Semester V, Discipline Specific Elective, DSE -5-1A

Unit 1: IMPACT OF THE BRITISH RULE IN INDIA

Unit 1.1: DE-INDUSTRIALISATION
Purba Roy Choudhury
The Bhawanipur Education Society College, Kolkata

Purba Roy Choudhury Thursday, 16 September 2021 1

 The British rule had pronounced and
profound economic impact on India.
 The various economic policies followed by
the British led to the rapid transformation of
India's economy into a colonial economy
whose nature and structure were determined
by needs of the British economy.
 An important aspect of British economic
policy was deindustrialisation

Purba Roy Choudhury Thursday, 16 September 2021 2

 India is not an industrial country in the true and
modern sense of the term.
 But by the standards of the 17th and 18th
centuries, i.e., before the advent of the
Europeans in India, India was the ‗industrial
workshop‘ of the world.
 But within a space of 60 years, once British
started ruling the subcontinent, India witnessed
the process of De-Industrialisation.
 This term came into prominence in India to
describe the process of destruction of Indian
handicraft industries by competition from the
products of British manufacture during the
nineteenth century.
 India‘s textile industries and the other handicrafts
enjoyed a worldwide reputation and a cost
advantage over the British and other manufactures.
 India was the ―Industrial Workshop‖ of the world.
 Textiles included the Muslin of Dacca, fine cotton
and silk fabrics of all kinds of manufactured all
over India specially Lucknow, Ahmedabad , Nagpur,
Madurai, Murshidabad, Maldah, Benaras and Poona,
woolen products of Kashmir, Amritsar and
Ludhiana.
 Other than textiles, India also excelled in all kinds
of artistic work specially enamel jewelry, stone
carving etc.
 India‘s traditional handicrafts declined for its pristine
glory during the British rule
 Further, India‘s traditional village economy was
characterized by the blending agriculture and
handicrafts.
 But this internal balance of the village economy had
been systematically slaughtered by the British
government.
 In the process, traditional handicraft industries
slipped away from its pre-eminence and its decline
started at the turn of the 18th century but proceeded
rapidly almost at the beginning of the 19th century.
 This process came to be known as ‗de-
industrialization‘-
 a term opposite to industrialization.
 The establishment of the British rule brought
about certain fundamental changes in the
economic structure and organization, which
transformed the conditions of life and labour.
 In the field of industry, the effect was to set in
motion a process of deindustrialization.
 The half century or so after 1875 was the period
of the spread of ―Industrial Revolution‖ in the
countries of the West.
 In India, this period had been termed by the
British authority as a period of ―arrested
development‖.
 Other writers have referred to this period as an
age of deindustrialization, or ruralization or
peasantization.
 D.R. Gadgil: deindustrialization means a process of
deliberate dismantling of the industrial structure that
existed in India prior to the commencement of the
British colonial rule.
 R.C. Dutt: it was the inevitable phenomenon of the
colonial regime whose main intention was to subjugate
an otherwise viable economy in the status of a
dependent economy, in the form of an appendage to
Great Britain as its main raw materials supplying source
and all this was done by a process of deliberate
application of the ―arm of political injustice‖.
 Radhakamal Mukherjee: deindustrialization as the
inevitable process of political transition accompanied
by some economic compulsions, leading to the
destructions of the ancient industries in the country.
 The industries of India, at the beginning of the
19th century, were mainly in the nature of
handicrafts, producing fine textiles and other
luxury products for the aristocracy as also for day-
to-day use.
 In these handicrafts, the Indian industry had
reached a high watermark of excellence.
 India could then provide the rest of the world with
a variety of handmade artistic wares, e.g, muslin
of Dacca, while she needed very few
manufactured articles from abroad.
 Radhakamal Mukherjee classified the ancient
industries into the following four categories:
 Industries

Peasant Art Village Urban Art

Village Art
and Craft Subsistence and Crafts
industries
industries industries industries

Superior
organisation of
Rural cottage Art and creativity craftsmanship
Done during
industries of high standard Highest standard
leisure or slack
Day to day for these of excellence
seasons
requirements of industries
Produced luxury
the village Widespread fame and semi luxury
goods of exquisite
quality
 These were side occupations which the
peasants pursued during their leisure and
slack seasons, where there was no work
either at home or outside.
