CHAPTER 1

• India being agrarian society

• Mughals ignored the need to to develop roads and highways for commercial purposes.
• River-ways which worked seasonally were INDUS AND GANGA.
• Major difficulties were the safety on the roads, custom barriers, different currencies circulating in different
parts of the worlds.
• Abkhaz’s reign- 1556- 1605.
• MAHMUDIS- west, Gujarat, PAGODAS in the south.
• Older coin less valuable because of the wear and tear.

MERCHANTS-

• One of the most influential merchants – SETH HIRA NAND SAHU. House of Jagath Seth. Was trading
around PATNA started from Rajasthan, acquired a great deal of fortune before the decline of the Mughal
empire. Main area of business being MONEY LENDING AND BANKING, but also TRADING
BUSINESS.
• SURAT being the most important port at the time.
• VIRJI VORA- the colossus of of business in the western India till he died in the 1680.

• Other prominent business families-

• CHELLABYS- SHIPPERS FOR RED SEA AND PERSIAN GULF
• PAREKHS AND RUSTOMJIS were BROKERS.
• TRAVADIS- were BANKERS.

• AHEMEDBAD- major place for business community.

• Biggest merchant was -KHUSHALCHAND, grandson of shanti das Zaveri, primarily JEWELERS.
• Great merchants of Ahmedabad were- VANMALIDAS TAPIDAS, KAPURCHAND BHANSALI and
PADAM GOPAL.
• Ahmedabad also known for textile – cotton, silk, and wool.
• Ahmedabad’s principal commodity being – INDIGO produced in SARKHEJ.
• Producing a lot of saltpeter and gunpowder.
• Names of big merchants operating in north whose names were in European trading companies – MALAY
CHETTI, KASI VIRANNA AND SUNCA RAMA CHETTI.
• India merchant princes to European traders dealt in -INDIGO, SPICES AND TEXTILES.
• HUNDI system- known as the credit system, shroffs were a major part of it.
• BANJARA business known as -nomads.
• Business type around 18th century was COMMERCIAL rather than industrial.
• Lack of INDUSTRIAL initiative makes perfect sense.
• HINDU businessmen and their locations- JAINS and VIASHNAVAS BANIAS in the west, KHATRIS in
the north-west, JAINS and AGARWAL banias in the north and east, CHETTIERS and KOMATIS in the
south.
• Most of the MUSLIM TRADERS in the GUJAGRAT-SINDH REGION.
• PARSEES- SURAT, NAVASARI AREA.
• MAHAJANS- pressure groups who were concerned with professional matters, unlike caste panchayats.
FORGEIN ELEMENTS-

• Europeans’ companies using INDIAN ports

• ENGLISH- SURAT, BOMBAY, MADRAS AND KOLKATTA
• DUTCH- SURAT, COCHIN, PULICUT, MASULIPATNAM, and HOOGLY.
• FRENCH- SURAT, PONDI, HOOGLY.
• Arabs and Egyptians were active around the Calicut region.
• Armenians were regarded as the oldest merchants of the world.
• Trading of the Europeans was multi-lateral in character.

Chapter 2- IMPERIAL CRISIS

• AURANGZEB death – 1707, the Mughal empire fell a few years past this.
• POTEDARI- a system to tackle financial problems post Mughal empire decline.
• Until the Mughal empire fell the Europeans where limited to a certain region, but as they fell the Europeans
started expanding their reach of doing business significantly.
• GUJARAT was considered north during the 18th century.
• Land revenue was the principal source of income for the MARATHAS.
• POONA emerged as the de-facto capital of the MARATHA state in 1725.
• GAIKWAD- BARODA
• SCINDIAS- GWALIOR
• HOLKARS- INDORE.
• POONA the capital for HUDNI SYSTEM.
• Hari bhaktis- a company handling the financial transactions was a big part of the Maratha kingdom, started
by 2 brothers Hari and bhakti, started for the Gaikwads, and expanded to POONA.
• At the end of the century, they closed their POONA branch.
• East India company started gaining foothold in the western India with merchant collaboration.
• 1717- EIC secured the right of free trade without paying any custom duties.
• Dacca was the capital of the Bengal province.
• Manekchand the son of HIRA NAND SAHU was given the right to mint the government coins.
• Fateh Chand the adopted son of manekchand became the face in the eastern part of the country especially in
Bengal.
• Post 1739 the Marathas started raiding west-Bengal.
• When the Marathas and the Mughals were fighting each other the EIC saw this as an opportunity and started
capitalizing.
• Battle of Plassey- 1757 was a turning point for the EIC.
• NIZAM- founded in 1724.
• EIC used palmer and co. at that time.
• Ijara – revenue farming is ensuring the government has access to ready cash.
• With the introduction of the postal system the dependency of the hundi system was substantially reduced.
• EICs silver rupee was introduced and made it to be legal tender throughout INDIA- 1835.
• MUGHAL EMPIRE – INDIAN MERCHANT PRINCE’S- EIC sequence of power transfer from 1700-1835.

Chapter 3- TRANSISTION – EIC and the EAST

 During the emergence of EIC in India, there was a simultaneous emergence of the industrial
revolution, in the early 17th century.
 Using steam engines marked the beginning of this revolution.
 James watt- discovered the steam engine in 1765.
 Richard Arkwright- spinning frame- 1769.
 James Hargreaves spinning jenny – 1770.
 YORSHIRE and LANCASHIRE were the thriving centers of textile production.
 Large coal and iron deposits in west- midlands and Staffordshire.
 Even the Britain was largely an agricultural society, but by 1850 it became an industrial dominant
society.
 Indian textile good were called CALICOES in the British market and enjoyed considerable price
advantage.

 With the industrial revolution, there was a reversal of role in the cotton production and domestic
goods were protected by tariff being imposed on the imports.

 As the production scales increased in the Britain, they stopped imports which hurt the Indian economy
but the British goods penetrated the Indian markets too.

 Industrial revolution made the Indian technology look outdated and thing of the past.

 British lost its colonies to north America in 1776.

 In 1813 the British gave up the total monopoly of the Indian trade, nearly after ruling it for 200
years.

 Free merchants adopted the AGENCY HOUSE system which was like the hundi system at the
international level.

 The agency houses being headquartered in mainly 3 cities Calcutta, Bombay and madras, where
most of the Europeans lived.

 Battle of Plassey was held in – KOLKATTA, so it had more European people living there,
followed by Bombay and then madras.

 First agency house was in BOMBAY – FORBES&CO in 1767, the 2nd agency house as late as
1790 in Bombay by then Kolkata had almost 15 such firms.

 Madras first agency house was founded by –THOMAS PERRY.

 Agency house applied the strategy of entering the markets where there was not enough reach from the
Indian side and one such area was coal mining, first attempted at 1775, but officially began in the
year 1820 when alexander and co. started exploring Raniganj.

 Agency houses used BANIAS to overcome the language barrier and they later became the lynchpin
for the entire trade to go around.

 There was a healthy collaboration between the agency houses and the EIC- for loans, imports, and
exports etc.

 The agency houses participated in – shipping, money lending, general trading, tobacco, ivory, spices.

 China used to import opium from India for use, and it was so profitable that everyone wanted a piece
of it.

 Forbes and faucet financed the EIC to fight the Marathas from 1799-1806.

 The agency house in madras- sold navy bills and traded in madeira wines. Main business being
banking.

 Thomas perry financed the EIC war with tipu sultan.

 Perry started the leather goods business in 1805, perry became one of the most prosperous
businessmen in the city of madras.

 Perry died of cholera in 1824 at the age of 56 and buried in cuddalore.

 Palmer and co although was not the first agency house in Calcutta but became the most significant
one.

 The first foreign bank set up by alexander and co. in 1770 was called the bank of Hindustan,
followed by commercial bank set up by the mackintosh.

 Later, palmer and co. also started a bank of their own.

 Palmer and co. started publication house called the Calcutta journal. And its only competition being
cruttenden and co.

 Palmer and co. was referred as the opium king. Palmer and co was also called the indigo king of
Bengal.

 Charter act of 1813 – abolished the monopoly of the EIC.

