East-india Company.

Among the monopolies and privileged communities which impede individual enterprise and national prosperity, the East-India Company and the Bank of England stand pre-eminent: these have formed the outworks, the strongholds, of the Borough System; and, by their connexions and interests, added greatly to that mass of influence by which the latter has been supported. Both these powerful associations have become more like petty states, acknowledging a feudatory dependence to the supreme power, than companies of traders, originally incorporated for commercial purposes. Both have risen from very humble beginnings, and perhaps it would not be easy to strike the balance of turpitude by which their power has been respectively acquired. Both have been nurtured under the fostering care of the Oligarchy, to which, under particular emergencies, they have been indebted for assistance; and, probably, it is from a knowledge of this paternal obligation, that these chartered bodies feel such a lively interest in the permanency of the existing system, and that whenever any popular movement indicates proceedings hostile to the government, they are instantly alarmed, and the Bank and the India-House immediately placed in a defensive attitude.

Both the Bank and the East-India Company claim particular attention, from the period having arrived about which their charters expire; and the legislature, either in the session of 1831 or the following year, will have to determine their future immunities, and the relative position in which they are to stand to the government and the community.

Before entering on the exposition of the present state of the East-India Company, it will be proper to give a brief outline of the history of this powerful association, and briefly indicate those extraordinary events by which a few traders in mace, nutmegs, and ginger, have been able to extend their sway over 120 millions of inhabitants, whose happiness depends on their wisdom and justice. In giving this notice, we shall enter into no detail of Asiatic triumphs, of battles and sieges. We have little taste for these things at best, but still less when the combatants are unequally matched,—when we should have to present a counterpart to the conquest of Peru and Mexico by the Spaniards,—exhibit the conflicts of wolves and sheep, and show how a handful of crafty, hardy, and unprincipled Europeans wrested a mighty empire from the feeble grasp of the artless and effeminate Hindoos. Leaving out, therefore, with one or two exceptions, military details, which in justice ought never to have formed part of the history of the East-India Company, we shall confine ourselves principally to the civil transactions of this association.

The first attention to the India trade appears to have been attracted by the success of the Dutch merchants. These rapacious traders, having supplanted the Portuguese in that part of the world, had an entire monopoly of the trade, and availing themselves of the exclusive possession of the market, exacted exorbitant prices for the productions of the East. To frustrate their avarice, and obtain some share in this lucrative traffic, the merchants of London despatched a mission to the Great Mogul, to obtain from him a grant of commercial privileges to the English. The success of this mission was not known till the year 1600; but, in the mean time, the lord mayor, aldermen, and other principal merchants of the city, to the number of 101, assembled in Founders’ Hall, and established an association for trading to India, for which they subscribed a capital of £33,133. To this society, and in the year mentioned, Queen Elizabeth granted the first charter of incorporation, with the exclusive privilege to trade to all parts of Asia, Africa, and America, for fifteen years, and the company to be managed by a chairman and twenty-four directors chosen annually. The capital of the corporation amounted to £70,000. They fitted out four ships of the burthen of 240, 260, 300, and 600 tons. The value of the ships’ stores and provisions, of the merchandize forming the cargoes, and of the bullion, was estimated at £68,373.

This expedition was tolerably successful, brought home valuable cargoes of merchandize, and succeeded in establishing factories at Bantany, and on the Molucca Islands. But, notwithstanding the success of this undertaking, no great effort was made to follow it up, and for several years after, the trade and capital of the Company gradually declined. In 1606, only three ships were fitted out. In 1608, the Company having subscribed a capital of £33,000, for a fourth voyage, the whole of their ships were either wrecked in India, or on their voyage home. Next year they were more fortunate, and their ships bringing home a valuable cargo of mace and nutmegs, they divided a profit of 211 per cent. Encouraged by this success, the Company solicited the renewal of their charter, and seemed resolved to push the trade with spirit. They built the largest ship that had ever been constructed in England for commercial purposes, being no less than 1000 tons burthen. King James and his court attended the launch, and named her The Trade’s Increase.

