Statements (1) and (3) are correct, whereas statement (2) is not correct. The economic policies followed by the British led to therapid transformation of India’s economy into a colonial economywhose nature and structure were determined by the needs of the British economy. They totally disrupted the traditional structureof the Indian economy. The high import duties and other restrictionsimposed on the import of Indian goods into Britain and Europe during the eighteenth and nineteenth centuries, combined with the development of modern manufacturing industries in Britain led to the virtual closing of European markets to the Indian manufacturers after 1820.