The East India Company was known as one of the most powerful corporations in history that might have come for trading purposes but once ruled an entire subcontinent. A 200-year reign by the British on the Indian subcontinent began with the East India Company and ended with the country’s partition in 1947. During this reign, the Indian subcontinent went from one of the world’s largest economies to one of the world’s poorest regions. While India’s economy accounted for nearly a quarter of the global economy at the beginning of the 18th century, by 1950, it had declined to just 4 (4.2%) percent. The company was dissolved more than 150 years ago. But in the early 21st century, Indian businessman Sanjiv Mehta acquired the East India Company and made it re-operationalized in 2005. Currently, the company operates as a food and luxury lifestyle business.
Foundation of EIC
Modern colonialism began in the early 1500s when the Portuguese took over the Straits of Gibraltar and started spreading Christianity. After that, several nations, including the British, French, Spanish, and Dutch, tried to establish their colonies and began to enrich their navies. As a result, there were wars and looting between these states to establish territories and dominate various trade routes. In one such incident of conflict and looting, in 1592, the Portuguese ship “Madre de Deus” was captured by British privateers in Azores, an island in the mid-Atlantic, on its way back from trade in the Asian continent with numerous gems, metals, spices, and textiles. In the past, this incident helped the British reach Asia. Textiles, metals, and precious stones were the main industries of the Indian subcontinent at that time. Muslin cloth made by Indian artisans was even mentioned in Greek Mythology. Besides, Indonesia’s Sumatra, Bantam, and Java Islands were primarily known for spices. As a result, European merchants from these states planned to trade directly with Asia by sea.
Given that, on 31 July 1600, to trade in East Asia, South-East Asia, and the Indian subcontinent, a group of London merchants led by Sir Thomas Smythe applied to Queen Elizabeth I for a Royal Charter. The Queen agreed to give them a royal charter and permission to carry arms themselves. Relying on this Royal Charter, the England East India Company, the world’s first joint stock company, began its journey by raising around £70,000 (£68,373) with 250 members.
In 1601, the England East India Company, under the command of Captain James Lancaster, set sail for the Indonesian island of Sumatra in the then flagship British ship Red Dragon. Along with the Red Dragon, three other vessels named Hector, Susan, and Ascension carried about 100 crew members with silver bullion and other goods for trading. Arriving in Sumatra the following year in 1602, Red Dragon and Hector set off for Bantam on Java Island in modern Indonesia to buy spices from merchants in exchange for silver. During the trading period at Bantam, the Company’s merchants realized that Indian textiles were in greater demand in Southeast Asia than silver, and that they could exchange these goods for more spices.
After returning to England after the first voyage, the East India Company plans to expand its trade in India’s textile business. So, under William Hawkins’s supervision, in April 1607, England East India Company sailed from London to India for the first time with one of the largest merchant ships, “Hector” of the British at that time, which had 110 crew members and 24 guns. Initially, the company intended to buy cloth from India in exchange for silver and use it to buy spices from Indonesia. On August 24, 1608, the East India Company reached Surat, near southern Gujarat, India. At that time, the entire India was under the Mughal Empire. As a result, when William Hawkins went to the Mughal emperor’s court in Agra to seek the permission of the then Mughal emperor Jahangir to build a “Kuthi” there, but the emperor disagreed. Because by then, the Portuguese and Dutch merchants had developed good relations with the Mughal Sultanate, and the emperor did not want to start any new conflict by allowing the British to trade with them. As a result, the East India Company failed to do business in India and again set sail for Indonesia.
Due to Dutch dominance in Indonesia, a part of the company retreated to the port of Swali near Surat in 1612. There, the Portuguese fought the company’s troops in a small naval battle known as the Battle of Suvali or BATTLE OF SWALLY. Although the East India Company was victorious in this battle, it later established its own naval unit to handle such situations and protect itself from pirates. In 1613, a delegation of the East India Company again asked permission from the Mughal emperor Jahangir to build a Kuthi, and this time the emperor agreed, and they established their first Kuthi at Surat. In 1615, the English ambassador Sir Thomas Roe visited Emperor Jahangir with several gifts to obtain some trade favors for the East India Company and received a royal decree from Emperor Jahangir. As a result, the East India Company began to build small forts and factory in the coastal areas of eastern and western India. In 1619, under the supervision of Thomas Roe, the East India Company started the coffee trade between India and Persia.
The Fall of Bangla
By 1623, Dutch dominance in the Spice Islands had reached such a level that they forced the British to stop nutmeg, javitri, and cloves trading in Bandas and Moluccas. Meanwhile, that year, the Dutch East India Company ordered the execution of British, Japanese, and Portuguese traders in Indonesia in what is known as the “Ambayana Massacre.” Soon after this incident, the Dutch merchants ended the business by withdrawing their trading representatives from India. During that period, the Portuguese were the only competitors of the East India Company. While they could not compete with the British for a long time, the East India Company succeeded in dominating the Indian subcontinent by defeating the Portuguese. Initially, the company dealt with spices but gradually expanded into calico (white cotton cloth), silk cloth, indigo, shora, and tea. In 1639, after the Portuguese were expelled from Bengal, the East India Company established a Kuthi at Baleshwar. Also, St. George acquired some land on the coast of Karmandal and built the ‘Black City’ fort, which later became Madras’s city.
