Development of Industries in India 

Introduction

• The history of Indian industry perhaps dates back to the history of humankind. India’s traditional economy was characterised by a blend of agriculture and handicrafts.
• According to Edward Baines, ‘The birthplace of cotton manufacture is India where it probably flourished long before the dawn of authentic history.’
• Bernier, who visited India during the reign of Mughal emperor Shah Jahan, marvelled at the incredible quantity of manufacture goods. Tavernier, a French traveller, admired the peacock throne, carpets of silk and gold as well as mini carvings.

Traditional Crafts of India

• The crafts in India has a rich history. Crafts were an integral part in the life of the people. Before arrival of mechanised industry, the production of Indian handicrafts was the second largest source of employment in rural India next to agriculture. The traditional Indian industry was known in the fields of textiles, woodwork, ivory, stone cutting, leather, fragrance wood, metal work and jewellery.
• The village artisans such as potters, weavers, smiths produced articles and utensils for domestic use. But some specialised goods were produced for domestic and international markets. Some such specialised goods produced were cotton textiles, muslin, wool, silk and metal articles. India was famous for its fine quality of cotton and silk clothes.
• There are references made in many scholarly works to the professions of the weaver, the tailor and the dyer. Certain centres of metal industry were quite well known. For example, Saurashtra was known for bell metal, Vanga (Bengal) for tin industry and Dacca was identified with muslin clothes.

Decline of Indian Industries

Loss of Royal Patronage:

• The British conquest transformed Indian economy (self-reliant) into colonial economy. As the British conquered the Indian territories one after another, the native rulers, the nobles and the landlords lost their power and prosperity. The demand for the fine articles to be displayed in durbars and other ceremonial occasions disappeared. As a result, the craftsman who were patronised by these rulers lost their importance and became poor.
• For generations, these craftsmen had been practicing their craft, and they did not possess any other skills. So they had to work as labourers in fields to meet their daily needs. This change resulted in increased pressure on agriculture and there was large-scale under-employment in agriculture. The substitution of commercial food crops in agriculture ruined the Indian agro-based industry. The splendid period of indigenous handicraft industries came to an end as the political influence of the East India Company spread over various parts of the country.

Transition from producer to exporter of raw materials:

• Indian handicrafts that had made the country famous, collapsed under the colonial rule. This was mainly due to the competition posed by the machine-made goods that were imported from Britain by the British rulers. The ruling British turned India as the producer of raw materials for their industries and markets for their finished products. Moreover, the railways and roadways introduced by the British facilitated the movement of finished products to reach the remotest parts of India and the procurement of raw materials from these parts. 

Competition of Machine-Made Goods :

• Textile was the oldest industry in India. The highly specialised skills of Indian weavers and the low production cost gave a tough competition to the European manufactures. It led to the invention of cottongin, flying shuttle, spinning jenny and steam engine in England, which made the production of textiles on large scale.
• India became the market for the finished products of Britain. As a result, peasants who had supplemented their income by part-time spinning and weaving had to now rely only on cultivation. So they lost their livelihood. Moreover, the Indian goods made with primitive techniques could not compete with industrial goods made in England.

Trading policy of the British :

• All the policies implemented by the British government in India had a deep impact on India’s indigenous industries. Free trade policy followed by the East India Company compelled the Indian traders to sell their goods below the market prices. This forced many craftsmen to abandon their ancestral handicraft talents.
• East India Company’s aim was to buy the maximum quantity of Indian manufactured goods at the cheapest price and sell them to other European countries for a huge profit. This affected the traditional Indian industry. The British followed the policy of protective tariffs that was much against the trading interests of India. Heavy duties were charged on Indian goods in Britain,but at the same time, the English goods entering India were charged only nominal duties.

De-Industrialisation:

• During the fi rst half of 19th century western countries were experiencing industrialisation, India suff ered a period of industrial decline. The process of disruption of traditional Indian craft s and decline in national income has been referred to as de-industrialisation. The Indian domestic industry could not have withstood foreign competition, which was backed by a powerful industrial organisation, big machinery, large-scale production.
• The difficulties in Indian industries was complicated further by the construction of Suez Canal, because of which transport cost was reduced, which made the British goods cheaper in India. The main cause for the decline of handicraft industry was the greater employment opportunities and income-generating eff ect of the modern factory.

Beginning of Modern Industries

• The process of industrialisation started in India from the mid-19th century. The beginning of modern industry is associated with the development in mainly plantations like jute, cotton and also steel. There was a limited development of mining, especially coal. The accelerated industrialisation began with the development of railways and roadways. This growth greatly influenced the economic and social life of people in the country.
• The two World Wars gave an impetus to the development of number of industries such as chemical, iron and steel, sugar, cement, glass and other consumer goods. Most mills were setup by wealthy Indian businessmen. Initially this development was confined to the setting up of cotton and jute textile mills.

Plantation Industries:
The plantation industry was the first to attract the Europeans. The plantation industry could provide jobs on a large scale, and in reality, it could meet the increasing demands for tea, coffee and indigo by the British society. Therefore, plantation industry was started early on. The Assam Tea Company was founded in 1839. Coffee plantation also started simultaneously. As the tea plantation was the most important industry of Eastern India, coffee plantation became the centre of activities in South India. The third important plantation, which gave birth to factory, was jute. All these industries were controlled by the many former employees of the British East India Company.

Machine-based Industries:
In India, modern industrial sector in an organized form started with the establishment of cotton textile industry in Bombay in 1854. In 1855, jute industry was started in the Hooghly valley at Rishra near Calcutta. The first paper mill was started in Ballygunj near Calcutta in 1870. The cotton mills were dominated by Indian enterprises and the jute mills were owned by the British capitalists. Cotton mills were opened in Bombay and Ahmedabad, and jute mills proliferated on the Hooghly river banks. The woollen and leather factories became prominent in Kanpur.

Heavy Industries:
The heavy industries included the iron and steel industry, Steel was first manufactured by modern methods at Kulti in 1874.Iron and steel industries began rooted in the Indian soil in the beginning of 20th century. However, the credit for the development of large-scale manufacture of steel in India goes to Jamshedji Tata. The Tata Iron and Steel Company (TISCO) was setup in 1907 at Jamshedpur. It started producing pig iron in 1911 and steel ingots in 1912.