Industrialisation, Urbanisation and Globalisation

This chapter answers the Class X social-science items of the general-studies syllabus: industrialisation in Britain and India, labour and living standards, urbanisation and city life, and the making of the world economy up to the 1991 reforms that tie India to globalisation. It is used by the Bihar Constable paper and by other police recruitment exams that carry a history or economy section. Questions are cause-and-effect or plain fact. So the chapter keeps one chain in view: machines and factories led to cities, cities to new problems and new laws, and trade and war to a global market with rules. All dates are historical. The 1991 material teaches the structure of the reforms; any later figure is dated, because such figures change.

Industrial Britain

Britain industrialised first, from the 1760s, because several things came together: coal and iron lay close to each other, overseas trade and colonies gave capital and markets, enclosures pushed small farmers off the land into towns, and a strong banking and patent system rewarded inventors. Before factories there was proto-industrialisation: town merchants gave raw wool or cotton to peasant households who spun and wove at home (the putting-out system), partly to escape the restrictions of town guilds. Factories gathered the work under one roof, with machines and a clock.

InventionInventorEffect
Spinning jenny (1760s)James HargreavesMany spindles at once; faster yarn
Water frame (1769)Richard ArkwrightWater-powered spinning in factories
Improved steam engine (1769 patent)James WattPower for mills, mines and transport
Power loom (1785)Edmund CartwrightWeaving by machine

Cotton textiles were the leading sector, and the railway was the next: the Stockton and Darlington line opened in 1825 and the Liverpool and Manchester line in 1830, using Stephenson's engines. Coal, iron and railways fed each other. Britain became the "workshop of the world".

⚠️ Exam trap
Watt did not invent the steam engine; he improved Newcomen's earlier engine. The jenny is Hargreaves, the water frame Arkwright, the power loom Cartwright.

Labour and Living Standards

Factory work was long, noisy and dangerous. Wages were low, hours of 12 to 16 a day were common, and women and children were hired because they were cheaper. Workers also feared machines would take jobs; in 1811-17 the Luddites smashed machines in protest. Wages rose and fell with trade, and unemployment came in slumps.

Reform came through law. The Factory Act of 1833 barred children under nine from textile mills, limited the hours of older children, and created factory inspectors. The Factories Act of 1847, the Ten Hours Act, limited the working day of women and young persons in textile mills to ten hours. Workers also formed trade unions and demanded the vote.

Worked example. If a mill worker's day falls from 15 hours to 10, the cut is 5 hours out of 15, which is 5/15 × 100 = 33.3 per cent, not 50 per cent (that would be 5 out of 10).

📖 The story
Charles Dickens described the grim mill-town in his novel Hard Times (1854), where the town is called Coketown; such writing shaped public opinion for reform.

Urbanisation and Urban Life

Factories drew migrants to towns, so cities grew faster than their services. Industrial cities such as Manchester and London had crowded tenements, dirty water and disease, especially cholera. Reforms followed: the Public Health Act of 1848, sewers, and in 1863 the world's first underground railway in London. At the end of the century Ebenezer Howard proposed the garden city, a planned town of homes, work and green space in a book published in 1898; Letchworth (1903) was the first such town built in England. Cities also created new leisure: music halls, football and, later, cinema.

Bombay is the Indian example. It was the main port for cotton exports, then the centre of the cotton mills, the western end of the first railways, and a city of migrants living in chawls. Land was reclaimed from the sea, and the Bombay Improvement Trust (1898) tried to clear crowded areas. Calcutta grew around jute and trade, Madras and Delhi more slowly.

Industrialisation in India

Under British rule Indian hand-spinners and weavers lost markets: cheap Manchester cloth entered India at low duty and raw cotton went out. Modern industry arrived in the nineteenth century. The first railway ran from Bombay to Thane on 16 April 1853. The first successful Bombay cotton mill was set up in 1854 by an Indian, Cowasji Nanabhoy Davar. Calcutta (the Hooghly banks) grew in jute, mostly under British capital. Assam had tea plantations worked by migrant labour. The Tata Iron and Steel Company was founded in 1907 by the Tata family firm under Dorabji Tata, carrying out the plan of Jamsetji Tata (who died in 1904); its town is Jamshedpur.