 These industries included hand-spinning and
weaving, molasses making, flour grinding,
rice pounding, rope making, basket making,
mat weaving, sericulture and tobacco
manufacture.
 Of these hand spinning was the most
important.
 The rural cottage industries essential for the
agricultural routine manned by the weaver,
goldsmith, carpenter, potter, etc. such industries
provided day to day requirements of the villagers.
 These industries had little to do with agriculture.
But their prosperity depended on the fortunes of
agriculture.
 These were mostly followed by the village servant
class of artisans such as blacksmith, carpenter, oil
presser and potter.
 Those who attended to the simple needs of the
villagers and were paid by shares of grain at harvest
time.
 These industries, in many cases enjoyed widespread
fame.
 Specialization in these village industries was a dream and
the organization of production was extremely crude.
 However, there were some village art industries that
catered the need of distant places and sometime outside
country.
 Art and creativeness were of a high standard for these
industries.
 Examples of these kind were lac and toy manufacture in
Meerut and Mirzapur, carpet weaving in Benaras, silk
weaving in Murshidabad and metal work of Boidrajpur
(Bihar), Santipur, Bishnupur, etc. some products like
embroidered cloths of Dacca villages, glass bangles of
Firozabad and Fatehpur, saris of Melapalayam, etc. were
exported to foreign countries.
 The urban domestic industries turned out various
products for the use of the townsfolk representing
superior organization of craftsmanship.
 It was in these industries that India reached a high
standard of excellence.
 These industries were carried on a comparatively
larger scale engaging hired workers with skill.
 These classes practiced certain amount of division
of labour and specialization.
 These industries produced luxury and semi-luxury
goods of exquisite quality.
 The chief industry was the textile handicraft. The
muslin of Dacca, ―the shadow of a commodity‖ was
the finest and the best known.
 The other products were metal ware (Benaras), shawls
(Kashmir, Amritsar), cotton fabrics (Ahmedabad,
Lucknow), silk manufacture (Malda, Murshidabad),
jewelry and stone carving (Rajputana)
 On account of the forces of nature controlling the supply
of raw materials, or other causes, some handicraft
industries localized in different parts of the country e.g.
shawl industry or paper mache work in Kashmir.
 Moreover, certain crafts became almost monopolies of
particular cities, e.g. marble inlaying work at Agra, the
Phulkari work of certain North Indian cities.
 The fortune of these urban handicraft industries spread
all over India largely depended on royal patronage.
However methods of production in these industries were
crude as well as expensive.
 According to Gadgil,
At that time basically three kinds of industries
existed in India such as,
i) the rural cottage and village industry
catering the demand for goods in the use
of daily life of rural people;
ii) the urban domestic industry supplying the
goods to the town folk, and
iii) the small urban factory producing
sophisticated products especially for the
use of upper class of the society.
 The difference between rural and urban
industries was found to be in the nature of
markets, organization and specialization.
 Urban industries mainly catered to the needs
of the Emperor and members of the imperial
court.
 A certain proportion of luxury goods was
exported.
 It was customary for the royal court to
organize its own place - workshops, called
'Karkhanas' so that an absolute control over
supply could be maintained.
 Apart from these state factories, there were
skilled artisans working on their own material
and selling their wares in the outside market.
 A different type of industries were located in the
towns and cities known for religious sanctity like
Banaras/ Allahabad, Puri and Tanjore. They have
patronized the specialized wares produced in
these cities.
 Some other important products like silk,
embroidery and printing, woollen carpet, metal
ware and stone were among the principal
industries in these places.
 But in the 19th century urban handicraft
products from the west poured into India in
increasing amount as a result urban handicraft
went through a continuous change in their
organization.
 The markets now became wider, specially after
the coming of metalled roads and railways.
