Chapter 4 The Age Of Industrialisation

Before The Industrial Revolution

While we often equate industrialization with factories and factory workers, it's important to note that large-scale industrial production for international markets existed long before the emergence of factories in England and Europe. This earlier phase, referred to by many historians as proto-industrialisation, was not based in factories but involved production across the countryside.

In the seventeenth and eighteenth centuries, merchants from European towns began extending their operations into rural areas. They provided money to peasants and artisans, encouraging them to produce goods for international trade. The growing demand for goods was fueled by the expansion of world trade and the acquisition of colonies. Merchants faced limitations in expanding production within towns due to the powerful presence of **urban crafts and trade guilds**. These guilds were associations of producers that controlled training, production quality, prices, and restricted the entry of new members. Rulers often granted guilds monopolies over specific products, making it difficult for new merchants to establish businesses in urban centers. Consequently, merchants sought producers in the countryside.

In rural areas, poor peasants and artisans welcomed the opportunity to work for merchants. This was a time when traditional open fields were being enclosed, reducing access to common lands that many depended on for resources like firewood and food. Peasants with small plots of land often couldn't sustain their families solely through cultivation. Merchants offering advances for production provided a crucial alternative income source. This allowed peasant households to remain in the countryside, continue farming their small plots, and make fuller use of their family labor. Income from proto-industrial production supplemented their diminishing earnings from agriculture.

Within this proto-industrial system, a close connection developed between towns and the countryside. Merchants resided in towns, but production primarily took place in rural households. For example, a cloth merchant in England would buy wool, transport it to spinners in the countryside, collect the spun yarn, take it to weavers, then to fullers (who gather cloth), and finally to dyers. The cloth would then be finished in London, which became a major finishing center, before being exported internationally.

This system was a network of commercial exchanges managed by merchants, with goods produced by a vast number of scattered producers working in their homes. Each merchant might employ 20 to 25 workers at each stage of production, effectively controlling hundreds of workers without owning a factory.

The Coming Up Of The Factory

The first factories in England were established around the 1730s. However, it was towards the late eighteenth century that the number of factories began to significantly increase.

Cotton production became the leading sector and the first symbol of this new industrial era. Its output grew dramatically in the late 19th century. In 1760, Britain imported 2.5 million pounds of raw cotton. By 1787, this import figure had jumped to 22 million pounds. This surge was directly linked to key changes in the production process.

A series of inventions in the eighteenth century improved the efficiency of various steps in textile production, such as carding (preparing fibers), twisting, spinning, and rolling. These innovations increased the amount of output per worker and allowed for the production of stronger threads and yarn. A pivotal development was Richard Arkwright's creation of the cotton mill. Previously, cloth production was decentralized and carried out in scattered rural households. With the advent of the mill, expensive new machines could be housed, installed, and maintained in one location. Bringing all production processes under one roof and management within the mill allowed for better supervision of quality, regulation of labor, and overall control, which were difficult in the dispersed system of domestic production.

By the early nineteenth century, factories became a prominent feature of the English landscape. Their imposing structures and the seemingly magical power of new technology impressed contemporaries, who often focused on the mills, sometimes overlooking the numerous workshops and smaller production units that still operated in alleys and bylanes.

Hand Labour And Steam Power

Considering the pace and nature of industrial change in Britain raises questions about whether industrialization solely meant the growth of factories and how rapid this transition was.

Firstly, while industries like cotton and metals were the most dynamic, the process of industrialization was not consistently rapid. Cotton led the first phase until the 1840s, after which the iron and steel industry took precedence, particularly with the expansion of railways. However, this growth didn't mean new industries immediately replaced traditional ones.

Secondly, even by the end of the nineteenth century, the technologically advanced industrial sectors employed less than 20 percent of the total workforce. While textiles were a dynamic sector, a significant portion of production still occurred outside factories, in domestic settings.

Thirdly, traditional industries didn't remain stagnant. While not driven by steam power, small innovations in sectors like food processing, building, pottery, glasswork, tanning, and furniture making contributed to gradual growth.

