Mumbai - the Financial Capital - I | Maharashtra State PSC (MPSC): Preparation - MPSC (Maharastra) PDF Download

 Page 1


 
 
74
7 
 
 
 
MUMBAI - THE FINANCIAL CAPITAL - I 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
b) LABOUR MOVEMENTS 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
 
Unit Structure 
 
7.0 Objectives 
7.1 Introduction 
7.2 Textile Mills 
7.3 Bombay Stock Market 
7.4  Banking  
7.5 Conclusion 
7.6 Questions 
   
7.0 OBJECTIVES 
 
• To understand the history of textile mills in Bombay now 
 
 INTRODUCTION 
 
 Mumbai, known as the financial Capital of India, is the 
economic hub of most of the commercial and business activities of 
the country. The Island city contributes factory employment, 
customs duty, income tax, foreign trade and central excise tax of 
India. Moreover, it produces a huge amount in corporate 
taxes. Indian companies like Tata Group, Godrej, Reliance, State 
Bank of India, etc, which form of part of Fortune Global 500 
companies, are based in Mumbai only. Most of the foreign banks 
and financial institutions have set up offices in its expanse. Mumbai 
credits its success chiefly to the textile mills and seaport till 1980's. 
Page 2


 
 
74
7 
 
 
 
MUMBAI - THE FINANCIAL CAPITAL - I 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
b) LABOUR MOVEMENTS 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
 
Unit Structure 
 
7.0 Objectives 
7.1 Introduction 
7.2 Textile Mills 
7.3 Bombay Stock Market 
7.4  Banking  
7.5 Conclusion 
7.6 Questions 
   
7.0 OBJECTIVES 
 
• To understand the history of textile mills in Bombay now 
 
 INTRODUCTION 
 
 Mumbai, known as the financial Capital of India, is the 
economic hub of most of the commercial and business activities of 
the country. The Island city contributes factory employment, 
customs duty, income tax, foreign trade and central excise tax of 
India. Moreover, it produces a huge amount in corporate 
taxes. Indian companies like Tata Group, Godrej, Reliance, State 
Bank of India, etc, which form of part of Fortune Global 500 
companies, are based in Mumbai only. Most of the foreign banks 
and financial institutions have set up offices in its expanse. Mumbai 
credits its success chiefly to the textile mills and seaport till 1980's. 
 
 
After that, the local economy branched out and included 
engineering, diamond-polishing, healthcare, information 
technology, etc. Mumbai has been granted the status of the state 
capital of Maharashtra, since it has a large percentage of state and 
central government employees in its workforce. It comprises of the 
headquarters of esteemed Indian financial institutions like Mumbai 
(Bombay) Stock Exchange, Reserve Bank of India, National Stock 
Exchange, etc. In the present day, Mumbai stands at 10th position 
amongst the biggest centers of commerce in the world. 
 
TEXTILEMILLS 
 
 According to Jawaharlal Nehru, “The history of cotton and 
of textiles is not only the history of growth of modern industry in 
India but in a sense it might be considered the history of India”.  
 
 Textile industry in Mumbai laid the foundation of the city’s 
prosperity and its rise as the industrial hub of India by the end of 
the First World War. It had by then become the major industrial 
metropolis of Asia. The textile industry influenced every aspect of 
life in Mumbai, its migrations, social relation, housing, municipal 
administration and above all its economy making Mumbai the 
commercial capital of the country. Mumbai had become the bastion 
of not only Indian Capital but also provided employment to lakhs of 
people in the textile mills and related industries. In textile industry 
alone there were 153,000 workers. By 1931 according to an 
estimate, half the population must have been economically reliant 
on this industry alone.  Textile mills flourished in Mumbai even after 
independence. During 1947 to 1960, Mumbai witnessed the growth 
of cotton production due to textile mills.  
 
