In this article we will discuss about the cottage industries of India:- 1. Decline of Cottage Industries or De-Industrialisation of India 2. Organisation of Cottage Industries 3. Effects of the Decline in India’s Cottage Industries.

Decline of Cottage Industries or De-Industrialisation of India:

An impression persists that India has “always been an agricultural country and that the people of India are, by nature and tradition deficient in industrial and commercial enterprise……. “ It is true, agriculture has been the main industry in India.

It is also true that India, in the past, was not an industrial country in the modern sense of the term. However, the contention that India never had any industries at all can be easily refuted by reference to her past history.

According to Baines, “The birth place of cotton manufacture is India where it probably flourished long before the dawn of authentic history”. Mummies in Egyptian tombs dating from 2000 B.C. were found wrapped in Indian muslins of the finest quality. The Muslin of Decca was known to the ancient Greeks by the name of ‘Gangetika’—a word suggestive of its origin from the banks of the Ganges.


The Iron industry not only supplied all local wants, but also enabled India to export its finished products to foreign countries….cutlery to England and its famous Damascus blades to Syria.

Bernier, who visited India in the reign of Shah Jahan, marveled at the incredible quantity of manufactured goods while Travernier dwelt, with wonder, on the marvelous Peacock throne, (the natural colours of the Peacock’s tail worked out in jewels), of carpets of silk and gold, and satins with streaks of gold and silver, an endless list of exquisite works of mini-carvings and other choice objects of art.

The fact is that “when merchant adventurers from the West made their first appearance in India, the industrial development of this country was, at any rate, not inferior to that of the more advanced European nations.”

It was trade in the products of these prosperous industries which lured the traders of Europe to India. The East India Company, as Malviya explains, was formed not to exchange the goods of England for the products of India but “to carry the commodities and manufactures of India to Europe”.


The ancient industries of India may be classified into the following four categories:

1. Peasant Arts and Crafts:

These were side occupations which the peasants perused during their spare time or off seasons when there was no work for them either at home or outside and which served as a second string to their bow.

These industries included, among others, hand spinning and weaving, gur making, flour grinding, rice pound­ing, cotton ginning, rope-making, basket making, mat weaving, sericulture and tobacco manufacture. Of these, hand spinning was by far the most important.

2. Village Subsistence Industries:

These were industries which had little to do with agriculture but whose prosperity still depended on the fortunes of agriculture. These were mostly fol­lowed by the village servant class of artisans such as the black smith, carpenter, weaver, oil-presser and Potter-all those who attended to the simple needs of the villagers and were paid by shares of grain at harvest lime.

3. Village Art Industries:


These industries, in many cases, enjoyed widespread fame. Examples of this kind were lac and toy manufacture in Meerul and Mirzapur, Carpel weaving in Mirzapur and Benares, Silk weaving in the villages of Murshidabad, Malda and Madura, Metal work in Boidrajpur (Bihar) Santipur, Bishnupur and, Kharagpur the manufacture of conch-shell bangles and mother of pearls buttons in the villages of Dacca, artistic clay modelling in Mirzapur and Nandia.

Some of their products like Lungis and Sarees of Melapalayam, glass bangles of Fatehpur and Firozabad, Silk Khes made in the village of Shahpur (Punjab) and embroidered cloth of Dacca villages were exported to foreign countries.

4. Urban Arts and Crafts:

It was in these that the Indian industry reached a high standard of excellence. The most important, of course, was the textile handicrafts. The muslins of Dacca, “the shadow of a commodity” were the finest and the best known. Next in im­portance were the fine cotton fabrics of all kinds and manufactured practically all over India.

Lucknow was famous for its Chintzes, Ahmedabad for its dhoties and Dopattas, Nagpur, Umrer and Paoni for their silk-bordered clothes. Next came the manufacture of silks, the most famous being the Bandanas and corabs of Murshidabad, Malda or other Bengal towns, the fine flowered brocades of Benares, Ahmedabad.

In woolens, the best known of the artistic products were the shawls, made chiefly in Kashmir, Amritsar, Ludhiana and in several other Punjab towns.

Leaving the textiles aside, another famous industry was metal- work. Benares was famous all over India for its brass, copper and bell-metal wares. The town of Rajputana excelled in all kinds of artistic work, specially enameled jewellery and stone-carving.