Unfortunately this vessel was lost, and Sir Henry Middleton, her commander, soon after died of grief. The trade subsequently declined, for which various causes may be assigned. The rivals of the Company, the Dutch and Portuguese, made use of every expedient avarice and treachery could suggest, to impede their success; besides which, we may add, the erroneous principles on which the different voyages were undertaken. Instead of the trade being conducted upon a joint-stock on account of the whole Company, every individual was privileged by the charter to subscribe as much or as little as he pleased, or nothing at all, for every voyage. The disadvantages of this system in an incipient and difficult undertaking became apparent; and, in 1612, it was determined to have no more separate voyages, but to open a subscription for a joint capital to continue for four years. Upon this principle the affairs of the Company assumed a new aspect; and in a very short time they had established more than twenty factories, in different parts of the Mogul’s dominions, and the islands in the Indian seas.

In 1616, when they proposed to raise a new capital, all ranks crowded into the subscription, which, at the time of closing it, amounted to £1,629,040, being the largest capital that had ever been subscribed in any part of Europe for a joint-stock trade. Among the subscribers were 15 dukes and earls, 13 countesses, 82 knights, including judges and privy counsellors, 18 widows and maiden ladies, besides clergymen, physicians, merchants, tradesmen, and others without any denomination; in the whole 954 subscribers. The stock of the Company sold for 203 per cent. The total value of their property, at this time, was estimated at £400,000. And it was stated by the deputy-governor, that they gave employment to 10,000 tons of shipping, 2500 seamen, 500 ship carpenters, and 120 factors in India.

In 1652 the Company obtained considerable privileges in Bengal through the skill of their surgeons, in curing a certain disease in the Mogul court, and which disease was little known in Europe, though afterwards of frequent occurrence in sea-ports and large capitals. In 1655, the trade was thrown open for three years, but closed again in two years on it being alleged that evils had resulted from the free-trade. In 1669 the Company received two canisters containing 1431/2 pounds of tea, which is supposed to have been the first importation of this article from any part of the Indies. It was partly given away in presents, and partly consumed in the India-House for the refreshment of the committees.

In 1676, the trade of the Company having been very successful for many years, they were enabled, out of their accumulated profits, to double their capital to £739,782, upon which the market price of their stock, which had been under par, immediately rose to £245 per cent. The ships in their employ amounted to from 30 to 35, of from 300 to 600 tons, and carrying from 40 to 70 guns. In the year 1680, the company sent a ship to trade with China. The whole of that trade had heretofore been monopolized by the Dutch and Portuguese. About this time they acquired the privilege to coin money, not resembling British money, at Bombay and other places in India. The Company consisted of 600 members, who were entitled to votes in proportion to their shares; hence it happened that some had to the amount of sixty votes:—every member, moreover, had liberty to carry on trade on his own private account, to the extent of one-fifth of his stock in the Company’s capital.

In 1698, the English factory obtained permission to purchase three small villages, extending in all about three miles along the east bank of the Ganges, and about one mile back from it, for which they agreed to pay annually to the Nabob 1195 rupees. This diminutive acquisition was the handle to the axe and commencement of the territorial aggrandizement of the Company, by which they were afterwards enabled to hew down the entire Mogul empire. The ground on which these villages stood forms the site of the great city of Calcutta, containing 600,000 inhabitants.

Some jealousy, about this time, began to be entertained at the increasing power of the Company; and the Government intimated to the association that a large sum would be expected for the public service, in consideration of a parliamentary confirmation of their privileges. They offered to advance £700,000 at an interest of 4 per cent. provided their charter was fully confirmed by parliament. Meanwhile several opulent individuals offered to advance £2,000,000, provided they were invested with all the privileges of the India trade, as heretofore enjoyed by the Company. Parliament accepted the larger sum, though at double interest, and a bill was ordered to be prepared for incorporating the subscribers. The Company, not to be outdone by their opponents, then proposed a loan of £2,000,000, but this availed them nothing. The government was favourable to the opposing interest, and it prevailed. So great were the advantages anticipated by the nation from the new association, that the subscription of two millions was filled up within a few days after the books were opened. The greatest part of this sum was subscribed by foreigners. The king himself was an adventurer to the extent of £10,000.

