent of cotton imports into Britain were coming from India.

But these boom years did not bring prosperity to all cotton producers. Some rich peasants did gain, but for the large majority, cotton expansion meant heavier debt.