On account of the easy availability of raw-materials and the force of a long tradition, certain areas became famous for special products. In­stances of this kind were the shawl and paper-Mache work in Kashmir, marble in-laying work at Agra, the Paithani of Yeola, Kincob of Ahmedabad or the Phulkari work of certain north Indian cities.

In addition, there were industries like the Iron smelting of Mysore, Chota Nagpur, Central Provinces and other provinces, the salt-petre manufacture, the bangle-making and paper manufacture. These were mostly localised and their methods of production were crude and un-economical though their products, as in the case of steel, were of a very high quality.

Organisation of Cottage Industries:

The organisation of village industries was very primitive. There was no specialisa­tion and the village artisans mostly carried on their traditional occupations, uninfluenced by the outside world. A.s regards the organisation of industries in bigger cities, there is a difference of opinion.


The official view is that these industries were also loosely organised and lacked anything similar or parallel to the guilds of Europe. Prof. Gadgil, on the other hand, holds the view that each craft was organised into guilds which looked after the welfare and also the quality of the work of their members.

Nominally, each guild was composed of all the freemen of the caste but a special position was allowed to the Chief of the guild. Each independent craftsman was not a big capitalist. He generally worked to order and on the materials supplied by his customer.

In the words of Dr. Anstey, “up to the 18th Century, the economic condition of India was relatively advanced, and Indian methods of production and her industrial and commercial organisation could stand comparison with those in vogue in any other part of the world”.

By the end of the 19th Century, however, most of the indigenous industries had either decayed beyond recovery or were on the road to ruin. Was it the result of the inevitable march of times? If that were so, the decline of cottage industries would have been nothing more than a matter of regret. In fact, it was much more a “tale of unfeeling selfishness and cruel injustice”.


The causes responsible for the decline of these industries are discussed below:

Causes of Decline:

1. Decline of Indian courts:

The disappearance of Indian courts struck the first blow at Indian handicrafts. As native states passed under British rule, the demand for fine articles, for display in durbars and other ceremonial occasions disappeared. The ordinary demand did continue for sometime longer, but the younger generation lacked the means and inducement to patronise the arts and handicrafts. And they declined.

2. The Establishment of British Rule:


The establishment of British rule in India affected cottage industries both directly and indirectly. Directly it led to the establishment of peace and order in the country which adversely affected such handicrafts as the inlaying of arms, weapons and shields. This craft was common in the Punjab and Sindh.

By eliminating the need for such weapons and by prohibiting their possession and use, the British reduced the industry to producing ornamental knick-knacks for European tourists. Similarly, the establishment of the British rule made it neces­sary, through an un-written order, for Indians to wear patent leather shoes when in the presence of British superiors.

This brought about the decay of the embroidered shoe industry. Indirectly, the British rule weekend the power of the guilds which regulated trade and supervised the quality of work done. As a consequence, evils such as the adulteration of raw materials and poor work­manship crept in and artistic and commercial value of the products deteriorated.

3. Western Education:

The new system of English education was another contributory factor. In the early stages, the newly educated Indians were more westernized than even the Europeans themselves. They blindly accepted European standards and fashions and looked down upon everything Indian.

Matters came to such a sorry pass that to follow European tastes was regarded as the hall mark of enlightenment. As a result, demand for the products of indigenous industries declined while that for Europeans goods increased.


4. Introduction of New Patterns:

With the disappearance of Indian states, old rulers and nobles also disappeared and their place was taken up by the European Officers and tourists. Indian craftsmen, however, did not clearly understand the forms and patterns which suited European tastes.

They tried to please their new customers by copying their forms and patterns. Very often, the new products were very poor copies of the original and “lacked the vigour and life” of the indigenous products. An instance of this kind is furnished by the Kaftgiri Industry in the Punjab which declined due to indiscreet European patronage.

5. Competition of Machine Made Goods:

Apart from the abolition of Indian courts and the introduction of foreign influences, it was the superior manufacturing technique based on power and im­proved machinery which enabled the British manufacturers to drive the Indian artisans from out of their home market. It was what Ranade calls, the competition of Natures’ powers against man’s labour’ which completed the ruin of Indian handicrafts.