Fourthly, technological changes were often slow to spread. New technologies were expensive, and industrialists were cautious about adopting them. Machines frequently broke down, repairs were costly, and their effectiveness didn't always match inventors' claims. James Watt's improved steam engine (patented 1781), for instance, took years to find buyers. By the early 1800s, England had only 321 steam engines, mostly in cotton, wool, mining, canal, and iron works, not widely used in other industries until much later.

In Victorian Britain, there was an ample supply of human labour. Poor peasants and migrants flocked to cities seeking employment, keeping wages low. This abundance of cheap labour reduced the incentive for industrialists to invest heavily in machines that would replace human workers. Furthermore, demand for labour in many industries was seasonal. Industries like gas works, breweries, bookbinders, printers (for Christmas demand), and waterfront repairs required more workers during specific peak seasons. Industrialists typically preferred hiring temporary hand labour for these periods rather than investing in machinery.

Hand labour was also necessary for producing goods with intricate designs and specific, non-standard shapes. Machines were best suited for producing uniform, standardized products for a mass market. However, there was significant demand for handmade goods with detailed craftsmanship. For example, in mid-nineteenth-century Britain, 500 types of hammers and 45 types of axes were produced, requiring skilled human labor rather than mechanical technology.

The upper classes in Victorian Britain, including the aristocracy and the bourgeoisie, favored handmade items, viewing them as symbols of refinement and high class due to their better finish, individual production, and careful design. Machine-made goods were often produced primarily for export to the colonies.

In contrast, countries with a shortage of labour, like nineteenth-century America, were more inclined to adopt mechanical power to minimize the need for human workers. Britain, with its readily available workforce, did not face this same pressure.

Life Of The Workers

The large supply of labour significantly impacted the lives of workers in Britain. News of potential jobs in cities drew hundreds of people from rural areas. The actual chance of securing employment often depended on existing social networks of friends and family; having connections within a factory increased the likelihood of getting a job quickly. Many job seekers without such connections faced weeks of waiting, often sleeping in temporary shelters or under bridges.

The seasonal nature of work in many industries meant long periods of unemployment for workers. After the busy season ended, many poor workers found themselves jobless again. Some returned to the countryside during the agricultural season, but most sought temporary odd jobs, which were scarce until the mid-nineteenth century.

Wages saw a modest increase in the early nineteenth century, but this didn't necessarily reflect improved worker welfare. Average wage figures hid significant variations between different trades and yearly fluctuations. For example, during the prolonged Napoleonic War, when prices rose sharply, the purchasing power of workers' wages decreased significantly. Furthermore, a worker's income depended not just on the wage rate but critically on the number of days worked, determining their average daily earnings. Even in better economic times before the mid-nineteenth century, about 10 percent of the urban population lived in extreme poverty. During economic downturns, like the 1830s, unemployment rates could soar to between 35 and 75 percent in different regions.

The constant fear of unemployment made workers resistant to the introduction of new technology that could replace them. When the Spinning Jenny (a machine devised by James Hargreaves in 1764 that increased spinning speed and reduced labour demand) was introduced in the woollen industry, women who relied on hand spinning to earn a living attacked the new machines. This conflict over the adoption of the Spinning Jenny persisted for a considerable period.

After the 1840s, increased building activity in cities created more employment opportunities. Projects like widening roads, constructing new railway stations and lines, digging tunnels, laying drainage and sewer systems, and embanking rivers generated demand for workers. The number of workers in the transport sector doubled in the 1840s and again over the next three decades.

Industrialisation In The Colonies

Moving our focus to India, we examine the process of industrialization within a colonial context, considering both factory production and the non-mechanized sector, particularly in the textile industries.

The Age Of Indian Textiles

Before the widespread adoption of machine industries, textiles from India, especially fine silk and cotton goods, dominated the global market. While coarser cottons were produced in various countries, India was renowned for its finer varieties. Indian textiles were transported across vast networks.

Armenian and Persian merchants carried goods from Punjab to Afghanistan, eastern Persia, and Central Asia via land routes. Bales of textiles were transported on camels through the northwest frontier passes and across deserts. Vibrant maritime trade also operated through major pre-colonial ports. Surat on the Gujarat coast connected India to the Gulf and Red Sea ports. Masulipatam on the Coromandel coast and Hoogly in Bengal facilitated trade links with Southeast Asian ports.