 The competition from factory produced goods
enforced a reduction in costs, so gradually
machinery was introduced.
 All these factors were of factory industry and
the trend, definitely was towards the market
economy
 The process of de-industrialization of India began
with the gradual disappearance of cotton
manufacture from the list of India‘s export and the
remarkable growth of the cotton manufactures in
the list of her imports mainly from the Britain.
 The restriction on the area of demand was the most
serious limitation of the Indian handicraft industry,
for it adversely affected its size and also the
development of its internal organization.
 The organization of village industries was very
primitive. As regards the organization in bigger
cities, Prof. Gadgil holds the view that each craft
was organized into guilds which looked after the
welfare and quality of work of their members.
 There is no denial of the fact that India‘s
traditional handicrafts have declined from its
pristine glory both in artistic excellence and
economic importance.
 In fact, by the end of the 19th century, most of
the indigenous industries had either decayed
beyond recovery or were on the road to ruin.
 Moreover, the urban handicraft industry, being
the best organized industry in India, was the first
to feel the effects of foreign competition.
 This decline of the handicraft industry continued
well on the 20th century – it was not
compensated by a sufficient rise in modern
industry.
 The main source or rather the entire sources of demand
for the product of these handicrafts came from the royal
courts and the urban aristocrats.
 With the abolition of the royal court, one source of
demand for the products of these crafts dried up.
 The disappearance of the Indian courts struck the first
blow at Indian handicrafts by steadily curtailing the
demand for their products.
 As native states passed under the British rule, the
demand for fine articles for display in durbars and other
ceremonial occasions disappeared
 But with the gradual extension of the British rule and the
decline in royal power all over India, craftsmen gradually
pulled down the shutter of their Karkhanas.
 The ordinary demand did continue for some time
longer but since the new generation lacked the
means and inducement to patronage the arts and
handicrafts, it invariably had a tendency to diminish
steadily.
 However, this had been to some extent
counterbalanced by the class of nobles and urban
aristocrats who patronized the arts and the
handicrafts in satellite states like Awadh, Bengal,
Hyderabad, Punjab etc.
 But, with the gradual extension of the British rule
and the decline in royal power all over India,
craftsmen gradually pulled down the shutters of their
karkhanas.
 .
 British rule affected the existence of the
handicrafts, both directly and indirectly.
 With the establishment of the British rule, foreign
influences unfavorable to the existence of these
handicrafts made their way into the native states.
 The establishment of the British rule indirectly
weakened the power of guilds (which regulated
trade and supervised the quality of the work).
 As a result, evils such as the adulteration of raw
materials and poor workmanship crept in and the
artistic and commercial value of the products
deteriorated.
 British merchants and their commissioned agents
began to exercise illegitimate pressure on the
craftsmen for delivery of goods to them on a
priority basis and at unduly low prices.
 Craftsmen were forced to sign agreements for
delivery which under normal conditions, they
could be hardly induced to do.
 Due to the exploitation of the merchants,
craftsmen were forced to abandon their craft, in
some cases.
 One of the most harmful effects of foreign rule is
the imposition on the conquered people the
ideas of the conquerors.
 The industry wished a new source of demand
from the European officials and tourists. But
the European officials favoured imported
manufactures.
 A certain amount of European demand for
these handicrafts existed which slackened
the rapidity of decline to a smaller degree.
 However, this small European demand
sabotaged the artistic quality of Indian
handicrafts since they introduced new forms
and pattern to suit their tastes which were
beyond the craftsmen‘s comprehension.
 The establishment of the British rule was also
indirectly responsible for the loss of power of
the guilds and other bodies which regulated and
supervised the trade.
 This led to the adulteration of materials, shoddy
and slovenly workmanship, resulting in a decline
of the artistic and commercial value of the
products.
 Naturally, they assiduously copied these forms
and the consequence of this blind imitation was
disastrous to indigenous arts. The classic
example was the Kashmir Shawl industry.
 The new system of English education was
another factor that triggered the process of
deindustrialization in India.
