The period of 18th and 19th century was characterized by the industrial revolution in Europe. This was marked with the increase in wealth, population and production. The rapid development of industries demanded markets for goods. The race of monopolizing markets consequently established colonies and colonial empires are lesser developed countries of the world which is also resulted in the British domination over India. Imperial policy, to a large extent, affected and controlled the development of entire Indian industry during the period. During the 18th century, main industries in India were textile, cotton and silk, ship building , handicrafts , and other arts and crafts such as tannery, perfumery , paper making etc. These were mainly in the hands of Indians. The decay of Indian trade and industry set in towards the end of the 18th century. Prominent causes of decay were: the Imperial policy to protect British industries, the competition with cheaper goods produced by machines, growth of new habits and tastes towards luxury goods from west. With this began an era of development of new industries in India.
Factors that led to the development of factory system in India
The industrial revolution in England was the main factor that led to development of factory system in India. The impact of the British rule, which was capitalist in nature based on private ownership of property, production of goods for markets and not for self consumption, large scale enterprises, profit motive, exchange of goods and services for money, specialisation, division of labour and marketing activities of buying, selling risk bearing etc. contributed to the development of factories in India. The orientation towards ‘Market Economy’ as different from ‘subsitance economy’ (as prevailed in villages during 18th century in India in which there was limited exchange of goods within the villages and with the...