The charter of the original Company had not yet expired, and a most ruinous contest ensued betwixt the rival associations. More than sixty ships are said to have been employed by the contending interests in the India trade. The glut of India goods, joined to other causes, produced by this rivalship, reduced the value of the stock of the old Company, which had been as high as 500 per cent., to 39 per cent. Both parties at length seem to have discovered the ruinous tendency of this contest, and an union was effected in 1702, by a tripartite indenture, wherein Queen Anne, the old Company and the new Company were partners. According to this instrument, the two Companies bind themselves to have at least one-tenth of their exports in English manufactures, and after the expiration of seven years they are to be called “The United Company of Merchants of England trading to the East Indies,” which is their present designation.

In 1766, the Company, in consequence of their territorial acquisitions, raised their dividend from 6 to 10 per cent. and shortly after to 121/2 per cent. In India this year, their power was exposed to hazard by the abolition of the double batta, or allowance to officers in the field: it originated a serious mutiny in the army, but was subdued by the firmness of Lord Clive, and many officers cashiered. The celebrated Hyder Ali, who from a subordinate rank had raised himself to the throne of Mysore, began about this period to menace the sway of the Company.

In 1779, the time for the renewal of the charter approaching, the Company prudently prepared for that event, by a present to the public of three seventy-four gun ships, besides a large sum of money in bounties to 6000 seamen. Notwithstanding this bonus, in 1781 notice was given to the Company by Government, that on the expiration of the charter their exclusive privileges should cease, unless they would agree to pay £1,000,000 into the exchequer, restrict their future dividend to 8 per cent. and pay three-fourths of the surplus profits, over and above that dividend, into the Treasury. After much discussion, the demand for the renewal of the charter was reduced to £400,000, the other conditions remaining unaltered; and the Company were required to submit all political despatches to ministers, who were to decide on all questions relative to peace and war.

In 1789 the decennial settlement of lands commenced in Bengal and Bahar, and was completed in 1793, when the settlement was made perpetual. By this settlement, which produced such an important change in the landed tenure of a vast territory in India, the zemindars, who were in fact the revenue agents of the Mogul government, usually hereditary and possessed of great power and influence, but not owners of the soil, which they could neither sell nor alienate, were declared the actual land-owners, and from them the principal revenue of India was to be derived in the shape of land-tax. The poor ryots or peasantry, who were, next to the sovereign, the real owners of the land, as much as the feudal nobility of England or Hungary, and who could not be dispossessed of it so long as they paid their public assessments, were at once transmuted into the tenants of the zemindars or tax-gatherers. The objects of this sweeping innovation were financial and of disastrous issue. The zemindars, obliged to go through the legal formalities to collect their levies from the ryots, were unable to pay their taxes to the government, whose proceedings were summary. Their lands were gradually sold for the arrears of taxes, and passed into the hands of absentee landlords; in a few years almost all the zemindars disappeared. No improvement took place in the condition of the ryots, who were more oppressed by the middlemen above them than they had been by the tax-gatherers of the Mogul.

About this period, the affairs of the East-India Company, and the transactions in Hindustan, began deeply to interest the public, and every session of parliament produced new investigations on this important subject. From merchants, the Company had risen into sovereign princes, and, instead of being occupied with the ginger and pepper trade, they were wholly absorbed in schemes of territorial aggrandizement. Occupied unceasingly in war—buying and exchanging territory—making treaties of partition—hiring troops to the native princes—establishing monopolies—and fomenting hostilities among the nabobs and subahdars, that these short-sighted princes, after weakening each other by their animosities, might fall an easy prey to the superior policy of the common invader. These avocations ill comported with the commercial character, and it was a little inconceivable how men, whose knowledge, it may be supposed, was principally confined to making out invoices, bills of landing, or book-keeping by double entry, could discharge these royal functions.

In 1783, Mr. Fox introduced his famous India Bills, the general objects of which were to divest the company of their administrative functions—to prohibit them from making war, unless in self-defence—from making treaties of partition—hiring troops to the native princes—and every illegal present was to be recoverable by any person for his own benefit. These provisions sufficiently indicate the prevalent abuses. They were opposed by Mr. Pitt, then out of place, an oppositionist and reformer. The question agitated the whole nation; and such was the outcry raised by the Company against the pretended violation of their charter—representing such a precedent as endangering the security of all the corporations in the kingdom,—that they finally prevailed, and the bills, though passed in the Commons, were rejected by the Lords.