 History of Mills in Mumbai 
 The first textile mill, the Bowreach cotton Mill, west bank of 
the river Hooghly near Calcutta was set up in India in 1818 by a 
British firm but it was closed down later on due to number of 
reasons. With the establishment of the first textile mill in Mumbai in 
1854 by Cowasjee Nanabhoy Davar, a new era opened in the 
history of not only in the city’s economy but also in the history of 
Indian economy. The first mill was established on 7 July 1854 with 
the help of 50 leading businessmen in the city named as “Bombay 
Spinning and Weaving Company”. The profits of the same 
exceeded all expectations, and many mills followed. By 1862 four 
mills were added and this number grew in course of time. “The 
Oriental Spinning and Weaving Company”, floated in 1855 under 
the leadership of M. N. Petit, Beramji Jijibhai, Varjivandas 
Madhavdas, E. Sassoon and two Europeans, started functioning in 
1858. M. N. Petit's entry into the mill industry marked the transition 
of his family from trade to industry. Prosperity of the industry 
Page 3


 
 
74
7 
 
 
 
MUMBAI - THE FINANCIAL CAPITAL - I 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
b) LABOUR MOVEMENTS 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
 
Unit Structure 
 
7.0 Objectives 
7.1 Introduction 
7.2 Textile Mills 
7.3 Bombay Stock Market 
7.4  Banking  
7.5 Conclusion 
7.6 Questions 
   
7.0 OBJECTIVES 
 
• To understand the history of textile mills in Bombay now 
 
 INTRODUCTION 
 
 Mumbai, known as the financial Capital of India, is the 
economic hub of most of the commercial and business activities of 
the country. The Island city contributes factory employment, 
customs duty, income tax, foreign trade and central excise tax of 
India. Moreover, it produces a huge amount in corporate 
taxes. Indian companies like Tata Group, Godrej, Reliance, State 
Bank of India, etc, which form of part of Fortune Global 500 
companies, are based in Mumbai only. Most of the foreign banks 
and financial institutions have set up offices in its expanse. Mumbai 
credits its success chiefly to the textile mills and seaport till 1980's. 
 
 
After that, the local economy branched out and included 
engineering, diamond-polishing, healthcare, information 
technology, etc. Mumbai has been granted the status of the state 
capital of Maharashtra, since it has a large percentage of state and 
central government employees in its workforce. It comprises of the 
headquarters of esteemed Indian financial institutions like Mumbai 
(Bombay) Stock Exchange, Reserve Bank of India, National Stock 
Exchange, etc. In the present day, Mumbai stands at 10th position 
amongst the biggest centers of commerce in the world. 
 
TEXTILEMILLS 
 
 According to Jawaharlal Nehru, “The history of cotton and 
of textiles is not only the history of growth of modern industry in 
India but in a sense it might be considered the history of India”.  
 
 Textile industry in Mumbai laid the foundation of the city’s 
prosperity and its rise as the industrial hub of India by the end of 
the First World War. It had by then become the major industrial 
metropolis of Asia. The textile industry influenced every aspect of 
life in Mumbai, its migrations, social relation, housing, municipal 
administration and above all its economy making Mumbai the 
commercial capital of the country. Mumbai had become the bastion 
of not only Indian Capital but also provided employment to lakhs of 
people in the textile mills and related industries. In textile industry 
alone there were 153,000 workers. By 1931 according to an 
estimate, half the population must have been economically reliant 
on this industry alone.  Textile mills flourished in Mumbai even after 
independence. During 1947 to 1960, Mumbai witnessed the growth 
of cotton production due to textile mills.  
 