 Indigo became the backbone of the trade between India and Britain.

 1819-1825 – BOOM OF INDIGO

 1826- DECLINE OF INDIGO

 1830- PALMER AND CO.- BANKRUPT.

  Prominent Indian names in Calcutta after the fall of palmer and co. – sheik Gulam Hussain, and
Ram dulal dey. Ram dulal dey was working as a banian for an American trader and made tons
of money exporting rice.

 DWARAKNATH TAGORE WAS THE MOST PROMINENT BENGALI OF ALL TIME.

 SECULAR EDUCATION STARETD – 1835.

 William car of palmer and co. joined forces with dwarakanath the most influential Bengali
person to open shop in the year 1834.

 Union bank was set up in the year 1829 by Dwarakanath Tagore. Which was the largest business
institution of his time and almost the entire of Calcutta had high stakes in them. They wanted to
expand their bank reach and gave loans to indigo producers

 By 1848 the union bank as well as the car and Tagore co. had to close shop as it was in losses. So,
from 1830- 1850 the palmer and co. agency house as well as the union bank along with Tagore
and carr co. engulfed.

 This crisis was called the commercial crisis of 1847, and dwarakanath Tagore died 2 years
before this.

 After this the shops were set up by the Russians like – Kilburn, Mackenzie, Schoene,
MacKinnon their interest being – tea, insurance, and shipping.

 Later became British Indian steam navigation company.

THE WEST- GUJARAT, MUMBAI AND MORE

 The business life was more stable here than the east and boring too.
 Gujarat was known for its commercial tradition- trading and moneylending.
 British people had limited presence in the west when compared to the east.
 The western regions trade with Persian, Arabian and gulf countries stopped after the decline of the Mughal
empire.
 The western approach was very inward looking, and it had weakened the commercial links with other parts
of the country and the world.
 RISE OF BOMBAY –

1. Need for opium started increasing.

2. New opportunities came for Ahmedabad, Surat, broach, chambray, Baroda, Bombay.
3. Chinese were addicted to opium and British loved the Chinese tea, so this was the kind of exchange they
made.
4. Large proportion of opium produced from Bengal was under the direct jurisdiction of EIC.
 5. Only EIC could secretly sell it to Chinese via private contractors.
6. The city of Ujjain was the most important part of the opium production, and it was not under EICs direct
control.

7. like the Europeans in the east used banias, the Europeans in the west used Parsees.

8. EIC established Bombay dockyard in the year- 1736.

9. Wadia’s were one of the very prominent parse families. Their fortunes increased when they started exporting
cotton to china among other things.

10. After Parsees the next to be lured were the Guajarati banias, both Hindus and Jains.

11. The Hindus and the Jains were involved with exporting cotton to china as well as to Persian and Arabian
markets.

KUTCH-KATHIWAR- REGION TO BOMBAY

 HINDU MERCHANTS – BHATIAS, LOHANAS, BANSALIS started moving to Bombay in the

beginning of the 19th century.
 MUSLIM MERCHANTS- BOHRAS, KHOJAS, MEMONS.
 Konkani Muslims were more successful in Bombay.
 Most prominent of them all – ROGHAYS- Muslim – NAKHODA (ship maker).
 Bombay also had a small Jewish population – DAVID SASSON joined them in 1832, started a two-way
business house from India to Persia known as – David sasson and sons.
 Bombay had become the commercial center by this time.
 1831 EIC lifted the opium ban, MALWA region became famous for production of opium.
 BOMBAY BECOMES THE HUB FOR THE ENTIRE WEST COAST.
 Exports to china successively rose after 1831, especially of opium, Parsees were dominant in the field and
retained their positions.
 British merchants used Indian ships to export opium instead of their own to avoid the risks, because the
export was unlawful.
 In the west people wanted banking system to emerge because of they were taking losses with certain
investments and thought banks can act as a repository in the middle, but the emergence also did not fluctuate
the local business of shroff who were known for their hundi system.
 Parsees and Konkani Muslims build their trade on china trade.
 After 1840s their profits and business model took a hit because post that the treaties of Nanking (1842) and
Tientsin (1858) opened china to the rest of the world for opium trade, and while the European and the other
exporters had steam engines, the Indian ships were outdated vessels.
 By 1850s India lost all its trade with china to Europe.
JAMSEETH JI JEJEEBHOY-

 born in 1783, to poor Parsee family, by 12 came to Mumbai to live with maternal uncle and found his cousin
who was a china trade, made 3 trips to china and sold cotton to England during the napoleon wars and made
 a small fortune, was in the leading businessmen in Mumbai at the early 19th century(1800s) and by 1822 the
britishers were using him to export opium to china. By 1826 he started participating in the auction of the
trade and had a fleet of ships too.
 JEJEBOY has close ties with the most prominent men of Ahmedabad like Kushal Chand, hatheesing,
Karamchand, premchand related to shantilal Zaveri, lalbhai family. Vakhatchand – was a nagarseeth.
 JEJEBOY was in business with the JARDINE MATHESON AND CO. on the Chinese shores which was
one of the most powerful agency shores in china but later all this fell off once china made themselves open
to the worldwide trade.
 Jeejeebhoy was knitted in -1842,
 FIRST INDIAN TO RECEIVE THE – BARONETCY- 1857.
 As the china opening themselves to trade was the fall of Jeejeebhoy it was an opportunity for David sasson
the Jew from Persia who fled to India.
 DAVID SASSOON- developed a multi-lateral channel among Persia, Iraq, and Britain.
 Sassoon started doing business with china after 1842 once they were open, Sassoon’s son elia has taken the
responsibility for this trade, set up bases in Shanghai and expanded to canton and Hong Kong, within the
first 5 years since 1842 gained near monopoly of the opium trade and unlike the Jeejeebhoy he used rental
ships.
 Where the first to open shop in JAPAN- 1853, after JAPAN ended their centuries long isolation from
the rest of the world.
 Sassoon later applied for British citizenship in 1853.
 Sassoon opened a branch in LONDON- 1858.

Others expanded themselves at regional or local levels only. – like Hinduja, Lohana, and Bhatia’s
 a lot of them came to Gujarat and few of them went to all parts of the world, these people where generally
Rajasthani people looking for better opportunities. They hailed from a region called Marwar and first went to
west Bengal now and they coined the term Marwari there.
 First railway line opened in the year- 1854. Dalhousie made it happen.
 DALHOUSIE- father of post and telegraph system of INDIA.
 He emphasized on the people of India learning the English language and under his rule the first 3 universities
were established.
 Gujarat vernacular society was established in -1848.
 Brahmo samajh founded in late-1820s.
 1850- first company law ever adopted in India.
 After the losses suffered by the Indians in the Calcutta region, they were not ready to take another risk, so
when the jute production opportunity came knocking, they let the scotmen-scootish people take it.
 Crimean war (1854-1860) was the reason their supply from Russia was affected which gave the opportunity
for jute production.
 Scott people had the jute monopoly in the city of Calcutta till 1920s.
 Then came setting up the manufacturing plant for cotton, which was first started in BOMBAY and later in
Ahmedabad as well.
 In Ahmedabad it was done by RANCHODLAL CHHOTALAL, who worked in the British government and
rose to the highest rank possible by an Indian, but lacked funds to start it, it took him nearly 10 years to get
his plan into proper motion when he started working in a bank in Ahmedabad in the year-1858.-
AHEMDABAD SPINNING AND WEAVING COMPANY.
 All the technical details of the manufacturing plan were given to ranchodlal by George full James.
 The first cotton manufacturing plant based on modern technology was started by a PARSEE in Mumbai
named- cowasji nanabhai davar in the year 1854.
 Looking at this at least 6 other mills were opened in the next 6 years.
 BOMBAY AND AHMEDABAD were the hub for the textile production.