A diverse network of Indian merchants and bankers supported this export trade, providing finance for production, managing the movement of goods, and supplying exporters. Supply merchants linked port towns with inland production centers. They provided advances to weavers in villages, collected the finished cloth, and transported it to the ports. At the ports, large shippers and export merchants used brokers to negotiate prices and purchase goods from the inland supply merchants.

By the 1750s, this robust trading network, primarily controlled by Indian merchants, began to decline. European trading companies gradually gained political influence, first securing concessions from local rulers and then acquiring monopoly rights to trade certain goods. This shift led to the decay of older ports like Surat and Hoogly, which Indian merchants had predominantly used. Exports from these ports decreased sharply, the credit systems that had financed the trade started to dry up, and many local bankers became bankrupt. The gross value of trade passing through Surat plummeted from ₹16 million in the late seventeenth century to ₹3 million by the 1740s.

While Surat and Hoogly declined, new ports like Bombay and Calcutta grew in prominence. This geographical shift in trade centers reflected the growing power of colonial rule. Trade through these new ports was increasingly controlled by European companies and transported on European ships. Many established Indian trading houses collapsed, and those that survived had to adapt and operate within the new network shaped by European trading companies.

These transformations significantly impacted the lives of Indian weavers and other artisans.

What Happened To Weavers?

The East India Company's consolidation of political power after the 1760s did not immediately lead to a decline in Indian textile exports. British cotton industries were not yet fully developed, and there was high demand for fine Indian textiles in Europe. Therefore, the Company initially sought to expand textile exports from India.

Before gaining political control in regions like Bengal and Carnatic in the 1760s and 1770s, the East India Company faced difficulties in obtaining regular supplies of goods for export. They competed with other European trading companies (French, Dutch, Portuguese) and local Indian traders, allowing weavers and supply merchants to negotiate prices and sell to the highest bidder. Company officials frequently complained in their letters to London about the challenges of supply and high prices.

Once the East India Company established political authority, it leveraged its power to assert a trade monopoly. It implemented a system to eliminate competition, control costs, and ensure consistent supplies of cotton and silk goods. This was achieved through several measures:

1. Eliminating existing traders and brokers: The Company sought to bypass the Indian merchants involved in the cloth trade.
2. Direct control over weavers: It appointed a paid supervisor called the gomastha to oversee weavers, collect supplies, and inspect cloth quality.
3. Preventing weavers from dealing with other buyers: This was enforced through a system of **advances (loans)**. Weavers who accepted a loan from the Company were obligated to produce cloth for the Company and forbidden from selling their output to any other trader.

Initially, as loans were readily available and demand for fine textiles was high, weavers eagerly accepted the advances, hoping to increase their earnings. Many weavers traditionally had small plots of land that they cultivated alongside weaving to meet family needs. Now, they were often forced to lease out their land and dedicate all their time to weaving. Weaving was a family enterprise, with all members participating in different stages.

However, tensions soon arose between weavers and the gomasthas in many weaving villages. Unlike the earlier supply merchants who often lived within the villages and had established social relationships with the weavers, looking after their welfare, the new gomasthas were outsiders. They acted with arrogance, often arrived with sepoys (Indian soldiers in British service) and peons (attendants), and punished weavers, sometimes severely (beating and flogging), for delays in supply. Weavers lost their ability to bargain for better prices and sell to different buyers; the prices offered by the Company were low, and the loans trapped them into working for the Company.

In response, weavers in many areas, particularly in Carnatic and Bengal, deserted their villages and migrated to other villages where they had family connections, hoping to set up looms there. In other places, weavers joined local traders in revolting against the Company and its officials. Over time, many weavers began refusing advances, closing their workshops, and seeking work as agricultural laborers. By the end of the eighteenth century, Indian cotton weavers faced significant new challenges.

Manchester Comes To India

In 1772, a Company official named Henry Patullo confidently stated that the demand for Indian textiles would never decline due to their unmatched quality. Yet, by the beginning of the nineteenth century, Indian textile exports began a long and steady decline. Piece-goods, which constituted 33 percent of India's exports in 1811-12, fell to a mere 3 percent by 1850-51.