 History of Mills in Mumbai 
 The first textile mill, the Bowreach cotton Mill, west bank of 
the river Hooghly near Calcutta was set up in India in 1818 by a 
British firm but it was closed down later on due to number of 
reasons. With the establishment of the first textile mill in Mumbai in 
1854 by Cowasjee Nanabhoy Davar, a new era opened in the 
history of not only in the city’s economy but also in the history of 
Indian economy. The first mill was established on 7 July 1854 with 
the help of 50 leading businessmen in the city named as “Bombay 
Spinning and Weaving Company”. The profits of the same 
exceeded all expectations, and many mills followed. By 1862 four 
mills were added and this number grew in course of time. “The 
Oriental Spinning and Weaving Company”, floated in 1855 under 
the leadership of M. N. Petit, Beramji Jijibhai, Varjivandas 
Madhavdas, E. Sassoon and two Europeans, started functioning in 
1858. M. N. Petit's entry into the mill industry marked the transition 
of his family from trade to industry. Prosperity of the industry 
 
 
attracted a number of shetias. Mangaldas Nathubhai floated the 
“Bombay United Spinning and Weaving Company” in February 
1860. B. H. Wadia and Kesowji Naik promoted one mill each in the 
same year. There were ten mills with 6,600 employees in the city in 
1865. 
 
 Besides the men of amazing commercial career mentioned 
above, the other pioneers of industry in Bombay included, Dinshaw 
Petit, Nusser-wanji Petit, Bomaiyi Wadia, Dharamsey Punjabhai, 
David Sassoon, Merwanji Pandey, Khatau Makanji, 
TapidasVarajdas, James Greaves, George Cotton, Morarji 
Gokuldas, Mancherji Banaji, Mulji Jetha, Thackersey Moolji, 
Jamshetji Tata and many more. They were said to be men of 
initiative and integrity. Jamshetji Tata emerged as an enterprising 
industrialist who was the first to introduce economies in cotton mills, 
a fair deal to workers and a system of bonus and provident fund to 
employees. He went to England to study the Lancashire mill 
industry in 1865, and started the Alexandra mill in 1869 and the 
Swadeshi mill in 1886, while the Tata mills was established after his 
death in 1915.  
 
 Morarji Gokuldas established a mill which bears his name 
even today, in 1870. Thackersey Moolji floated the ‘Hindoostan 
Spinning and Weaving Company’ in 1873. This was followed by the 
mills of David Sassoon in 1874 and of Khatau Makanji in 1875. In 
1875, the Mumbai mills employed almost 2,50,000 workers in more 
than 52 mills. The progress of the industry was particularly rapid 
from 1875 to 1885. The Greaves Cotton and Company and the 
firms of D. M. Petit and the Thackersey family expanded their textile 
ventures by establishing many new mills. The number of mills in the 
city increased to 70 in 1895.  
 
 By the end of the 19
th
 Century Mumbai had become, with its 
over eighty textile mills, India’s largest textile centre. It was the 
largest employer of workers. Along with many workers employed in 
its ancillary industries, such as engineering workshops, chemical 
industries, railways, shipping and the cloth markets made Mumbai 
the largest employer of labour. Most of the workers employed by 
the mills lived in close proximity of their place of work in the regions 
of Lalbaug, Sewri, Parel, Currey road, Dadar and Byculla. However, 
69% of the workers lived in primarily single room accommodations 
or barracks hence the workers were mostly low-wage and migrants 
from other parts of the state. The progress of the industry was, 
however, retarded by a depression, an unprecedented plague and 
famine. Many inefficiently managed companies went into liquidation 
or changed Agents. 
 
 The opportunities afforded by the progress of trade, 
industries and communications attracted considerable number of 
Page 4


 
 
74
7 
 
 
 
MUMBAI - THE FINANCIAL CAPITAL - I 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
b) LABOUR MOVEMENTS 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
 
Unit Structure 
 
7.0 Objectives 
7.1 Introduction 
7.2 Textile Mills 
7.3 Bombay Stock Market 
7.4  Banking  
7.5 Conclusion 
7.6 Questions 
   
7.0 OBJECTIVES 
 
• To understand the history of textile mills in Bombay now 
 
 INTRODUCTION 
 
 Mumbai, known as the financial Capital of India, is the 
economic hub of most of the commercial and business activities of 
the country. The Island city contributes factory employment, 
customs duty, income tax, foreign trade and central excise tax of 
India. Moreover, it produces a huge amount in corporate 
taxes. Indian companies like Tata Group, Godrej, Reliance, State 
Bank of India, etc, which form of part of Fortune Global 500 
companies, are based in Mumbai only. Most of the foreign banks 
and financial institutions have set up offices in its expanse. Mumbai 
credits its success chiefly to the textile mills and seaport till 1980's. 
 
