Industrial Development in India in the nineteenth century By the beginning of the nineteenth century England, a major importer turned

into a big producer of finished goods. Therefore it naturally made sense for England to explore more markets. Lancashire was the hub of industrialization. It had led to the downfall of handloom market in England, then Europe and now was eyeing India, a colony of East India Company. But the challenge was EIC, which wanted its monopoly in all trade with India. The crown too tried to protect these traders because they brought wealth. So Lancashire put pressure on the crown to withdraw the monopoly recognition. By 1813 monopoly charter was withdrawn. Lancashire as a producer, wanted agents in India to market and sell their products. Marwaris (who were the major losers of EIC monopoly) grabbed the opportunity. Net impact was the destruction of Indian artisan base or de-industrialization. Even Europe had experienced this, but weavers found alternative livelihood in the factories. But not so in India because no industries to replace. Handloom weavers who lost their jobs became beggars (sanyasis and fakirs, depending on religion) moving from place to place. This led to the non-agricultural workforce reduced to 11%. Due to the huge imports by the Marwaris, EIC had to find new exports to balance the imports & exports. Therefore the focus is shifted on agricultural inputs to industrial Britain like cotton (textile), jute (packaging), etc. Commercialization of agriculture: Hence Indias agricultural exports were tea, jute, indigo and opium. Food agriculture went down in favor of these cash crops. Jute was the only major export to start with. Indian cotton short staple variety and England needed long staple (Egyptian variety), produced in North America. Dyes used for textile mills needed indigo. The EIC identified that they could export opium to China. UK
Cotton goods Imports>Exports

Tea/ Silk Export>Import China Opium Only Exports

India

A triangular trade with China (opium preferred by the Chinese aristocracy, just like tea by British aristocracy) could tilt the balance of trade with China in Britains favor. Assam teak was another export from Assam to Calcutta (timber route through Brahmaputra). This was used as sleepers of rail tracks. Wild tea plants noticed in Assam forests. The felling of forests for teakwood gave room for tea gardens. By mid 19th century, tea along with jute was major export. Later tea plantations extended to Darjeeling and Nilgiris. Development in Britain Capital goods sector in Britain bloomed with Lancashire mills. As the state of art technology gets saturated in domestic industry, it then moves to other countries as better technology replaces it. Around 1830s (after the first 50 years of Industrial revolution.) steam engine was on the rail, major fillip in the Industrial Revolution. High expertise developed in the Civil, Hydraulic Mechanical Engineering. The expertise in Railway technology could be used in other countries. India and China were the two obvious choices. But because of agrarian economy and also its getting poorer and poorer coz of siphoning of wealth from the country Railways in India Nobody was interested in investing in railways as no one could see economic viability in it. Lord Dalhousie wanted railways in India because of problem in administering such a large country. Thus railways were developed more in need for army personnel movement than movement of goods. East India Co. became the underwriter and assured 5% ROR in railways investment in India. Major investment was carried out in Calcutta region although first line was introduced in Bombay.