Although the European part of the Russian Empire was rich in raw materials its industrialisation started late, due mainly to the lack of labour and capital caused by centuries of extreme exploitation of the serfs and the nobility’s lack of interest in innovative economic projects. Thus, the task of developing the economy fell solely to the state.
Czar Peter the Great initiated the first wave of industrialisation in the early 18th century, with the aim of strengthening his empire militarily. Shipyards and factories were established in St. Petersburg and the mining of copper and iron ores in the Ural Mountains, which were smelted using charcoal produced in local forests. The city of Yekaterinburg was founded in 1723 with the construction of a massive ironworks. In Ishevsk in the western Urals, the ironworks led to the establishment of an arms factory that is still in operation today, and also in Tula, near Moscow, the Czar established a tradition of armament manufacture. Textile manufacturing flourished as well. Flax production prosperedin Ivanovo, later known as “Russia’s Manchester”, the first cotton spinning machine went into operation in Shlisselburg at the end of the century, and 1805 saw the commissioning of the first steam engine in St. Petersburg.
On the other hand, the boom in iron production trailed off in the mid-19th century, and the government attempted to stimulate the economy by building railways. The line from St. Petersburg to the Summer Palace in Zarskoye Selo opened for demonstration purposes in 1837 and was followed by a link between Warsaw, at that time under Russian rule, and the Austro-Hungarian border. From 1851 trains ran between St. Petersburg and Moscow. These lines were financed primarily with foreign capital and as the domestic iron industry was unable to meet the demand for rails, locomotives and wagons, these had to be imported.
Alexander II finally eliminated serfdom in 1861, but this did not result in economic growth because the peasants remained dependent on the noble landowners, and in the mines of the Urals, which were worked by serfs, iron production even declined. However, the expanding rail network helped to significantly increase grain exports via the ports of the Baltic and Black Seas. The government now began to channel funding into heavy industry, production of hard coal increased, as did iron and steel production, and towards the end of the 19th century the Russian Empire experienced the first phase of industrialisation. However, workers’ living conditions were often even more basic than under early capitalism in the West.
In this initial period of growth, the government succeeded in stabilising the rouble with the aid of import tariffs and by attracting foreign investment. Construction of the Trans-Siberian Railway commenced in 1892 – primarily for strategic reasons – and was completed in 1916. St. Petersburg developed into a centre for machinery manufacturing, while the textile industry in particular flourished in Moscow. Yet outside of these two rapidly growing metropolises, Russia was still an agrarian country when the Bolsheviks seized power in 1918.
From 1929, Stalin started to replace Lenin’s experiment of the liberal “New Economic Policy” in favour of one of uncompromising industrialisation. Steelmaking and coal mining – in the formerly soviet Ukraine and in Siberia – quadrupled. In the southern Urals, Magnitogorsk, the first of numerous “test-tube” cities, was established in 1932. Europe’s largest agricultural-machinery complex was erected in record time in Rostov on Don, production commenced in the Stalingrad (today Volgograd) tractor works in the mid-1930s, and in Gorki (today Nishni Novgorod) the automotive plant GAZ churned out cars and trucks. One of the world’s most innovative aircraft manufacturers grew out of the Moscow office of the designer Andrei Nikolajevitsch Tupolev. Also in Moscow, the Alexandrov Radio Works commenced operation in 1932, and began the mass production of televisions following World War II. New power stations delivered electricity, new canals and railways facilitated transportation, and the economic development of Siberia continued to advance. However, this rapid advancement through the ranks of the great industrial nations came at the price of flagrant neglect of agriculture, dramatic shortages of consumer goods, and the constant fear of the ruthless power of the state.
Perm. Egoshihinsky Copper Mill