 
After that, the local economy branched out and included 
engineering, diamond-polishing, healthcare, information 
technology, etc. Mumbai has been granted the status of the state 
capital of Maharashtra, since it has a large percentage of state and 
central government employees in its workforce. It comprises of the 
headquarters of esteemed Indian financial institutions like Mumbai 
(Bombay) Stock Exchange, Reserve Bank of India, National Stock 
Exchange, etc. In the present day, Mumbai stands at 10th position 
amongst the biggest centers of commerce in the world. 
 
TEXTILEMILLS 
 
 According to Jawaharlal Nehru, “The history of cotton and 
of textiles is not only the history of growth of modern industry in 
India but in a sense it might be considered the history of India”.  
 
 Textile industry in Mumbai laid the foundation of the city’s 
prosperity and its rise as the industrial hub of India by the end of 
the First World War. It had by then become the major industrial 
metropolis of Asia. The textile industry influenced every aspect of 
life in Mumbai, its migrations, social relation, housing, municipal 
administration and above all its economy making Mumbai the 
commercial capital of the country. Mumbai had become the bastion 
of not only Indian Capital but also provided employment to lakhs of 
people in the textile mills and related industries. In textile industry 
alone there were 153,000 workers. By 1931 according to an 
estimate, half the population must have been economically reliant 
on this industry alone.  Textile mills flourished in Mumbai even after 
independence. During 1947 to 1960, Mumbai witnessed the growth 
of cotton production due to textile mills.  
 
 History of Mills in Mumbai 
 The first textile mill, the Bowreach cotton Mill, west bank of 
the river Hooghly near Calcutta was set up in India in 1818 by a 
British firm but it was closed down later on due to number of 
reasons. With the establishment of the first textile mill in Mumbai in 
1854 by Cowasjee Nanabhoy Davar, a new era opened in the 
history of not only in the city’s economy but also in the history of 
Indian economy. The first mill was established on 7 July 1854 with 
the help of 50 leading businessmen in the city named as “Bombay 
Spinning and Weaving Company”. The profits of the same 
exceeded all expectations, and many mills followed. By 1862 four 
mills were added and this number grew in course of time. “The 
Oriental Spinning and Weaving Company”, floated in 1855 under 
the leadership of M. N. Petit, Beramji Jijibhai, Varjivandas 
Madhavdas, E. Sassoon and two Europeans, started functioning in 
1858. M. N. Petit's entry into the mill industry marked the transition 
of his family from trade to industry. Prosperity of the industry 
 
 
attracted a number of shetias. Mangaldas Nathubhai floated the 
“Bombay United Spinning and Weaving Company” in February 
1860. B. H. Wadia and Kesowji Naik promoted one mill each in the 
same year. There were ten mills with 6,600 employees in the city in 
1865. 
 
 Besides the men of amazing commercial career mentioned 
above, the other pioneers of industry in Bombay included, Dinshaw 
Petit, Nusser-wanji Petit, Bomaiyi Wadia, Dharamsey Punjabhai, 
David Sassoon, Merwanji Pandey, Khatau Makanji, 
TapidasVarajdas, James Greaves, George Cotton, Morarji 
Gokuldas, Mancherji Banaji, Mulji Jetha, Thackersey Moolji, 
Jamshetji Tata and many more. They were said to be men of 
initiative and integrity. Jamshetji Tata emerged as an enterprising 
industrialist who was the first to introduce economies in cotton mills, 
a fair deal to workers and a system of bonus and provident fund to 
employees. He went to England to study the Lancashire mill 
industry in 1865, and started the Alexandra mill in 1869 and the 
Swadeshi mill in 1886, while the Tata mills was established after his 
death in 1915.  
 
