Book Excerpt: Of ‘King Cotton’ and Vidarbha

A vintage photo showing cotton picking in the US Deep South. Credit: iStock

As if the American Civil War was not disruptive enough for global cotton supply chains, the ‘Cotton Famine’ or ‘Cotton Panic’ that was associated with the depressed textile industry of Lancashire was critical in the history of cotton. How the ‘Cotton Famine’ affected capitalist production systems and the livelihood of workers of the cotton manufacturing industry is an artefact of the susceptibility of the cotton economy to economic forces of demand, supply, and speculation. How the path dependencies in the cotton economy crossed the paths of Vidarbha, Britain, and the American South is a fascinating story.

Since 1850 there had been a surge in cotton manufacturing in England as thousands of mills sprung up in Lancashire and its vicinity. However, there were concerns about the viability of the Lancashire mills because the price of finished cloth was depressed due to the glut from overproduction. In 1860, over 1 billion pounds of raw cotton were imported and nearly 3 billion yards of cotton cloth along with about 200 million pounds of twist and yarn were exported.

As the Civil War erupted, there was a fall in American demand for printed imports produced by these mills. At the same time, there was severe negative supply shock as raw cotton exports from the South were disrupted. To make matters worse for Lancashire, apprehending supply shortages from political upheavals in the American South, there was large-scale speculative storage of baled cotton in the entrepôts. Speculation was rife as merchants in entrepôts hoarded cotton and prices of finished goods slumped. These developments resulted in very high prices of raw cotton, which in the face of the glut implied a reduction in production. As production fell, the employment of mill workers in Lancashire was grievously affected. By the later part of 1862, a ‘cotton panic’ or ‘cotton famine’ ensued. In response, public relief and welfare schemes were implemented to support the impoverished, and since 1864 the imports of raw cotton reverted to earlier high levels. It was in this chaotic setting that India emerged as a major supplier of cotton to Lancashire.

Beyond doubt, the Civil War had far-reaching consequences on the American South as well as other parts of the world including India that substituted for the American supply of raw cotton. The shift induced technology developments that augmented Indian cotton. It also created an environment in which the state increasingly played an important role along with traders, merchants and textile manufacturers. In what follows, we use this backdrop to describe the evolution of Vidarbha’s cotton economy.

Within a decade of the end of the Civil War, the United States regained its position as the leading exporter of cotton. Consequently, the fortunes of those who experienced a windfall during the Civil War period reversed. Indeed, the Civil War stimulated the cotton economy, but by that time farmers of the region had already been introduced to high-value cash crop production—one that offered prospects of high returns albeit with the risk of considerable adverse possibilities. The region was however by no means alien to cotton-growing or international trade in raw cotton. In what follows, we describe the factors that made Vidarbha conducive to cotton cultivation and the familiarity of the region with cotton before its colonial takeover.

Excerpted with permission from Accidental Gamblers: Risk and Vulnerability in Vidarbha Cotton by Sarthak Gaurav and Thiagu Ranganathan @2022 Cambridge University Press