Development Of Industries In India

Class 8 | Social Science — History | Unit 6

Class 8 Unit 6 History

Unit 6 Development of Industries in India

Learning Objectives

• Acquit with the traditional crafts of India.
• Analyse the causes for the decline of Indian industries.
• Understand the beginning of modern industries.
• Know the aim of five-year plans.
• Understand the phases of industrial development 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 manufactured 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.

The muslin of Dacca
Mummies in Egyptian tombs dating from 2000 BC(BCE) were found wrapped in Indian muslins of the finest quality. A 50metres of this thin fabric could be squeezed into a match box.

Decline of Indian Industries

a. 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.

b. 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.

c. 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.

The Drain Theory of Dadabai Naoroji
Dadabai Naoroji was the first to acknowledge that the poverty of the Indian people was due to the British exploitation of India's resources and the drain of India's wealth to Britain.

d. 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.

e. De-Industrialisation

During the first half of 19th century western countries were experiencing industrialisation, India suffered a period of industrial decline. The process of disruption of traditional Indian crafts 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 effect 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.

a. 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.

b. 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.

c. 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 nineteen not seven at Jamshedpur. It started producing pig iron in nineteen eleven and steel ingots in nineteen twelve.

Growth of Modern Industries

The length of railways increased from 2,573 km in 1861 to 55,773 kilometer in 1914. Opening of the Suez Canal also shortened the distance between Europe and India by about 4,830 kilometer. This reduced distance facilitated further industrialisation of India. As a result of Swadeshi Movement, the cotton mills increased from 194 to 273 and jute mills from 36 to 64. The British had consolidated the power in India and thereby attracted large number of foreign entrepreneurs and capital particularly from England. Foreign capitalists were attracted to Indian industry as it held the prospect of high profit. Labour was extremely cheap. Raw materials were cheaply available. India and its neighbours provided a ready market.

Confederation of Indian Industry (C, I, I)

The Confederation of Indian Industry is a business association in India. CII is a nongovernment, not-for-profit, industry-led and industry-managed organisation. It was founded in 1985. It has over 9,000 members form the private as well as public sectors, including small and medium enterprises (S, M, E) and multinational corporations (M, N, Cs).

Industrial Growth in India

To realise the dream of development of industries, Indian Government adopted certain industrial policies and Five-Year Plans. One of the most important innovations in the industrial field after Independence has been the introduction of the Five-Year Plans and the direct participation in industry by the government as expressed in the Industrial Policy Resolution of 1948. This Resolution delineated the role of the state in the industrial development both as an entrepreneur and as an authority. As per the Industrial Policy Resolution 1956, industries were classified into three categories:

Schedule A: Only the Government can handle these industries. Some of these are atomic energy, electrical, iron and steel and others.

Schedule B: These comprise road and sea transportation, machine tools, aluminium, chemicals including plastics and fertilisers, ferroalloys and certain types of mining.

Schedule C: Under this category, the remaining industries and left to the private sector.

Classification of Industries
On the basis of raw materials used, industries can be classified into agro-based and mineral-based. According to their role it can be classified into basic and key industries. On the basis of ownership it can be classified into public sector, private sector, joint sector and co-operative sector.

Phases of Industrial development in India

a. Industrial development during 1950s to1965

During this phase, a majority of consumer goods were produced in India. The industrial sector was underdeveloped with weak infrastructure. Technical skills were in short supply. The first three Five-Year Plans were very important because their aim was to build a strong industrial base in independent India. These plans mostly focused on the development of capital goods sector. As a result, this phase witnessed a strong acceleration in the growth rate of production.

b. Industrial development during nineteen sixty five to nineteen eighty

As the first three Five-Year Plans mostly focused on the development of the capital goods sector, the consumer goods sector was neglected. The consumer goods sector is the backbone of rural economy. As the result, there was a fall in the growth rate of industrial production. So this period is marked as the period of structural retrogression.

c. Industrial Development during nineteen eighty to nineteen ninety one

The period of the 1980s can be considered as the period of the industrial recovery. This period witnessed quite a healthy industrial growth.

d. Industrial Development Post nineteen ninety one Reforms

The year nineteen ninety one ushered a new era of the economic liberalisation. India took major decision to improve the performance of the industrial sector. The Tenth and Eleventh Five-Year Plans witnessed a high growth rate of industrial production. The abolition of industrial licensing, dismantling of price controls, dilution of reservation of small-scale industries and virtual abolition of monopoly law enabled Indian industry to flourish. The new policy welcomes foreign investments.