 Morarji Gokuldas established a mill which bears his name 
even today, in 1870. Thackersey Moolji floated the ‘Hindoostan 
Spinning and Weaving Company’ in 1873. This was followed by the 
mills of David Sassoon in 1874 and of Khatau Makanji in 1875. In 
1875, the Mumbai mills employed almost 2,50,000 workers in more 
than 52 mills. The progress of the industry was particularly rapid 
from 1875 to 1885. The Greaves Cotton and Company and the 
firms of D. M. Petit and the Thackersey family expanded their textile 
ventures by establishing many new mills. The number of mills in the 
city increased to 70 in 1895.  
 
 By the end of the 19
th
 Century Mumbai had become, with its 
over eighty textile mills, India’s largest textile centre. It was the 
largest employer of workers. Along with many workers employed in 
its ancillary industries, such as engineering workshops, chemical 
industries, railways, shipping and the cloth markets made Mumbai 
the largest employer of labour. Most of the workers employed by 
the mills lived in close proximity of their place of work in the regions 
of Lalbaug, Sewri, Parel, Currey road, Dadar and Byculla. However, 
69% of the workers lived in primarily single room accommodations 
or barracks hence the workers were mostly low-wage and migrants 
from other parts of the state. The progress of the industry was, 
however, retarded by a depression, an unprecedented plague and 
famine. Many inefficiently managed companies went into liquidation 
or changed Agents. 
 
 The opportunities afforded by the progress of trade, 
industries and communications attracted considerable number of 
 
 
merchants, entrepreneurs and workers to Bombay from all over 
Western India. Among the migrants the businessmen were from 
Gujarat, Cutch and Rajasthan, mill hands from The Deccan and 
Konkan and clerks from South India. The enterprising men of 
industry and trade included Parsis, Banias, Bhatias, Marwaris, 
Khojas, Memons and Jews. By 1921, an enormous 84 per cent 
population of the city had been born outside it. 
 
  The entire mill industry and other industries owned by 
Indians, as well as most of the Indian-owned modern financial 
institutions, were controlled by about 50 individuals. Five great 
family-based managing agencies, namely Currimbhoy Ibrahim and 
Company, E. D. Sassoon and Company, Nowrojee Wadia and D. 
M. Petit and sons, controlled over half the spindles and looms in 
Bombay mills. 
 
 Swadeshi Movement  
The textile industry dominated Mumbai’s economy. Out of 
160 industries, 90 were textile mills. The popularity of the Swadeshi 
and Boycott movement and the revival of the textile industry in 
Mumbai were closely linked. When the movement was at its height, 
between 1906 and 1910, nearly 66 new mills were added. The 
revival of Swadeshi in 1919 prolonged the prosperity of the textile 
industry in Mumbai. Even in 1921 the textile industry provided 
employment for eleven per cent of the people of the city and two 
out of every three industrial workers in the city were in this industry. 
 
Textile Mill during the period of World War I  
World War I brought wealth to Mumbai by the opening up of 
Africa and West Asian markets, which all till then had depended on 
German textiles and manufactures. Mumbai gained financially, as 
the value of the export of textile rose from rupees eighty lakhs in 
1915 to three crore and eighty lakhs in 1917. The raw cotton 
exports fetched another eight crore. In 1919, the textile industry 
alone accounted for a huge profit of nineteen crore rupees in 
addition to the large profits that accrued due to the heavy increase 
in import and export trade. At the time of World War I British Empire 
received generous support from Mumbai. Mumbai responded 
generously and raised more than eleven crore of rupees as war 
loans in order to safeguard the interest of democracy against the 
autocratic powers of Europe.  
 
