The Pattern of Industrial Growth in Interwar India

The interwar period in India witnessed diversification of factory-based industry from mainly textile- and export-oriented activities into a wide range of consumer and intermediate goods for the home market. The two most well-known interpretations of this process are: tariff-aided import-substitution, and relocation of surplus out of land. The paper reviews trends in factory-employment to suggest that a part of this enterprise occurred in clusters consisting of small units, using local resources, and located at points of internal trade. This tendency was consistent with commercialization of agriculture, and development of capitalism within the major crafts.