Several factors led to this dramatic change:

• As cotton industries developed in England (particularly in Manchester), British industrial groups lobbied their government to protect domestic production. They successfully pushed for the imposition of import duties on cotton textiles from other countries, including India, making it difficult for Indian cloth to compete in the British market.
• British industrialists also pressured the East India Company to promote the sale of British manufactured goods in Indian markets. Exports of British cotton goods to India surged in the early nineteenth century. From virtually no imports of cotton piece-goods into India at the end of the eighteenth century, they accounted for over 31 percent of the value of Indian imports by 1850 and over 50 percent by the 1870s.

Indian cotton weavers thus faced a dual crisis: their traditional export markets collapsed due to British protectionist policies, and their local Indian market shrank dramatically as it was flooded with cheap, machine-made goods from Manchester. Imported cotton goods, produced at lower costs by machines, were significantly cheaper, making it nearly impossible for Indian weavers to compete. By the 1850s, reports from weaving regions across India described a widespread decline and devastation of the weaving industry.

By the 1860s, weavers faced an additional problem: a shortage of good quality raw cotton. When the American Civil War disrupted cotton supplies from the US, Britain turned to India as an alternative source. The resulting increase in raw cotton exports from India drove up the price of raw cotton domestically. Indian weavers struggled to obtain sufficient supplies and were forced to purchase raw cotton at excessively high prices, making weaving increasingly unprofitable.

Towards the end of the nineteenth century, yet another challenge emerged for weavers and other craftspeople: the rise of factories in India itself. These new mills began producing machine-made goods, further flooding the market and making it even harder for traditional weaving industries to survive.

Factories Come Up

Despite the challenges faced by traditional industries, the nineteenth century also saw the emergence of factory industries in India. The first cotton mill in Bombay was established in 1854 and commenced production in 1856. By 1862, Bombay had four mills operating. Around the same time, **jute mills** were set up in Bengal, with the first in 1855 and another in 1862. In North India, the Elgin Mill was started in Kanpur in the 1860s, followed by the first cotton mill in Ahmedabad a year later. By 1874, the first spinning and weaving mill began production in Madras.

Key questions about this development include: Who were the early industrialists? Where did the necessary funds come from? And who worked in these new mills?

The Early Entrepreneurs

Industries were established in different parts of India by a variety of entrepreneurs. The history of many prominent Indian business groups is linked to their involvement in trade, particularly with China.

From the late eighteenth century, the British in India engaged in exporting opium to China and importing tea from China to England. Many Indians participated as intermediaries in this trade, providing finance, sourcing supplies, and shipping goods. Having accumulated wealth through trade, some of these businessmen aspired to establish industrial ventures in India.

• In Bengal, Dwarkanath Tagore built his fortune in the China trade before investing in industries. He founded six joint-stock companies in the 1830s and 1840s. Although Tagore's ventures faced setbacks during the broader business crises of the 1840s, many other China traders became successful industrialists later in the century.
• In Bombay, prominent Parsis like Dinshaw Petit and Jamsetjee Nusserwanjee Tata, who established vast industrial empires, accumulated their initial capital partly from exports to China and partly from shipping raw cotton to England.
• Seth Hukumchand, a Marwari businessman who set up the first Indian jute mill in Calcutta in 1917, also had trading links with China. The father and grandfather of the famous industrialist G.D. Birla were also involved in the China trade.

Capital was also generated through other trading networks. Some merchants from Madras traded with Burma, while others had connections with the Middle East and East Africa. There were also commercial groups that operated primarily within India, involved in activities like transporting goods, banking, and financing traders. Many of these groups also ventured into setting up factories when industrial investment opportunities arose.

As colonial control over Indian trade became tighter, the scope for Indian merchants to operate independently narrowed. They were restricted from trading manufactured goods with Europe and were largely confined to exporting raw materials and food grains required by Britain, such as raw cotton, opium, wheat, and indigo. Indian businessmen were also gradually pushed out of the shipping industry.

