by Sven Beckert
Another decisive factor in the rise of the Chinese cotton industry was government support. State bureaucrats believed that China needed cotton mills to withstand foreign pressures and they used their albeit limited state capacity to provide strategic support to these enterprises. Just like in Japan and elsewhere, they did so partly under pressure from ever better organized and mobilized urban economic elites. The Chinese state helped keep labor costs down by repressing workers’ collective action with a strong police or even army presence in cotton mills. During the 1920s, Shanghai mill owners, with the support of Kuomintang leader Chiang Kai-shek, went along with the murder of thousands of left-leaning labor leaders. But the state mattered in other ways as well. At times it granted monopoly rights to certain enterprises to attract capital, and on occasion the state provided what one author has called “bureaucratic capital” to enable the start up of a mill. Provincial governments promised low taxes and other supports, along with loans and even machines. But the financial means, and indeed the power, of the government was quite limited, especially after the defeat in the 1895 war against Japan, which saddled China with indemnity payments. It was only in the 1920s and 1930s, when Chinese nationalists called for a boycott of Japanese goods, and after 1929, when China regained the capacity to create tariff barriers, an ability that it had lost in 1842, that Chinese industrialists could begin to compete effectively.76
Unlike the situation in Japan, or, for that matter, other parts of the world, Chinese investments in cotton mills were rapidly combined with, and eventually superseded by, international investments. The reason for this unusual deep penetration by foreign capital was the very weakness of the Chinese state: The 1895 Treaty of Shimonoseki that ended the Sino-Japanese War, as mentioned, explicitly allowed for the establishment of foreign-owned mills in China. Two years later, the first foreign-owned mill opened, and by 1898 there were already four such mills in Shanghai. Many followed. Some of these mills drew on British and German capital and expertise, but the vast majority were of Japanese origin.
Ultimately, the Japanese cotton industry created its own low-wage production complex across the East China Sea, just as the Germans would do in Poland and the manufacturers of New England in the states of the U.S. South. The first Japanese-owned mill opened in 1902 in Shanghai, drawn by labor costs only half of what they had been in Japan. Chinese workers lacked any of the paternalist welfare benefits increasingly enjoyed by Japanese workers. Such investments made Japanese-owned mills the fastest-growing segment of the Chinese cotton industry, and by 1925 nearly half of Chinese spinning capacity was foreign-owned, overwhelmingly by the Japanese.77
Considering the importance of states to industrial capitalism’s political economy, and the onslaught of an ever larger number of imperial powers such as the United States and Germany, it is not surprising that economic elites throughout the global South aspired to forge such states as well. European and North American statesmen and capitalists resisted them in this project, however, and in turn became even more dependent on their respective states, states strengthened by the colonial project and whose tasks now included containing ever more vibrant anticolonial movements. The ensuing struggle was fierce and violent, creating for budding manufacturers in the global South conditions fundamentally different from the ones their counterparts had faced a hundred years earlier in western Europe and the United States. Because their opponents—mighty North Atlantic states tightly linked to wealthy capitalists—were so powerful, the new entrepreneurs were forced to build coalitions with increasingly mobilized and nationalized groups of workers and peasants within their own societies. As they were unable to fight on both foreign and popular fronts, their dependence on subordinate social groups in the process of state making distinguished their trajectory toward industrialization from Europe’s or North America’s. The legacy of colonialism would remain a powerful influence long after independence even while decolonialization became perhaps the single most significant event in the history of twentieth-century capitalism.
Ownership of spindles in Chinese cotton production, 1900–1936 (illustration credit 13.10)
As capital-rich merchants and bankers along with their rulers in the global South worked to create conditions conducive to cotton industrialization, and industrialization more broadly, they developed a devastating critique of colonialism. Entrepreneurs in Shanghai, Mahalla al-Kubra, Ahmedabad, and elsewhere saw the urgent need for a state responsive to their interests—a goal that brought them into open opposition to foreign powers.78 Indian cotton capitalists were among the most eloquent, as they vocally accused the colonial state of being beholden to the interests of Lancashire. British colonialism, they argued, had failed to allow Indian capitalists the benefit of protected markets, as the tariff policy of the colonial government was guided by the principle of allowing for the massive importation of English yarn and cloth.