The invention of the power loom in Europe brought about the ruin of the Indian textile industry and, by 1834-35,” the bones of the cotton-weavers were bleaching the plains of India.” The same story may be recounted of other Indian industries such as the ship-building Iron smelting, glass, dyeing and paper manufacture.


The Indian domestic and cottage handicrafts could not possibly have withstood foreign competition which was backed by a powerful industrial organisation, big machinery, large-scale production and complex division of labour.

The difficulties of the Indian industries were further aggravated by the construction of the Suez canal, fall in freight rates and the reduction of transport costs which made British goods more cheap in India.

6. Policy of the British Govt.:

In the beginning, the commercial interests of East India company led it to encourage Indian industries because its exports from India were largely drawn from them. This policy, however, met with determined opposition from vested interests in England which compelled the company to concentrate only on the export of raw- materials so necessary for the expanding British Industries.

This policy of making India subservient to the industries of Great Britain was followed with rare determination and fatal success. Orders were issued to force Indian artisans, especially silk-winders, to work in the company’s factories and not in their homes; commercial residents were vested with extensive legal powers over villages and communities of Indian weavers. The use of dyed Indian calicoes was prohibited.

Extensive use was made of custom duties to crush Indian in­dustries. For instance, in 1813, cotton and silk goods of India could be profitably sold in the British market at a price 50-60% lower than the price of cloth manufac­tured in England. However, duties ranging from 70-80% on their value were imposed on Indian textiles in order to drive them out of the British market.


If such heavy duties and prohibitive decrees had not been enforced, “the mills of Paisley and Manchester would have been scarcely set in motion even by the power of the steam.” A free India would have retaliated by imposing counter duties on British goods but, being slave, this act of self defence was denied to her.

Thus, British manufacturers “employed the arm of political injustice to keep down and ultimately strangle a competitor with whom he could not have competed on equal terms. These prohibitive duties were removed only about the middle of the 19th Century when Indian indigenous industries had already been crippled.

While such was the policy followed in England, the Govt. of India also did not lend a helping hand. Rather, it went out of its way to assist English manufac­turers in exploiting the Indian market.

As Ranade observes:

“India was regarded as a plantation; growing raw-produce to be shipped by the British agents in British ships, to be worked into manufactured articles by British skill and capital, and to be re-exported to India by British merchants to their corresponding British firms in India and elsewhere”.

No industry could have flourished in such an atmosphere. The result was a rapid decay of Indian trade and manufacturers and ruralisation of the country.


7. Role of Intermediaries:

Except the village subsistence and rural art industries, in all others, the extension of the market led to the emergence of dealers and financiers who reduced the artisans to “hewers of wood and drawers of water” for their masters. The part played by middlemen in bringing about this stale of affairs is best illustrated by the activities of the East India Company itself.

The company, being a dealer in the products of cottage industries, made advances in cash and raw-materials to buy the finished products. Having done so once, it held the craftsmen under its iron grip.

For example, it provided that a weaver, who had received advances from the company, “shall on no account give to any other person, European or native, either the labour or the produce engaged to the company” that, on his selling the cloth to others, the “weaver shall be liable to be prosecuted in the Diwani Adalat” ; that weaver “shall be subject to a penalty of 35% on the stipulated price of every piece of cloth that he fails to deliver according to the written agreement”.

Whenever the artisans were unable to carry out the agreements forced upon them, their goods were forcibly seized and sold on the spot to make good the deficiency. Unable to resist this injustice, many weavers     “cut off their thumbs to prevent their being forced to weave silk.”

If the East India Company was cruel and rapacious, Indian businessmen were no better. Acting as financiers and coordinating agents, they held complete sway over the artisans whom they fully exploited.

Effects of the Decline in India’s Cottage Industries:

The decline of India’s cottage industries had a disastrous effect on the economy of the country. The Indian village system had been built on the “domestic Union of agricultural and manufacturing pursuits”. The handloom and the spinning wheel were the pivots of the old Indian society.

However, the British broke up the Indian handloom and destroyed the spinning wheel and thus produced “the greatest social revolution ever heard of in Asia”. This revolution not only destroyed the old manufacturing towns but also destroyed the balance of economic life in the villages.

From this arose the desperate over-pressure on agriculture which has continued, on a cumulative scale, right up to the present day.