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Role of Graft and Bias in Colonial Ethnography

"A series of conquests expanded the territory held by the British and the idea of responsible trusteeship began to creep into the thinking of the individuals charged with governing British India. The freebooters of the 18th century were giving way to the bureaucrats of the 19th century. Ironically, it is highly debateable which of the two, freebooters or bureaucrats, were the most dangerous to the people of India. Treasure can be replaced. Cultures, once tampered with, are nearly impossible to reclaim." 
-Kevin Hobson, Ethnographic Mapping and the Construction
of the British Census in India
Post-colonial Indian and Western scholars have now for over several decades scrutinized a  vast body of administrative literature produced by colonial government of British India.  This study is both enlightening and contentious at the same time . This ambivalence is the necessary result of two factors. First,  prior to European colonial intervention in the long and continuous history of Indian subcontinent, the region had not yet developed or honed critical intellectual traditions of objective history in the way this body of study is now recognized.  History recording was left - especially among the Hindus- to a  group of hereditary bards who mixed fact with myth along with considerable poetic flourish  for easy oral transmission and narration  of events, people and plots which comprised  the "Itihāsa". 
That said, this is not to say that Hindu tradition lacked intellectual sophistication which is more than evident from the astronomical, mathematical, medical and philosophical treatises produced by ancient Hindus which have managed survive. It is just that Hindus did not seem have paid much attention to the recording of what would be easily explained as temporal and transient if one situates oneself in the cosmological frame of reference of the seers of Upnidhads, the most authoritative religious texts of Indian spiritual traditions. 
Another other reason offered by scholars for Hindu indifference toward historiography  is monsoon based  climate of the subcontinent which did not allow the scrolls made of leaves to be preserved for a long time and consequently  forced the people to continue to rely on oral traditions for the transmission of most essential intellectual knowledge. Needless to say, there is limitation to the prowess of human memory retention and accordingly only the systems of knowledge like "Jyotish", "Ayurveda",  "Upnishads",  "Itihāsas" like Mahabharta, Puranas , etc - which contained the most essential body of Hindu learning- were deemed fit for a space in tradition of memory based transmission of knowledge.
Yet another reason for this phenomenon is explained by about seven hundered years of unbroken Muslim rule of North India in which Hindu and Buddhist monastaries, temples and libraries were targeted for wholesale destruction  by invading Muslim armies who professed in very intolerant version of Islam. The destruction of the Buddhist  monastary cum university of Nalanda is a case in the point.