The Indian Factories Act of 1881 was the first law on factory work, mainly for child labour and safety. The First World War (1914-18) raised demand for Indian goods such as jute, cloth and steel and gave industry a boost, and the Swadeshi movement (from 1905) encouraged Indian-owned mills.

CentreIndustry
BombayCotton textiles
Calcutta (Hooghly)Jute
JamshedpurIron and steel
AssamTea plantations
🧠 Memory trick
Order: railway 1853, cotton mill 1854, Factories Act 1881, Tata Steel 1907, with the number rising by one from 1853 to 1854.

The Making of a Global Economy

Trade across continents is old (the Silk Route), but the nineteenth century made a world market. Food and labour moved: Britain repealed the Corn Laws in 1846, so cheap grain poured in from America and elsewhere and landowners suffered; the Irish potato famine (from 1845) pushed migration; and Indian and Chinese indentured labourers went to plantations abroad. Technology (railways, steamships, the telegraph) cut costs. Colonies supplied raw materials and bought manufactures.

The First World War broke trade links, and the Great Depression began in 1929 with the Wall Street crash in the USA. Prices and incomes fell everywhere. In India farm prices collapsed while the revenue and debts that peasants owed stayed fixed, so rural distress deepened and exports fell.

🎯 C
Cheap transport made distant markets reachable; reachable markets rewarded specialisation (cotton from India, grain from America); specialisation made countries depend on each other, so a crash in one (1929) spread to all.

The Post-War Order: IMF, World Bank, GATT and WTO

To prevent a second depression the Allies met at Bretton Woods (USA) in July 1944. The International Monetary Fund (IMF) was to keep exchange rates stable and help countries with payment problems; the World Bank (then the International Bank for Reconstruction and Development) was to finance rebuilding and development. They are the Bretton Woods twins. GATT (the General Agreement on Tariffs and Trade, 1947) lowered tariffs through rounds of talks; after the Uruguay Round it was succeeded by the World Trade Organization (WTO) on 1 January 1995, with headquarters at Geneva. India is a founding member of both the GATT and the WTO.

After 1945 the decolonised countries were called the Third World, and the rich countries and big firms (multinationals) led trade and investment. Many countries stayed protected until the late twentieth century, when more of them opened up.

⚠️ Exam trap
The IMF handles currency and payment problems; the World Bank lends for development; the WTO (not the IMF) writes the rules of trade. Both IMF and World Bank date from Bretton Woods (1944); the WTO is from 1995.

1991: India Joins the Global Economy

The chain of 1991 is a cause-and-effect lesson. Cause: a balance-of-payments crisis. A heavy fiscal deficit, an oil price shock from the Gulf War and the loss of confidence left reserves enough for only a few weeks of imports, and India pledged gold abroad to raise dollars. Response: the rupee was devalued in two steps on 1 and 3 July 1991, and the New Industrial Policy of 24 July 1991 abolished industrial licensing for most industries and opened the door to foreign investment. The government of P. V. Narasimha Rao, with Manmohan Singh as Finance Minister, led the change. Its three strands are LPG: Liberalisation (fewer licences and controls), Privatisation (a smaller role for the public sector, disinvestment) and Globalisation (links with the world through trade and investment).

Worked example (illustrative). Suppose the rate moves from Rs 20 to Rs 24 per US dollar, a devaluation of the rupee. An export priced at Rs 2,400 costs a foreign buyer 2,400/20 = $120 before and 2,400/24 = $100 after, so exports become cheaper; an import priced at $100 costs Rs 2,000 before and Rs 2,400 after, so imports become dearer.