Until the First World War, European Managing Agencies significantly controlled large sectors of Indian industries. Prominent examples include Bird Heiglers & Co., Andrew Yule, and Jardine Skinner & Co. These agencies were responsible for mobilizing capital, establishing joint-stock companies, and managing them. In most cases, Indian financiers provided the capital, but the European Agencies made all the crucial investment and business decisions. European merchant-industrialists formed their own chambers of commerce, which excluded Indian businessmen.

Where Did The Workers Come From?

The growing number of factories created an increasing demand for workers. In 1901, there were 584,000 factory workers in India, a number that rose to over 2,436,000 by 1946. These workers primarily came from the surrounding rural districts.

Peasants and artisans who could not find work in their villages migrated to industrial centers in search of employment. For instance, over 50 percent of the workers in the Bombay cotton industries in 1911 originated from the nearby district of Ratnagiri. Similarly, the mills in Kanpur drew most of their textile workers from villages within the Kanpur district. Millworkers often maintained ties with their villages, returning home during harvests and festivals.

Over time, as news of job opportunities spread, workers traveled considerable distances to find work in the mills. For example, migrants from the United Provinces (now Uttar Pradesh and Uttarakhand) moved to work in the textile mills of Bombay and the jute mills of Calcutta.

Getting a job in the mills was consistently challenging, even as the number of mills and the demand for workers increased. The supply of job seekers always exceeded the available positions. Entry into the mills was also often restricted through a system involving a **jobber**. Industrialists typically hired a jobber, usually an older, trusted worker, to recruit new laborers. The jobber would bring people from his village, help them secure jobs, assist them in settling in the city, and provide financial support during crises. This role gave the jobber significant authority and influence. Over time, jobbers often began demanding money or gifts in exchange for their services and exerted control over the lives of the workers they recruited.

While the number of factory workers grew, they constituted a small fraction of the total industrial workforce in India.

The Peculiarities Of Industrial Growth

The European Managing Agencies, which held significant control over industrial production in colonial India, primarily focused on specific types of products. They established tea and coffee plantations, often acquiring land cheaply from the colonial government, and invested in mining, indigo cultivation, and jute processing. These were largely geared towards export markets rather than domestic sale within India.

When Indian businessmen began setting up their own industries in the late nineteenth century, they strategically avoided direct competition with Manchester goods in the Indian market. Since yarn imports from Britain into India were not as significant as finished cloth, the early Indian cotton mills initially concentrated on producing coarse cotton yarn (thread) instead of fabric. Finer varieties of yarn were typically imported. The yarn produced by Indian spinning mills was used by handloom weavers in India or exported, mainly to China.

Changes occurred in the pattern of industrialization in the first decade of the twentieth century. The growing Swadeshi movement encouraged nationalists to urge people to boycott foreign goods, including cloth. Indian industrial groups formed associations to protect their interests, lobbying the government for increased tariff protection and other concessions. Furthermore, from 1906 onwards, the export of Indian yarn to China declined because Chinese and Japanese mills began flooding the Chinese market with their produce.

These developments prompted Indian industrialists to shift their focus from yarn production to producing finished cloth. As a result, cotton piece-goods production in India doubled between 1900 and 1912.

Despite these shifts, overall industrial growth remained relatively slow until the First World War. The war dramatically altered the situation. With British mills preoccupied with producing war-related goods for the army, imports from Manchester into India sharply declined. This suddenly created a vast domestic market for Indian mills to supply. As the war continued, Indian factories were called upon to produce essential war supplies, such as jute bags, cloth for military uniforms, tents, leather boots, horse and mule saddles, and other items. New factories were established, existing ones operated multiple shifts, many new workers were hired, and working hours were extended. Industrial production in India experienced a significant boom during the war years.

After the war, Manchester was unable to regain its pre-war dominance in the Indian market. The British economy faced challenges modernizing and competing with industrial powers like the US, Germany, and Japan. British cotton production and cloth exports declined significantly. Within the colonies, Indian industrialists gradually strengthened their position, replacing imported manufactures and capturing the home market.