 The newly educated Indians were so
westernized that they blindly accepted the
European standards and fashions and looked
down everything indigenous.
 As a result, demand for the products of
indigenous industries declined while that for
the European goods increased.
 With the virtual elimination of demand for the
industry following the disappearance of noble
courts, the industry wished a new source of
demand from the European official and tourist
and from the ‗baboos‘ and black Indian ‗sahibs‘.
 This European demand sabotaged the artistic
quality of Indian handicrafts since they
introduced new forms and pattern to suit their
tastes which were beyond the craftsmen‘s
comprehension.
 They tried to please their new customers by
coping their forms and patterns.
 Very often the new produce were very poor
copies and consequently demand for indigenous
crafts declined.
 The revolution in technology which gained
momentum throughout the 19th century in the
wake of the industrialization revolution
hastened the process of the decline of
traditional handicrafts.
 It was the superior manufacturing technology
based on power and improved machinery
enabled the British manufacturers to drive the
Indian artisans out of their home market.
 In the last quarter of the 18th century, the
application of steam power to industrial
processes became possible in England.
 This increased the speed of cotton yarn and
piece goods production and reduced the cost of
production in the British cotton textile industry.
 Consequently the urban weaver in India was
hopelessly beaten in the matter of price. The
Indian domestic and cottage handicrafts could
not withstand foreign competition which was
backed by powerful industrial organization, big
machinery, large scale production and complex
division of labour.
 Machine- made textile goods of Britain did
the great damage to this Indian industry
since 1750. The invention of power-loom in
Europe completed the decline of this
important industry.
 Industry that had experienced the onslaught
of de-industrialisation most was the cotton
textile industry. It was the largest provider of
employment after agriculture. India‘s cotton
goods were the best in the world before
1800.
 Consequent upon industrial revolution in cotton
textile industry, there had been massive growth
of British imports in India and the domination of
British cloth in the Indian market did the havoc.
 It created large scale unemployment as well as
unbelievable drop in wages among the spinners
and weavers.
 Other affected industries were jute handloom
weaving of Bengal, woolen manufacturers of
Kashmir, silk manufacture of Bengal, hand-paper
industry, glass industry, lac, bangles, etc.
 The government of India did not impose
protective import duties on imports from
England and did not give any kind of financial
assistance to Indian handicrafts industry.
 On the other hand, to put her manufacturing
industries on a sound footing at home,
England pursued the policy of protection
through the policy of import duties.
 But for India, she preached the gospel of free
trade.
 At about this time, the government in India
also manipulated the railway rates in such a
way that the manufactured goods from
England could enter the vast Indian markets
by paying lower railway freights.
 As a result, the indigenous industries were
badly affected and declined.
 The policy followed by the British government
also contributed the decline of the Indian
industries. Orders were issued to force the
Indian artisans‘ especially silk winders to work
in the company‘s factories and not in their
homes. The use of dyed Indian calicoes was
prohibited.
 Extensive use was made of custom duties to
crush the Indian industries.
 Free trade policies adopted by England after the
middle of the 19th century and forced on India,
helped the entry of English goods into the Indian
markets without duties being imposed on them.
 This tariff policy came to be known as the ‗one
way free trade policy‘ which preached that what
was good for England was considered good for
India.
 The government of India was compelled to
follow the prevailing laissez faire policy in
England and did nothing to help preservation or
protection of Indian handicrafts.
 The emergence of dealers and financiers held
complete survey over the artisans whom they
fully exploited.
 They made advances in cash and raw materials
to buy finished products and thus held the
craftsmen under their iron grip and forced them
to enter into certain agreements; their goods
were forcibly seized and sold on spot to make
good deficient.
 Unable to resist this kind of injustice, the Indian
craftsmen gradually gave up their professions
and consequently the cottage/handicraft
industries of India declined.
 Some people argue that the weakness in the
industrial structure itself must also be
blamed for this decline of handicraft
industries.
 No efforts were made to explore markets for
products.
 India‘s trade was in at the mercy of
foreigners as far as sales in overseas were
concerned.
