150 years of BSE: 1929 tariff-led boom ends with global market crash

The second of a three-part series on booms and busts looks at a period when protectionism prepared the soil for a bull market in the 1920s, which was eventually ended by the Great Depression

The British government moved towards encouraging Indian industries in the early 1920s by making imports more expensive. It began with a 15-25 per cent tariff for protecting India’s nascent iron and steel industry. The boom in post-war profits for many industrial groups provided the base capital for expansion. All of this prepared the soil for a rally in the stock market. 

Textile, steel, coal and jute companies soared. Tata Steel (ordinary) was up from ₹8 in 1924-25 to ₹88 by 1929 — a ten-bagger, decades before legendary fund-manger Peter Lynch popularised the term. This period of unprecedented