Factories come up: first mills, entrepreneurs, workers

Detail

What "factory" meant here

• A mill = a large building with machines run by steam or water power, where many workers do one job each.
• Before mills, Indian cloth was made by hand at home by weavers and spinners. Mills moved that work into one roofed place under one owner.
• Indian mills came up after British factories, and in the shadow of colonial rule. So they grew in only a few lines — cotton yarn, jute, later steel — not in every industry.

The first mills — dates to memorise

First mill	Place	Date
First cotton mill	Bombay	Set up 1854; began production 1856
First jute mill	Bengal	1855 (a second one in 1862)
Elgin Mill	Kanpur	1860s
First Ahmedabad cotton mill	Ahmedabad	A year after Elgin Mill
First spinning and weaving mill	Madras	1874
First Indian iron and steel works	Jamshedpur (J.N. Tata)	1912
First Indian-owned jute mill	Calcutta (Seth Hukumchand)	1917

• Bombay grew fast: by 1862 four mills were working, with 94,000 spindles and 2,150 looms.

• A spindle spins raw cotton into yarn (thread). A loom weaves yarn into cloth. So Bombay had far more spinning than weaving at the start.

• Bombay chose cotton because raw cotton grew nearby in Gujarat and Maharashtra, and the port could ship yarn out to China.

• Bengal chose jute because raw jute grew in the delta — but the Bengal jute mills were mostly European-owned until 1917.

Note: Jamsetji Tata had already built the Empress Mills at Nagpur in 1877, a cotton mill named after Queen Victoria, and later the Svadeshi Mills at Coorla (Kurla), Bombay; his mills were known for modern machinery and better labour protection [2]. The steel works date in the scaffold (1912) stands. Britannica records the Tata Iron and Steel Company as incorporated in 1907, with the Jamshedpur plant opening around 1911 [3]; NCERT dates the first Indian iron and steel works to 1912. Keep 1912 for the exam.

• The steel township was first the village of Sakchi; Viceroy Lord Chelmsford renamed it Jamshedpur in 1919 in memory of the founder [3].
• Jamsetji's sons Sir Dorabji Tata (1859–1932) and Sir Ratanji Tata (1871–1932) ran the firm after him and made it India's largest privately owned steelmaker [3].

Where the money came from — the China connection

• From the late 18th century, the British had a problem: they wanted Chinese tea, but China wanted little from Britain.
• Their answer — grow opium in India, sell it in China, use that money to buy tea for England. This triangle made huge fortunes.
• Many Indians were junior partners in this trade. They did not run it. They supplied money, goods and ships.
• These traders later turned trade profits into factory capital. That is how India's first industrialists appeared.

Pioneer	Base / community	Capital origin and role
Dwarkanath Tagore	Bengal	Made money in the China trade; set up six joint-stock companies in the 1830s–40s — shipping, mining, banking, plantations, insurance. All sank in the business crises of the 1840s
Dinshaw Petit	Bombay Parsi	Exported to China and shipped raw cotton to England; built a huge industrial empire
Jamsetjee Nusserwanjee Tata	Bombay Parsi	Same China-and-cotton route; founded the Tata industrial empire (J.N. Tata set up the Jamshedpur steel works, 1912)
Seth Hukumchand	Marwari, Calcutta	China trade money → first Indian jute mill, 1917
G.D. Birla	Marwari	His father and grandfather traded with China; the family moved that money into industry
Jamsetjee Jeejeebhoy	Parsi, a weaver's son	China trade and shipping; owned a large fleet. English and American competition forced him to sell his ships by the 1850s

• Joint-stock company = a firm whose money is put in by many shareholders, not one owner.
• Jeejeebhoy's story is the whole pattern in one life: an Indian could rise from weaver's son to shipping magnate, but could not hold his place against European shipping power.
• Dwarkanath Tagore formed Carr, Tagore and Company — described as the first commercial firm with equal Indian and British ownership [4].

Other routes into industry

• Madras merchants did not trade with China. Their money came from trade with Burma, the Middle East and East Africa.
• Some capital was purely internal — traders who moved goods within India, and financiers who lent to traders and producers. When factory openings appeared, they shifted into industry.

The colonial squeeze — why Indian business stayed small

• Barred from Europe in manufactures: Indian merchants could not export manufactured goods to Europe. They were pushed into shipping out only raw materials and food grains — raw cotton, opium, wheat, indigo.
• Edged out of shipping: European firms with better ships and state backing drove Indian ship-owners out.
• European Managing Agencies ruled industry till the First World War.
• A Managing Agency = a firm that controlled and ran several companies at once — it raised funds, bought machines, decided what to produce.
• Biggest three: Bird Heiglers & Co., Andrew Yule, Jardine Skinner & Co.