 Guild organization in India was definitely
very weak. India didn‘t possess a class of
industrial entrepreneurs.
 The weaknesses in the industrial structure itself
must also be blamed for this decline of
handicraft industries.
 No efforts were made to explore markets for
products. India‘s foreign trade was in the hands
of foreigners.
 This meant that the Indian artisans and
producers were at the mercy of foreign
merchants so far as sales or demand propagation
in overseas markets were concerned.
 Secondly, guild organisation in India was
definitely very weak.
 Finally, she did not possess a class of industrial
entrepreneurs unlike its western counterparts.
 The process of decay of Indian industries
began by the establishment of foreign rule
and accelerated forces of foreign influence
like competition from foreign goods and
policy of the British led to ultimate decline
of the industries.
 Towards the last century, the urban industry
of India had only two courses left to follow –
either to change its methods and turn out
cheap art wares (of doubtful artistic value)
or to keep their old standards and face
destruction, slow or rapid.
 The decline of Indian cottage industries had
a disastrous effect on the economy of the
country.
 The Indian village community had been built
on the domestic union of agriculture and
manufacturing pursuits and once a partner of
the nexus as destroyed, the entire economy
was torn.
 The handloom and spinning wheel were the
pivots of old Indian society.
 The decline of the Indian handicrafts had a
disastrous impact on the Indian economy.
 It led to destruction of India‘s handicraft
industry.
 It led to ruralisation of India.
 Artisans were displaced from traditional
occupations. With no other alternative source of
livelihood, the artisans adopted agriculture.
 Such overcrowding of agriculture badly affected
its efficiency. Present problems of subdivision
and fragmentation of land holdings, over-
cultivation or cultivation of inferior and
unproductive land, etc., are the direct effects of
the British rule.
 It led to disguised unemployment and underemployment.
The rural unemployment and under-employment were
rooted to the imbalance in the occupational structure due
to such de-industrialisation.
 The trade to GDP ratio declined and international trade
reshaped the domestic structure of the economy. India
became one of the major markets for the British made
cotton yarns and cloths and became one of the large
suppliers of Grain.
 The large scale de-industrialisation brought far reaching
impacts on the economy with loss to traditional economy,
which was earlier considered as a blend of agriculture and
handicrafts. The de-industrialisation of India played an
important role in the underdevelopment and increasing
poverty of the country. Thus the process of de-
industrialisation proved to be a disaster for the several
million persons.
 At the base of the Indian agrarian system, there
were more or less a cooperative or collective
village.
 These village communities were mostly based on
the common possession of land on the blending
of Indian handicrafts and agriculture and more or
less unalterable division of labour based on
caste.
 The artisans were the organised member of the
rural community.
 The deindustrailisation and increased
ruralisation destroyed the slender balance of the
old natural economy existing in India
 The artisans lost their traditional livelihood and
fell back on land which was not remunerative
either.
 The prosperous village industries used to siphon
off the increased labour force following natural
increase in population and the land man ratio
was kept in balance.
 The decline of the Indian industries especially
handicrafts pushed the artisans back into
agriculture making it extremely overcrowded.
 The disguised unemployment, seasonal
unemployment and general unemployment – all
were rooted to the imbalance in the
occupational structure due to deindustrialisation
 The real impact of the decline of the cottage
industries were on the path or course of
Indian economic development.
 Not only did it slow down the rate of capital
accumulation, they also removed the
possibility of technological innovation and
delayed the emergence of entrepreneurial
class.
 It also chartered a separate class– a distinct
course for emergence of capitalism
 With the impact of foreign trade the Indian
merchants in the earlier years of the British rule
grew in strength and advanced large sum of
money to the artisans.
 The factory system was emerging gradually.
Indian producers and merchants, from domestic
and foreign trade were accumulating capital
rapid enough to take a new leap.
 But deindustrialisation made no possibility
available.
 Thus the possibility of emergence of the Indian
industrial enterprises were completely aborted
 The handlooms and spinning wheels were the
pivots of the old Indian society.
