Research Scholar CAS
Department of History, AMU, Aligarh
British colonialism ravaged Indian economy in varied ways. Indian industrialization was deliberately stalled for a long period of time. Rather a debilitating process of deindustrialization happened in India. How this counter process of decentralization was effected in India? Madan Mohan Malaviya’s threadbare analysis of this process through his unique ideas on Indian industrialism provided solutions to some of these poignant questions of modern Indian economic history. Malaviya was a strong proponent of Indian industrialism. Malaviya propounded the Swadeshi creed at a very early stage in 1893. He also advocated the Japanese model of Industrialization in India which was dependent on state support. Thus, his economic thought was continuously evolving. His understanding of problems of Indian industrialization got documented in his independent dissent ‘note’ to the Indian Industrial Commission of 1916-18. Through this research paper, I seek to explore various strands of Malaviya’s economic thought, which are essential for understanding his contribution towards the development of economic nationalism in India.
Keywords: Colonialism, Industrialism, Economy, Deindustrialization, Multifaceted
Questions on grinding ‘poverty’ increasingly dominated Indian psyche from the second half of the nineteenth century. Deindustrialization was regarded as one of the prime reasons behind this. Malaviya as a Moderate nationalist, from the earliest years of his public life raised the question of revival of Indian industries. He became a strong votary of Swadeshi Movement. He through his unique ideas on Swadeshi (which subsequently formed part of the ethos of Indian freedom struggle against colonialism) made a stellar contribution towards the Indian industrialism. Malaviya was part of the Indian Industrial Commission of 1916-18 which was “instructed to examine and report upon the possibilities of further industrial development in India.”
Genesis, composition and recommendations of the Industrial Commission
It was through the painstaking efforts of Ibrahim Rahimtoolla (1862-1942), the famous Mayor of Bombay, that Indian Industrial Commission was formed in May 1916 to report on the measures to be adopted for the growth and development of industries. He was a member of the Finance Commission where he advocated fiscal autonomy as a prerequisite for industrialization. However, Industrial Commission was more a product of the war time hardships faced by the colonial government in India. It was the urgency to address the issue of declining war supplies that the Commission was brought in. The colonial government was facing serious issues in the production of war supplies in India. It was the urgent need of removing these hindrances rather than any thought of reviving, in modern times the indigenous industries which had perished by the impact of the industrial revolution and the policy of colonial exploitation that Government had thought of making the country at least partially self-supporting. Idea of fiscal autonomy which was much discussed at the time of end of World War was considered ineffectual by Malaviya. He stoutly protested protective tariffs in favour of British industries like textile industry in Manchester. He lamented that official majorities within the Government and legislature would be dictated by the British industrial lobby. He finally resigned from the legislature in 1930s on this issue.
Sir T.H. Holland presided over the Indian Industrial Commission. Some eminent British industrialists and civil servants also participated in the ten member commission. It also comprised three nominated Indian members – Sir Dorabji Tata, Sir Fazulbhoy Currimbhoy Ebrahim and Sir Rajendranath Mookerji. Later, Malaviya also joined them as an Indian member on the insistence of Government. The announcement of the Commission was done in May 1916. The Commission prepared questionnaires, scrutinized available evidence and extensively toured United Provinces, the Central Provinces, Bihar, Bengal, Orissa and Madras. Malaviya accompanied them whilst the Commission was in United Provinces.
The Report provided an extensive survey of urban and rural industries of the country, particularly of important urban areas like Calcutta, Bombay, Ahmedabad and Kanpur. Major industries such as cotton, jute, tea and indigo were also covered encompassing their logistical requirements, raw materials and labour. The Report highlighted the abysmal state of technical and commercial education in India. The final chapter contained the summary of recommendations. The Report said Indian industries were unevenly distributed and inadequately developed. And most of the raw material was left unutilized. The Commission exhorted the Government to provide technical, financial and administrative assistance which could help become India “strong by its own strength and a worthy partner in the Empire.”
The Report was much condescending in tone visible from its first chapter itself. And this became a recurring theme in subsequent chapters also. India was described incapable of undergoing industrialization due to myth and idiosyncrasies:
“India produces nearly all the raw materials necessary for the requirements of a modern community; but is unable to manufacture many of the articles and materials essential in times of peace and war. For instance, her great textile industries are dependent upon supplies of imported machinery and would have to shut down if command of the seas were lost.”
Thereafter, it went on to target the ineptitude and inefficiencies of Indians. Measures suggestive of improving the inefficiency of Indian artisans were discussed displaying blatant disregard and ignorance for any scientific explanation for sorry state of Indian industries. The Commission was perhaps more interested in finding faults than boosting the morale of dilapidated Indian industries. It was shown that the relative lowness of wages paid to Indian labour is counterbalanced by the comparative inefficiency of the individual Indian workman. The Commission demoralized Indian inefficiency in a most racial manner, when it regarded societal variations as a factor of heredity only:
“The general aversion from the industrial pursuits of the educated Indian is ascribed to hereditary predisposition accentuated by an unpractical system of education. A complete revolution in the existing methods of training is proposed.”
Thus, the Commission conveniently ignored the effects of British colonialism. The Report only castigated the existing state of affairs without giving any reasonable explanation for it. The Commission penned a long detailed report of almost three hundred pages which incidentally also included a fifty page independent dissent note by Malaviya. Even after half a dozen draft reports were prepared, Malaviya signed the Report only after writing an independent ‘note’ which formed almost a fifth of the Report.
