From Trade to Territory
The Company Establishes Power
Aurangzeb was the last of the powerful Mughal rulers. He established control over a very large part of the territory that is now known as India. After his death in 1707, many Mughal governors ( subadars ) and big zamindars began asserting their authority and establishing regional kingdoms. As powerful regional kingdoms emerged in various parts of India, Delhi could no longer function as an effective centre. By the second half of the eighteenth century, however, a new power was emerging on the political horizon – the British. Did you know that the British originally came as a small trading company and were reluctant to acquire territories? How then did they come to be masters of a vast empire? In this chapter you will see how this came about.
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Fig. 1 – Bahadur Shah Zafar and his sons being arrested by Captain Hodson After Aurangzeb there was no powerful Mughal ruler, but Mughal emperors continued to be symbolically important. In fact, when a massive rebellion against British rule broke out in 1857, Bahadur Shah Zafar, the Mughal emperor at the time, was seen as the natural leader. Once the revolt was put down by the company, Bahadur Shah Zafar was forced to leave the kingdom, and his sons were shot in cold blood.
East India Company Comes East
In 1600, the East India Company acquired a charter from the ruler of England, Queen Elizabeth I, granting it the sole right to trade with the East. This meant that no other trading group in England could compete with the East India Company. With this charter the Company could venture across the oceans, looking for new lands from which it could buy goods at a cheap price, and carry them back to Europe to sell at higher prices. The Company did not have to fear competition from other English trading companies. Mercantile trading companies in those days made profit primarily by excluding competition, so that they could buy cheap and sell dear. The royal charter, however, could not prevent other European powers from entering the Eastern markets. By the time the first English ships sailed down the west coast of Africa, round the Cape of Good Hope, and crossed the Indian Ocean, the Portuguese had already established their presence in the western coast of India, and had their base in Goa. In fact, it was Vasco da Gama, a Portuguese explorer, who had discovered this sea route to India in 1498. By the early seventeenth century, the Dutch too were exploring the possibilities of trade in the Indian Ocean. Soon the French traders arrived on the scene. The problem was that all the companies were interested in buying the same things. The fine qualities of cotton and silk produced in India had a big market in Europe. Pepper, cloves, cardamom and cinnamon too were in great demand. Competition amongst the European companies inevitably pushed up the prices at which these goods could be purchased, and this reduced the profits that could be earned. The only way the trading companies could flourish was by eliminating rival competitors. The urge to secure markets therefore led to fierce battles between the trading companies. Through the seventeenth and eighteenth centuries they regularly sank each other’s ships, blockaded routes, and prevented rival ships from moving with supplies of
Fig. 2 – Routes to India in the eighteenth century
Mercantile – A business enterprise that makes profit primarily through trade, buying goods cheap and selling them at higher prices
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goods. Trade was carried on with arms and trading posts were protected through fortification. This effort to fortify settlements and carry on profitable trade also led to intense conflict with local rulers. The company therefore found it difficult to separate trade from politics. Let us see how this happened.
East India Company...
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