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Expansion and Consolidation of Colonial Power

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Expansion and Consolidation of Colonial Power Expansion and Consolidation of Colonial Power Subject: History Unit: Expansion and Consolidation of Colonial Power Lesson: Expansion and Consolidation of Colonial Power Lesson Developer : Prof. Lakshmi Subramanian College/Department : Professor, Centre for Studies in Social Sciences, Kolkata Institute of Lifelong Learning, University of Delhi Expansion and Consolidation of Colonial Power Table of contents Chapter 2: Expansion and consolidation of colonial power • 2.1: Expansion and consolidation of colonial power • Summary • Exercises • Glossary • Further readings Institute of Lifelong Learning, University of Delhi Expansion and Consolidation of Colonial Power 2.1: Expansion and consolidation of colonial power Introduction The second half of the 18th century saw the formal induction of the English East India Company as a power in the Indian political system. The battle of Plassey (1757) followed by that of Buxar (1764) gave the Company access to the revenues of the subas of Bengal, Bihar and Orissa and a subsequent edge in the contest for paramountcy in Hindustan. Control over revenues resulted in a gradual shift in the orientation of the Company’s agenda – from commerce to land revenue – with important consequences. This chapter will trace the development of the Company’s rise to power in Bengal, the articulation of commercial policies in the context of Mercantilism that developed as an informing ideology in Europe and that found limited application in India by some of the Company’s officials. This found expression until the 1750’s in the form of trade privileges, differential customs payments and fortifications of Company settlements all of which combined to produce an alternative nucleus of power within the late Mughal set up. The English East India Company: origins and growth Founded by a royal charter dated 31 December 1600, the English East India Company was a joint stock company of London merchants who took the decision to intervene in the Euro- Asian trade that had been initiated by the Portuguese and subsequently expanded by the Dutch. The impulse to control trade between Europe and Asia in spices and pepper, calicoes and textiles went back to the end of the 15th century, when the Portuguese first cut into the Italian stranglehold of the Levantine trade, and directly transported spices from Asia to Europe. The Dutch followed suit with measures that were even more draconian, to ensure complete control over supplies of spices and their carriage, although by the middle of the 17th century, there was a definite shift from the quest for spices to the craze for calicoes. The same motivation drove the English Company which, however, had only one tenth of the capital owned and mobilized by the Dutch East India Company known as the Verenigde Oostindische Compagnie or V.O.C. It was this lack that persuaded the English Company to turn towards India not only for its valued textiles that paid for spices but also found growing numbers of buyers in England and Europe. Over the course of a century, the Company established trading posts in western and eastern India as well as in the Coromandel. From modest beginnings in 1617, the Company extended its trading activities by the end of the 17th century, when Bombay, Madras and Calcutta emerged as major trading centres and spheres of influence. Institute of Lifelong Learning, University of Delhi Expansion and Consolidation of Colonial Power Value addition: did you know? The Levant The Levant is the collective name for countries along the shores of the eastern Mediterranean and includes Anatolia, Syria and Egypt. The area was the principal transit point in the transit trade between the East and the west and consisted of transportation of spices and luxury goods. Traditionally the Levantine trade was dominated by the Venetian merchants who were until the 16th century the principal distributors of spice in Europe. Trade coming into the mouths of the Red Sea and the Persian Gulf and dominated by Asian merchants and Arabs reached the Levant where the goods were picked up by the merchants of the Italian city states. The discovery of the all sea route to Asia by the Portuguese ended the stranglehold of the Italians and directly impacted on the older trade of the Levant. Sources: http://en.wikipedia.org/wiki/File:The_Levant_3.png In its nascent stage, the English East India Company traded in textiles and functioned within a well established trading system in India. The Company’s servants, termed factors, advanced money to brokers who channeled these to weavers and primary producers. There was a growing expansion in the textile trade but not at India’s expense as India received substantial consignments of bullion in return for its manufactures. In fact, the growth of the textile industry ensured the enrichment of brokers and supply merchants and in the case of Bengal even improved the bargaining capacity of weavers. There was thus no question