Some Snippets from Malaviya’s dissent ‘Note’
Malaviya largely agreed with the spirit of recommendations. But, he wanted that the Government’s responsibility for the ruin of Indian industries must be unambiguously brought out in the Report. And he also wanted to explode the ‘myth of Asiatic apathy to industrial pursuits’. Long held stereotypes regarding unsuitability of banking system here in India were the reason behind the weak industrial base of India, he regarded. He through evidentiary analysis brought out how Indian industries became a victim of British colonialism. He had laboriously sketched a ‘note’ on the history of Indian industry. While comparing Indian economy in ancient and modern periods, he had dexterously quoted from British historians, who have admitted that India was reduced to an agricultural country in modern times.
The colonial government had pursued a policy of deindustrialization in India. Malaviya in his dissent note has highlighted on this process of deindustrialization in India. He has dealt this process under the head: “How India came to be an Agricultural Country”. He chose to focus on three basic industries namely: (a) Cotton and textile industry (b) Iron industry (c) Shipping industry. Malaviya has quoted, William Digby, who he says has categorically proved that colonial import-export tax policy was designed to export raw materials from India to England and to make India a dumping ground for English factory goods. He gives a tabular data of import/export duties in various products. “These burdensome charges were subsequently removed but only after the export trade in them had, temporarily or permanently, been destroyed.” He further argues that Industrial revolution in England was a factor of Indian decentralization that happened almost simultaneously. Malaviya quotes Mr. Henry Tucker in support, who had, on retirement from India, become a Director of the East India Company Writing in 1823, he said:
“The silk manufactures (of India) and its piece-goods made of silk and cotton intermixed, have long since been excluded altogether from our markets, and of late, partly in consequence of the operation of a duty of 67 per cent, but chiefly from the effect of superior machinery, the cotton fabrics which heretofore constituted the staple of India, have not only been displaced in this country, but we actually export our cotton manufacturers to supply a part of the consumption of our Asiatic possessions. India is thus reduced from the state of a manufacturing to that of an agricultural country”
Writing of the Shipping industry, Malaviya traces the trajectory of Ship building from ancient times, and in support, he quotes from R.K. Mukhejee’s, History of Indian Shipping, that both Darius and Alexander had hundreds of Indian vessels. But the new colonial rulers of India deliberately chose to destabilise once thriving Indian shipping industry for their own colonial interests.
Malaviya then addresses the Industrial revolution in England under the head “English Industrial Revolution”. He says many English historians today discuss why this revolution first happened in England? Malaviya argued: It was perhaps financed from the loot of Bengal and Carnatic. Malaviya then examines the effect of export free passage given to Indian raw materials on Indian economy. Although, he praises Lord Dalhousie’s Railway policy, but he has also written about the deleterious effects Railways had on Indian economy which is the reason behind the recurrence of periodic devastating famines in colonial India.
Malaviya cites the Report – “The cry of Indians for the promotion of Technical Education and Indigenous Industries”, and its non-implementation. Thereafter, he traces the evolution of the demand for technical education and indigenous industries by Indian National Congress since the publication of this Report in 1880. And Congress repeatedly requested in 1891, 1892 and 1893, for the appointment of a Commission to inquire into these issues. Malaviya then addresses the issue of agricultural and technical education. He urged the Government to open Imperial Engineering College or at least an Imperial Polytechnic Institute. Malaviya had a special interest in education of trade & commerce. He also asked for the development of banking sector in India.
Malaviya concluded with an endorsement of Sir Fredrick Nicholson views:
“I beg to record my strong opinion that in the matter of Indian industries we are bound to consider Indian interests firstly, secondly and thirdly – I mean by ‘firstly’ that the local raw products should be utilised, by ‘secondly’ that industries should be introduced and by ‘thirdly’ that the profits of such industry should remain in the country.”
He believed, If measures for the industrial development of Indian were taken in this spirit, India will become prosperous and strong, and England more prosperous and stronger.
Malaviya had an active public life of more than fifty years. His interests were much diverse spanning politics, journalism, law, education, teaching etc. His multifaceted personality has mostly been reduced to politics and education fields. But Malaviya’s economic ideology is mostly unexplored. Malaviya had some unique ideas on Indian industrialism. His engagement with the Indian Industrial Commission of 1916 was a case in point. Malaviya argued that it was only by keeping India an agricultural economy, British factory goods could be dumped in India. But his economic contribution was not just limited to a dissent note to the Industrial Commission. Malaviya was in the long line of Moderate leaders within the Indian National Congress who provided what has been called ‘the economic critique of colonialism’.
 Bhai Parmanand, Mahamana Madan Mohan Malaviya: An Historical Biography, Vol. I, B.H.U. Press, Varanasi, 1985, p. 288.
 Report of the Indian Industrial Commission, 1916-18, Superintendent Government Printing, Calcutta, 1918, pp. 1-2.
 R.N. Tripathi, Tees Din Malaviyaji ke Sath, Sasta Sahitya Mandal, Delhi, 1942, p. 274.
 Parmanand, op. cit., p. 289.
 Report, op. cit., pp. 229-42.
 Ibid., pp. 6-7.
 Ibid., p. 3.
 William Digby, Prosperous British India: A Revelation from Official Records, London, 1901, p. 90. Malaviya has quoted from Digby profusely, Report, op. cit., p. 250.
 Report, op. cit., p. 250. Memorials of the Indian Government, being a selection from the papers of Henry St George Tucker, London, 1853, p. 494, quoted by R.C. Dutt, Economic History of British India, p. 262
 Report, op. cit., p. 251.
 V.N. Tiwari, Mahamana Pt Madan Mohan Malaviya ki Jivani, Kashi Hindu Vishwadyalaya, Varanasi, p. 76
 Ibid., p. 77.
 Report, op. cit., p. 300.