Small-Scale Industries Predominate

While factory industries saw steady growth after the First World War, large-scale industries constituted only a small part of the overall economy. In 1911, about 67 percent of large industries were concentrated in just two regions: Bengal and Bombay. Across the rest of the country, **small-scale production** remained the dominant form of industrial activity.

Only a small percentage of the total industrial workforce was employed in registered factories: 5 percent in 1911 and 10 percent in 1931. The majority of workers were employed in small workshops and household units, often located in less visible areas like alleys and bylanes.

Interestingly, in some cases, handicrafts production actually expanded during the twentieth century. This includes the handloom sector, which survived despite the challenges posed by machine-made yarn and cloth. While cheap machine-spun yarn wiped out the spinning industry in India in the 19th century, weavers managed to persevere. Handloom cloth production consistently grew in the twentieth century, nearly tripling between 1900 and 1940.

This survival and growth were partly facilitated by **technological changes** adopted by handloom weavers. Handicrafts people were willing to use new technology if it improved productivity without significantly increasing costs. By the second decade of the twentieth century, many weavers started using looms equipped with a **fly shuttle**. This mechanical device, moved by ropes and pulleys, inserted the weft (horizontal threads) into the warp (vertical threads) more efficiently, increasing productivity, speeding up weaving, and allowing weavers to operate larger looms to produce wider cloth. By 1941, over 35 percent of handlooms in India had fly shuttles, with proportions reaching 70-80 percent in regions like Travancore, Madras, Mysore, Cochin, and Bengal. Other small innovations also helped weavers enhance productivity and compete with the mill sector.

Certain groups of weavers were better positioned to withstand competition from mill industries. Weavers producing coarse cloth faced volatile demand, as the rural poor who bought it had little cash during bad harvests or famines. However, demand for finer varieties, purchased by the wealthy, was more stable. The rich could afford these even when the poor struggled. Mills also found it difficult to replicate specialized weaves, such as saris with intricate woven borders or the renowned lungis and handkerchiefs from Madras.

Despite their continued production and adoption of some technology, weavers and other craftspeople in the twentieth century often led difficult lives with long working hours. The entire household, including women and children, frequently participated in various production stages. However, they were not merely relics of the past; their labor and skills were an integral part of the industrial landscape.

Market For Goods

The process of industrialization wasn't just about production; it also involved creating markets for new products. As British manufacturers aimed to capture the Indian market and Indian producers sought to resist colonial dominance and expand their own markets, the question of how to persuade people to buy goods became crucial. People needed to be convinced that they needed or desired these new products.

One powerful method used to create new consumers was advertisement. Advertisements make products appealing and create new needs and desires in people's minds. From the early industrial age, advertisements played a vital role in expanding markets and shaping a new consumer culture. Today, we are surrounded by advertisements in various media, but their historical significance in driving demand is noteworthy.

When Manchester industrialists began selling cloth in India, they used labels on cloth bundles. These labels served multiple purposes: identifying the place of manufacture and the company name for buyers and signaling quality. Seeing "MADE IN MANCHESTER" on a label was intended to instill confidence in the buyer regarding the cloth's quality.

These labels weren't just text; they often featured images and were beautifully illustrated. Analyzing these old labels provides insight into the manufacturers' strategies and how they attempted to appeal to Indian consumers. Notably, images of Indian gods and goddesses frequently appeared on these foreign labels. This was intended to lend a sense of divine approval to the products and make the foreign-made goods seem more familiar and acceptable to the Indian populace.

By the late nineteenth century, manufacturers also printed calendars for product promotion. Calendars had a wider reach than newspapers or magazines as they were used even by people who couldn't read. They were displayed in various places, from tea shops and poor homes to offices and middle-class residences, ensuring daily exposure to advertisements throughout the year. These calendars also often utilized images of gods to promote new products.

Besides religious figures, images of important personalities like emperors and nawabs adorned advertisements and calendars. The implicit message was often one of endorsement: respecting the royal figure should translate to respecting the product, implying its superior quality if used by royalty or produced under their patronage.

Indian manufacturers, when advertising their products, often incorporated a clear and strong nationalist message. Their advertisements became a vehicle for the Swadeshi (buy Indian) message, urging consumers to support Indian industries and care for the nation by purchasing domestically produced goods.