In 1648, the East India Company established its headquarter in London, called “East India Company House.” Two year later, In 1650, the East India Company reached the Bengal province of India, Hooghly and with the permission of the then Subedar of Bengal, Shah Shuja, built the first Kuthi at Hooghly in 1651, and the second at Kasimbazar in 1658. Meanwhile, in 1668, King Charles II of England married Catherine of Braganza, sister of the King of Portugal, and received the trading authority of Bombay as a dowry. Later that year, Charles leased Bombay to the East India Company for £10 per annum. In the same year, another new Kuthi was established in Dhaka, the capital of Bengal. In 1690, Job Charnak purchased the zamindari ownership of three villages on the banks of the Bhagirathi River – Kalikata, Sutanati, and Gobindapur for 1200 rupees and founded Calcutta. In 1698, another new company was found as the competitor of East India Company, called “General Society Trading to the East Indies”. Later, Job Charnak began the establishment of Fort William. Apart from India, around 1699, the company started to expand its business in various directions, including importing porcelain, silk, and tea from China. By then, tea had become quite popular in England, and more than 60 percent of the East India Company’s total trade was tea. But, the company mainly traded tea with China in exchange for silver, which was quite expensive.
However, to reduce the cost of this silver, the company started buying tea from China in exchange for opium produced in India through illegal means. Gradually, the East India Company’s business expanded to countries in Southeast Asia, East Asia, and the Persian Gulf. As the company made a profit each year, it also started gaining more power. With more power, the company began accumulating military power and intervening Indian politics.
In 1700, the company converted its Fort William in Calcutta into an independent presidency. Later, in 1702, the new company ‘General Society Trading to the East Indies’ merged with the East India Company to become ‘The United Company of Merchants of England Trading to the East Indies,’ but the company eventually remained the ‘East India Company.’ Although the Mughals still ruled India, Bengal was individually ruled by Murshid Quli Khan. During his rule, there were significant developments in Bengal’s trade and commerce, especially in foreign trade. However, when the Mughal ruler Aurangzeb died in 1707, the company sought to take advantage of the weakness of the central government, but Murshid Quli Khan strongly opposed it and also tightly controlled the old facilities allocated to the company. As a result, the company officials had to accept a lot of harassment in the customs houses, which angered the company officials. Moreover, Murshid Quli Khan strongly discouraged company officials from using the company’s stamp on their personal business, and officials also trying to trade duty-free, resulting in conflict between the company and him.
In such a situation, in 1716, Company’s Calcutta Council sent John Sarman, a delegation with many gifts, to the then Emperor Farrukhsiyar. The Emperor was satisfied by their approach and issued a Farman (a royal decree). This farman is known initially as Farrukhsiyar’s Farman of 1717. In addition to the company’s current benefits, the Subedar of Bengal was ordered to give the company several benefits through this Farman, including the zamindari of 38 mauza’s around Calcutta. Moreover, in case of theft of goods belonging to the Company or an Englishman, the Subedar must take measures to recover the goods and pay compensation if the Subedar’s sepoys cannot recover the goods. Furthermore, the Subedar was also asked to commence the circulation of Surat and Madras rupees in Bengal at the same value, handing over all liable and indebted persons to the company, not to stop or examine any cargoes on board ships issued by the company, allowing to issue companies coins from the Murshidabad mint. Due to these benefits mentioned in the Farman, in 1717, the East India Company, with the permission of Emperor Farrukhsiyar, started duty-free trade in Bengal, Madras, and Mumbai. However, the company struggled a lot during Murshid Quli Khan’s tenure. After he died in 1727, his son-in-law Sujauddin Khan came to power, and the company got an opportunity to enforce all its claims fully. In particular, the company fully confirmed its zamindari authority over 38 mauzas. However, Sujauddin Khan followed in the footsteps of his predecessor but tried to avoid any conflict with the company. But when the dispute between the company and the Subedar over the salt trade eventually led to the possibility of war, Jagat Seth (Fateh Chand) intervened between them.
Although the company’s relationship with the Nawab was good, the East India Company enjoyed a large trade boom during the reign of Sujauddin Khan (1727-1739). As a result, the company’s interest in Bengal for trade increased. The company initially wanted a Nawab in Bengal who would be sympathetic to them and would not interfere with their business. From 1740 to 1756, the Nawab of Bengal was Alivardi Khan, who realized that the English traders should be feared more than the Marathas or it would be difficult to get rid of them. Later, after his death in 1756, Sirajuddaula became the Nawab of the Murshidabad and gave three conditions to the company to conduct trade and commerce in Bengal, which are – the company must dismantle all illegal defenses in Calcutta, they must stop abusing the Dastak, and obey the state laws. However, the East India Company’s Fort William Council disobeyed the Nawab’s orders. So, the Nawab raided Calcutta in the same year with the support of French merchants and captured Fort William. After this victory, Sirajuddaula renamed Calcutta Alinagar in honor of Alivardi Khan.