at this stage of the Company becoming a political power even if they periodically made demands that were not considered appropriate and that even occasionally undermined the sovereign dignity of the land. Institute of Lifelong Learning, University of Delhi Expansion and Consolidation of Colonial Power What made the Company different from other foreign merchants who came to India, settled down and traded? There were three major differences and some scholars have associated these with the play of mercantilist ideas. In the first place, the Company demanded from the ruling government, privileges that exempted them from paying customs duties even as they took over the responsibility of maritime protection to indigenous shipping. Secondly, the Company authorities fortified their centres where they had their own courts of adjudication and thereby set up a special zone of influence where Mughal writ could not run. Thirdly they felt emboldened to offer protection to fugitives from the law as part of a general policy of peopling their centres with a client population of collaborating subjects. In fact, it was precisely around these issues of privilege and exemption that the Anglo Mughal wars of 1757, 1764 and the subsequent clash with Muhammed Reza Khan occurred in Bengal. In fact the element of force used by the English East India Company especially in the 18th century lent a particular coercive edge to its profile that marked it very distinctly off from other foreign merchants including the other trading companies. This was partly due to their secure political position and also because they drew on an older system of force and ‘legitimate protection’ that the Portuguese had introduced into the trading system of the Indian Ocean. To what extent were these claims part of a larger mercantilist driven political project? To answer this we need to understand what mercantilism means and how this encouraged some Company servants even in the 17th century to confront the Grand Mughal. Defining mercantilism The term ‘mercantilism’ refers to a corpus of economic theories espoused by states in early modern Europe and perceived as critical elements in ensuring the health of states. The objective was to control and regulate trade and ensure its proceeds and maintain the bullion reserves of the states. Put simply, it was important to prevent an unnecessary outflow of treasure from the state abroad, to curtail imports and encourage exports. Dominant between the 16th and 18th centuries, it led to some significant instances of government intervention over the economy in the form of standardization, of controlling guilds and even regulating commerce by floating chartered companies, thereby giving them monopoly over trade with certain regions and giving them sovereign political power in distant continents. All these were intended to enhance the power of the state. Implicit in mercantilism, was the assumption that wealth constituted power and that power and wealth were the proper ultimate ends of national policy. A key tract that is universally acknowledged as a quintessential mercantile doctrine was Thomas Mun’s ‘England’s Treasure by Forraign trade’. Mun was in fact a major protagonist for the English East India Company and insisted that its policies were not responsible for the deficits of specie that England faced and also that its imports could find valuable markets in Europe when re-exported. The close connections between the Company in India and the state in England certainly bear out the importance of such views, which enjoyed wide currency. This is not to say that the Company did not enjoy considerable local autonomy or that it could and did take independent policies but to make the point that the Company was not mere traders but that it acted as a vehicle for promoting public and private interest. Institute of Lifelong Learning, University of Delhi Expansion and Consolidation of Colonial Power There is considerable evidence to indicate that from the very beginning the Company could use force to push its interests and that the Company and the state were united in realizing certain diplomatic and even financial goals. Recall for instance how the island of Bombay that Charles II had received as dowry by the Portuguese crown was transferred to the Company as its base so that it could be used in future against Portuguese settlements in western India. Mercantilism in action: the Company settlements of Madras, Bombay and Calcutta The Company settlements at Madras, Bombay and Calcutta began as humble trading stations that the authorities secured from local political rulers or, as in the case of Bombay, as part of a settlement with the Portuguese. These settlements were seen as regional hubs - Madras was the coordinating centre for settlements in southern India, Bombay for the western part and Calcutta for trading stations and factories in the east. It was here that the Company established and maintained its full strength, consisting of the Governor and his council, and through them, coordinated the trading operations of their servants.
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