The city of Ahmedabad in the state of Gujarat in western India was one of the major centres of the Indian textile industry. Over the years, Ahmedabad saw the rise of its textile industry, so much so that it came to be known as the 'Manchester of India'. The prosperity of the textile industry played a major role in the city's economy. It was the leadership of the Gujarati people which brought this industry to the city. Their business skills, indigenous entrepreneurship and expertise in finance played a key role in the process. The initiative of setting up a textile mill in Ahmedabad was first taken by an Indian entrepreneur, Ranchhodlal Chhotalal. The start of the Ahmedabad textile industry was special and trend-setting because it was financed by Indian capital and in that sense, it later came to represent the 'Swadeshi' movement in India.
Gujarat had been a hub of national as well as international trade for centuries. The prevalence of high morality in trade among the people and a well worked-out capital borrowing system were also significant traits which helped this industry to flourish. It is noteworthy that the system that was established for borrowing capital was highly trust-based. A tradition of co-operation rather than competition was visible in the trade guilds of Ahmedabad. The market of the textile industry was large and there was less to fear and more to gain from co-operation.
It was Ranchhodlal Chhotalal, who, in 1847, looked into the possibilities of textile manufacturing in Ahmedabad. Subsequently, capital was raised and preliminary plans were formed. As a result, in 1859, Rs 75,000 were invested by wealthy merchants along with Rs 25,000 by Ranchhodlal himself. It is said that the machinery that was purchased burned and went down at sea, so, presumably, the purchasing had to be done twice. (The decision of Ranchhodlal to do the purchasing once again reflects his grit to fulfil his ambition in such an adverse situation, which is surely worthy of praise.) Finally, the first cotton textile mill of Ahmedabad, the Ahmedabad Cotton Mill, started production on May 30, 1861. Employing 63 workers, it contained 2,500 spindles and provided yarn to handloom weavers. Ranchhodlal's mill at Shahpur set an example which led to more such efforts. Ahmedabad's second mill was founded by Bechardas Ambaidas Patel in 1867.
By 1891, the Bania community entered the industry. Also, financial and managerial institutions for running the mills were established. The Mill Owners' Association of Ahmedabad was founded too. Channels for procurement of machines and for recruitment of personnel had been formed. In 1892, MangaIdas Girdhardas Parekh, in partnership with Balabhai, founded the Aryodaya Spinning Mills. Lalbhai Dalpatbhai, a prominent financier, opened the Saraspur Mill in 1897. Soon, the Parsis also entered the Ahmedabad textile industry as entrepreneurs. The establishment and success of these early mills had a profound psychological effect on other investors who were to follow.
From 1891 to 1905, the industry witnessed a period of record growth. The Swadeshi movement instilled confidence in the people of Ahmedabad and gave a fillip to the number and profits of the mills. The number of mills increased to 32. The number of spindles, also, rose to 5.77 lakhs and that of looms, from about 2,500 to about 7,200. The number of workers tripled and the capacity of Ahmedabad's industry grew at almost double the pace of all India growth. By 1905, mills in Ahmedabad represented 15 percent of the total mills in India. Even after 1905, the industry grew speedily. Newer technologies and managerial pioneering along with the entry of more families into the industry fuelled this growth. The Swadeshi movement in India, which supported domestically manufactured products, gave a huge boost to the Indian textile industry and Ahmedabadis seized the opportunity. The cotton textile industry was affected by the partition of the country in 1947. India got 409 out of the 423 textile mills of undivided India while 22 percent of the land under cotton cultivation went with Pakistan. For many years after independence, Indian mills had to import cotton from Pakistan and from other countries.
In 1965, 62 textile mills in Ahmedabad employed about 1,30,000 people - one-tenth of the population of Ahmedabad at that time. 1,150 million yards of cloth were produced annually - a quarter of all of India's mill production in those days, worth over Rs 100 crores (1961). However, a crisis emerged in the Ahmedabad textile industry in 1966. Post 1970s, large-scale fragmentation was visible in the industry. Nevertheless, the origins and growth of the Ahmedabad textile industry remains an example of the Indian Swadeshi movement.
