Through the ages...

Excerpts and photographs from the book

The beginning

Early one day in July 1639, an Englishman surveyed a sandy strip along the Coromandel Coast. What he saw, a piece of land rounded by rivers on two sides and washed by the sea on the third, might not have looked promising, but to Francis Day, it appeared the perfect site. He could not have known it then, but this would in time become Madras.

Day had boasted that Madras was the place for “excellent long Cloath and better cheaper by 20 per cent than anywhere else.” Whether this was true or not, it began life as a weaver's settlement as the English began encouraging those involved in the textile trade to settle around the Fort. Soon a bustling native town sprang up and this became the Black Town in contrast to the Fort where the English lived, which in turn became the White Town.

Free Trade

Begun in 1788, Parry Firm was initially in to trading of piece goods (cloth) and banking. Later, it also expanded into trading of Madeira wine, administration of estates for absentee landlords, booking of tickets on ships bound for England, selling of newly published books, discounting Navy bills and sale of Bengal lottery tickets. It was not a life of untrammelled growth however, and for a while when the going was sticky, Parry lay low and became a Captain in the household of Nawab of Arcot.

While Parry was in Nawab's service, another young man landed in Madras. This was John Binny, who came from a family that already had powerful link to the city. John Binny suddenly transformed in to Dr John Binny and became surgeon to Nawab Umdat-Ul-Umrah's household, though as a biographer put it, we have no knowledge as to “who his patients were, whether he killed or cured, or conducted even a single operation.”

The free merchants were a colourful lot. For most free merchants, Englishwomen being in short supply and the idea of going back home to marry farfetched, they formed liaisons with Indian mistresses, often termed Bibis.

Taxing taxes

Those who complain of taxation today ought to study the Coimbatore district in the 1830s. It has 35 different taxes levied on its people. There were taxes on potters, on those wearing the ‘namam', ‘vibhuti' and other sacred marks, weekly market, dye stuffs, ghee, tobacco, heaps of grains, ‘chunam', tailaries, nirgantis, pack-bullock keepers, dancing girls, labour ‘maistries', women committing adultery (how this was assessed was a mystery), lotus leaves, gardens in backyards and plantations on riverbanks…. Retail trade

Retail trade was thriving in Madras as far back as 1840s. By 1856, the big names in trade came together as the Madras Trades Association, later to become the Madras Chamber. Among the earliest in retail trade were Oakes & Co. established in 1843. In later years, Oakes was taken over by another retail giant and a name that still lives – Spencers. At the other end of the spectrum were P Orr & Sons (1849) which were in to watches, precious stones, silver, clocks and scientific instruments catering to the Europeans, Indian royalty and landed gentry.

Port city

Madras' emergence as a trading hub could not have been possible without its harbour. The chamber had a big role to play in building it, claims the book. The docking of ships at Madras was made difficult by the rough seas closer to the coastline, forcing traders to rely on a renegade band of small boatmen. Finally, after much persuasion and inputs from many engineers of the time, a proposal was mooted to construct two piers that ran 1200 yards into the sea, which would in turn be enclosed by yet another pier parallel to the coast. It was in 1886 that the government passed the Madras Harbour Act. Kerosene, which was retailed through the Spencer's was one of the first ‘luxury' imports through this harbour, eventually leading to the Royal Dutch Shell and Burmah Oil company entering the city.

The first central bank

In 1913, a Royal Commission on Indian Finance and Currency was set up and at a very early stage, it was felt by its members that India needed a Central or State bank. Two of the Commission's members, Sir Ernest (later Lord) Cable and John Maynard (later Lord) Keynes, the eminent economist, were asked to study this issue. Keynes came up with a comprehensive scheme for what he called the Imperial Bank of India. He envisaged this to be formed by the merger of the three Presidency Banks. Its functions according to him would be issue of notes, management of India's public debt, effecting remittance for the Secretary of State through the London office and acceptance of payments and making disbursements on behalf of the Government.

The world of finance

The years of the Great Depression saw the fall of European business houses and, therefore, the chamber was somewhat diffident when it came to new investments. But Indians began getting into the financial business in large numbers. Vijaya Bank, Federal Bank, Parur Central Bank and Vysya Bank were all founded in the early 1930s. In 1934, Kallidaikurichi-based SNN Sankaralinga Iyer founded the Indo-Commercial Bank. Two young clerks in the bank were TS Narayanaswami and the founder's son - KS Narayanan. Together the two would go on to found India Cements and Chemplast. The Indian Overseas Bank was set up by M Ct Chidambaram Chettyar in 1936. In 1937, the Madras Stock Exchange was set up, an earlier attempt in 1920 having failed. In its new avatar the MSE had five firms registered as brokers and 84 companies listed on the exchange. Significantly, there were three Indian-managed broking firms too - Kothari & Sons, Dalal & Co and India Brokers.

The Chamber on nationalisation

The Industries (Development and Regulation) Act of 1951 reserved for the Government the power to grant licences for the manufacture of practically every item possible. The production capacity of each enterprise would also be regulated by the Government. To the chamber and its members, who were largely used to a system of laissez-faire, all this was new and most uncomfortable. The chamber felt that the legislation as a whole was “dangerous to the industry.” Its main objection concerned the power vested with the Government to take over any industry. There was no mention of compensation for mismanagement by the Government, of industries taken over by them. The Government paid no heed and the Bill went on to become an Act. Two years later, it was up for revision and this time the Government did not even make a show of circulating it among Chambers of Commerce for their opinion.

The new entrepreneurs

The automotive industry was in the ascendant in Madras right through the 1950s and 1960s. A whole host of newcomers to industry joined the Chamber, several of them with British collaboration. Among the early entrants were the constituent units of the TVS Group. Beginning with bus transport, TV Sundaram Iyengar & Sons had in the 1930s moved into selling and servicing of vehicles and retailing of spares.

Cement and chemicals were also businesses which were being taken up in right earnest during the 1960s by Indian entrepreneurs. The Chettinad Cement Corporation was incorporated in 1962 by the family of Raja Sir MA Muthiah Chettiar, for long a member of the Chamber in his individual capacity. An earlier venture was India Cements, set up in 1946; it commenced manufacture in 1949 at its first factory in Tirunelveli District in 1949. The promoters of the company later ventured into chemicals and plastics, setting up in 1962, Chemicals and Plastics India Ltd (now Chemplast and part of the Sanmar Group) in collaboration with BF Goodrich of the USA. Another entrant was MRF Ltd. That began as a toy-balloon manufacturing unit in 1946. . !

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