Modernisation

India has now a large variety of industries producing goods of varied nature, which shows a high degree of modernisation. Some modern industries have really grown and they are competing effectively with the outside world. This has reduced our dependence greatly on foreign experts and technologists. On the contrary, India is exporting trained personnel to relatively less developed countries. The term information technology includes computer and communication technology along with software. Along with three-sector model of primary, secondary and tertiary industries, a fourth sector, information-related industries, has emerged. The knowledge economy depicts the automation of labour-intensive manufacturing and service activities as well as growth in new service industries such as health care, distance education, software production and multimedia entertainment.

Self-Reliance

Another positive aspect of industrial growth is the attainment of the goal of self-reliance. We have achieved self-reliance in machinery, plant and other equipment. Today, the bulk of the equipment required for industrial and infrastructural development is produced within the country. The Indian road network has become one of the largest in the world. Government efforts led to the expansion of the network of National Highways, State highways and major district roads, which in turn has directly contributed to industrial growth. As India needs power to drive its growth engine, it has triggered a noteworthy improvement of availability of energy. After almost seven decades of independence, India has emerged as the third largest producer of electricity in Asia.

Conclusion

Industrialisation is an important component of economic growth. India's industrial expansion over the plan period presents a mixed picture. Compared to the preindependence level, industrial growth during the Five-Year plan periods is phenomenal.

Recap

The history of Indian Industry dates back to the history of human kind. The crafts in India has a rich history. Indian handicrafts that had made the country famous, collapsed under the Colonical rule. The process of Industrialisation started in India from the mid of 19th Century. In India modern industrial sector in an organised form started with the establishment cotton textile Industry. Confederation of Indian Industry is a nongovernment, not-for-profit, industry-led and industry-managed Organisation.

GLOSSARY

incredible unbelievable நம்பமுடியாத indigenous Native உள்நாட்டு acceleration increasing the speed விரைவுப்படுத்துதல் swadeshi produced with in this country உள்நாட்டு உற்பத்திப்பொருள் entrepreneur businessman தொழில் முனைவோர் retrogression to return to older பின்னோக்கிச் செல்லுதல்

Evaluation

Exercise 1. Choose the correct answer

Which of the following activities of the people will not come under handicraft?

a. Carving statues out of stone b. Making bangles with glass c. Weaving silk sarees d. Smelting of iron

The oldest industry in India was industry.

a. Textile b. Steel c. Electrical d. Fertilizers

The woollen and leather factories became prominent in

a. Bombay b. Ahmadabad c. Kanpur d. Dacca

What was the aim of first Three Fiveyear Plans of India?

a. To control population growth b. To reduce illiteracy rate c. To build a strong industrial base d. To empower the women

What was not the reason for the decline of Indian Industries?

a. Loss of royal patronage b. Competition of machine-made goods c. Industrial policy of India d. Trading policy of British Exercise 2. Fill in the blanks

1. was the integral part in the life of the people.

2. Industrial revolution took place in

3. The Assam Tea Company was founded in

4. Jute industry was started in the Hoogly Valley at near Calcutta.

5. shortened the distance between Europe and India.

Exercise 3. Match the following

1) Tavernier
2) Dacca
3) Dadabai Naoroji
4) Ballygunj
5) Smiths

Options: Drain Theory, Paper mill, Artisan, Muslin, French traveller

Exercise 4. True or False 1. India was famous for cotton and silk cloths. 2. The railway was introduced in India by the British. 3. Steel was first manufactured by modern methods at Jamshedpur. 4. The industrial policy of 1948, brought mixed economy in industrial sector. 5. The tenth and eleventh five-year plans witnessed a high growth rate of Agricultural production. Exercise 5. Consider the following the statements and tick ( ✓ ) the appropriate answer

Which of the following statements are correct?

1. According to Edward Baines, 'The birth place of cotton manufacture is in England'.
2. Before mechanised industry handicrafts was the second largest source of employment in rural India.
3. Saurashtra was known for tin industry.
4. Construction of Suez Canal made the British goods cheaper in India.

a) 1 and 2 are correct b) 2 and 4 are correct c) 3 and 4 are correct d) 1, 2 and 3 are correct

Assertion (A): Indian handicrafts collapsed under the colonial rule.
Reason (R): British made India as the producer of raw materials and markets for their finished products.

A is correct R is correct explanation of A A is correct and R is not the correct explanation of A Both A and R is correct Both A and R is wrong

Which one of the following is wrongly matched?

