The paper seeks to refute the popular view that the growth of the Indian cotton textile industry was a case of "adaptive innovation." Asserting that the distinction between "creative innovation" and "adaptive innovation" is, conceptually, meaningless, the author contends that in the case of the Indian industry, the early pioneers experimented with forms of ownership and management which were distinctly different from those in vogue in Lancashire mills. Also, though the Indians depended on England for technology to a large extent, they kept their minds open to technological devices invented in other countries-devices which were yet to become popular in Lancashire. The Indian entrepreneurs also developed their own methods to raise working capital and dealing with labour problems. The system of long term deposits and granting a small share of the agency commission to the depositors was a distinct improvement over the Lancashire practices; the Ahmedabad experiment in setting up a permanent machinery to settle labour problems peacefully was unique in many ways. The author, therefore, concludes that the Indians innovated in the areas in which it was possible for them to innovate, and this should not be lost sight of while assessing the innovative ability of the early Indian pioneers. Technology, after all, is not the only index of the innovative capacity of a community.