Later steps: India became a founding member of the WTO on 1 January 1995, and the Foreign Exchange Management Act (FEMA), 1999 replaced the stricter FERA, 1973. The structure is stable; any trade, growth or reserve figure after 1991 changes every year, so learn it only with its year.

⚠️ Exam trap
Devaluation is a deliberate government decision under a fixed rate (1991); depreciation is a market fall. The 1991 crisis was a payments crisis, not a food shortage.

Key takeaways

  • Britain led from the 1760s: coal, iron, capital, enclosures and inventions (Hargreaves, Arkwright, Watt, Cartwright); cotton and railways led growth.
  • Factories brought long hours and child labour; the Factory Act 1833 and the Ten Hours Act 1847 began regulation, helped by workers' protest and public opinion.
  • Cities grew faster than services: cholera, crowding, then sewers, underground railway (1863), garden city (Howard, 1898); Bombay shows the Indian pattern with mills and chawls.
  • Indian chronology: railway 1853, Bombay cotton mill 1854, Factories Act 1881, Swadeshi 1905, Tata Steel 1907; centres Bombay cotton, Calcutta jute, Jamshedpur steel.
  • World economy: Corn Laws repealed 1846, Great Depression from 1929, Bretton Woods July 1944 (IMF and World Bank), GATT 1947, WTO 1 January 1995.
  • 1991 chain: payments crisis, devaluation (1 and 3 July), New Industrial Policy (24 July), then LPG; later figures change, so date them.

Practice questions (18)

Attempt each one before opening the answer. Every explanation names the tempting wrong option as well as the right one, because that is where marks are lost.

  1. Match the invention with its inventor.
    P. Spinning jenny;
    Q. Water frame;
    R. Power loom;
    S. Improved steam engine (1769 patent). Inventors:
    1. James Watt;
    2. Edmund Cartwright;
    3. Richard Arkwright;
    4. James Hargreaves.

    1. P-4, Q-3, R-2, S-1
    2. P-3, Q-4, R-2, S-1
    3. P-4, Q-3, R-1, S-2
    4. P-2, Q-3, R-4, S-1
    Show answer

    Answer: A — P-4, Q-3, R-2, S-1

    Hargreaves made the jenny, Arkwright the water frame, Cartwright the power loom and Watt improved the steam engine. The commonest swap is jenny and water frame between Hargreaves and Arkwright, and Watt and Cartwright are also exchanged.

  2. Which industry was the leading sector of the early Industrial Revolution in Britain?

    1. Cotton textiles
    2. Motor cars
    3. Electronics
    4. Oil refining
    Show answer

    Answer: A — Cotton textiles

    Cotton spinning and weaving, using the jenny, water frame and power loom, led growth, with railways and iron following. Motor cars, electronics and oil refining are twentieth-century industries and cannot be the early leader.

  3. How did the enclosures of common land in Britain help the growth of factories?

    1. They pushed small farmers off the land and into towns, where they became wage labour
    2. They gave every farmer larger fields and so raised his income enough to buy factory goods
    3. They forced landlords to sell their land to the government for building new factories
    4. They ended the putting-out system by banning home spinning and weaving in villages
    Show answer

    Answer: A — They pushed small farmers off the land and into towns, where they became wage labour

    Enclosure fenced common land for larger farms, leaving many small farmers and cottagers without land, so they moved to towns and supplied factory labour. The claim about larger incomes is wrong because enclosure raised the gap between big and small farmers rather than every farmer's income.

  4. Which provision belongs to the Factory Act of 1833 in Britain?

    1. Children under nine were barred from working in textile mills
    2. Every worker was guaranteed a ten-hour day in all industries
    3. All child labour below the age of fourteen was abolished
    4. Women were banned from working in all textile mills
    Show answer

    Answer: A — Children under nine were barred from working in textile mills

    The 1833 Act barred children under nine from textile mills, limited older children's hours and created inspectors. The ten-hour day is the Act of 1847 and covered women and young persons in textile mills, which makes it the tempting wrong choice.