In response to such discrimination, Indian capitalists mobilized politically. In Bombay, they formed the Millowners’ Association to articulate their demands. Ahmedabad’s Gujarati counterparts followed suit and organized the Gujarat Industrial Association, advocating for protectionism. One of their first struggles began in the 1890s against the excise tax that they were forced to pay on their products to make up for modest import duties, a tax they found to be “not fair on any principle”—“an altogether unnecessary and indefensible sop to Lancashire.” This struggle carried into the new century, with mill owner and activist Ambalal Sakarlal Desai complaining at the Indian National Congress meeting in Ahmedabad in 1902 that the “heavy duties imposed on the textile industry are unjustly borne by every householder of Ahmedabad.”79
In this conflict, the mill owners encountered Indian nationalists, who focused a significant share of their agitation on the ill effects of British colonialism on Indian cotton industrialization. The Mahratta, published in Poona by militant nationalist Bal Gangadhar Tilak, consistently expressed opposition to colonial tariff policies. It favored mass protests against the cotton duties bill and accused the colonial government of “sacrificing” India for Lancashire through the “cotton duties crime.” A year later, the colonial government sent Tilak to jail for sedition. Even Gopal Krishna Gokhale, founder of the Servants of India Society and a leader of the Indian National Congress, who could not agree on much with Tilak, was opposed to the tariff policies of the British in regard to cotton. When the Imperial Legislative Council was enlarged in India in 1911, mill owner Ratanji Dadabhoy Tata demanded abolition of the excise duties, supported by fifteen of the sixteen Indian members. For freedom fighter Mahatma Gandhi, these duties were “an instance of fiscal injustice…unparalleled in any civilized country of modern times.” Indeed, the struggle over the excise duty on cotton goods was one of the first great flare-ups of the anticolonial struggle, as the political interests of cotton manufacturers became important to Indian anticolonialism more broadly.80
Narottam Morarjee, cotton manufacturer and chairman of the Bombay Millowners’ Association, 1894
Cotton capitalists not only sought relief from excise taxes and protection; they also wanted the state to be more supportive in their efforts to capture export markets. Indian mill owners, like their British counterparts, recognized the promise of distant markets—in Africa, for example—and went so far as to produce cloth specifically designed for the tastes of East Africans. But they bemoaned that “there really exists no official organization for the supply to Indian merchants and manufacturers of the trade intelligence so indispensable to their enterprise which the Foreign Office and the Board of Trade purvey to the British trader.” Such market information, gathered by governments, had become increasingly important to manufacturers. To access foreign markets they needed the support of the state, support that the colonial government, unlike, for example, the contemporary Japanese government, was not likely to provide.81
One of the strategies that Indian nationalists increasingly advocated in opposition to the British presence in India was to encoura
ge consumption of domestically manufactured textiles. The first Indian Industrial Conference meeting in 1905, bringing together industrialists from all over India, decided to “foster and extend the use of such manufactures in India in preference to foreign goods.” That demand intersected with the emerging Swadeshi movement, which advocated Indian self-sufficiency, especially in cottons, and symbolized the confluence of cotton entrepreneurs and the emerging nationalist political elites. Tilak was “glad to find that associations and leagues have been formed in various places to advocate the necessity of using native cloth and thus ousting Lancashire and Manchester from the Indian market,” and the increasingly influential Indian National Congress, founded in 1885, supported the Swadeshi movement. Indian entrepreneurs agreed: Ahmedabad textile pioneer Ranchhodlal Chhotalal, along with others, created the Swadeshi Udhyam Vardhak Mandli (Organization for the Promotion of Indigenous Industry); Jamshetji Nusserwanji Tata named one of his mills the Swadeshi Mill; and Ambalal Sakarlal Desai, of the Ahmedabad Merchants Spinning Company, strongly supported Swadeshi. As the Chairman of the Bombay Millowners’ Association, Vithaldas Damodar Thackersey remarked at the annual meeting in 1907, he was “glad to see…the increased interest which the public take in indigenous industries under the impulse of the Swadeshi movement.” Hopes ran high that domestic industrialization would restore India’s former importance to the global economy. Symbolizing the great significance of cotton to nationalism and anticolonialism, a few years later Gandhi not only wrote a history of cotton in India, but also publicly spun cotton on a spinning wheel, the same mechanism that the Indian National Congress chose in 1930 as the centerpiece for its flag.82
Gandhi was nostalgic about homespun cotton, but Indian industrialists had a realpolitik appreciation of decolonialization. They agreed with Gandhi that the radical spatial recasting of the global cotton industry in the nineteenth century was one of the most damaging effects of colonialism—but they also had a significant interest in furthering the colonial project of turning rural cotton spinners and weavers into the producers and consumers of commodities, with Sir Purshotamdas Thakurdas, mill owner and president of the East India Cotton Association, urging in 1919 that “measures must be taken to protect the quality of Indian cotton.” Indian mill owners fought just as strenuously for recasting the Indian countryside as their British counterparts had done. Tata himself suggested that longer-staple cotton be grown in India in order to enable domestic manufacturers. When a group of Surat cotton merchants met in April 1919 they discussed measures to maintain the quality of local cottons. And Purshotamdas Thakurdas saw an urgent need to improve Indian cotton, as otherwise it would “militate considerably against the Weaving Industry of India.” Indian capitalists now became deeply immersed in questions of cotton supply: Vithaldas Damodar Thackersey of the Bombay Millowners’ Association demanded government support for the cultivation of long-staple cottons to “revolutionize the whole industry.” By 1910, the association went so far as to laud the efforts of the British Cotton Growing Association to improve cotton growing in India: “We cannot but deplore the absence of legislation against the adulteration of cotton in this country.”83 Eventually, cotton nationalism did not lead to a return to the preindustrial world of cotton symbolized by Gandhi’s spinning wheel, but instead to a massive wave of state-sponsored industrialization that radically recast the empire of cotton once more, drawing millions of displaced rural cultivators into cotton factories, to work for wages only a fraction of the ones paid in Lancashire, in Lowell, or in the valleys of the Black Forest.84