 The mill owners, who made enormous profits during this war 
period, failed to share at least some of it with their employees. 
Hardships caused by rocketing prices, compelled a lakh and a half 
textile labourers to launch the first major textile strike in 1919. It 
was only after hard bargaining that the Parsi, Muslim and Bhatia 
mill-owners agreed to increase the wages of the workers by thirty 
per cent. In 1920s the textile strike and competition from other 
Page 5


 
 
74
7 
 
 
 
MUMBAI - THE FINANCIAL CAPITAL - I 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
b) LABOUR MOVEMENTS 
 
a) TEXTILE MILLS, STOCK MARKET AND BANKING 
 
Unit Structure 
 
7.0 Objectives 
7.1 Introduction 
7.2 Textile Mills 
7.3 Bombay Stock Market 
7.4  Banking  
7.5 Conclusion 
7.6 Questions 
   
7.0 OBJECTIVES 
 
• To understand the history of textile mills in Bombay now 
 
 INTRODUCTION 
 
 Mumbai, known as the financial Capital of India, is the 
economic hub of most of the commercial and business activities of 
the country. The Island city contributes factory employment, 
customs duty, income tax, foreign trade and central excise tax of 
India. Moreover, it produces a huge amount in corporate 
taxes. Indian companies like Tata Group, Godrej, Reliance, State 
Bank of India, etc, which form of part of Fortune Global 500 
companies, are based in Mumbai only. Most of the foreign banks 
and financial institutions have set up offices in its expanse. Mumbai 
credits its success chiefly to the textile mills and seaport till 1980's. 
 
 
After that, the local economy branched out and included 
engineering, diamond-polishing, healthcare, information 
technology, etc. Mumbai has been granted the status of the state 
capital of Maharashtra, since it has a large percentage of state and 
central government employees in its workforce. It comprises of the 
headquarters of esteemed Indian financial institutions like Mumbai 
(Bombay) Stock Exchange, Reserve Bank of India, National Stock 
Exchange, etc. In the present day, Mumbai stands at 10th position 
amongst the biggest centers of commerce in the world. 
 
TEXTILEMILLS 
 
 According to Jawaharlal Nehru, “The history of cotton and 
of textiles is not only the history of growth of modern industry in 
India but in a sense it might be considered the history of India”.  
 
 Textile industry in Mumbai laid the foundation of the city’s 
prosperity and its rise as the industrial hub of India by the end of 
the First World War. It had by then become the major industrial 
metropolis of Asia. The textile industry influenced every aspect of 
life in Mumbai, its migrations, social relation, housing, municipal 
administration and above all its economy making Mumbai the 
commercial capital of the country. Mumbai had become the bastion 
of not only Indian Capital but also provided employment to lakhs of 
people in the textile mills and related industries. In textile industry 
alone there were 153,000 workers. By 1931 according to an 
estimate, half the population must have been economically reliant 
on this industry alone.  Textile mills flourished in Mumbai even after 
independence. During 1947 to 1960, Mumbai witnessed the growth 
of cotton production due to textile mills.  
 
 History of Mills in Mumbai 
 The first textile mill, the Bowreach cotton Mill, west bank of 
the river Hooghly near Calcutta was set up in India in 1818 by a 
British firm but it was closed down later on due to number of 
reasons. With the establishment of the first textile mill in Mumbai in 
1854 by Cowasjee Nanabhoy Davar, a new era opened in the 
history of not only in the city’s economy but also in the history of 
Indian economy. The first mill was established on 7 July 1854 with 
the help of 50 leading businessmen in the city named as “Bombay 
Spinning and Weaving Company”. The profits of the same 
exceeded all expectations, and many mills followed. By 1862 four 
mills were added and this number grew in course of time. “The 
Oriental Spinning and Weaving Company”, floated in 1855 under 
the leadership of M. N. Petit, Beramji Jijibhai, Varjivandas 
Madhavdas, E. Sassoon and two Europeans, started functioning in 
1858. M. N. Petit's entry into the mill industry marked the transition 
of his family from trade to industry. Prosperity of the industry 
 
 
attracted a number of shetias. Mangaldas Nathubhai floated the 
“Bombay United Spinning and Weaving Company” in February 
1860. B. H. Wadia and Kesowji Naik promoted one mill each in the 
same year. There were ten mills with 6,600 employees in the city in 
1865. 
 
