Evolution of Modern Industry in India | Sociology Optional for UPSC (Notes) PDF Download

Introduction

• Industrialization is the process of transitioning from a society based primarily on agriculture to one focused on the production of goods and services through industrial means. This shift is characterized by the rise of machine production powered by inanimate resources such as steam and electricity. In this context, we will explore the evolution of industrialization in India, its impact on society, and the comparative analysis with other countries.
  
• Historically, even in the most advanced traditional civilizations, a significant portion of the population was engaged in agricultural work due to the limitations of technology. However, in contemporary industrial societies, the majority of the workforce is employed in factories, offices, or retail establishments rather than agriculture. This shift has also led to a high urbanization rate, with over 90% of people living in towns and cities where job opportunities are concentrated. While industrialization and urbanization often occur simultaneously, they are not always linked. For instance, Britain, the first country to undergo industrialization, transitioned from a predominantly rural society to an urban one.

Industrialization and Urbanization

• Industrialization is closely tied to urbanization, as the growth of industries often leads to the expansion of cities. Early sociologists like Karl Marx, Max Weber, and Emile Durkheim observed the social changes brought about by industrialization, including the shift from close-knit rural communities to anonymous relationships in urban workplaces. They noted the detailed division of labor in factories, where workers often produce only a small part of a product, leading to a sense of alienation. This alienation occurs when individuals view their work as a mere means of survival rather than a fulfilling activity.
• Despite the challenges posed by industrialization, such as repetitive and exhausting work, it has also led to greater equality in some areas. For example, caste distinctions are less relevant in public spaces like trains, buses, and cyber cafes. However, older forms of discrimination may persist in new industrial settings, and economic inequality continues to grow. Early sociologists had mixed views on industrialization, but by the mid-20th century, modernization theory portrayed it as an inevitable and positive development.

Evolution of Modern Industry in India

• The history of industrialization in India dates back to the Mauryan period and Mughal rule, where artisan-based industries thrived. However, British colonial policies, such as tariff regulations and the decline of handicrafts, led to de-industrialization and a reverse migration to rural areas. After the 1857 revolt, the British government recognized the need for communication networks, leading to the establishment of railways as an industry. The First World War also prompted industrialization in India to meet administrative needs, resulting in the diversification of industries such as paper, sugar, iron, and coal.
• Post-independence in 1947, India pursued state-led industrialization through the Nehru-Mahalanobis model, focusing on capital-intensive industries in the public sector to spur private sector growth. However, inefficiencies in the public sector, bureaucratic dysfunction, and inflation due to wars led to low growth rates. By 1991, the Mahalanobis model was abandoned in favor of economic liberalization.

Impact of British Industrialization on India

• Deindustrialization: British industrialization in India led to the decline of traditional sectors. For example, the rise of mechanized factory industries diminished the global demand for traditional Indian exports like cotton and silk.
• Urban Shift: As manufacturing thrived in Britain, traditional Indian cities such as Surat and Masulipattnam declined, while cities like Bombay and Madras grew due to industrial expansion.
• Population Changes: With the establishment of mechanized industries, certain towns became heavily populated as people migrated for work.
• Economic Dominance: British rule resulted in the economic dominance of certain port cities, with industries concentrated in locations like Madras, Bombay, and Calcutta.

Comparative Analysis of Industrialization in India and the West

India’s experience of industrialization shares similarities with the Western model but also exhibits distinct differences:

• In developed countries, the majority of the workforce is employed in the services sector, followed by industry, with less than 10% in agriculture. In contrast, India in 1999-2000 had nearly 60% of its workforce in the primary sector (agriculture and mining), 17% in the secondary sector (manufacturing, construction, and utilities), and 23% in the tertiary sector (trade, transport, financial services, etc.).
• Despite the high employment in agriculture, the sector's contribution to economic growth has declined sharply. In contrast, the services sector has become a major contributor to economic growth, accounting for approximately half of the country's economic output.
• This disparity poses a significant challenge, as the sector employing the majority of the population (agriculture) is unable to generate substantial income for its workers.
• Over the years, the Indian government has adopted various policies to promote industrialization, including the establishment of public sector units and the encouragement of private sector participation.
• In the early years post-independence, industries were primarily located in port cities like Madras, Bombay, and Calcutta. However, with government efforts to spread industries across different regions, cities like Baroda, Coimbatore, Bangalore, Pune, Faridabad, and Rajkot have emerged as important industrial centers.
• Despite these efforts, the majority of the workforce is still employed in agriculture, highlighting the challenges of transitioning to a more balanced and productive economy.

Industrialization in the Early Years of Indian Independence

• The initial modern industries in India included cotton, jute, coal mining, and railways.
• At the time of independence, the government took control of the 'commanding heights of the economy', which involved sectors like defense, transport, communication, power, mining, and other projects that were essential for private industry to thrive.
• India adopted a mixed economy policy where some sectors were reserved for government control while others were open to the private sector. The government aimed to ensure that industries were spread across different regions through its licensing policy.
• Before independence, industries were mainly concentrated in port cities like Madras, Bombay, and Calcutta. Post-independence, other cities like Baroda, Coimbatore, Bangalore, Pune, Faridabad, and Rajkot emerged as important industrial centers.
• The government also promoted the small-scale sector through incentives and assistance. Many items, such as paper, wood products, stationery, glass, and ceramics, were reserved for the small-scale sector.
• By 1991, small-scale and traditional industries employed 72 percent of the total workforce engaged in manufacturing, while large-scale industry employed only 28 percent.

