What governs state interests in development in formerly colonised societies? Conventional social science accounts stress politico-economic variables, particularly the need for capital accumulation. By means of a detailed analysis of the Bhadravati Iron Works, an ambitious industrial project in the state of Mysore in colonial India, it is demonstrated that mechanisms are also important in state-led development. Locational disadvantages, technical problems, and increased production costs made the iron plant an unprofitable venture from its inception. The state, however, kept the plant operational on grounds of its pedagogic value for local society. A claim for civilisational recognition for India’s capacity for development, which was expressed from within the conceptual parameters of mercantilist, social evolutionist and orientalist thought, provides the cultural logic of the developmental state in Mysore.