Industrial Labour in India

The growth of industries and the evolution of an industrial proletariat are comparatively recent in India. India has always been and still is a predominantly an agricultural country. The two important factors that have been responsible for rural stagnation in India are pressure of population and lack of opportunity for work, in non agricultural occupations.

Between 1901 and 1971 the occupational distribution of population in India did not change much in spite of expansion of our industries as failed to create more employment in the industrial sector.

In the economically advanced countries, broadening of employment in the non agricultural sector accounts for increase in fresh labour force as well as transfer of labour from agriculture to other sectors.

Labour in Ancient India and Middle Ages.

Available evidence indicates that labour occupied an important place in the ancient Hindu society.

Kautilya’s Arthashtra, and Edicts of Ashoka show that labour received a fair deal in those days. It was the states duty to see that the workers received sufficient wages to survive; and ensure that each worker had shelter. Workers were treated well, received fair and sometimes high wages, and were paid regularly. Evidence indicates that workers organizations existed and were recognized by the state. Disputes regarding wages were settled by the king and social security provisions like old age pensions, grant of leave with wages in case of sickness etc were common.

The conditions of workers deteriorated during the Muslim rule especially in the royal factories known as “shahi karkhahans” described in “Ain-e-Akbari”. The karkhanas worked under the nobles [known as Amirs], who were generally selfish and self centered desiring to make maximum profits, and they did so at the cost of workers wages and conditions of work. Workers were ill treated even flogged and the king had little knowledge of the conditions of workers. Evidence also indicates that prisoners were frequently employed on different jobs undertaken by the state.

After the death of Aurangzeb – the last of the moghuls, in 1707, the country was left in a state of chaos and started disintegrating.

During thr transition period from the moghuls to the british rule it was difficult to regard india as an economic unit. Cottage industries existed in the rural areas. Compact closely organized urban industries controlled by guilds or middlemen, catered to foreign markets, existed in the urban areas.

Economic Industrial Scene before Industrialisation

At a time when Western Europe – the birth place of the modern industrialization, was inhabited by uncivilized tribes, India was famous for its industries, skilled artists, division of labour, specialization, international trade. During the 17th century India was a hub of trade and commerce.

From the middle of the 17th century Indian textile exports to England increased phenomenally, but due to technological, economic and political developments these exports could be maintained. One of the major reasons for the decay of Indian indigenous industry was the Industrial revolution which started in England in the second half of the 18th century.


The industrial revolution and the East India Company’s trade policy led to the decline of Indian handicraft industry by the middle of the 19th century. This increased the pressure of population in the rural areas.

India’s isolated self sufficient villages opened up with the introduction of Railways in 1853, and led to the decay of the old industrial organization of the villages and paved the way for large scale factory system.

Growth of Modern Industry and Industry Policy in India

Despite the discouraging attitude of the Government, some large scale industries were set up in India after 1850, some with foreign capital and some due to certain enterprising Indian industrialists. The period between 1860 and 1875 saw the beginnings of plantations, factories and mining in India though progress achieved was insignificant.

1852 – A private tea garden started in Assam

1840 – First coffee plantation started in south India.

1854 – The first cloth mill started functioning in India in Mumbai.

1854 – jute mill started in Serampure

1820 – Coal mine opened in Raniganj in Bengal. Then other minerals were mined, around 1845 – tanning industry in Madras, Paper in Bengal etc.

After the first world war [1914 - 1918] the

May 1916 – industrial commission was appointed, which recommended that the government should play an active role in the industrial development of the country, to make it self sufficient.

October 1921 – The fiscal commission stated that the policy of protection applied judiciously would prove advantageous to Indian industry.

The Second World War [1939 - 1945] once again promoted industries; however significant development did not take place.

It was after independence [15th August 1947] the Indian national government took positive steps to promote rapid economic development in the country. Various Industrial policy resolutions were passed.

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