 Besides the men of amazing commercial career mentioned 
above, the other pioneers of industry in Bombay included, Dinshaw 
Petit, Nusser-wanji Petit, Bomaiyi Wadia, Dharamsey Punjabhai, 
David Sassoon, Merwanji Pandey, Khatau Makanji, 
TapidasVarajdas, James Greaves, George Cotton, Morarji 
Gokuldas, Mancherji Banaji, Mulji Jetha, Thackersey Moolji, 
Jamshetji Tata and many more. They were said to be men of 
initiative and integrity. Jamshetji Tata emerged as an enterprising 
industrialist who was the first to introduce economies in cotton mills, 
a fair deal to workers and a system of bonus and provident fund to 
employees. He went to England to study the Lancashire mill 
industry in 1865, and started the Alexandra mill in 1869 and the 
Swadeshi mill in 1886, while the Tata mills was established after his 
death in 1915.  
 
 Morarji Gokuldas established a mill which bears his name 
even today, in 1870. Thackersey Moolji floated the ‘Hindoostan 
Spinning and Weaving Company’ in 1873. This was followed by the 
mills of David Sassoon in 1874 and of Khatau Makanji in 1875. In 
1875, the Mumbai mills employed almost 2,50,000 workers in more 
than 52 mills. The progress of the industry was particularly rapid 
from 1875 to 1885. The Greaves Cotton and Company and the 
firms of D. M. Petit and the Thackersey family expanded their textile 
ventures by establishing many new mills. The number of mills in the 
city increased to 70 in 1895.  
 
 By the end of the 19
th
 Century Mumbai had become, with its 
over eighty textile mills, India’s largest textile centre. It was the 
largest employer of workers. Along with many workers employed in 
its ancillary industries, such as engineering workshops, chemical 
industries, railways, shipping and the cloth markets made Mumbai 
the largest employer of labour. Most of the workers employed by 
the mills lived in close proximity of their place of work in the regions 
of Lalbaug, Sewri, Parel, Currey road, Dadar and Byculla. However, 
69% of the workers lived in primarily single room accommodations 
or barracks hence the workers were mostly low-wage and migrants 
from other parts of the state. The progress of the industry was, 
however, retarded by a depression, an unprecedented plague and 
famine. Many inefficiently managed companies went into liquidation 
or changed Agents. 
 
 The opportunities afforded by the progress of trade, 
industries and communications attracted considerable number of 
 
 
merchants, entrepreneurs and workers to Bombay from all over 
Western India. Among the migrants the businessmen were from 
Gujarat, Cutch and Rajasthan, mill hands from The Deccan and 
Konkan and clerks from South India. The enterprising men of 
industry and trade included Parsis, Banias, Bhatias, Marwaris, 
Khojas, Memons and Jews. By 1921, an enormous 84 per cent 
population of the city had been born outside it. 
 
  The entire mill industry and other industries owned by 
Indians, as well as most of the Indian-owned modern financial 
institutions, were controlled by about 50 individuals. Five great 
family-based managing agencies, namely Currimbhoy Ibrahim and 
Company, E. D. Sassoon and Company, Nowrojee Wadia and D. 
M. Petit and sons, controlled over half the spindles and looms in 
Bombay mills. 
 