 However, the British broke up the Indian
handlooms and destroyed the spinning
wheels thus causing the greatest social
revolution ever heard of in Asia.
 This revolution not only destroyed the old
manufacturer in town but also the balance of
the economic life in the villages.
 From these the desperate over-pressure on
agriculture occurred which has continued on
a cumulative scale in present days as well.
 Three different sets of views have emerged round the
process of de-industrialisation following the evidence
suggested by nationalist economists, modern
researchers and foreign scholars.
 One school of thought represented by Daniel Thorner
tends to argue that de-industrialisation might have
appeared in the early 19th century but the evidence
of industrialisation was clearly visible in the last
decade of the 19th century and the early 20th
century.
 Secondly, to the U.S. scholar Morris D. Morris the
stage of de- industrialisation in India was highly
difficult to find.
 However, Nationalist economists, however, had no
doubt about de-industrialisation.
 In support of their assertion, nationalists like
R. C. Dutt, M. M. Malabya relied on external
trade statistics which indicated a rapid
growth of imports of broadcloth
 The value of imports showed a remarkable
uptrend during 1860 and 1900 when it rose
from 96 lakh pounds to 27 crore pounds.
 Fall in exports is tantamount to loss of
foreign market of indigenous products while
rise in imports means destruction of home-
made goods in the home market.
 However, this trade data do not clearly
explain de-industrialisation since this data do
not give any definite inkling about the
decline in productions.
 Industrial production data is more decisive
on the question of industrialisation which
was not available at that time.
 In view of this, researchers now rely more on
the industrial distribution of the workforce.
 According to Morris D. Morris, de-
industrialisation was a myth since it did not take
place even in the early 19th century.
 Morris argued that nationalists' index of de-
industrialisation (that is, external trade data)
could not stand as a fair index.
 Further, nationalists did not take into account
the 'compensatory effect' of de-industrialisation.
 According to Morris, had there been de-
industrialisation, village handicrafts would not
have survived long.
 Unfortunately, his arguments were more
conjectural and dubious.
 Village handicraft industries survived mainly
as an only occupation left to the artisans.
 Above all, artisans were forced to put
themselves into the clutches of
moneylenders.
 In a colonial economy, this merchant capital
or the question of exploitation played a
dominant role in the survival of these
industries.
 In terms of output and employment,
handloom and a variety of traditional
industries suffered a catastrophic decline.
 The purpose of Daniel Thorner‘s study was to
evaluate the notion of de-industrialisation in India
under British Rule during the last phase of the 19th
century.
 Thorner‘s presentation of the issue is a threefold
proposition to the effect that decline of
handicrafts continued into the 20th century and it
was not compensated by a sufficient rise of
modern industry.
 In consequence the Indian economy became more
and more agricultural. To test this hypothesis,
Thorner depended on the information available in
the census report from 1881 to 1931.
 As an index he considered Manufacturing Work
Force (MWF) and reached the conclusion that the
census data for males do not support the case
either for absolute de-industrialiation or even
for relative de-industrialisation.
 He suggested that if indeed a major shift from
industry to agriculture ever occurred in the
British Rule in India, it might have happened
sometime between 1815 and 1880.
 But at present neither the data on output in non-
factory establishment nor the data on output per
worker in such establishments can be depended
upon.
 Krishnamurthy is correct in his criticism of
Thorner that MWF data alone do not give us a
total picture of the degree of de-
industrialisation.
 But what Krishnamurthy overlooks is that the
output data--- like the working force data —
alone cannot give us any measure of de-
industrialisation.
 We can hardly understand anything from the
ratio, suggested by Krishnamarthy without
considering the institutional— structural
framework of the economy.
 Apart from the usual index number problem
associated with the measurement of the change
in such a ratio, there also exists the problem of
ownership of the output.
 When the manufacturing sector of a colonised
economy is in the hands of imperialists, then the
output may be generated for the outside market.
In such a situation any increase in output may
not increase the net national income.
 The profit accrued may not be ploughed back
into the economy.
 R. Chattopadhyay‘s objection to Thorner is
twofold.