  5. Consider these statements about labour in industrial Britain.
    P. The Luddites broke machines in 1811-17 in protest.
    Q. The Factories Act of 1847 limited the day of women and young persons in textile mills to ten hours.
    R. The Factory Act of 1833 created factory inspectors.
    S. The 1833 Act banned all night work for adult men.
    Which statements are correct?

    1. P, Q and S only
    2. Q and R only
    3. P, R and S only
    4. P, Q and R only
    Show answer

    Answer: D — P, Q and R only

    P, Q and R are correct. S is wrong because the 1833 Act restricted night work for young people and children, not adult men. The option of Q and R only is incomplete, since the Luddite risings of 1811-17 are also true.

  6. Under the putting-out system of early industrial Europe, who supplied the raw material to peasant households that spun and wove at home?

    1. Town merchants
    2. Factory inspectors
    3. Craft guilds
    4. Village moneylenders
    Show answer

    Answer: A — Town merchants

    Merchants in towns supplied wool or cotton to village households and collected the cloth. The guilds are the tempting answer because they controlled crafts in towns, but merchants turned to the countryside precisely to escape guild restrictions.

  7. Arrange in correct order, earliest first:
    P. Tata Iron and Steel Company set up;
    Q. First railway from Bombay to Thane;
    R. First successful Bombay cotton mill;
    S. Indian Factories Act.

    1. Q, R, P, S
    2. Q, R, S, P
    3. R, Q, S, P
    4. Q, S, R, P
    Show answer

    Answer: B — Q, R, S, P

    The railway came in 1853, the cotton mill in 1854, the Factories Act in 1881 and Tata Steel in 1907. The order R, Q is tempting because mills seem the older industry, but the railway (1853) came a year before the mill (1854).

  8. Match the centre with its industry.
    P. Bombay;
    Q. Calcutta (Hooghly);
    R. Jamshedpur;
    S. Assam. Industries:
    1. Tea plantations;
    2. Cotton textiles;
    3. Jute;
    4. Iron and steel.

    1. P-3, Q-2, R-4, S-1
    2. P-2, Q-3, R-1, S-4
    3. P-2, Q-3, R-4, S-1
    4. P-2, Q-4, R-3, S-1
    Show answer

    Answer: C — P-2, Q-3, R-4, S-1

    Bombay was the cotton city, Calcutta's Hooghly banks were the jute belt, Jamshedpur is the Tata steel town and Assam grew tea. The commonest slip is swapping cotton and jute between Bombay and Calcutta.

  9. Who proposed the idea of the garden city, a planned town with homes, work and green space, in a book published in 1898?

    1. Robert Owen
    2. Ebenezer Howard
    3. Charles Dickens
    4. Joseph Bazalgette
    Show answer

    Answer: B — Ebenezer Howard

    Ebenezer Howard put forward the garden city idea, and Letchworth (1903) was the first such town built in England. Dickens described industrial misery in novels, and Bazalgette is known for London's sewers, so neither proposed a planned town.

  10. In which city did the world's first underground passenger railway open in 1863?

    1. New York
    2. Paris
    3. Manchester
    4. London
    Show answer

    Answer: D — London

    The first underground passenger railway opened in London in 1863, to ease the crowding of its streets. Manchester is tempting as a great industrial city, but it did not get the first underground railway.

  11. What was the effect of Britain's repeal of the Corn Laws in 1846?

    1. Cheap grain was imported in large quantities, and British landowners lost
    2. Britain stopped importing food and grew all of its own grain
    3. Grain prices rose sharply because imports were taxed more heavily
    4. The Irish potato famine ended and Irish emigration stopped
    Show answer

    Answer: A — Cheap grain was imported in large quantities, and British landowners lost

    The Corn Laws had restricted grain imports; repealing them in 1846 let cheap American and other grain in, which lowered food prices and hurt landowners. The claim that prices rose is the reverse of what happened.