 Swadeshi Movement  
The textile industry dominated Mumbai’s economy. Out of 
160 industries, 90 were textile mills. The popularity of the Swadeshi 
and Boycott movement and the revival of the textile industry in 
Mumbai were closely linked. When the movement was at its height, 
between 1906 and 1910, nearly 66 new mills were added. The 
revival of Swadeshi in 1919 prolonged the prosperity of the textile 
industry in Mumbai. Even in 1921 the textile industry provided 
employment for eleven per cent of the people of the city and two 
out of every three industrial workers in the city were in this industry. 
 
Textile Mill during the period of World War I  
World War I brought wealth to Mumbai by the opening up of 
Africa and West Asian markets, which all till then had depended on 
German textiles and manufactures. Mumbai gained financially, as 
the value of the export of textile rose from rupees eighty lakhs in 
1915 to three crore and eighty lakhs in 1917. The raw cotton 
exports fetched another eight crore. In 1919, the textile industry 
alone accounted for a huge profit of nineteen crore rupees in 
addition to the large profits that accrued due to the heavy increase 
in import and export trade. At the time of World War I British Empire 
received generous support from Mumbai. Mumbai responded 
generously and raised more than eleven crore of rupees as war 
loans in order to safeguard the interest of democracy against the 
autocratic powers of Europe.  
 
 The mill owners, who made enormous profits during this war 
period, failed to share at least some of it with their employees. 
Hardships caused by rocketing prices, compelled a lakh and a half 
textile labourers to launch the first major textile strike in 1919. It 
was only after hard bargaining that the Parsi, Muslim and Bhatia 
mill-owners agreed to increase the wages of the workers by thirty 
per cent. In 1920s the textile strike and competition from other 
 
 
emerging textile manufacturing countries like Japan, the textile 
industry in Mumbai suffered a setback. The general strike in 1928 
that lasted for a few years caused it to lose its markets. This 
general strike marked the rise of Girni Kamgar Union led by the 
communists. 
 
Mumbai so far known as the textile capital of India began to 
turn into an industrial city. In 1919, as soon as the British 
government removed the ban on starting Indian companies nearly 
208 old partnership companies were converted into Limited 
Companies, and within two years 272 new companies were 
registered.  
 
Mumbai was among the largest cotton markets in the world 
next only to Liverpool and New York. In the 1920s it continued to be 
Asia’s largest cotton market. Mumbai’s Mulji Jetha Market, Moraraji 
Gokuldas Market and Lakshmidas Khimji Market remained India’s 
largest trade centers of cotton piece goods. By 1920s, Mumbai had 
certainly established itself as the commercial and financial capital of 
India.  
 
 Impact of Great Depression and Civil Disobedience 
Movement 
 The Great Depression of 1929 had great impact on the 
economy of Mumbai especially the textile mills. The prosperity of 
the post-war period disappeared. The textile industry suffered with 
the closer of 9 mills and 19 more were on the verge of a closure by 
1933. 17 mills showed a loss of Rs. 39 lakhs. 
 
 The Civil Disobedience Movement of 1930 also affected 
Mumbai’s trade adversely. Because of the agitation, the import-
export trade of Mumbai was shifted to the ports of Kathiawar and 
inland trade moved to Bhavnagar. The Swadeshi movement 
reduced the demand for the fine manufactured textiles of the 
Mumbai mills. Mumbai strongly supported the Civil Disobedience 
Movement and Gandhi. The Boycott Movement placed a ban on 15 
mills employing 34,000 Indians. It prevented stocks being cleared 
and no dealer could sell or buy. In April and May 1930, there was a 
hartal in the Mumbai Cotton Market. In July1930, Mulji Jetha Market 
was closed and Congress volunteers picketed in front of the market 
and prevented the merchants from opening their shops. The 
uncertain and disturbed situation in trade and business continued 
until May 1933, which the Civil Disobedience Movement was 
suspended.  
 
  Textile Mill during the period of Second World War   
 The textile industry regained its 1927 level of production in 
1937, the year when the Congress formed its first ministry in 
Mumbai under the provisions of Provincial Autonomy. Import and