In such a situation, the Englishman did not stop. They brought back Robert Clive from Madras, and under his leadership, Fort William was recaptured on 2nd January 1757. The company also gathered conspirators against Nawab at Mushirdabad court and secretly made an arrangement with them To overthrow the Nawab from the throne. In return for helping the company, the conspirators will get all facilities and compensation to the British. On that agreement, Mir Zafar, who was recently decommissioned by Nawab, was announced as the future Nawab of Bengal. As per the terms of the arrangement, East India Company fought a battle with Nawab Sirajuddaula at Palashi on 23rd June 1757, where most of the Nawab’s troops, siding with Mir Zafar and other conspirators, refrained from participating in the battle. This battle is known as the famous Battle of Palashi, where Sirajuddaula was defeated. After the victory at the Battle of Palashi, the entire Indian subcontinent, including Bengal, was opened up for the East India Company to trade. However, the Nawabs after Siraj was not loyal to the British for long, and even Mir Kashem, who had been brought to power to support the company, joined Shuja-Ud-Daulah and Emperor Shah Alam II during the Battle of Boxer in 1764. After winning this war too, the East India Company obtained more power and from 1765, they started collecting customs and revenue from Bengal, Bihar, and Orissa. But due to two successive wars and the arbitrariness of the company, a famine occurred in Bengal from 1769 to 1770, and nearly one-third of the people died. On the other hand, from 1765 to 1772, the company shared revenue with the administration of Bengal, but they did not take any administrative responsibility directly. Rather Syed Mohammad Reza Khan continued to perform all administrative duties related to revenue on behalf of the company. At the same time, the arbitrariness and personal development of the company and its employees continue to destroy Bengal’s wealth indiscriminately, and the country’s economic situation deteriorates rapidly. Not only that, but the economy of Bengal as well as the company’s income and expenses, started to suffer. The East India Company had to take a loan from the British government in 1771 to avoid constant losses, and the Repeal of the Regulating Act in 1773 gave the British government the power to intervene in the company’s management whenever necessary.
Start of British Rule
In 1784, the British government enacted a detailed Act to regulate company management in India, where a standing parliamentary committee, the Board of Control, was set up to oversee company management. Under this Act, any member of the Board of Directors is prohibited from accepting any gratuity or gift from cadets nominated to become members of the Bengal Civil Service. However, due to the pressure of private British merchants, under the Charter Act of 1793, the monopoly of the Company’s trade in India was remarkably relaxed, as well as the provision of reserved space in the Company’s ships for the transportation of goods of private merchants. And by relegating the Company’s position, the Company-run Indian state was brought directly under the British King or Queen. Finally, by changing the Charter Act again in 1813, the British government revoked the monopoly trade rights of the East India Company. As a result, India was then fully open to free trade.
The East India Company never faced competition while trading in India. However, due to this new charter, the company became commercially weaker when more people joined the business in India. In such circumstances, the Charter Act of 1833 abolished the company’s commercial activities in other areas except for China. In 1841, a botanist named Robert Fortune was credited with establishing premium tea gardens in Darjeeling, India.
He went to China in disguise, brought 20,000 tea plants from there, and planted them in Darjeeling. In 1851, the East India Company participated in the world’s first Great Exhibition at the Crystal Palace in Hyde Park, London. On 29 March 1857, The Sepoy Rebellion against the English and the East India Company started at Barrackpore under the leadership of Mangal Pandey. It quickly spread to Meerut, Delhi, and other parts of India. The movement spread to the Bengal province of India, and skirmishes broke out from Dhaka to Chittagong, Sylhet, Jessore, Rangpur, Pabna, and Dinajpur. Due to this, in 1858, the British Crown stopped all activities of the East India Company by passing “The Government of India Act.” In 1874, the British East India Company was officially abolished, with Queen Victoria becoming Empress of India. From here, the British’s direct rule over the Indian subcontinent began.
After the dissolution in 1874, India was under the direct colonial rule of the British Empire for more than seven decades, which ended in 1947 with the birth of two states, India and Pakistan. Meanwhile, the East India Company was dormant for more than 130 years, but in 2003, the company’s shareholders tried to re-operationalize the East India Company through the tea and coffee business.
According to The Hindustan Times, in 2005, Indian entrepreneur Sanjeev Mehta acquired the East India Company from the stakeholders for $15 million and relaunched the business with premium tea, coffee, and food items. In 2010, Sanjeev Mehta established the first store of the present-day East India Company in London’s elite May Fair area. Aside from selling tea and coffee, the company also sells chocolates, biscuits, drinks, lifestyle products, and various historical coin collections.