  12. Why did the Great Depression, which began in 1929, hurt Indian peasants especially badly?

    1. Farm prices fell sharply, but the revenue and debts they owed stayed fixed in money terms
    2. British traders stopped buying Indian farm produce entirely, so every port stayed shut for years
    3. The government abolished land revenue altogether, which made landlords raise rents on peasants everywhere
    4. Farm prices rose faster than industrial prices, so peasants could not afford the tools they needed
    Show answer

    Answer: A — Farm prices fell sharply, but the revenue and debts they owed stayed fixed in money terms

    Falling farm prices meant a peasant had to sell more produce to meet the same money payment of revenue and debt, so distress rose. The claim that farm prices rose is the opposite of what happened, and revenue was not abolished.

  13. Which two institutions emerged from the Bretton Woods conference of July 1944?

    1. The IMF and the World Bank
    2. The WTO and the IMF
    3. The GATT and the World Bank
    4. The UN and the WTO
    Show answer

    Answer: A — The IMF and the World Bank

    Bretton Woods created the International Monetary Fund and the World Bank. The WTO is tempting but it dates from 1 January 1995, replacing GATT, which was agreed in 1947 and is not one of the Bretton Woods institutions.

  14. By how many years does 1995, when the World Trade Organization replaced the GATT, come after 1947, the year the GATT was agreed?

    1. 38 years
    2. 48 years
    3. 50 years
    4. 51 years
    Show answer

    Answer: B — 48 years

    1995 minus 1947 equals 48 years, which is the time from the GATT of 1947 to the WTO. The figure 50 is the rounded number many remember, but the question asks for the exact difference of the years.

  15. Which sequence correctly lists the events of 1990-95 in India's reform story, earliest first?
    P. Oil price shock from the Gulf War strains the balance of payments;
    Q. The rupee is devalued in two steps in July 1991;
    R. The New Industrial Policy ends most licensing on 24 July 1991;
    S. India becomes a founding member of the WTO.

    1. P, R, Q, S
    2. Q, P, R, S
    3. P, Q, S, R
    4. P, Q, R, S
    Show answer

    Answer: D — P, Q, R, S

    The oil shock and payments strain came first, the devaluation of 1 and 3 July followed, the New Industrial Policy of 24 July came after it, and WTO membership followed in January 1995. The order with R before Q is tempting because the policy is better remembered, but the devaluation was in early July.

  16. Suppose the exchange rate moves from Rs 20 to Rs 24 per dollar. An Indian product priced at Rs 2,400 in India is sold abroad at its rupee price converted to dollars. What is its dollar price after the change?

    1. $ 120
    2. $ 100
    3. $ 96
    4. $ 80
    Show answer

    Answer: B — $ 100

    After the change the price is 2,400 divided by 24, which is $100. The figure $120 is the price before the change (2,400/20), and it is the tempting answer for those who forget the new rate.

  17. A mill worker's day is cut from 15 hours to 10 hours by law. By what percentage of the original day have the hours been cut?

    1. 50 %
    2. 30 %
    3. 33.3 %
    4. 66.7 %
    Show answer

    Answer: C — 33.3 %

    The cut is 5 hours out of the original 15, so 5/15 × 100 = 33.3 per cent. The figure 50 per cent comes from dividing by the new day of 10 hours instead of the original one.

  18. Match the LPG component with the action.
    P. Liberalisation;
    Q. Privatisation;
    R. Globalisation. Actions:
    1. Disinvestment and a smaller role for the public sector;
    2. Integration with the world through trade and investment;
    3. Fewer licences and controls on industry.

    1. P-3, Q-1, R-2
    2. P-1, Q-3, R-2
    3. P-3, Q-2, R-1
    4. P-2, Q-1, R-3
    Show answer

    Answer: A — P-3, Q-1, R-2

    Liberalisation removed licences and controls, privatisation reduced the public sector's role through disinvestment, and globalisation linked India to world trade and investment. Privatisation and liberalisation are the pair commonly swapped.