THE INTERLUDE

 Britain used to import cotton from USA, but in the year 1861 civil war broke in USA causing a heavy
disruption in the supply and Britain turned to India to fill this gap, so the production rose to very significant
level and people started investing in this business, but as soon as the war was over (1865) the Britain shifted
again to the USA causing a major turmoil in the Indian economy. One such businessman who got affected
was premchand roychand. By1866, he lost a lot of money.
 In Calcutta people tried investing in tea plantations in 1861 because of the increase in demand but eventually
it all collapsed by 1866.
 So, during this time it was only the Scotsmen who could make some bank in the jute industry.
 Brahmno samajh was started in Kolkata- Raja Ram Mohan Roy, Dwarakanath Tagore
 PRARTHANA SAMAJH – was the next samajh made for competent authority- Dr. Atmaram Randuram-
Bombay
 All the business brought a lot of wealth to the city.it was first used to improve the city, then to promote the
businesses.

Chapter 6- RISE OF THE INDUSTRIAL ELITIE

 The telegraph line between India and Europe was set up by 1866.
 The Suez Canal opened for business.
 A lot of new cotton and textile mills surfaced from m1860-1875 and all the indigenous people even made a
mill-owners association to preserve their rights.
 Ahmedabad people also started their own mill-owners association in the year 1891.
 In 1882 the Britain government abolished all import duties on textile goods. And this was done to promote
free trade.
 Factories act of 1881-1892 were announced for the legislation purposes of the millworkers and increased the
cost of labor to the producer.
 Bhatia’s who were active in the Bombay region since the early 19 th century only stepped into the textile
business once they saw that it was profitable and with them came a lot of other industrialists like Gokaldas,
vasanji, thackersey and jaitha. By 1880 there only 6 mills only controlled by the Bhatia’s.
 In Ahmedabad it was seths- Jains and Vaishnava banias, once they realized cotton manufacturing was more
profitable than trading.
 Gujarat spinning and weaving company was found by – bhagubhai in 1877.
 Banias were spinning around 65% of the entire Ahmedabad textile scene by 1892.
 Sassoon the Jewish businessman from Bombay also started his own mill in the year 1874, but by 1892 he
also added a silk mill to his empire.
 Sassoon company were the largest employers in and around Bombay in the year 1877.
 The most powerful British agency was the killick Nixon and co. and did not enter the industry till 1896, this
was when they launched the Kohinoor mills.
 Parsees who dominated the mill industry- din Shaw petit he did so well that he was knighted in -1887 and
conferred a BARONETCY 3 years later.
 Dinsaw petit came in collab with nowrosjee Wadia to introduce a 4000-horsepower steam engine.
 The other formidable parses were the tatas, Jamshedji tata whose dad shifted to Bombay from Navsari in the
early 19th century.
 Jamshedji tata was sent to London to study how they operate the mills and plants and came back to India and
wanted to start a big plant to make waves. The first mill they set up was called Alexandria mill in the year
1869.
 Jamshedji was one of the first few businessmen who set up plant not in Bombay but close by to the resources
they needed, like Nagpur.
 Jamshedji’s tatas most successful venture was the set-up of the taj mahal in Bombay in 1904.
 Morajee gokuldas was another such person who set up shop close to the resource and not in Bombay.
 After morarjees death – thackersey mulji was the leading Bhatia in the family. And makanji khatau.
 Sir currimbhoy Ebrahim was the only prominent Muslim in the textile market scene, owned ships, had
offices in Bombay, Hong Kong, and shanghai. Founded his mills in 1888 which was in Indore.

CALCUTTA SCENE –

 From 1866-1872 there were a lot of jute firms being set up mainly by the Scotsmen.
 This quick expansion was too much for the market such that the market went into recession.
 Indian jute mill association was set up in the year 1884.
 But after a while the market caught up and started doing well and it was profitable.
 The use of coal increased as it was the fuel which ran the jute and cotton mills and even railways, so from
1860 the the coal demand and coal mining also increased exponentially especially in the raniganj area.
EASTERN INDIA was the highlight for the coal mining in India.
 The tea industry also bounced back after the 1860 fiasco from the 1870s,
 Indians were mostly aloof in the eastern part from the growing opportunities, and it was done by English
or Scotsmen, which were mainly (JUTE, COAL, COTTON, TEA)
 After a long time, a partnership of Rajendra Mookerjee and martin a London based businessmen started a
company called martin&co in the year 1892. And soon Mookerjee took over once martin was dead.
 MOST prominent partnerships under British controls were BIRD & CO. Sam bird the founder came to
India in 1858 and started as a labor contractor joined forces with his brother in 1864 and founded a coal
company and jute company and became the largest exporter of Indian coal.
 Another such story was from the Scotsmen called Andrew yale who started his firm in the year 1863 and
went to own as many as 31 enterprises. And put a firm foothold in the 19 th century.

NORTH, SOUTH, NORTH-WEST

 Everything was started by expatriates.

 Elgin mills in Kanpur was the first cotton mill set up in north India in 1861.
 Marwaris were dominant in the north and chettiers in the south in the madras region.
 Thomas perry the welsh guy was the pioneer of industrialization in the south region as he set up an indigo
shop.
 After parry died William dare overtook the company and expanded into coffee plantation in the year
1823 near the Mysore region.
 They expanded to sugar mills as well which played a crucial role, this was done in the year 1842 and
soon bone mill for manure production.
 Binny and co. was another such industrialist of the south and acquired Indian steam navigation company
in the year 1865, which was a highlight of his company.
 The top 3 industrialists of the south were- THOMAS PERRY, BINNY AND ARBUTHNOT.
 Binny’s best contribution was the introduction of a cotton mill to the region in the year 1876.
 North-west was only known for its brewery set up by general dyer of the Jallianwala bag.
 West and east were known for- cotton, jute, coal, and tea.
 South was known for – sugar, shipping, manufacturing, and navigation.
 J.N TATA was the first mill owner to allow calculating the depreciation costs.
 Stockbrokers’ association of Bombay was established in the year-1875 and Calcutta stock exchange in
the year 1908.
 First bank to be launched in India was the Alexandria bank in the year 1770.
 All the presidencies had government-controlled banks which were called the presidency banks, there
were 4 private banks out of which also the 3 were under British rule.
 The bank of Allahabad was founded in the year-1865.
 PNB was the only bank which was controlled by Indians- in the year 1894.

DEVELOPING AND IDENTITY -CHAPTER- 7

 The indo-british partnership was formed in the 1830-1840s but recently as the industrialization era
started, the Indian industrial class was becoming increasingly more conscious about its own identity.
 Certain events made them think so too
 Manchester’s growing hostility towards the Indian textile industry was the first visible sign on the
assault on the Indian sensitivities.
 All the import duties on textile duties were abolished in the year 1882, as in the factory act of 1892
they set up a ploy to snatch from the competitive advantage. The 2nd sign was the imposition of
 countervailing excise duty in the year 1894 on the production of the textile goods in India to offset the
duty on imports.
 Many Indian industrialists were openly against it like J.N. TATA and ranchodlal but did not
participate in the protests.
 As the industrial revolution came and the country was growing the middle class started a sense of
disillusionment from the crown government and many Indian journalists pointed this out as-well like
dadabhai naroji, mahadev Govind ranade etc.
 They clearly mentioned that the crown government was exploiting the Indian resources for their own
benefit. All the Indians wanted was to be treated equally with the British.
 The INDIAN NATIONAL CONGRESS was set up in the year 1885.and all the industrialists were in
close contact with the party.
 Godrej is owned by a parse.
 The swadeshi spirit got stronger in – Delhi, Punjab region.
 Agriculture was still the primary job of these people.
 The importance of industrial revolution and modern industries for the economic good was seen by
everyone now.
 The establishment of PNB bank was the result of this swadeshi movement in 1894.
 Harikishan lal was one of the very prominent owners of PNB and started – BHARAT INSURANCE
company and PEOPLES BANK of India the first of their kind and he was also responsible for
generating industrial interest in the Punjabi households.

