Other Industries in India

Sugar: Railways helped develop other industries like sugar. Previously sugar mills couldn’t be set up coz of transportation delays of sugarcane to the mills location. Now railways came to their rescue.

Leather: Madras was the only port to export leather to Europe till the end of the 19th century. Emergence of nation states led to building up of armies => more demand for leather (boots belts). Leather was tanned by vegetable (inefficient). Later, chemical tanned leather (chrome-tanned) emerged and US took advantage of this. This led to the death of Madras leather tanneries.

Indigo faced a similar fate as leather. Indigo was replaced by synthetic blue invented by a German scientist.

Spices were exported from Madras, Cochin. This was till the end of 19th century after which Indonesia took that lead from India.

Except China and US, the whole world was either colonies or colonizers’ property. Among the colonies, India was the most industrialized, which had indigenous industrial capitalists.

Jute Industry

Jute industry was developed in Scotland (around Dundee) but based on RM supplied from Calcutta. The characteristics of jute industry were:

1. Labor intensive. But not high-skill labor.2. Dependant demand. The market of jute goods were other industries and hence demand for jute

depended on demand or well being of other industries. Market was not local but world market.

The factors that led to growth of jute industries in Calcutta are:1. Low wages in Calcutta as compared to Dundee and hence lower cost of production2. Nature of RM. The volume/value ratio was high and that was not the case with cotton (jute could

not be bent). The marginal cost of transportation was much higher in jute than in cotton.3. Production process The raw jute had a high wastage in production process, which meant you

would be importing extra jute and hence would be paying extra for that4. Slave trade. The slave trade was declining and those in slave trade were looking for some other

investment. They found good opportunity in jute mills in India. That is the reason we find all jute mills in India, were owned by Europeans till 2nd WW.

Impact of jute industryThe jute mills did not employ local laborers, as wage differential was the key to their success. So they brought people from different places, Sardars were appointed, sent to Bihar, Orissa, etc. These Sardars would pay advance to villagers and brought people to town, they not knowing where they were heading (The operation was very similar to slave trade). These people would be settled in compound of the mills and that is the reason jute mills had huge compounds.The people in Calcutta saw jute mills as a symbol of foreign oppression.Whereas the people of Bombay saw cotton mills as symbol of national pride, owned and worked by Indians.

Cotton Industries Came to India for reasons different than jute industry. British oppressed Bombay 60 years after Calcutta. By then the monopoly of EIC was withdrawn

and mercantile attitude was replaced by Utilitarian capitalistic attitude. There was an attitude difference in British Bombay and British Calcutta.

For 60 years of difference Bombay merchants enjoyed free trade in local market and they had a lot of capital accumulation. Deccan handloom had survived and it was a major cotton belt controlled by Bombay Parsis.

Lancashire and European textile producers had moved from short Indian staple to long American staple causing obsolescence of previous spinning mills. These obsolete machines found buyers in Indians.

The Bombay mills were dealing with short staple and producing coarser variety of cotton cloth. There was a small market of this cloth in Africa and Indian textile owners were competing with Chinese and Japanese textile manufacturers.

The demand for yarn was increasing and hand spinning was not sufficient to meet the demand. The Lancashire did not enter into this market, as profit margins were lower.

The Parsi traders bought the old spinning mills from the textile manufacturers against wishes of Lancashire and thus cotton-spinning mills came up in 1840-60’s.

This is the reason why Bombay textile mills were not integrated whereas Ahmedabad had integrated spinning mills.