The English East India Company, which would become synonymous with the British Empire in India from the late 18th century, was born on the last day of 1600. On that day, Elizabeth I granted to a group of merchants interested in long distance trade, a royal charter granting them the monopoly to trade in Asian waters – the large stretch of water and land from the Cape of Good Hope to the South China Sea. The ‘monopoly’ meant that no one, person or corporation, save the English East India Company could trade in the territory and waters described in the royal charter. This monopoly, from the moment of its inception, never went unchallenged.
There existed in those early years of the 17th century a rival company demanding the same privileges in the same geographical area. It required a great deal of complicated negotiations to bring together the ‘Old’ and the ‘New’ Companies by Lord Godolphin’s award in 1608, and from the next year, the United Company of Merchants trading to the East Indies was formed and it started operations. This rivalry between the Old and the New Companies is often overlooked – it is overlooked even in Rupali Mishra’s meticulously researched book A Business of State: Commerce, Politics, and the Birth of the East India Company – but is not without some importance. For one thing, the rivalry in the initial decade had dislocated the trade with India, and had aggravated political factionalism in the City and in the Court. For another, the rivalry was a pointer to how fragile the notion of monopoly was from the very beginning and would become even more so as the trade of the East India Company grew and its activities expanded.
Rupali Mishra
A Business of State: Commerce, Politics, and the Birth of the East India Company
Harvard University Press, 2018
Mishra has written an important book. This is not just a book that is extraordinarily well-researched but it also fills a major gap in the literature. The first hundred years of the Company has received very little attention from historians. The second hundred years is covered in Lucy Sutherland’s magisterial, The East India Company in Eighteenth-Century Politics (Oxford: Clarendon Press, 1952). More importantly, the book demonstrates the close and almost inevitable connection that existed between the English East India Company from its inception and the English state. This, in fact, is the central argument of the book.
The point is important – and Mishra establishes it beyond any reasonable doubt – because there still exists the few among certain historians (mostly British) that the English state had little or nothing to do with the early conquests in India and the setting up of an empire. The latter grew out of the haphazard activities of a trading body, namely the English East India Company. The trade and other operations of the latter, as Mishra shows in great detail, were “a business of the state” – pushing it a bit further one could say without too much of an exaggeration that it was the state’s business to promote and protect the English East India Company and its activities.
The first link in the chain was the Company’s need for a royal charter. As Mishra writes, “Only through a letter patent [read charter] could a group of merchants be transformed into an incorporated body with powerful privileges.’’ Without a charter, it was possible to embark on a trading venture but there would be no guarantees or special legal powers. In other words, for such a venture to be successful and profitable, state support was a necessary condition. The royal charter was a step in that direction. Mishra notes very pertinently, “A patent represented the moment when the private interests of individuals and the interest of the commonwealth were bound together. It signified how the monarch, through an act of the royal prerogative, could harness the endeavours of a group of individuals for the benefit of the whole nation.” The self-interest of individuals was through a royal charter merged into the reach and the power of the state. The interests of the English East India Company were thus, from the inception of the Company, inextricably linked to the interests and the glory of the English state.
Mishra quotes a member of the Company, Thomas Mun, who was also an early economic theorist, who wrote that trade was “the very touchstone of a kingdom’s prosperity’’. The trade of the English East India Company was not only obviously an integral part of England’s trade but also as the 17th century advanced and in the 18th century, it was arguably the most lucrative part of England’s trade. England’s political class were aware of this and many members of that class were involved in the trade of the Company by way of being its shareholders earning very good dividends.
The word “empire” in the 17th century had still not overtly entered the Company’s lexicon. But events in the outposts in India were rapidly changing the nature of the Company’s activities. In India, the English Company had to take into account the competition of other European countries; and in the late 17th century the power of the Mughal Empire began to decline leaving the Company’s trade vulnerable to disruption. The servants of the Company were the first to recognise the implications of this danger. Gerald Aungier wrote to his employers that “the times now require you to manage your general commerce with sword in your hands’’.
In London, those who guided the Company’s fortunes, especially Sir Josia Child, were also able to grasp the importance of this. From this began the project of fortifying its settlements and its factories. These contained the seeds of conflict with local Indian rulers and of future military expeditions and conquests. Violence and acquiring of territory were becoming essential parts of the Company’s operations. This transformation could not have been possible if the trade of the Company, as Mishra so ably presents to her readers, had not been the business of the state.
How did a mere trading Company come to be the master of a huge territory by the end of the 18th century? This is a question that is often posed. And one answer that has been around since the 19th century is that the empire grew out of a fit of absent mindedness – with the English state having nothing to do with it. Mishra’s book nails this persistent misrepresentation. The fortune and the future of the English East India Company were never separate from those of the English state, not even in the 17th century.
Rudrangshu Mukherjee is chancellor and professor of history at Ashoka University. All views expressed are personal.