 The swadeshi movement was in simmer till 1905, but when lord Curzon decided to divide the Bengal
into east and west it transformed into full- fledged protest movement.
 A call was taken by the Indians to boycott all foreign goods and promote indigenous products.
 Experiments of 1840s killed the Bengali interests for business, but the swadeshi movement revived it
 PRAFULLA CHANDRA RAY - set up Bengal chemicals and started their own pharmaceutical
company.
 TRIBUVANDAS KALYANDAS GAJJAR and A.S. KOTIBHASKAR to form alembic chemicals
which was one of the first 4 chemical plants established in India and first in the entire west.
 LAXMAN RAO KIRLOSKAR- invented a better way to yield plough. And later, set up the Kirloskar
brothers.
 PAISA FUND GLASS works set up at Talegaon POONA in 1905.
 1899 IRKSOME archaic regulations were replaced by a new set of granted rules.
 CHANDA district was a bust and later DURG district was set up as the goal for iron production.
 Jamsedji TATA passed on the helm to darobji TATA and died in the year 1904 in Germany.
 TISCO- TATA IRON AND STEEL COMPANY was finally registered in the year 1907 and was
situated in SAKSHI, a district in BIHAR. Started production by 1911 and was the first steel firm in
India.

THE IMPACT OF THE SOUTH

 The swadeshi spirit in the south was manifested in the region by establishing several banks.
 The south was mainly owned by the trio of binny, parry and Arbuthnot. But 2 of the 3 failed by 1906.
  Sir JAMES LYKE head of BRITISH INDIA NAVIGATION COMPANY took over the binny and co.
 Arbuthnot was sentenced to prison for 18 months for cheating.
 This made way for Indian. Banks. –
 INDIAN BANK- 1907
 New ventures like UNITED INDIA LIFE INSURANCE COMPANY were floated by lingam
brothers.
 PUNAJB AND SIND BANK- 1908.
 CENTRAL BANK OF INDIA- 1911
 BANK OF BARODA- 1908.
 After the steel plant, the TATAs wanted to venture into the hydroelectric power supply, darobji
registered the company by 1910 and was functional by 1915 as LORD SYDENHAM helped.

EFFETCS OF THE FIRST WORLD WAR

 The WAR was a very profitable time for the INDUSTRIAL AND COMMERICAL SECTOR, but
disastrous for BANKING SECTOR.
 WAR disrupted imports and exports, so the price of the Indian goods went up.
 Crown government which was skeptical for using TATs steel had no other choice as the imports
stopped and they developed a great synergy together.
 To meet the power generation as the Indian companies were supplying materials to both the
government and for exports tata hydroelectric plants had to expand and new players like ANDHRA
VALLEY POWER SUPPLY AND TATA POWER COMPANY.
 TATA GROUP diversified into CEMENT PRODUCTION established plant in PORABANDAR
KATHIWAR and added the 2nd one in BIHAR.
 TATA joined into many other sectors but little they knew about these sectors.
 THE COTTON INDUSTRY benefited the most from the war as much as 15-18 times more than
pre-war.
 Greatest were the companies that catered to the domestic demand of the cloth.
 LOSSES FOR THE CHINEESE MARKETS-1913.
 European industrialists like BIRD BROTHERS who were into jute, coal and tea also made
handsome profits but not in the tea sector.
 BIRD BROTHERS acquired F.W. Heliers& co.
 THE BANKING SECTOR did not function well at all the RBI HAD TO SET UP RULES FOR
proper functioning in the year 1936.

MARWARI ENTRY INTO THE INDUSTRY

 A sizeable Marwari population had migrated everywhere, even to places like Hyderabad, Poona, Nagpur etc.
 SARUPCHAND HUKUMCHAND was one of the first most prominent Marwaris who made his money
through opium, sugar and other trades opened cotton mills at his headquarters NDORE in 1909 and 1914 and
later a JUTE MILL.
 Perfect pottery was formed by KHUSHALCHAND IN JABALPUR by 1905.
 Marwaris made their presence felt especially in the KOLKATTA region.
 Marwaris were the locals who helped the European industrialists and thus were near all the new things
happening.
 GHANSHYAMDAS BIRLAs family symbolized more than any other family. From PILANI in
RAJASTHAN they moved to Mumbai in 1857 looking for trade but eventually had to move to CALCUTTA
because of the plague.
 IN CALCUTTA they got associated with the firm TARACHAND GHYANSYHAM DAS and later became
the BANIAS for the ANDREW YULE & CO.
 BIRLAS made a ton of fortune during the war, trading in jute, coal, cotton etc.
 BIRLAS WERE THE FIRST TO OPEN A JUTE EXPORT OFFICE IN LONDON IN THE YEAR 1917.
 GHYANSHYAMDAS then in the year 1916 marked the beginning of his industrial carrier by buying a
cotton mill in DELHI.
 Barely after 4 years BIRLAS set up a JUTE MILL IN COMPETITION WITH THE EUROPEANS.
 There was a competition between BIRLAS AND HUKUMCHAND until HUKUMCHAND sold all his
mills to the BIRLAS in the year 1939.
 Other famous mar -wadis were-
 HARGOVIND DALMIA- COTTON MILL- 1921
 SINGHANIAS WHO WERE VERY PROMINENT IN KANPUR and JUGGILAL their forerunner.
 JAIPURIA partnered with SHOBA SINGH – KHALSA MILLS – 1923.
 NANDAL FAMILY TEXTILE MILL INDORE- 1922.
 ANANDILAL PODAR in collab with JAPANEESE in the year 1924.

CHAPTER-8 TOWARDS MATURITY

 THE CROWN government started placating a healthy relationship towards Indian businesses, because they
saw how useful they could get during the WORLD WAR-1 phase.
 INDIAN INDUSTRIAL COMMISSION was set up to help Indian interests, and the tariff protection to
Indian industries.
 GOVERNMENT ACT OF 1919- to represent the native business interests in the legislative councils.
 MAHATMA GANDHI entered the scene around 1915 and was fighting for better rights and this drove a
gulf between the native and the expatriate business interests.
 THE INDIAN BUSINESSES WERE GROWING AT A FASTER RATE THAN THE EXPATRIATE
ONES post the WORLD WAR.
 INDIANS could not challenge BRITISH MONOPOLY in the sectors like coal, tea, jute etc.

EXPANSION OF THE OLDER HOUSES

 AS TATAS opened a lot of companies and diversified a lot during WW-1 a lot of them stopped
generating profits after the war ended, which either led to them selling it other people or closing the shop.
 TATA bank was merged with CBI.
 TATA CONSTRUCTION was acquired by WALCHAND HIRACHAND.
 And the cement company became a part of ACC (associated cement company) in the year 1936.
 After the war ended the British started importing steel again which left TATAS in the cross-roads with
overcapacity. It lost a lot of its revenue overnight and was struggling to stay afloat.
 TATA management did 3 main things to stop the bleeding.
1. Borrowed 2 million pounds on the London market.
2. DORABJI put all his personal assets as collateral to get 100 lacs loan from imperial bank of
INDIA.
3. Management stepped up efforts to secure protection for the steel company.

 1919 – finally a act was passed to impose duties on the imports, thus protecting the TATA steel.
 TATAs had to sell 50% of their stake in the hydroelectric plant to a firm American and foreign power
in the year 1930. And was in joint custody till 1951.
 J.R.D TATAs major contribution was to the civil aviation department because there were no
substantial air services in India till 1932.
 AIR INDIA was started as the division of TATA and sons.
 TATA CHEMICALS reputed to be the biggest chemical works in the country at the time of its birth in
the year 1939.
 The location was MITHAPUR near DWARKA the seacoast in the state of the maharaja.

TATA WITHOUT A DOUBT IS THE FIRST FAMILY OF INDIAN BUSINESS-1930.

BIRLAS-

BIRLAS were right after them and it was only because they came into the industrial sector a little
late who were considered the cotton and jute Indian giants.
 1922-1930 was a confusing period for the Indian economic environment. Major changes were the
increase in cotton imports from England and japan. And the abolition of the excise duty in the year
1924.
 1932-CHANGE IN THE GOVERNMENT POLICY GRANTIG TRAIFF PROTECTION TO
INDIAN SUGAR INDUSTRY encouraged BIRLAS to diversify once again.
 From 1929-1936 the sugar factories increased from 27-150 and BIRLAS were the first to secure
this position.
 They started with UP and western BIHAR where sugarcane was grown in abundance.
 TOP THREE SUGAR PRODUCERS- BEGG SUTHERLAND, GOKULCHAND NARANG AND
BIRLAS.
 BIRLAS WENT AHEAD AND STARTED ORIENTAL PAPER MILL COMPANY TO
BREAK THE EUROPEAN MONOPOLY in 1936.
 BIRLAS ANOTHER PROMINENT INITIATIVE WAS -TEXMACO.
 BIRLAS was a patriot and had strong ties with everyone who wanted to promote indigenous
products.
WALCHAND HIRACHAND

 Gujrati Jain family.