Globalization, Liberalization, Privatization, and Change in Indian Industry

• Since the 1990s, the Indian government has embraced liberalization, encouraging private companies, especially foreign firms, to invest in sectors previously reserved for the government, such as telecom,civil aviation, and power.
• Licenses are no longer required to open industries, and foreign products are widely available in Indian shops.
• Liberalization has led to the acquisition of many Indian companies by multinationals. Conversely, some Indian companies are becoming multinationals, such as Parle, which was bought by Coca Cola. Parle's annual turnover was Rs. 250 crores, while Coca Cola's advertising budget was Rs. 400 crores, significantly increasing the consumption of Coke in India.
• Disinvestment is a major area of liberalization, where the government tries to sell its shares in public sector companies. This process has raised concerns among government workers about job security. For example, in Modern Foods, the first company to be privatized, 60% of the workers were forced to retire within the first five years.
• Companies are increasingly reducing the number of permanent employees and outsourcing work to smaller companies or even homes. Multinational companies often outsource globally, with developing countries like India providing cheap labor.
• Small companies, competing for orders from larger firms, keep wages low and working conditions poor. Trade unions find it more challenging to organize in smaller firms. Almost all companies, including government ones, now practice some form of outsourcing and contracting, but this trend is particularly pronounced in the private sector.
• Despite the decline of secure employment in large industries, the government is pursuing land acquisition for new industries. However, these industries do not always provide employment for local people and often cause significant pollution.
• Adivasis, who make up about 40% of those displaced by these projects, are protesting against low compensation rates and the loss of their land, forcing them to become casual laborers and live on the streets of India’s major cities.

Socio-Cultural Implications of Industrialization in India

Industrialization in India began in the late 19th and early 20th centuries, leading to significant changes in the socio-cultural landscape. Before this shift, India had an agrarian, less-monetized economy with a rudimentary level of technology. Economic activities were primarily conducted within the household, with no clear distinction between the occupations of family members. The society was deeply rooted in tradition, valuing the authority of elders and the sanctity of customs over rationality.
However, industrialization has brought about profound economic and socio-cultural transformations:

Economic Changes:

• Specialization and Occupational Mobility: Industrialization has led to greater specialization in work and increased mobility between different occupations.
• Monetization of the Economy: The economy has shifted towards a more monetized system, reducing the direct link between kinship and occupational roles.

Social Changes:

• Urban Migration: There has been a significant migration of people from rural areas to cities in search of better opportunities.
• Spread of Education: Industrialization has contributed to the spread of education, fostering a more informed and skilled populace.
• Centralized Political Structure: The political landscape has become more centralized and organized.

Cultural Changes:

• Secularization: Beliefs and faiths have become more secular, moving away from traditional religious practices.

Effects on Family Organization

Industrialization has significantly altered the structure and dynamics of families:

• Transformation of Family Roles: The family, once a unit of production, has shifted to a consumption unit. Instead of all members working together, a few male members typically go out to earn a living. This shift has impacted the traditional joint family structure and altered relationships among family members.
• Financial Independence of Young Adults: Factory employment has granted young adults financial independence, weakening the authority of the household head. In urban areas, both men and women often contribute to the family income, further changing intra-family dynamics.
• Shift in Perception of Children: Children have shifted from being seen as economic assets to liabilities. Although child labor has seen some increase, legal restrictions and rising educational demands have lengthened the period of dependence on parents. Additionally, the high costs of urban living and child care have further complicated family dynamics.

Debate on Family Structures

• Some sociologists challenge the notion that industrialization leads to nuclear families. Studies by researchers like M.S.A Rao, M.S. Gore, and Milton Singer indicate that joint families are preferred in certain communities, and many nuclear families maintain strong kin ties. 
• Historical evidence shows that nuclear families were already a norm in Europe and the United States before industrialization. However, Indian nuclear families still feel a strong obligation to primary kin, maintaining close relationships despite living apart.

Impact on Community Dynamics

• The movement of populations from rural to urban areas has diminished authoritarian power and fostered secularism, promoting values of individual initiative and responsibility. 
• As people work away from home, the intimacy of family relationships has declined. Industrialization has contributed to a decline in family self-sufficiency and changes in attitudes towards family life.

Social Profile Changes

• The social profile of communities affected by industrialization reflects various dimensions of linkages and interactions among different regions, cultures, and social categories. 
• Migration has increased bilingualism, with estimates suggesting much higher bilingualism rates than official figures. Communities have moved away from traditional occupations and are now more aware of government-sponsored developmental programs.

Conclusion

In conclusion, industrialization in India has brought about significant socio-cultural changes, transforming family structures, altering community dynamics, and fostering greater awareness of developmental initiatives. While challenges remain, the impact of industrialization continues to shape the socio-cultural landscape of the country.