Bernier – Shajahan Cotton mill – Ahmadabad TISCO – Jamshedpur Economic Liberalisation - nineteen eighty Exercise 6. Answer the following in one or two sentences

1. What are the traditional handicrafts industries of India?

2. Write about the drain theory.

3. Name the inventions which made the production of textiles on large scale.

4. Write a short note on Confederation of Indian Industry.

5. What is de-industrialisation?

Exercise 7. Answer the following in detail

1. How was the trading policy of British caused for the decline of the Indian Industries?

2. Write in detail about the plantation industries.

3. Explain Industrial development after 1991 reforms.

Exercise 8. HOTs

How do handicraft products differ from machine made products?

Exercise 9. Mark the following places on the outline map of India

Bombay, Calcutta, Dacca, Jamshedpur, Rishra, Ahmadabad, Kanpur, Kulti, New Delhi, Assam

Exercise 10. Project and Activity

1. Name the industries in your state and divide them into Agro based metal based and forest based.

2. Prepare a project on air, water, and land pollution due to the industrial development in India.

3. Make a power point presentation on the industrial development of India and highlight the main features of those developments.

REFERENCE BOOKS

• Dharmakumar (ed). The Cambridge Economic History of India, Vol II, c.17572003
• The Gazeteer of India. Vol II Publications Division India 1995 - A reference Annual, Publications Division

INTERNET RESOURCES

• http://www.suezcanal.gov.eg
• http://www.cii.in

Book-back Exercises — Questions & Answers

Answers generated strictly from the Samacheer Kalvi textbook content. Attempt each question first, then click "Show Answer" to check.

1. Choose the correct answer

1. Which of the following activities of the people will not come under handicraft?

a) Carving statues out of stone b) Making bangles with glass c) Weaving silk sarees d) Smelting of iron

Answer: d) Smelting of iron

Explanation: The chapter mentions traditional handicrafts included stone cutting, textiles, and making articles for domestic use, but iron smelting was part of heavy industries.

2. The oldest industry in India was ________ industry.

a) Textile b) Steel c) Electrical d) Fertilizers

Answer: a) Textile

Explanation: The chapter states "Textile was the oldest industry in India."

3. The woollen and leather factories became prominent in

a) Bombay b) Ahmadabad c) Kanpur d) Dacca

Answer: c) Kanpur

Explanation: The chapter mentions "The woollen and leather factories became prominent in Kanpur."

4. What was the aim of first Three Five-year Plans of India?

a) To control population growth b) To reduce illiteracy rate c) To build a strong industrial base d) To empower the women

Answer: c) To build a strong industrial base

Explanation: The chapter states "The first three Five-Year Plans were very important because their aim was to build a strong industrial base in independent India."

5. What was not the reason for the decline of Indian Industries?

a) Loss of royal patronage b) Competition of machine-made goods c) Industrial policy of India d) Trading policy of British

Answer: c) Industrial policy of India

Explanation: The chapter mentions loss of royal patronage, competition of machine-made goods, and trading policy of British as causes for decline, but not industrial policy of India.

2. Fill in the blanks

1. ________ was the integral part in the life of the people.

Answer: Crafts

2. Industrial revolution took place in ________.

Answer: England

3. The Assam Tea Company was founded in ________.

Answer: 1839

4. Jute industry was started in the Hooghly Valley at ________ near Calcutta.

Answer: Rishra

5. ________ shortened the distance between Europe and India.

Answer: Suez Canal

3. Match the following

1. Match the Following

1) Tavernier	a) Drain Theory
2) Dacca	b) Paper mill
3) Dadabai Naoroji	c) Artisan
4) Ballygunj	d) Muslin
5) Smiths	e) French traveller

Answers: 1-e, 2-d, 3-a, 4-b, 5-c

4. State True or False

1. India was famous for cotton and silk cloths.

Answer: True

2. The railway was introduced in India by the British.

Answer: True

3. Steel was first manufactured by modern methods at Jamshedpur.

Answer: False

4. The industrial policy of 1948, brought mixed economy in industrial sector.

Answer: True

5. The tenth and eleventh five-year plans witnessed a high growth rate of Agricultural production.

Answer: False

5. Consider the following statements

1. Which of the following statements are correct?
1) According to Edward Baines, 'The birth place of cotton manufacture is in England'.
2) Before mechanised industry handicrafts was the second largest source of employment in rural India.
3) Saurashtra was known for tin industry.
4) Construction of Suez Canal made the British goods cheaper in India.

a) 1 and 2 are correct b) 2 and 4 are correct c) 3 and 4 are correct d) 1, 2 and 3 are correct

Answer: b) 2 and 4 are correct

Explanation: Statement 2 and 4 are correct according to the chapter text. Statement 1 is wrong as Baines said birthplace is India, not England. Statement 3 is wrong as Saurashtra was known for bell metal, not tin industry.