 Started with shipping as a business.
 Scandia steam navigation company. -
 Suffered losses and came under James Lyle MacKay.
 By 1920s TATS sold off their construction company to WALCHAND who renamed it to premier
construction company.
 Opened a sugar mill – 1932, in Nashik district.
 Have a reputation of running the most efficient sugar mills in the country.

LAXMAN RAO KIRLOSKAR

 Factory owner – iron plough and shaft cutter.

 Kirloskar brothers into a public limited company 1920.
 1920s important were the diesel engine and centrifugal pump to facilitate drawing off well for
irrigation.
 Collaborated with DCM- Delhi cotton mills and even acquired a jay engineering works.
 Diversified from textile to cotton to sugar and expanded to Calcutta they were the firsts to include
sewing machine in their portfolio along with fans and pressure gauges.

MERCHANTS IN THE WEST WERE SKEPTICAL ABOUT EXPANDING BEYOND THEIR HOME
GROUND.

 Parekhs and sarabhai did not expand but still made good profits in their home state.
 on the OTHER HAND LALBHAIS, WHO HAD A TOKEN PRESSENCE IN AHMEDABAD
INDUSTRIAL SCENE WENT FOR MAJOR EXPANSION FROM 1929- 1931 JUST BEFORE
GREAT DEPRESSION TO EMERGE AS THE LARGEST GROUP IN THE INDUSTRY IN THE
MIDDLE PF THE DACADE.

 AHEMEDABAD WAS CALLED THE MANCHESTER OF INDIA.

 MAFATLAL was another exception who expanded from Gujarat to other states too.
 The most distinguished casualty was the one and only MUSLIM group CURRIMBHOY group who had
almost 12 companies under them.
 MAFATLAL had contacts and ginnies in AFRICA, UGANDA.

NEW ENTRANT MAKING MONEY

 SINGHANIAS of Kanpur expanded and came into the textile and jute sectors during war -1 years.
 JAMANLAL BAJAJ OF WARDHA and JEEVANLAL MOTHICHAND of GUJARAT.
  RAMKRISHNA DALMIA a Marwari from ROHTAK PUNJAB, had a lot of diversified companies
under him called it the ROHTAS INDUSTRIES.
 AMONG THE FIRST INDIANS TO MANUFACTURE PAPER.

PROMINENT CHANGES OCCURRED IN SOUTH INDIA TOOO

 CHETTIARS AND NAIDUS OF THE SOUTH WERE PROMINENT NAMES DURING THE WAR
YEARS.
 OTHER NAMES WERE R-SHEESASAYEE AND C. RAJAN IYER who were also known for
BRAHMINS ENTERING THE SCENE.

OTHER CHANGES -

 IN 1921 ALL THE 3 PRESIDENCY BANKS ALMALGAMATED AND BECAME IMPERIAL

BANK OF INDIA.
 RBI WAS ESTABLISHED IN 1934.
 PUROSHOTAM THAKURDAS WAS KNOWN AS THE COTTON KING OF INDIA.
 GOENKA ENJOYED THE SAME POWERS IN THE EAST, WAS A GROUP LEADER OF SMALL
MARWARI COMMUNITY, WAS IN SEVERAL BOARDS INCLUDING IMPERIAL BANK OF
INDIA, BECAME THE CHAIRMAN OF IMPERIAL BANK OF INDIA IN 1933. FIRST INDIAN
TO HOLD THIS POSITION AND IN RESERVE BANK TOO.
 ASSOCHAM – ASSOCIATION CHAMBERS OF COMMERCE FOUNDED IN 1921 first pressure group
who claim to represent the Indian and the European businesses.
 FICC- federation of India chambers of commerce finally came into being in the year 1927, showing the
growth of the Indian native businesses.

CHAPTER-9 EXPATRIATS AND MULTINATIONALS

 TATAs were the largest of all BUSINESS GROUPS native and foreign.
 After the tatas it was E.D SASSOON who was after them in the cotton textile manufacturing.
 BIRD AND HEILGERS were one of the most prominent of expatriate firms and along with YULE and co.
but just like the TATAs they opened a lot of shops during the war to make profits but after war it all
collapsed.
 JUTE, COAL AND PAPER were the most profitable avenues for businesses.
 BIRD AND TATAS came together to defeat the other AMERICAN competition.
 After the wars there were a lot of entry barriers in the Indian markets for foreign traders or consider it
stagnation period after much growth.
 ANDREW YULE MAIN BUSINESSES WERE- JUTE, COAL AND TEA.
 INDIAN PAPER PULP COMPANY WAS SETUP IN 1919. TURNED PUBLIC IN 1933.
 INDIAN INSURANCE COMPANY WAS ALSO SET UP YULE IN 1931.
 TOBACCO INDUSTRIAL LIMITED WAS SET UP IN 1931.
  NEW ENTRIES WERE – SHAW WALLACE AND DUNCAN BROTHERS.
 WALLACE WAS KNOWN FOR THIS COAL BUSINESS AND THE CHEMICAL BUSINESS-LIKE
KEROSENE AND SULPHURIC ACID.
 DUCAN FOR HIS TEA BUSINESS.

NORTH, WEST, AND SOUTH

 BEGG SUTHERLAND -PIONEER – TEXTILE AND SUGAR INDUSTRY IN NORTH.

CHAPTER-10 DURING THE WAR AND AFTER

▪ THE TOP 5 INDIAN BUSINESSMEN WERE

1. TATAS

2. BIRLAS

3. WALCHAND HIRACHAND

4. KIRLOSKAR BROTHERS.

▪ During the world war-1 the import and export network was disrupted and the demand for indigenous
products increased a lot because of it.
▪ This naturally pushed the prices of the products and the Indian businessmen started making good profits.
▪ To ensure the maximum production the British government started offering a series of incentives to the
manufacturers and invoked the famous DEFENCE OF INDIA RULES TO BAN STRIKES AND LOCKDOWNS.
▪ SEVERAL PROVISIONS OF THE FACTORIES ACT WERE RELAXED AND UNHINDERED SUPPLY OF RAW
MATERIALS.

On the eve of the World War 1 there were 3 categories of businessmen

1- Indian businessmen who dominated the customer good segment in the Indian business.
2- The expatriate firms whose business was mainly dependent on the imports and exports of commodities like
JUTE, COAL AND TEA.
3- Subsidiaries of the multinational firms that focused on what may be called the new industries such as
chemicals, engineering, and stores.

▪ TATA was a commanding amongst all business groups during World War 1.
▪ TATAS HAD – STEEL COMPANY, COTTON MILLS, OIL MILL, CHEMICAL COMPANY, AND AN AIRLINE.
 ▪ INDIAS textile industry boosted a lot during these times, approximately 400% and all the countries who
were exporting from japan and other countries turned to INDIA NOW.
▪ TATA set up their RESEARCH AND CONTROL LAB in 1937, which was the first case of an INDIAN
BUSINESS GROUP.
▪ TATA was famous for 2 types of STEEL production- TISCROM (High tensile alloy steel)- used to make
the HOWRAH BRIDGE IN KOLKATA
▪ TISCOR- COROSSION RESISTANT EXTRA LONG STEEL USED IN THE INDIAN RAILWAYS.
▪ KNOWN FOR BUILDING An ARMOURED CAR- TATANAGAR.
▪ TATA LOCOMOTIVE AND ENGINEERING COMPANY- POST WORLD WAR 2 LAUCNHED IN 1945.

