During the first half of the 19th century or even upto 1880 India's economy witnessed a strange phenomenon. While Western countries were experiencing industrialisation India suffered a period of industrial decline. This process has been described as 'de-industrialisation'. India's traditional handicraft industry decayed beyond recovery. The period of decline of Indian handicrafts was contemporaneous with the firm foundation of the Industrial Revolution in England and England's tight control over the strings of Indian economy.
Western scholars like Morris D. Morris and A. Thorner are never weary of emphasising the point that the decline of handicraft industries was inevitable and was a worldwide phenomenon and was a logical outcome and integral ; part of the Industrial Revolution and the coming of the factory system. The peculiar situation in India- different from the developments in European i countries and North America-may be summarised thus:
(a) 19th century India witnessed a steep decline of handicrafts, a process which continued well into the 20th century, and
(b) Unlike European countries India was not compensated by a sufficient rise of modern industry. I The 19th century was the period of Industrial Capital i.e., Britain's rising industrialists and trading interests launched a new economic offensive based on the principles of free trade against India. Their persistent propaganda and lobbying resulted in the abolition of the Company's monopoly of Indian trade by the Charter Act of 1813.
A change came in the character of Indo-British trade. So far India had been chiefly an exporting country, now onwards it became an importing country. English twist and cotton stuffs flooded Indian markets, spelling ruination of Indian weaving industry.
The government of William Bentinck noted in 1834, "The misery hardly finds a parallel in the history of commerce. The bones of the cotton weavers are bleaching the plains of India". In a similar vein, Karl Marx, a shrewd contemporary observer, remarked, "It was the British intrude who broke up the Indian handloom and destroyed the spinning wheel.
England began with depriving the Indian cottons from the European market. It then introduced twist into Hindustan and in the end inundated the very mother country of cotton with cottons". In the first half of the 19th century in bringing about a rapid decline in the artistic excellence and economic importance of Indian handicrafts. These were:
(i) The disappearance of native Indian courts which patronised fancy arts and handicrafts and often employed the best craftsmen on a regular salary basis.
(ii) The establishment of an alien rule, with the influence of the many foreign influences that such a change in the nature of government meant. New classes rose after the establishment of British rule, namely the European officials and the new Indian educated professional class. The European bureaucracy normally patronised English-made products and the Indian Western-educated professional class imitated European standards and poured scorn on everything Indian.
(iii) The competition of a more highly-developed form of machine-industry.