Before the 1950s Tibet had no modern industries. There were small handicraft centres that were owned either individually or collectively and that produced scroll paintings, metal images, wooden block prints, and religious images. For these crafts, the lag-shes-pa, or craftsmen, had to be well versed in literature and mathematics. There were also carpet weavers, tanners, potters, gold- and silversmiths, carpenters, tailors, and incense-stick makers--all of whom learned their trade through apprenticeship. Because the government rewarded outstanding artists and craftsmen with official titles, estates, and money, the arts and crafts of Tibet were well preserved.

The initial steps toward industrial development came in 1952, when an iron- and woodwork factory was opened in Lhasa. This was followed by an automobile repair shop in 1957 and a tannery in 1958.

Under the Chinese government the small hydroelectric power station at Lhasa was repaired and reinforced with three generators. A new thermal station was installed in Jih-k'a-tse. Hydrographic stations in Lhasa and elsewhere were established to determine the hydroelectric potential of the Brahmaputra, Lhasa, and Ni-yang-ch'ü rivers. An experimental geothermal power station began generating electricity in the early 1980s, with the transmitting line terminating in Lhasa. In the 1980s emphasis was placed on agricultural-processing industries and tourism.