BIRLAS

▪ PROSPERED MORE THAN TATAS DURING THE WARS, 2ND LARGEST BUSINESSHOUSE IN INDIA.
▪ KNOWN FOR BUSINESS IN SUGAR, PAPER AND JUTE, PAPER AND SUGAR INDUSTRY DOMINATED
DURING THE WARS.
▪ BIRLAS NET WORTH WHEN UP BY 6 TIMES FROM 1939-1945.
▪ BIRLAS ACCQUIRED SWADESHI MILLS IN 1944 AT AHMEDABAD.
▪ STARTED NEW FLOTATIONS LIKE- INSURANCE COMPANY, A CYCLE MANUFACTURING CONCERN IN -
1940.
▪ UNITED COMMERCIAL BANK – 1943.
▪ CIMMCO- CENTRAL INDIA MACHINERY MANUFACTURING SET UP IN GWALIOR IN 1945.
▪ HINDUSTAN MOTORS STARTED IN 1942- ASSEMBLY PLANT- BARODA- IN COLLAB WITH MORRIS
MOTORS FROM THE UK- FIRST VEHICLE LAUNCHED IN 1950- BRAND NAME-HINDUSTAN.

WALLCHAND HIRCHAND

▪ WAS INTO SHIPBUILDING AND PASSENGER CARS.

▪ SCINDIA SHIPYARD WAS LAID OUT BY THE THEN PRESIDENT – RAJENDRA PRASAD.
▪ COLLABORATION WITH – DHARMSEY MULRAJ KHATAU AND TULSIDAS KIRLACHAND, PROMINENT COTTON
TRADERS IN THE CITY.
▪ STARTED PREMIER AUTOMOBILES IN THE YEAR 1944, ACCQUIRED COOPER ENGINEERING LIMITED IN 1932
AND BOMBAY CYCLE MOTOR AGENCY FOR HELPING PRODUCE INTERNAL COMBUSTION ENGINES, SET UP
SHOP IN – BOMBAY.
▪ TOOK UP AIRCRAFT MANUFACTURING RANDOMLY AFTER TALKING TO AN AMERICAN AIRLINES COMPANY
HEAD, NAME UNKNOWN.
▪ SET UP LAND IN MYSORE – HINDUSTAN AIRCRAFT COMPANY- 1940. AND PRODUCTION STARTED BY -1941.
▪ AS THE 2ND WORLD WAR WAS GOING ON DURING THAT TIME, THERE WAS AN OPINION THAT JAPAN
MIGHT COME INTO INDIA AND HIGHJACK THE COMPANY SO THE BRITISH GOVERNMENT TOOK OVER THE
 COMPANYS PRODUCTION UNDER WAR POWERS, AND THOUGH IF THE JAPANEESE FORCES CAME INSIDE,
THEY WOULD DESTROY THE PLANT. (SAD SHIT).
▪ SHIPYARD COMPLETED- 1946, FIRST CAR LAUNCEHD- 1947 IN COLLAB WITH CHRYSTER USA.
▪ BRITISH GOVERNMENT ASKED THE COMPNAY TO SURRENDER TO 9 SHIPS TO HELP FOR THE WAR, THE
COMPANY ALSO STARTED BUILDING VESSELS IN VIZAG – 1943.
▪ APART FROM ALL THIS WALLCHAND AND HIS BROTHERS HAD SEPARATE BUSINESSES LIKE THE COOKING
OIL, VEGETABLE OIL UNDER THE BRAND NAMED WALDA, VANASPATI BRAND OF THEIR FAMILY WAS
PRODUCING SOAPS AND TIN CONTAINERS.

KIRLOASKAR BROTHERS.

▪ IRON CASTS PRODUCTION FOR GRENADES.

▪ HAD A PLANT IN MYSORE ON THE BANK OF THE RIVER TUNGABHADRA SET UP IN 1941.
▪ AGRICULTURAL MANUFACTURING WAS TOP PRIORITY FOR THE FAMILY.
▪ STARTED 2 COMPANIES – ELECTRIC COMPANY AND THE OIL COMPANY.
▪ ELECTRICAL COMPANY IN 1946, WAS THE FIRST FIRM TO MANUFACTURE ELECTRIC MOTORS IN INDIA.
▪ OIL ENGININE WAS SET UP IN POONA.
▪ ONLY 2 OTHER COMPANIES WERE PRODUCING ENGINES- OREINT ENGINEERING IN PUNJAB AND
WALCHAND COOPER ENGINEERING AT SATARA NEAR BOMBAY.

▪ DCM- founded by LAL SHRI RAM.

▪ PRODUCTION OF COARSETS AND YARN AND CLOTH.
▪ DCM ADDED A CHEMICAL DIVISION – 1941.

OTHER GROUPS AND COMPANIES-

▪ SINGHANIAS- DEVELOPED INTO A HUGE ORGANISATION DURING WAR.

▪ ACCQUIRED NATIONAL INSURANCE COMPANY AT CALCUTTA AND HINDUSTAN COMMERICAL BANK AT
BOMBAY NO LONGER CONFINED TO KANPUR.
▪ MODI- TOILET SOAP – 1940 AND WASHING SOAP.
▪ COTTONSEED AND GROUND NUT OIL.
▪ MODI SPINNING AND WEAVING COMPANY WAS THE BIGGEST MODI ENTERPRISE.
▪ THAPARS – JUTE, PAPER AND COAL BEFORE THE WAR, JAGJIT TEXTILE MILLS.
▪ DALMIAS – SET UP CEMENT PLANTS AND FLOATED BHARAT BANK AND BHARAT AIRWAYS IN 1943 AND
1946.
▪ ALEMBIC CHEMICALS – INDIAN LIQUOR IN 1942.ALSO STARTED MAKING BOTTLES AND ENGINEERING
TOOLS, AND VEGETABLE OIL TOO.
▪ SHEESASAYEES MADE THE MOST SPECTACULAR PROGRESS IN WW2 THEY HAD THEIR OWN ELECTRICAL
COMPANY AND FROM 1930-1940S IT EXPANDED FROM URBAN TO RURAL AREAS TOOO.
▪ SOUTH MADRAS ELECTRIC COMPANY WAS THE NAME OF THEIR COMPANY.
▪ METTUR CHEMICAL – HYDROELECTRICITY PLANT IN THE SOUTH.
▪ FERTILIZER COMPANY IN TRAVENCORE, KOCHI.
▪ THEY HAD SMALL SHARES IN THEIR BUSINESSES
▪ ACC WAS CREATED BY 4 COMPANIES.
▪ BANGURS- RAJASTHAN- TRADER, PROPERTY DEALER AND SHARE BROKER, CAME INTO TEXTILES-1934.
▪ SOMANYS- MARWADI- TEXTILE AND CEMENT
▪ BALDEO SINGH- FIRST DEFENCE MINISTER OF INDIA
INDEPENDENCE – A NEW BUSINESS CLIMATE – CHAPTER – 11

▪ 15TH AUGUST 1947 India was partitioned into two countries namely India and Pakistan.
▪ It was a loss of land and with that loss of some of the finest cotton growing tracts and most of them jute
growing areas and the loss of a few manufacturing units set up in Lahore of BIRLAS AND BAJAJ, loss of a
business partner to the MAHINDRA AND MAHINDHRA.
▪ Modern industries made a considerable headway in investing India.
▪ But they were still dependent on the imported technology.
▪ NATIONAL PLANNING COMMITTEE (NPC) was formed in the year 1938 whose president was
JAWAHARLAL NEHRU.
▪ Before independence a lot of the people were in the same political party because of their combined interest
of independence but once this became a reality the members started having very polarizing views on how to
run the country. Jawaharlal Nehru wanted an assertive control over all the companies but SARDAR
VALLBHAI PATEL was a capitalist didn’t want the businesses to be regulated beyond a point.
▪ The industry policy resolution of 1948 was the first major pronouncement of the new government formed.
▪ The first 5-year plan was set for 1951-1956 which was in accordance with the Bombay plan of 1944.
▪ A system of industrial licensing was the 2nd instrument devised by the new government to achieve industrial
policy.
▪ The main theme of the new government was to produce the local businesses from the boost in imports, so
they levied a lot of import taxes and even the subsequent exports declined gradually.
▪ A new industrial policy was announced in the year 1956.
▪ Imperial bank of India got Indianized to STATE BANK OF INDIA.
▪ A new company law was enacted in the year 1956.
▪ A new rule stated that no managing company would have more than 10 companies under them.
▪ This new law came into effect from April 01/1960, this law stated that you cannot own more than 10
companies, but you can be the treasurer for them, so basically its harmless.
▪ Government tried to create credit facilities to help private sectors to run their business smoothly
▪ Institutes like IFCI (INDUSTRIAL FINANCE CORPORATION OF INDIA)
▪ NSIC- NATIONAL SMALL INDUSTRIES CORPORATION.
▪ ICICI-
▪ IDBI- INDUSTRIAL DEVELOPMENT BANK OF INDIA
▪ IRCI- INDUSTRIAL REFINANCE CORPORATION OF INDIA.