2. Assertion (A): Indian handicrafts collapsed under the colonial rule.
Reason (R): British made India as the producer of raw materials and markets for their finished products.

a) A is correct R is correct explanation of A b) A is correct and R is not the correct explanation of A c) Both A and R is correct d) Both A and R is wrong

Answer: a) A is correct R is correct explanation of A

Explanation: Both assertion and reason are correct, and R correctly explains A as mentioned in the chapter.

3. Which one of the following is wrongly matched?

a) Bernier – Shajahan b) Cotton mill – Ahmadabad c) TISCO – Jamshedpur d) Economic Liberalisation - nineteen eighty

Answer: d) Economic Liberalisation - nineteen eighty

Explanation: Economic liberalisation began in 1991, not 1980, according to the chapter.

6. Answer the following in one or two sentences

1. What are the traditional handicrafts industries of India?

Answer: The traditional Indian industry was known in the fields of textiles, woodwork, ivory, stone cutting, leather, fragrance wood, metal work and jewellery. Some specialised goods produced were cotton textiles, muslin, wool, silk and metal articles.

2. Write about the drain theory.

Answer: Dadabai Naoroji was the first to acknowledge that the poverty of the Indian people was due to the British exploitation of India's resources and the drain of India's wealth to Britain.

3. Name the inventions which made the production of textiles on large scale.

Answer: It led to the invention of cotton gin, flying shuttle, spinning jenny and steam engine in England, which made the production of textiles on large scale.

4. Write a short note on Confederation of Indian Industry.

Answer: The Confederation of Indian Industry is a business association in India. CII is a non-government, not-for-profit, industry-led and industry-managed organisation founded in 1985 with over 9,000 members from private and public sectors.

5. What is de-industrialisation?

Answer: The process of disruption of traditional Indian crafts and decline in national income has been referred to as de-industrialisation.

7. Answer the following in detail

1. How was the trading policy of British caused for the decline of the Indian Industries?

Answer: The British trading policies severely affected Indian industries. Free trade policy forced Indian traders to sell goods below market prices, making many craftsmen abandon their ancestral handicraft talents. The East India Company aimed to buy maximum quantity of Indian goods at cheapest price and sell them to European countries for huge profit. The British followed protective tariffs policy that was against Indian trading interests. Heavy duties were charged on Indian goods in Britain, while English goods entering India were charged only nominal duties. This unfair trade policy led to the decline of traditional Indian industries.

2. Write in detail about the plantation industries.

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

3. Explain Industrial development after 1991 reforms.

Answer: The year 1991 ushered a new era of economic liberalisation when India took major decisions to improve industrial sector performance. The Tenth and Eleventh Five-Year Plans witnessed high growth rate of industrial production. The abolition of industrial licensing, dismantling of price controls, dilution of reservation of small-scale industries and virtual abolition of monopoly law enabled Indian industry to flourish. The new policy welcomed foreign investments, leading to significant industrial growth and modernisation.

8. HOTs

1. How do handicraft products differ from machine made products?

Answer: Based on the chapter, handicraft products were made with highly specialised skills by Indian craftsmen using traditional techniques and had low production cost. Machine-made goods were produced on large scale using inventions like cotton gin, flying shuttle, spinning jenny and steam engine. The Indian goods made with primitive techniques could not compete with industrial goods made in England, leading to the decline of handicrafts.

📝 Summary

1. India had a rich tradition of handicrafts and industries dating back to ancient times, with traditional crafts including textiles, woodwork, ivory, stone cutting, leather, metal work and jewellery being integral to people's lives.
2. Before mechanised industry, handicraft production was the second largest source of employment in rural India after agriculture, with specialised goods like cotton textiles, muslin, wool, silk and metal articles produced for both domestic and international markets.
3. The decline of Indian industries began with the loss of royal patronage as British conquest transformed India's self-reliant economy into a colonial economy, causing native rulers, nobles and landlords to lose power and prosperity.
4. India transitioned from being a producer of finished goods to an exporter of raw materials under British rule, with machine-made goods imported from Britain competing with and destroying local handicrafts.
5. The introduction of railways and roadways by the British facilitated the movement of finished products to remote parts of India and enabled procurement of raw materials, further accelerating the decline of traditional Indian industries.