Next year a dissolution of parliament and change of ministers having taken place, Mr. Pitt introduced a new bill for the better government of India. Many of the provisions of this bill were similar to those of the bill of Mr. Fox. The most important difference related to the appointment of the Board of Control. The commercial affairs and territorial possessions of the Company were to continue in their hands, subject to the superintendence of a board of commissioners appointed by the Crown.

The next subject of any interest is the trial of Warren Hastings. This gentleman had presided over India thirteen years, and arrived in England on the 16th of June, 1785. On the 26th of the same month, Mr. Burke, who had brought heavy accusations against him in the preceding session, gave notice of his intention to impeach him for high crimes and misdemeanours, alleged to have been committed in India. After long debates in this and succeeding sessions, the prosecution was sanctioned by the Commons, and, in 1787, articles of impeachment were sent to the Lords. The trial was protracted from year to year, till the 23d of April, 1795, when the accused was acquitted, on the payment of his fees, of all the charges preferred against him. The Company, in consideration of the services of this officer, discharged the expenses he had incurred by the prosecution, amounting to upwards of £70,000, and settled upon him an annuity of £5000.

In 1793 the charter of the Company was renewed, and their exclusive privileges continued to them until the first day of March, 1814. In this act a clause was inserted to restrain the belligerent propensities of the Company’s servants, but it appears not to have been much regarded. In 1792 Tippoo Saib was despoiled of half his dominions, and compelled to deliver two of his sons into the hands of the Marquis Cornwallis, as hostages for the performance of a treaty by which he engaged to pay £1,600,000 in money to the Company. In 1799 this prince was again attacked by Lord Mornington, now Marquis Wellesley, under pretext of having entered into negotiations with the French, and some of the native princes, for the entire expulsion of the English from India. This war completed the destruction of the sultan. His capital of Seringapatam was taken by assault, himself slain in its defence, and his dominions dismembered. His descendants are now supported by pensions payable by the ci-devant dealers in mace and cloves.

The Company having obtained possession of the different members of the Mogul empire, in 1803, completed their conquests by attacking the Mogul himself in his capital of Delhi. This monarch and his family were also placed upon the pension-list of the Company.

We shall only mention a few more facts connected with the Company’s history till the opening of the trade in 1814. By the act of 1784 the fortunes acquired in India were to be ascertained on the return of each servant of the Company to England; this clause was repealed two years after by 26 Geo. III. c. 57. By the 29 Geo. III. c. 65, they were authorised to add one million to their capital stock. The new stock being subscribed at 174 per cent. produced £1,740,000, which raised their joint-stock to five millions. In 1793 they were authorized to add another million to their capital by subscription, making it £6,000,000, its present amount. This additional stock produced £2,000,000, being subscribed at 200 per cent.

In 1797 valuable concessions were made to the Americans with regard to the India trade. They were permitted to carry on trade with the Company’s territories in India, in articles not prohibited by law, on paying only the duties paid by British vessels. These advantages were not neglected by the Americans. In a few years the trade of the United States in India equalled nearly one half the trade of the Company. It was singular policy to admit a foreign state to the participation of the India trade while our own merchants were excluded.

In 1803, during the alarm of an invasion, the Company, at a general court, came to a resolution to present to government 10,000 tons of shipping to guard the coast, and to be maintained at their own expense. In the years 1808 and 1809 the Company lost four outward-bound and six homeward-bound ships. The value of the ships and cargoes was estimated at two millions.

We have now mentioned the more important facts in the history of the East-India Company to the year 1813, when the exclusive privileges of this association were in part abolished. Prior to that time private traders were not wholly excluded from the India trade. By the 17th clause of the act of 1793, the Company were obliged to appropriate 3000 tons of shipping for carrying out goods belonging to private merchants and manufacturers. The act of 1813 continues to the Company the revenue and territorial acquisitions in India, and the exclusive monopoly of the China trade; but the trade to India, subject to certain restrictions and regulations, is thrown open to the enterprise of individuals. These immunities were conceded to the Company until the 10th of April, 1831, absolutely, and afterwards, until three years’ notice be given by parliament, and the debt due from the public to the Company be paid.