The government was leading for the first time and there were a lot of faulty implementations which created
loopholes and for a lot of corruption, but they learned to be better over the years.

CHAPTER-12- BUSINESS IN THE NEHRU ERA

▪ People were a little unhappy of NEHRUs approach because putting a limit on the native businesses after
the independence did not make sense to them.
 ▪ SWATANTTRA PARTY WAS FORMED BY RAJGOPALCHARI THE FIRST INDIAN GOVERNOR
OF THE FREE INDIA.
▪ NEHRU DEATH- 27TH MAY 1964.
▪ The coming 5 years after NEHRUs death were chaotic
▪ The bloody war with china left INDIA in chaos which started in the year- 1962.
▪ War with PAKISTHAN started in no time.
▪ THERE was no rainfall for 3 years in succession.
▪ WHEAT PRODUCTION WAS KNOWN AS THE GREEN REVOLUTION.
▪ INDIAN ECONOMIC SCENARIO WAS IN DISTRESS IN THE 1960s.
▪ NEHRUS successor was LAL BAHADUR SHASHTRI who could not serve as the PM for more than 20
months, but the music was faced by INDIRA GANDHI who was the daughter of NEHRU and she failed
to catch the trend in the first 2 years leading to an economic CRIPPLE.
▪ TO GAIN THE SUPPORT INDIRA GANDHI NATIONALISED THE BANKS ON 19TH JULY 1969.
▪ NATIONALISING THE BANKS WAS THE END OF NEHRU ERA.

NOW LET’S SEE HOW THE OLD ESTABLISHED HOUSES PERFORMEND UNDER THE NEHURU
ERA

▪ TATA iron and steel company TISCO never participated in the freedom movements but was a close ally to
the Indians, and after the world war it was impaired the the demand for product dropped substantially and
the Indian government and the foreign banks helped too.
▪ THE INDIAN GOVERNMENT HELPED TISCO IN GETTING PERMITS AND THE LOAN OF 10CR
WAS GRANTED TO TISCO TO DOUBLE ITS PRODUCTION FROM 1 MILLION TONNES TO 2 AND
THIS WAS LARGEST LOAN GIVEN OUT EVER TO AN AISAN COUNTRY.
▪ TELCO WAS FORMED – automotive and engineering company to produce railway cars but it was not
allowed to produce passenger vehicles, it tried collaborating with BENZ AG but the government did not
allow that.
▪ The TATA chemical company was gaining stability but was not allowed to expand into fertilizer
manufacturing. The government claimed that TATAS were too big already to expand.
▪ THE AIRLINE INDUSTRY WAS RESERVED FOR PUBLIC SECTOR WAS TATA were already in the
advanced stage of production when this bill passed so the government and the TATAS collared and started
the TATA AIR INDIA THE YEAR 1948.
▪ TATA COLLABORATED WITH JAMES FINLAY AND STARTED TATA TEA IN 1963,
▪ TATA CONSULTANCY SERVICES WAS STARTED IN 1968.
▪ TATA CHEMICALS WAS ALLOWED TO OPEN THE FERTILIZER PLANT IN THE YEAR 1967.
▪ BIRLAS

▪ Grew their business more than the tatas post-independence.

▪ One of the first producers of the cloth fabric RAYON.

 ▪ G.D BRILAS proposal to open a steel mill was not accepted and later he had to open the aluminum plant
which turned out to the biggest on in this field. -HINDALCO in RENUKOOT UP in partnership with
KAIZER American company.

▪ DIGVIJAY WOLLEN MILLS WAS REGISTERED IN THE YEAR 1948.

▪ the most important ventures were the Hindustan motors and TEXMACO.

▪ the group grew exponentially post 1947, from 13 they almost acquired 31 companies

▪ Birla’s were amongst the first companies to expand globally because the laws were not favorable, they
expanded to Ethiopia, NIGERIA, KENYA, MALAYSIA.

▪ THAPARS- acquired greaves.

▪ Trading in engineering products and engines.

▪ Acquired a paper mill from Ballarpur and opened a few sugar and coal mills as well down the line.

▪ Almost had 50 companies under them. It became the 4th largest business house in the NEHRU ERA.

MAFATLALS- lead by navinchand, acquired the sasson spinning and weaving company, these guys were in
the front row in textile manufacturing companies.

▪ Allied to dyestuffs and soon to chemicals and petrochemicals around 1957.

▪ Resulted in the emergence of NOCIL AND PIL. Became the 3rd largest business house of the country.

KIRLOSKAR BROTHERS.

▪ Started by Lakshman Rao Kirloskar and now the power being shifted to S.L. KIRLOSKAR the eldest
son.
▪ Pursued oil engines and marketed them in 14 different countries and started producing combustion
engines also.
▪ Merged with an American company and started a company called Kirloskar cummings and similarly
Kirloskar electrical company.

LALBHAIS AND WALCHANDS AND DALMIAS

▪ LALBHAIS had Atul products limited which but eventually developed to become the most
sophisticated dye producer of the country.
▪ Walchand had to sell his shipping business, but he had other things to hold on too which were more
important and profitable like premier automobiles, premier construction and they wanted to maintain
these and gain profits rather than diversifying.
 ▪ DALMIAS started great and acquired a lot of companies, but it fell as soon as it rose because tax
evasion problems and this was the first company to face this, few of its famous accquisions were-
BENETT COLEMAN AND CO,
MARTIN AND BURN who was one of the most profitable business groups also sold itself to the government
because of labor issues in 1960, and it was the 3rd largest group in the country.

New entrants were – BAJAJ, MAHINDRA, SINGHANIAS, BANJURS and GODREJS.

BAJAJ – set itself up as an automobile and electrical company mainly producing supplies also had Mukund
steel company under them.

MAHINDRA- took their first franchise of jeeps from the American willy overland company but later
started assembling them and became the market leader in a decade. Also went ahead and acquired a British
house called turner and co.

BANGUR WAS A MAJOR PLAYER – came into the picture only after world war-2, made its fortune there
and acquired a lot of mills and expanded.

GODREJS – making toilet paper soap and security equipment before they diversified into office
equipment’s like furniture.

SINGHANIAS – stepped out of Kanpur and acquired new mills from Sassoon’s and others and became a
national character by the NEHRU ERA.

Others who emerged strong during this time were – GOENKAS (MARWARDI FAMILY), KALYANIS,
KHAITANS.
AND 3 FAMILIES FROM GOA- CHOWGULES, SALAGONKAS, DEMPOS.

OTHER people who just started were AMBANIS, MAPPILLAI OF MRF TYRES and BRIJ MOHAL LAL OF
HERO and RAUNAQ SINGH of APOLLO TYRES.

THE GOENKAS- RAJASTHANI TRADRS SHIFTED TO CALCUTTA AND WERE THE OPERATING
BANIAS FOR THE EUROPEAN AGENCY HOUSES LIKE DUNCAN BROTHERS, AND OTHERS WHO
WERE THE MOST IMPORTANT AT THAT TIME

THE GOENKAS OPENLY CHALLENGED THE BIRLAS ALTHOUGH THEY WERE NEVER IN THE
INDUSTRIAL PART FORMALLY.

THE GOENKAS INDUSTRIAL JOURNEY BEGAN UNDER KESHAV PRASAD THE SON OF BADRIDAS
GOENKA. THEIR FIRST ACCQUISION WAS OCTAVIA STEEL, SUGAR MILLS AND COLLIERIES.

