From British Raj to Global Powerhouse 2026

Minhaj Merchant, Author, Publisher and Editor

In the 18th century, India accounted for about 25% of the global economy. The textile industry was the central pillar of its prosperity. Indian cotton dominated the entire world. Cotton textiles were exported to the markets of Europe, America and Asia. Then the British came.

They established trading ports and built small factories in Surat. After 1757, when Robert Clive defeated Siraj-ud-Daula, the Nawab of Bengal, at the Battle of Plassey, the British established control over India’s textile industry. Within a few years the cotton trade began to collapse.

The British had long been concerned about the popularity of cotton textiles. The UK did not exist as a country until 1700. At that time England and Scotland were two independent states, which had their own separate laws. It was only in 1707 that both of them united and became the United Kingdom. Much before that, England had passed the Calico Act (1700).

Under this law, the import of printed or dyed cotton textiles coming from India was banned. These clothes had become so popular in England that the British textile industry was suffering huge losses. After gaining control of Bengal in 1757, the British began to gradually deindustrialize India, starting with India’s booming textile industry.

Britain imposed more than 70 percent duty on exports from India. This situation is somewhat reminiscent of Trump’s tariffs. But America itself was a colony of Britain about 300 years ago. Britain used its old American colony to exploit its new Indian colony.

Duty-free imports into India from cotton grown in the southern part of the United States pushed agriculture towards the production of only raw cotton. At the same time, ready-made garments manufactured in British factories started coming to India in large quantities. East India Company reduced the import duty to zero. Indian weavers lagged behind the competition and went bankrupt.

Britain’s Industrial Revolution gained momentum in the 1760s on the strength of cheap raw materials obtained from its Indian colonies. Tax revenue collected from Indian farmers, landowners and workers financed the development of new machines in England. The Industrial Revolution also strengthened the expansion of the British Empire. Exactly the opposite happened in India. Jobs started ending. Surat, Dhaka and Murshidabad, the traditional centers of the textile industry, fell victim to hardships, population decline and periodic famines, resulting in the deaths of millions of people.

Now let’s come to 2026. Nearly 79 years after the end of British colonial rule, the situation has completely reversed. India is once again among the world’s leading textile and apparel manufacturers. The Indian textile market now represents sales of over $250 billion (Rs 24 lakh crore).

India is also once again the world’s largest cotton and jute producer, with a global market share of 35 percent. The cotton industry directly employs more than 4.5 crore people and indirectly employs about 10 crore others.

After being freed from the colonial shackles, the Indian textiles sector appears to be an emerging defining industry in the coming years. Free trade agreements with the EU and UK could provide a new impetus to exports, as tariffs could be reduced to almost zero – a reversal of the situation in previous centuries.

But despite India’s progress as a textiles-powerhouse, it still lags behind in textile exports. China is the world’s largest textile exporter with over $300 billion. Then there are Bangladesh ($49 billion), Vietnam ($42 billion), Turkey ($39 billion) and India ($38 billion).

The government’s Production-Linked Incentive (PLI) scheme has helped domestic producers. Currently the world’s fifth largest textile exporter, India has reached a position where, with appropriate policies, it can emerge as the world’s second largest textile exporter after China by 2030. After three hundred years, the tide of textile industry once again seems to be turning in favor of India.

The British Raj had destroyed India’s textile industry, but today we have again become the world’s largest cotton and jute producer. The cotton industry provides employment to crores of people. But we can do better than this. (These are the author’s own views)

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