“A characteristic feature of organised industry and commerce in all the chief Indian centers is the presence of large agency firms which, except in the case of Bombay, are mainly European. In addition to participating in the export and import trade, they finance and manage industrial ventures all over the country, and often have several branches in the large towns. The importance of these agency houses may be gauged by the fact that they are in control of the majority of the cotton, jute and other mills as well as of the tea gardens and the coal mines.”
The general remarks about the industrial deficiency of the country will be better understood from the following extracts:
“We have already referred to the dependence of India on outside sources of sulphur and the necessity for insisting on the local smelting of her sulphide ores. In the absence of any means for producing from purely Indian sources sulphuric, nitric, and hydrochloric acids, and alkalis, our manufactures, actual or prospective, of paper, drugs, matches, oils, explosives, disinfectants, dyes and textiles are dependent upon imports which under war conditions, might be cut off. Sources of raw materials for heavy chemicals are deficient. The output of saltpeter could be raised to 40,000 tons per annum and supplementary supplies of nitrates could be produced, if necessary, from atmospheric nitrogen; but for this again, cheap electric power is needed. Salt occurs in abundance and the establishment of caustic soda manufacture, preferably by an electric process, that would also yield chlorine, is a necessary part of our chemical programme. There are available in the country, in fair quantity, many other raw materials necessary for heavy chemical manufacture, in addition to those referred to under other heads; among them may be mentioned alum, salts, barytes, borax, gypsum, limestone, magnesia, phosphates of lime and ochres. The installation of plants for the recovery of by-products in coking has recently been undertaken, but for the recovery of tar and ammonia only. The recovery of benzol and related products has so far not been attempted nor has anything been done to utilise the tar by re-distillation or other chemical treatment.
“Although India exported raw rubber valued in 1917-1918 at 162 lakhs, rubber manufacture has not been started in the country and goods to the value of 116 lakhs were imported in 1917-1918. This industry is one of those that are essential in the national interest and should be inaugurated, if necessary, by special measures.
“Though textile industries exist on a large scale, the range of goods produced is still narrow, and we are dependent upon foreign sources for nearly all of our miscellaneous textile requirements. In addition to these, the ordinary demands of Indian consumers necessitate the import of some Rs. 66 crores worth of cotton piece-goods, and interference with this source of supply has caused serious hardship. Flax is not yet grown in appreciable quantities and the indigenous species of so-called hemp, though abundantly grown, are not at present used in any organized Indian industry.
“Our ability to produce and to preserve many of our foodstuffs in transportable forms or to provide receptacles for mineral or vegetable oils depends upon the supply of tin plates which India at present imports in the absence of local manufactures.
“Our few paper factories before the war stood on an uncertain basis and we are still dependent upon foreign manufacture for most of the higher qualities.”
India produces enormous quantities of leather on a relatively small scale by modern processes; and the village tanner supplies the local needs only, and with a very inferior material. To obtain the quantities and standards of finished leather which the country requires, it will be necessary to stimulate industries by the institution of technical training and by the experimental work on a considerable scale.
“Large quantities of vegetable products are exported for the manufacture of drugs, dyes and essential oils, which in many cases are re-imported into India.
“The blanks in our industrial catalog are of a kind most surprising to one familiar only with the European conditions. We have already alluded generally to the basic deficiencies in our iron and steel industries and have explained how, as a result, the many engineering shops in India are mainly devoted to the repair or to the manufacture of, hitherto mainly from imported materials, comparatively simple structures, such as roofs, bridges, wagons and tanks. India can build a small marine engine and turn out a locomotive provided certain essential parts are obtained from abroad but she has not a machine to make nails or screws, nor can she manufacture some of the essential parts of electrical machinery.[1]