AFTER INDEPENDENCE THE EUROPEAN AGENCIES THOUGHT OF WITHDRAWING AND SOLD

THEIR ASSETS TO THE GOENKAS SOMEWHERE AROUND 1963.
KESHAV PRASAD ACCQUIRED 3- 4 MAJOR COMPANIES DURING 1966-1969 COTTON AND
ELECTRIC CABLE PRODUCTION COMPANY.ALSO SHOWED INTEREST IN BALMER LAWRIE AN
EXPATRIATE FIRM.

KHAITANS- STARTED AS SUPPLIER OF PLYWOOD AND PACKING CRATES TO THE TEA

PLANTATION AND THIS WAS STARTED BY BRIJ MOHAN LAL AND SOON HE BECAME THE MD OF
THE TEA PLANTATION POST 1950 AS THE EUROPEAN FRIM RICHARD MORGON WAS LOSING
CONTROL AND THEN GAVE UP THE COMPANY TO BRIJ MOHAN AND THEN EVENTUALLY HE
ENDED UP BEING THE BIGGEST INDIVIDUAL TEA PLANTER IN THE WORLD.

THE RUIAS FROM-MADRAS STARTED OFF BY NAND KISHORE RUIA THEY WERE IMPORTING
TRUCKS AND EXPORTING GROUNDNUT OIL AND COTTON FROM MADRAS TO BOMBAY.MADRAS
BEING THE HEADQUATERS.

THE GOA BASED 3 FAMILIES BECAME A SINGLE ENTITY AND WORKING TOGETHER AFTER THE
PORTUGEESE LEFT IN THE YEAR 1962. AND THESE 3 FAMILIES WERE CONROLLED BY A
MAHARASHTRIAN BRAHMIN FAMILY.

KALYANI GROUP- FOUNDED BY MAHARASHTRIAN BRAHMIN FAMILY, TRADER IN TURMERIC

AND GROUNDNUT, SET UP BHARAT FORGE WITH FINANCIAL HELP FROM ICICI IN 1964.

DHIRUBHAI HIRACHAND AMBANI- FROM GUJARAT, GAS FILLER IN THE ANDEN STATION,
STARTED BUSINESS CARRER IN 1958, SET UP RELIANCE COMMERICIAL CORPORATION IN
BOMBAY WHICH EXPORTED- CASHEWNUTS, PEPPER, NYLON, RAYON. EARNED A LOT OF
PROFITS CUZ NO ONE PRODUCED NYLON IN INDIA, SET UP RELIANCE TEXTILES IN 1966 IN
AHMEDABAD.
MAMMEN MAPPILLAI AND RAUNAQ SINGH FOUNDERS OF MRF AND APOLLO TYRES-
STARTED BUSINESS IN 1939, AND FROM 1961 CAME INTO TYRE MANUFACTURING, RAUNAQ
SINGH BEING A REFUGEE FROM PAKISTAN GOT LOAN FROM PNB.

DRUG MANUFACTURING- BHAI MOHAN SINGH(REFUGEE), UTTAMBHAI MEHTA, RAMBHAI PATEL

OF CADILA.

BHAI MOHAN LAL SINGH WAS IN BED WITH ITALIAN DRUG MANUFACTURER LEPETIT WHICH
WENT BANKRUPT, AND HE BOUGHT THE COMPANY THEN DIVERSIFIED INTO HEALTH CARE BY
SETTING UP MAXX INDIA. - RANBAXY WAS THEIR COMPANY.

UTTAMBHAI MEHTA- LAUNCHED TORRENT IN 1969.

OTHER STEEL PRODUCERS WERE – JINDAL, MITTAL, RAI.

STEEL ROLLING MILL USING JAPANEESE TECH WAS SET UP IN SOUTH INDIA IN THE YEAR
1956, ONE OF ITS KIND.

MITTALS FIRST BUSINESS WAS AN OIL MILL IN KANPUR.

SPIC, MAC, ESCORTS, TVS, HERO, AND AMALGAMATION STARTED PRODUCING POWER
DRIVEN 2 WHEELERS FOR THE LESS AFFULENT SECTIONS OF THE SOCIETY.

LAMBRETTA WAS STARTED – POINEER OF ITS KIND BUT SUCCUMBED TO THE

COMPETITION BY BAJAJ.

CHINDAMBARAM MOVED OUT OF THIS DEAL AND SET UP A FERTILIZER PLANT IN TUTICORIN IN
TAMIL NADU.

ESCORTS- HARI PRASAD NANDA- 1944- ELECTRICAL APPLIANCES AND THEN CARS.

TVS- IYENGAR SUNDARAM.

AMALGAMATION – WAS ALSO CONTROLLED BY TAMIL BRAHMINS.

HERO- BRIJ MOHAN LAL A REFUGEE SET UP CYCLE SHOP IN LUDHIANA AND LATER IN 1956.

OTHER COMPANIES LIKE AVON AND ALTAS WERE ALSO REFUGEE COMPANIES.
BRILAS ALSO HAD THEIR HIND CYCLES.

HERO GROUP BY 1969 CAME OUT ON THE TOP FOR CYCLES.

VITTAL MALLAYA WHO WAS A STOCKBROKER BOUGH UNITED BREWRIES AND BOUGHT THE
CONTROLLING SHARES OF THE COMPANY AND SET UP NEW BREWERIES POST INDEPENDENCE.

OBEROI- STARTED BY MOHAN SIGH OBERI, FIRST HOTEL WAS IN CALCUTTA, EARNED HUGE
PROFITS DURING WW-2 AND EXPANDED GLOBALY.
PUBLIC SECTOR- DURING THE NEHRU ERA THE PRIVATE SECTOR WAS NOT HAPPY WITH TOO
MANY RESTRICTIONS ON THEM AND THE FAVOURISIM TO THE PUBLIC SECTOR BUT THIS WAS
DONE IN ORDER TO HELP THE COUNTRY BUILD AND DEVELOP RATHER THAN JUST HELPING
PRIVATE SECTOR.

EXPATRIATES AND MULTINATIONALS – ALL THE EXPATRIATE AGENICES FOLDED AND LEFT
SOON AFTER INDEPENDENCE OR SELLING OFF THEIR COMPANIES TO THEIR OPERATIONAL
BANIAS, FEW FIRMS LIKE ANDREW YULE, BIRD, AND IN THE SOUTH PARRY AND BINNY
THOUGHT COULD SUSTAIN BUT THAT DID NOT HAPPEN, THE GOVERNMENT MOSTLY TOOK ALL
OF THEM UNDER BY 1976, A DISASTUROUS FLOOD IN MADRAS EVEN DESTROYED THE
FACTORIES WHICH LET THE BINNY GROUP TO FOLD BY 1980.
ASSAM UNDERTAKING COMPANY SUSTAINED TILL- 1991, TAKEN OVER BY THE MEHTA
GROUP.

AS THE EXPATRIATES WERE FOLDING IT HAD ONE EXCEPTION THO, THE L&T COMPANY,
WHICH WAS STARTES BY THE 2 DANISH BROTHERS,

HILDA LIMITED REGISTERED ITSELF IN 1943. THE BUSINESS OF HILDA WAS TO REPAIR SHIPS,
AND THE PARTNERSHIP BETWEEN HILDA AND L&T IN 1946 TO THE IMPORT AND EXPORT OF
CAPITAL GOODS IN 1946.

IN 1958 GOI CANCELLED A LOT OF IMPORT LICENSES TO HELP SET UP MANUFACTURING

SECTORS IN INDIA, COMPANIES LIKE UNILIVER AND ITC SET UP SHOP AND EVEN CHANGED
THEIR WHICH RESONATED WITH THE INDIAN COUNTERPARTS.

UNILIVER INDIA-1956- PRAKASH TANDON-1964.

THE 3 OIL COMPANIES SET UP IN INDIA WERE – SHELL, BURMAH, STANDARD VACCUM AND
CALTEX.

THE SOVIET GOVERNMENT HELPED INDIA IN SETTING UP THEIR CRUDE OIL REFINIERS IN THE
1960S.