 First, Thorner was wrong in considering the
ratio between the industrial working force
and the total working force as the index of
de-industrialisation.
 By taking the total working force as the
denominator of the ratio, Thorner did not
take into account the unemployed population
and the dependants.
 The correct method would be to consider
the industrial working force as a ratio of
total population.
 The ratio between the industrial working
force and the total population may
decrease owing to an increase in
population over time without a
corresponding increase in industrial
working force.
 This phenomenon should be considered as
a case of relative de-industrialisation.
 J. Krishnamurthy challenged Thorner‗s thesis on
theoretical and empirical grounds.
 To discuss de-industrialisation Krishnamurthy
defines industrialisation as a rise in the share of
manufacturing output per capita.
 This is historically associated with a rise in the
share of manufacturing workers to total workers.
 But this is neither a necessary nor a sufficient
condition for industrialisation.
 With this proposition Krishnamurthy argues
against Thorner that to show that the number or
the proportion of working force engaged in
manufacturing has remained roughly constant
does not disprove the de-industrialisation
hypothesis.
 The hypothesis can only be tested by the data on
output in manufacturing and total output in the
economy.
 The second objection regarding Thorner‘s
method of collection of data on the working
force can be made clear by three points.
 First, Thorner‘s handling of the data on
general labour is wrong because he includes
workers under this heading only workers in
the agricultural sector.
 B.R.KaIra, a census officer for 1961 census,
calculated that about 20 percent of the
unspecified labourers were in the urban
areas.
 Secondly, the idea of including trade in
the industrial sector is also erroneous.
This is particularly so when the object is
to study the process of de-
industrialisation.
 Thirdly, Thorner did not take the data on
female workers into account.
 Following R. Chattopadhyay‘s own definition, we
can evolve the following criteria for the study of
changes in an economy vIs-a-vis industrialisation
--- (i) change in NNP; (ii) change in the ratio of
manufacturing output to the total output (NNP)
and (iii) change in the ratio of manufacturing
working force with respect to total population.
 If all these three factors increase over the years,
we can strictly define a process of
industrialisation.
 Similarly a decline in all the three factors will
strictly indicate a process of de-industrialisation.
 A decline in the second or third factor together
with a constant NNP will also indicate a process
of de-industrialisation.
 As far as the output part of (i) and (ii) are
concerned the information available for India is
scattered and needs thorough research.
 But studies by Thorner, S. J. Patel and S.
Sivasubramaniam show that national income in
India remained more or less stagnant over the
period 1900-1940.
 So, if we can now show that manufacturing
working force declined over the period, then we
have a strong case for de- industrialisation.
 A.K.Bagchi has interpreted de-industrialisation
as a decline in the proportion of population
dependent on industry in total population.
 He has based his estimation on the detailed
tables giving the number of common artisans
prepared by Buchanan Hamilton from his survey
of different districts of Bihar over 1809-13.
 Bagchi has made certain adjustment in the data.
 To arrive at an estimate regarding the family size of
industrial workers Bagchi has assumed that except for
cotton spinners, each industrial worker supported
five people including himself.
 An average cotton spinner was assumed to support
either only himself or two persons including himself.
 Based on these alternative assumptions Bagchi has
derived two estimates of the proportion of total
population dependent on the industrial population for
1809-13 in the 5 districts of Bihar (Gaya, Bhagalpur,
Munghyr, Purnia, Sahabad)
 Comparing them with the 1901 census figures he has
come to the conclusion that in all these districts
there was a rapid decline in the proportion of
population dependent on industry suggesting a de-
industrialisation.
 Bagchi has argued that since the districts
concerned had nothing unique compared to
other parts of India, his de-industrialisation
thesis is true for the whole of India.
 It is to be noted here that as an evidence of
deindustrialisation, data on industrial production
would have been an ideal index.
 But in their absence, employment data serves
the purpose, especially because there is no
evidence of technological change in the
indigenous sector leading to an increase in per
capita output of the industrial sector.
 However, deindustrialisation was a reality.