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The East India Company - Working to Rule

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It's not often you come across a business that has prospered for over 250 years. Still rarer is it to find one that has ruled a subcontinent!

The East India Company is the only such beast. It grew from a group of intrepid investors and traders to become the guiding hand behind the polishing of the 'jewel' of the British Empire. The Company was formed, perhaps fittingly, on New Year's Day of 1601 and given English monopoly on all trade with the East Indies. Their stated intention was, in their charter's sonorous terms:

... that they, of their own Adventures, costs and charges as well as for the honour of this, our realm of England as for the increase of our navigation and advancement of trade of merchandise... might adventure and set forth one or more voyage with convenient number of Ships and Pinnaces, by way of traffic and merchandise to the East Indies...

A Passage to India

At this point in history, traders dealing with the East were still caught between a rock and a hard place. The safest way was, of course, overland. But the Venetians, among others, monopolised the caravan trade routes. The marine route was far more treacherous, requiring navigation of the perilous waters of the African horn, known for centuries by fearful sailors as the Cape of Storms.

First Steps

The first of the Company's vessels landed in India at Surat in 1608. There, Sir Thomas Roe, as James I's official representative to the Moghul Empire, established a 'factory' in 1615. The term 'factory' is, perhaps, misleading as, in a 17th Century context, it was not a manufacturing base but basically a warehouse, built to store goods for ships to pick up.

The English, however, were not alone. Those indefatigable explorers, the Portuguese, were already well established, not only in India – they had a major centre in Goa – but also in the court of the Emperor (at this time, Jahangir Khan).

The result was a great deal of conflict, particular with sour diplomatic relations existing between England and Spain (of which Portugal was a an ally until 1640). This included a major sea battle off the east coast of India in which the Portuguese were roundly defeated – showing, for the first time, that the English could fight.

From humble beginnings then, the Company – and the English in India – grew explosively. By the turn of the century, three sizeable 'presidencies' had been established at Calcutta, Bombay and Madras. Around these nuclei, the English clustered in a number of thriving communities. In 1717, the company achieved its most notable coup to date in securing an exemption from custom duties in the state of Bengal.

Trading Places

Then came the titanic shift from trading to ruling empire. The Battle of Plassey in 1757 saw one of the Company's most gifted servants, Robert Clive, defeat the superior force of the Anglophobic Nawab of Bengal thus, in effect, becoming Nawab himself.

This was later followed by the granting of revenue-collection rights in the state. The grant proved to be something of a mixed blessing. Initially, the state was pillaged to the point of destitution and famine by the ferocious greed of many employees. As a result of the famine - for which the English were largely held responsible - as many as a third of the populace lost their lives through starvation. This, naturally, not only lessened trade but also increased hostility, requiring constant military alertness.

Faced with ruinous expenses, the Company required a parliamentary injection of cash to keep it afloat but, as with all such things, there were strings attached. The Regulating Act of 1773 gave Parliament increased control over Company affairs and instituted the office of Governor-General.

Apex of Empire

From here, things proceeded apace. From the investiture of Warren Hastings as the first governor-general in 1784, through the ruthless self-aggrandisement of Arthur Wellesley (later the Duke of Wellington) and culminating in the Mutiny of 1858, the English wiped out all opposition and annexed territories until they were masters of all India.

The Mutiny, caused by exactly the acts just mentioned, resulted in the dissolution of the company; its massive holding becoming a Crown responsibility. The Governor-General became the Viceroy, second in power and stature only to the Secretary of State for India and in 1877, Queen Victoria became Empress of India.


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