East India Company, any of a number of commercial enterprises formed in Western Europe during the 17th and 18th centuries to further trade with the East Indies. The companies, which had varying degrees of governmental support, grew out of the associations of merchant adventurers who voyaged to the East Indies following the discovery in 1497 of the Cape of Good Hope route by Portuguese navigator Vasco Da Gama. The most important of the companies were given charters by their respective governments, authorizing them to acquire territory wherever they could and to exercise in the acquired territory various functions of government, including legislation, the issuance of currency, the negotiation of treaties, the waging of war, and the administration of justice. The most notable companies were the following. English East India Company
Chartered in 1600, the English East India Company eventually transformed England's Asian trade into an extensive colonial empire. Initially, the company struggled to establish itself in India, creating small outposts such as this port at Fort Saint George in Madras. Within 150 years, the company had developed into a major military and political force in India, defeating other European trading companies and uniting much of India under British rule. The most important of the various East India companies, this company was a major force in the history of India for more than 200 years. The original charter was granted by Queen Elizabeth I on December 31, 1600, under the title of “The Governor and Company of Merchants of London Trading into the East Indies.” The company was granted a monopoly of trade in the East Indies, with the formal restriction that it might not contest the prior trading rights of “any Christian prince.” The company was managed by a governor and 24 directors chosen from its stockholders.
Company rule in India
Although the British East India Company had administered its factory areas in India—beginning with Surat early in the 17th century, and including by the century's end, Fort William near Calcutta, Fort St George in Madras and the Bombay Castle—its victory in the Battle of Plassey in 1757 marked the real beginning of the Company rule in India. The victory was consolidated in 1764 at the Battle of Buxar (in Bihar), when the defeated Mughal emperor, Shah Alam II, granted the Company’s right to collect land-revenue in Bengal, Bihar, and Orissa. The Company soon expanded its territories around its bases in Bombay and Madras: the Anglo-Mysore Wars (1766–1799) and the Anglo-Maratha Wars (1772–1818) gave it control over most of India south of the Narmada River.
Starting in 1772, the Company began a series of land revenue "settlements," which would create major changes in landed rights and rural economy in India. In 1793, the Governor-General Lord Cornwallis promulgated the permanent settlement in the Bengal Presidency, the first socio-economic regulation in colonial India. It was named permanent because it fixed the land tax in perpetuity in return for landed property rights for a class of intermediaries called zamindars, who thereafter became owners of the land. It was hoped that knowledge of a fixed government demand would encourage the zamindars to increase both their average outcrop and the land under cultivation, since they would be able to retain the profits from the increased output; in addition, the land itself would become a marketable form of property that could be purchased, sold, or mortgaged. However, the zamindars themselves were often unable to meet the increased demands that the Company had placed on them; consequently, many defaulted, and by one estimate, up to one-third of their lands were auctioned during the first three decades following the permanent settlement. In southern India, Thomas Munro, who would later become Governor of Madras, promoted the Ryotwari system, in which the government settled...