Protest in the empire of cotton: flag of the Indian National Congress and Gandhi spinning at home (illustration credit 13.11)
More so than perhaps anywhere else in the world, cotton and nationalism became intertwined in India. Textile industrialists became supporters of the independence movement, and its leaders in turn made domestic cotton industrialization a prime goal. As Gandhi, who enjoyed close connections to Ahmedabad’s mill owners, put it in 1930, “The cotton textile industry is a valuable national asset giving employment to a large number of people, effecting the prosperity of the people of India, and its safety and progress must continue to receive attention of her capitalists, labour leaders, politicians and economists.” For many Indian nationalists, independence would, among other things, make possible the development of a home market and import-substitution industrialization—the “reconstruction of her entire political and economic life,” according to a 1934 book by scholar and engineer Mokshagundam Visvesvaraya. Creating a state conducive to domestic industrialization threw Indian cotton industrialists, like their Egyptian, Chinese, and eventually African and Southeast Asian counterparts, into skirmishes with the colonial state, as a global social conflict came to focus increasingly on the control of the state.85
Postcolonial state building: Prime Minister Pandit Jawaharlal Nehru being received by cotton mill owner Purshotamdas Thakurdas (with cane), industrialist Naval Tata, Maharashtra governor Sri Prakasa (second right), and Maharashtra chief minister Y. B. Chavan at the office of the Indian Merchants Chamber in Bombay on February 3, 1958 (illustration credit 13.12)
Despite unprecedented differences in wealth as well as state strength, and despite a thick bulwark of racism that pinned much of humanity to subordinate roles, the struggle to break out of the imperial system succeeded, across the globe, by the second half of the twentieth century. Sometimes small victories came even before the great wave of decolonialization, such as in India, when tariffs began to protect the Indian industry against Japanese competition, and when the hated excise duty was repealed in 1926.86 Such victories—and even more so decolonialization itself—came not as a result of the political strength of global South capitalists alone, but because nationalist movements were able to draw on large numbers of newly mobilized peasants and workers. Indeed, decolonialization almost always rested on mass mobilization, and thus the construction of nation-states in the formerly colonial world looked drastically different from their constitution in Europe and North America a century and a half earlier.
Capitalists’ dependence on workers and peasants in their struggle to create a state conducive to the interests of national capital, however, weakened those same capitalists in the long run. Not surprisingly, global South cotton capitalists remained quite ambivalent about popular anticolonial mobilizations. Indeed, at times fear drove them into the arms of the colonizing power. In Korea, the Japanese colonialists observed in 1919 that “wealthy Koreans have recently grown extremely fearful of the radicalization of popular sentiment.” Indian industrialists were generally on the moderate side of agitation as well, not least because they feared the militancy of their workers; “the truculence of the mill-hands needs to be checkmated in time,” said the Bombay Millowners’ Association, reporting after a round of rioting in 1909 that they “have lost their hold over them.” Industrialist Ratanji Tata supported the Servants of India Society for similar reasons, embracing the nationalist call for a program of “industrial development of the country,” but also hoping that the society would retain its moderate positions. Manufacturer Purshotamdas Thakurdas pushed strongly against Gandhi and the non-cooperation movement, and tried to draw on the support of Indian capitalists for his position. The need to forge a state dedicated to the interests of national capital, in a colonial setting such as India, in effect brought national capitalists into an uneasy alliance with politically mobilizing workers and peasants. In the wake of the depression of 1929, Indian industrialists saw little alternative but to hitch their political fortunes to a Congress Party whose mass base increasingly was to be found among India’s peasants. When they started planning for a postindependence economy, they acknowledged in the 1944 Bombay Plan the centrality of government planning, with a “supreme economic council” coordinating most sectors of the economy—laying the groundwork for India’s first five-year plan in 1950. Five-year plans of the kind that spread from Russia to China to India had decisively not been on the minds of Lancashire
, Alsatian, or New England manufacturers a century earlier.87
Throughout the global South, indeed, cotton workers played key roles in the struggles for national independence, in addition to joining unions and engaging in vast strike movements. Social and national struggles merged more often than not. Some of the twenty-five thousand workers at Egypt’s huge Misr Spinning and Weaving Company in Mahalla al-Kubra, for example, played a key role in the struggle for Egyptian independence. There and elsewhere, tens of thousands of cotton workers went on strike in 1946 and 1947 to demand better conditions of employment—and the removal of British troops from Egypt.88
Chinese textile workers mobilized just as much, and—eventually—would come to play an important role in the struggle against Western powers, and in the 1949 revolution. They struck frequently, 209 times between 1918 and 1929. When workers walked out of the Japanese-owned Naigai Wata Kaisha mill in May 1925, they provoked “the famous May 30 incident,” a day of rallies culminating in the killing of thirteen Chinese protesters by the police. This incident fueled a wave of popular discontent and the growth of Chinese trade unionism. Cotton workers at times also joined the Communist Party and took on an important role in the revolutionary struggle between 1946 and 1949.89