• The hard fact: Indian financiers gave the capital; Europeans took all investment decisions.

• Chambers of commerce (business clubs that lobby government) were run by Europeans and kept Indians out.

• No capital-goods industry. Machinery, railways and locomotives were nearly all imported.
• Capital goods = machines used to make other machines and goods.
• Because India imported them, India could not build the industry that builds industry — not until after Independence.

The workers — numbers

• 584,000 factory workers in 1901 → over 2,436,000 by 1946. Roughly a four-fold rise in 45 years.
• Even so, this was a tiny share of a population of hundreds of millions. Most Indians stayed in farming.

Who the workers were and where they came from

• Workers came mainly from the districts around the mill city, not from far away at first.
• Over 50% of Bombay's cotton mill workers in 1911 came from Ratnagiri district in the Konkan.
• Kanpur mills drew workers from Kanpur district itself.
• Later, men from the United Provinces travelled long distances — to Bombay's textile mills and Calcutta's jute mills.

Circulation — one foot in the village

• Workers did not cut ties with the village. They moved back and forth.
• They went home for harvests and for festivals.
• The Konkani worker went back for the paddy (rice) harvest.

• The Ghati worker (from the Western Ghats) went back for sugarcane.

• Effect: the mill workforce was never fully settled city labour. Owners faced men who could leave and return.

The jobber — gatekeeper of the mill

• Jobs were always fewer than job-seekers. Crowds waited at mill gates. Some mill owners kept a gatekeeper to pick a few and turn the rest away.
• Entry ran through the jobber:
• An old, trusted worker the mill owner relied on.
• He went to his own village and brought back people he knew.

• He helped migrants settle in the city and lent them money in a crisis.

• Over time the jobber became a figure of power:

• He demanded money and gifts for giving a job.

• He controlled the lives of the workers under him.

• Lesson for the exam: recruitment ran on caste, village and personal ties, not on open advertisement — so the village network was carried straight into the factory.

Law and the workday

• Factory work was long and unregulated at first. The Indian Factories Act, No. XI of 1891 replaced the earlier Factories Act of 1881 [5].
• Such Acts were the first legal attempt to limit hours and regulate child labour in Indian mills — a direct result of mill work becoming a mass occupation.

Prelims Hooks

• India's first cotton mill was set up in Bombay in 1854 and began production in 1856.
• India's first jute mill came up in Bengal in 1855; a second one in 1862.
• By 1862 Bombay had four cotton mills, 94,000 spindles and 2,150 looms.
• Elgin Mill, Kanpur started in the 1860s; the first Ahmedabad cotton mill a year later.
• The first spinning and weaving mill in Madras was set up in 1874.
• The first Indian iron and steel works was set up at Jamshedpur in 1912 by J.N. Tata; Sakchi village was renamed Jamshedpur in 1919 by Viceroy Lord Chelmsford [3].
• Jamsetji Tata founded the Empress Mills at Nagpur in 1877, named after Queen Victoria [2].
• The first Indian-owned jute mill was set up in Calcutta in 1917 by Seth Hukumchand, a Marwari.
• Dwarkanath Tagore set up six joint-stock companies in the 1830s–40s; they collapsed in the 1840s business crises.
• The three biggest European Managing Agencies were Bird Heiglers & Co., Andrew Yule and Jardine Skinner & Co.
• Factory workers rose from 584,000 (1901) to over 2,436,000 (1946).
• In 1911, over 50% of Bombay's cotton mill workers came from Ratnagiri district.

Mains Points

• Colonial rule shaped where Indian capital could go. Indian merchants were shut out of manufactured exports to Europe and out of shipping, and left with raw cotton, opium, wheat and indigo. So early Indian capital piled up in trade and finance and entered industry only where the British had no strong interest — cotton yarn for China, later steel. Use this to argue that Indian industrialisation was late, narrow and lopsided, not simply slow.
• The Managing Agency system shows colonial control without ownership. Indian financiers supplied money while European agencies made every investment decision and European chambers of commerce kept Indians out. This is a strong example of structural exclusion — the barrier was institutional, not a lack of Indian capital or skill.
• No capital-goods base = permanent dependence. Machines, railways and locomotives were imported, so India could not build the industries that build industries till Independence. Link this forward to the post-1947 emphasis on heavy industry in the Second Five Year Plan.
• The factory workforce was half-peasant. Workers came from nearby districts, circulated back for paddy and sugarcane harvests and for festivals, and entered mills through the jobber, who recruited on village and caste ties and then used that power to extract money and gifts. Use this to show how rural social structure was reproduced inside the modern factory, which also explains why a stable, organised industrial working class formed only slowly.