By the first decade of the 20th Century, a series of changes affected the pattern of industrialisation.
(i) As the Swadeshi Movement gathered momentum in India, the nationalists mobilised people to boycott foreign cloth and other goods. Industrial groups organised themselves to protect their collective interests pressurising the government to increase tariff protection and grant other concessions.
(ii) From 1906, export of Indianyarn to China declined. So Indian industrialists shifted their interest from yarn to cloth production leading to considerable production of cotton piece goods.
(iii) The beginning of First World War created a new situation. Since British mills were busy in producing war materials to meet their own war needs, export of goods to India declined. This gave an opportunity to Indian industries to thrive. Indian mills now had a vast home market to supply.
(iv) As the war continued, Indian factories were called upon to supply war needs, such as jute bags, cloth for army uniform, tents, leather boots, horse and mule saddles, etc. New factories were set up and old factories ran double shift.
(v) After the war, industries in Britain got a severe setback. In India however local industrialists gradually consolidated their position substituting foreign manufactures and capturing home market. Handicraft production also expanded in the 20th century.