Economic Life of India Under colonial Rule 1858 - Term Paper Example

This paper analyses the Indian textile industry, and the consequent de-industrialization of this industry during the colonial period.

Deindustrialization of the Indian Textile Industry During Colonial Period

Deindustrialization is a theory that depicts a process through which social and economic change takes place, characterized by reduction or removal of industrial capacity in a nation or region, especially in the heavy manufacturing industry. The process of deindustrialization signifies the decline of an industry when it remains uncompensated by the growth of the modern industry in the same line of production.4 The increasing exploitation of the Indian textile industry by the British in the period explained above was therefore characteristic of this deindustrialization.  The textile industry had for a long time been an important contributor to India’s exports. Archaeological evidence from Mohenjo-Daro shows that dyes were used in India as early as in the second millennium BC.  As noted earlier, the history of India’s prominence in a textile industry largely stems from its wealth of natural resources such as cotton, silk, and jute crops.

A few decades before the colonial period, India had a well-developed textile industry, which for many centuries had sold high-quality cotton products on the local market, and throughout the Middle East and large parts of Africa.  The country’s manually operated textile machines were among the best in the world; they were a model for the first production machines in Britain. There were large factory towns where skilled laborers could produce so cheaply that the British East India Company, which controlled trade in the region, could purchase from the native industrialists, ship these products to Britain, and sell them at a full 100 percent mark-up over their cost. Generally, before colonial period, the presence of these natural resources and development of manufacturing sector enabled India to enjoy huge surpluses in in forthbrought stained though textile industry. The prosperous Indian textile industry had increased the local manufacturing sector’s capability of successfully challenging the British manufacturing sector. After British entry into India in 1858, it reacted to this potential challenge both politically and economically. First, the British textile industries started increasing investments equipment, and increased the amount of capital utilized by each worker