Process of Industrialization in India

Topics: Economic growth, Industry, Manufacturing Pages: 9 (2783 words) Published: April 1, 2011

Meaning of Industrialization

The term "industry" refers mainly to manufacturing activity. Agriculture, mining, and most other services are excluded from it. The term "industrialization” literally means the growth of manufacturing industry. It is thus a part of the much broader process of economic development which involves the raising of standard of living, through a steady increase in the efficiency of factors of production. India is a developing country. Economic development here must basically mean raising the productivity of agricultural workers. After a certain stage of development, however, it may become more profitable to transfer the surplus labor to their gainful employments as manufacturing.

Indian Industrialization

The industrial policy of free India was first announced in 1948. This policy envisaged a mixed economy with an overall responsibility of the Government for the planned development of industries and their regulations in national interest. It stated the right of the state to acquire an undertaking. The public interest, and reserved an appropriate sphere for private enterprise. According to this policy Indian industries were classified into three groups. 1. The first category included arms and ammunitions, atomic energy, river valley projects, and the railways. There were to be directly under the management of the state. 2. The second category included coal, iron and steel, aircraft, telephones, telegraphs, wireless, shipbuilding and mineral oils which were also to be the responsibility of the state. The private undertaking in these industries were to, however, continue for at least ten years. 3. The third category included the remaining industries, which were to be developed by private enterprise.

History of Industrialization in India

(1) 1850- 1874
The first industrial undertaking was established in India only after the first railways had been constructed in 1851. The development in 1854 of the cotton textile industry in India - the first important large scale industry marks the dawn of a new industrial era in India. The real beginning of the industry was made in Bombay in 1854 with predominantly Indian capital and enterprise. In 1855 the jute industry was established at Rishra near Seramore, 12 miles north of Calcutta with Scottish capital and enterprise. The paper mill industry was started at Bally near Calcutta in 1867. The glass and chemical industries were started subsequently. A small number of minor industries, rice and flour mills, woolen and silk mills, iron foundries etc. were also set up. India continued to be an exporter of food and raw materials and an importer of manufactured articles. The progress of the jute industry was remarkable and spectacular.

(2) The Period 1874-1914:
The development of the coal mining industry towards the later part of the 19th century in the Damodar Valley inspired the development of various manufacturing industries in the country. The big iron industry was started at Kulti near Asansol with foreign capital and enterprise in 1875. Towards the end of the 19th century a number of paper mills were established in the country. The Titaghar Paper Mill was established in 1882 and the Deccan Paper Mill was started at Poona in 1889. With the establishment of the Tata Iron and Steel Co. Ltd. at Sakchi (now Jamshedpur) in 1907, a new era in the industrial history of India began.

(3) Development during the First World War (1914-18):
The war (1914-18) gave a great impetus to industrial development in the country. At the eve of the war, cement and sugar industries were also started. Due to shipping shortage imports of essential goods and articles were also curtained. The supplies of essential consumer goods were cut off. Industries in India suffered considerably for want of machinery, spare parts and chemicals for which the country had to depend on foreign countries. The absence of basic engineering...
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