Rise and fall of East India Company-2

 Rise and fall of East India Company-2

Mughal Empire lost wealth and prestige both after the invasion of Nader Shah and it was disintegrated rapidly. Rebellions and disloyalty became commonplace. Muhammad Shah Rangila tried to regain his strength with the help of Asaf Jah I (the first Nizam of Hyderabad), developed diplomatic tie with Ottomans and his army defeated another foe Ahmad Shah Durani (Abdali) in the battle of Manupur in 1748. However, the heavy casualties made him sick and he died due to grief on 26 April 1748. Trusted noble man Nizam Asaf Jah I died on 1 June 1748. His successor emperors couldn’t stop the collapsing empire. His successor Ahmad Shah Bahadur was defeated by Maratha in the battle of Sikandarabad in 1753. He was blinded and imprisoned in 1754 and was succeeded by Alamgir II. Abdali invaded Punjab twice and established his control over Punjab, Sind and Kashmir in 1749 and 1752 and third time captured Delhi and Mathura in 1756. Maratha became the power centre. They had captured Gujarat and Orissa and installed Shah Alam II (Ali Gohar) as Mughal emperor under Maratha control. The empire of 17th Mughal emperor Shah Alam was squeezed from Delhi to Palam. The disintegrated subjects of Mughal in Deccan brought the Marathas and Muslims into direct conflicts that had strengthened the position of English and French in India. Maratha lost their strength after their defeat against Abdali in the third battle of Panipat in 1761. 

On Bengal side, the Clever Clerk Clive used a mean of bribery to win the battle of Plassey in 1757 and made the British East India Company a Nawab maker as Mir Jafar betrayed Sirajudaula and later Mir Quasim betrayed Mir Jafar. Mir Quasim was smarter, made union with the Nawab of Awadh Shuja ud Daula and Mughal Emperor Shah Alam II and took on British East India Company in the battle of Buxar on 23 October 1764 but lost. It was a turning point of Indian history as the defeat forced the Emperor Shah Alam II to sign “Allahabad Treaty” on 12 August 1765 to grant “Diwani” (to collect revenue) of Bengal (it includes Bihar and Orissa) to the British East India Company in return for an annual tribute of ₹ 2.6 million to be paid by the company from the collected revenue. The company was exempted from the tax. Nawab of Awadh paid ₹5 million as war indemnity to BEIC and became dependent on company for security of state. BEIC became the imperial tax collector from 20 million people. The company appointed a deputy Nawab Muhammad Reza Khan to collect revenue on behalf of the company. Clive pocketed £234,000 (current value £23 m) and transferred to EIC treasury £2.5 million (current value £250 m) seized from the defeated rulers of Bengal. 

However, the turf was not that easy. Famine (1770) in Bengal led to massive shortfalls in expected land revenue. EIC was left with debt of £1.5 million and a bill of £ 1 million unpaid tax owned to the Crown. The directors of the company took loan from Bank of London and British Government in 1772.  The Govt passed Regulating Act of 1773 and to control political policy in India passed India Act of 1784. The company appointed Warren Hastings as the first Governor General in 1784. The man who founded British rule in India Robert Clive committed suicide in 1784 by slitting his own throat with a paperknife. His remains in Shropshire village marked with a small wall plaque inscribed: “PRIMUS IN INDIS”. 

It was a ‘dual rule’, where East India company was enacting laws to maximise collection of revenue and the Nawab appointed by Mughal emperor looked after affairs of the province. The company later discontinued tribute of ₹2.6 million and abolished Nizamat and annexed Bengal in 1793. 

The Maratha captured Delhi in 1771 and Shah Alam II returned to the throne. Mughals became Maratha protectorate. Maratha occupied Delhi for two decades. But infightings amongst Marathas took price. Peshawa and Scindia were defeated by Holkar. Peshwa Bajirao II fled to EIC and signed treaty of Bassein in 1802, known as the death knell of Maratha Empire. Divided they were defeated by the EIC in second Anglo Maratha War in 1803-05. Mughals became British protectorate. 

EIC was an outsourced company, took over Diwani rights, raised force of Indian Sipoy to collect revenue and became a big arm force in the country. The company London office had permanent staff of 159, but it had made armies of Indian Sepoys in Bengal, Madras and Bombay by 1785. When they captured Delhi in 1803, it had 2.6 lakh soldiers, twice to British Army of that time. Indian rulers were ceiling territory to the company for the maintenance of subsidiary force and making the British Empire bigger. It was an “empire within empire” with a vast and sophisticated administration and civil service. There were two India. India under direct rule of the company and Princely India under the suzerainty of the Company. 

The Diwani was a legal document of the company not the Crown even though the Govt had spent a massive sum on naval and military operations protecting the EIC in India. It is said that it was not the British government that seized India at the end of the 18th century, but a dangerously unregulated private company headquartered in one small office, five windows wide, in London, and managed in India by an unstable sociopath. However 1/3 of the MPs were holding company’s stock and therefore, it was protected by British foreign policy where the Company was the trade face but British Crown was the power face behind. It was beginning of British rule and loot in India. Artisans and weavers were made slaves and Indian markets were flooded with British products. 

Punamchand

23 August 2021