The first cotton mill was established in the year 1854 in Mumbai. Cotton industry flourished in Mumbai for several years. But now it's declined and cotton industry is being concentrated around other places like Gujarat-Vadodara industrial regions.
The main reason for the decline of cotton industry in Mumbai is extreme congestion in Mumbai and lack of space.
Moreover, Mumbai has a disadvantage of paying double freight charges, one is by bringing raw material from peninsular hinterland to Mumbai and the other is dispatching the finished products to inland consuming points in India.
Ahmedabad is situated very close to cotton growing area and hence had easy availability of raw material. And also climate here is ideal for spinning.