Chapter 2 – From Trade to Territory (The Company Establishes Power) | Class 8th History

End of Mughal Empire

1. Aurangzeb was the last of the powerful Mughal rulers.
2. In 1707, after his death, many Mughal governors (subadars) and big zamindars established regional kingdoms.

East India Company Comes East

1. Vasco da Gama, a Portuguese explorer, discovered the sea route to India in 1498.
2. The Portuguese were the first Europeans who came to India, establishing their presence on the western coast and basing in Goa.
3. In 1600, the East India Company acquired a charter from the ruler of England.
4. By the early seventeenth century, the Dutch and the French also arrived.
5. All the companies were interested in buying the same goods, such as cotton, silk, pepper, cloves, cardamom, and cinnamon. This created competition and reduced profits.
6. To secure markets, fierce battles ensued between the trading companies.

East India Company Begins Trade in Bengal

1. The first English factory was set up on the banks of the river Hugli in 1651.
2. As trade expanded, the Company persuaded merchants and traders to settle near the factory.
3. By 1696, it began building a fort around the settlement.
4. In 1698, the Company gained zamindari rights over three villages, one of which was Kalikata (later known as Kolkata).

Battle of Plassey

1. After the death of Aurangzeb, the Bengal nawabs asserted their power and autonomy.
2. In 1756, Sirajuddaulah became the nawab of Bengal after the death of Alivardi Khan.
3. The Company wanted a puppet ruler and tried to help one of Sirajuddaulah’s rivals become the nawab without success.
4. Angry, Sirajuddaulah asked the Company to stop interfering in his dominion's political affairs, stop fortification, and pay revenues.
5. After negotiations failed, the Nawab marched with 30,000 soldiers to the English factory at Kassimbazar, captured the Company officials, locked the warehouse, disarmed all Englishmen, and blockaded English ships.
6. He then marched to Calcutta to establish control over the Company’s fort.
7. As the news of the fall of Calcutta reached, Company officials in Madras sent forces under the command of Robert Clive.
8. In 1757, Robert Clive led the Company’s army against Sirajuddaulah at Plassey.
9. The Nawab was defeated as Mir Jafar, one of Sirajuddaulah’s commanders, did not fight the battle.
10. After the defeat at Plassey, Sirajuddaulah was assassinated, and Mir Jafar was made the nawab.

The Puppet Nawab

1. The Company’s primary objective was the expansion of trade, not administration.
2. When Mir Jafar protested, the Company removed him and placed Mir Qasim in his place.
3. When Mir Qasim complained, he was defeated in a battle at Buxar (1764), driven out of Bengal, and Mir Jafar was re-established.
4. The Nawab had to pay Rs 500,000 each month, but the Company demanded more money to fund its wars, trade, and other expenditures.

The Company Becomes the Diwan of Bengal

1. In 1765, the Mughal emperor appointed the Company as the Diwan of the provinces of Bengal.
2. The outflow of gold from Britain stopped after the assumption of Diwani as now revenues from India could finance Company expenses.

The East India Company Gets Diwani of Bengal

1. In 1765, the Mughal emperor designated the Company as the Diwan of the Bengal provinces.
2. Diwani enabled the Company to utilize Bengal's vast revenue resources, resolving a significant financial problem for the Corporation.

The Residents of the Company

1. Initially, the Company did not intend to assume political power in India.
2. The Company decided to directly administer affairs only when it saw that without acquiring political power, their trade would not flourish.
3. After gaining control of Bengal’s administration, they appointed Residents, agents of the Company.
4. Through these residents, the Company interfered with the internal matters of Indian regions, deciding successions and administrative posts.
5. The Company used a subsidiary alliance to prevent Indian rulers from maintaining independent armies; instead, the Company’s army would protect them, funded by the local rulers.
6. When diplomacy failed, the Company used direct military intervention.

Wars with the Company

1. Mysore grew under leaders like Haidar Ali and his son Tipu Sultan.
2. Tipu Sultan stopped the export of sandalwood, pepper, and cardamom, and prevented local merchants from trading with the Company.
3. Four wars were fought with Mysore (1767-69, 1780-84, 1790-92, and 1799). Only in the last, the Battle of Seringapatam, did the Company win.
4. Tipu Sultan was killed defending his capital, and Mysore was placed under the Wodeyars with a subsidiary alliance imposed.
5. The Company sought to curb the power of the Marathas. After their defeat at the Third Battle of Panipat (1761), a series of wars ensued.
6. The First Anglo-Maratha War ended in 1782 with the Treaty of Salbai, without a clear winner.
7. The Second Anglo-Maratha War (1803-05) allowed the British to reach Orissa and northern territories of the Yamuna River.
8. The Third Anglo-Maratha War (1817-19) ended the Maratha power.

The Policy of Paramountcy

1. From the early 19th century, the Company pursued aggressive territorial expansion.
2. Under Lord Hastings (Governor-General from 1813 to 1823), a new policy of "supremacy" was launched.
3. The Company claimed its authority was paramount, superior to that of the Indian states.
4. Sind was annexed in 1843.
5. Punjab was annexed after two wars following the death of Maharaja Ranjit Singh in 1839.

The Doctrine of Lapse

1. Under Lord Dalhousie (Governor-General from 1848 to 1856), the Doctrine of Lapse was introduced.
2. This doctrine stated that if an Indian ruler died without a male heir, his kingdom would become part of the Company’s territory.
3. Kingdoms annexed under this doctrine included Satara (1848), Sambalpur (1850), Udaipur (1852), Nagpur (1853), and Jhansi (1854).

Setting up a New Administration

1. Warren Hastings (Governor-General from 1773 to 1785) played a significant role in the expansion of Company power.
2. British territories were broadly divided into administrative units called Presidencies:-
   1. Bengal
   2. Madras
   3. Bombay
3. Each was ruled by a Governor and the supreme head of the administration was the Governor-General. From 1772, a new system of justice was established.

→Each district was to have two courts:-

(a). A criminal court (faujdari adalat)

(b). A civil court (diwani adalat)

4. Under the Regulating Act of 1773, a new supreme court and a court of appeal were established in Calcutta.
5. In Civil courts, Maulvis and Hindu pandits interpreted Indian laws for the European collectors.
6. The criminal courts were still under a qazi and a mufti but under the supervision of collectors.
7. The collector's main job was to collect revenue and taxes and maintain law and order in the district with the help of judges, police officers, and darogas.

The Company Army

1. From the 1820s, the cavalry requirements of the Company's army declined because the British Empire was fighting in Burma, Afghanistan, and Egypt where soldiers were armed with muskets and matchlocks.
2. In the early nineteenth century, the British began to develop a uniform military culture.
3. The soldiers were given European-style training and were subjected to drill and discipline.

Conclusion:

→ The East India Company was transformed from a trading company to a territorial colonial power. By 1857, the Company exercised direct rule over about 63 percent of the territory and 78 percent of the population of the Indian subcontinent.