June 14, 2021
5 Minutes

The East India Company V. The British Raj

The East India Company remains history's most petrifying lesson about the abuse of corporate power - one which is very appropriate to heed in this era.

Join 1,000+ readers and get my weekly newsletter. It's a minute read. I share work that I have shipped, work that has piqued my curiosity, and a haiku poem I have written.
You're in! Check your inbox :)
There's an issue. Try Again :)
Table Of Contents

1. The East India Company

2. The British Raj

3. The Independence Of India

We often believe that the East India Company and the British Raj were the same entity. Though the East India Company and the British Raj were British through and through, they were not similar. One was a private company, and the other was direct rule by the British Crown.

The East India Company - a powerful and private profit-making corporation that built up a private army, paved the way for rule by the British Crown. The British Raj transitioned India from commercial power to colonial power.

The East India Company

The East India Company (registered - Governor and Company of Merchants of London Trading into the East Indies), was a private company founded by John Watts in December 1600. At that time, there were competing East India Companies, notably Netherland’s Dutch East India Company.

Queen Elizabeth I, granted the East India Company a royal charter - that allowed it to use military power to protect itself from competitors. And, undertake expeditions to the Indian subcontinent. She also granted over two hundred other companies similar privileges.

The role of the East India Company was one of commerce and conquest.

In 1640, the East India Company built a trading centre in Madras. During this period, they realised it wasn’t possible to compete with the Dutch East India Company in the spice trade. Hence, they diverted their attention to textiles.

By 1688, the East India Company had established factories in Goa, Chittagong, Bombay, Madras and three small villages in the East of India.

By the 1700s, the East India Company dominated the global textile trade, in the process, amassing a private army to protect its interests. (In 1708, the East India Company merged with a rival to create the United Company of Merchants of England Trading to the East Indies.)

India’s wealth rapidly drained into Britain and into Robert Clive’s pocket, who, after winning the Battle of Plassey in 1757, become the master of Bengal.

By 1785, the East India Company controlled a monstrous empire with a staff of only 159. The meteoric rise of the East India Company was in part due to the decline of the Mughals.

After the East India Company’s victories in the Battle of Plassey (1757) and Buxar (1764), it got granted the Diwani of Bengal - the right to collect taxes. At this point, the East India Company transitioned from being one of brutal commercial power to an impromptu imperial power. Exploiting this power, by 1803, the East India Company had captured Delhi.

Image by Wikimedia

Building upon their victories, the East India Company drove the French and Dutch out of the Indian subcontinent. And, within less than a decade, rerouted the wealth in the East, westward.

To protect this monopoly, Sir Josiah Child - governor of the East India Company, conceived the idea to create a private army. It had more troops than the British Army at its peak - that turned the East India Company into a ferocious authority governing over India.

The demise of the East India Company got by itself. Because of its sociopathic behaviour (parliament called it repressive), the East India Company’s commercial monopoly got broken in 1813.

The East India Company’s army played a prominent role in the unsuccessful Indian Uprising (1857-1858), where Indian soldiers led an armed revolt against their British counterparts. The Indian Uprising gained popularity as a war for Indian independence.

In 1858, the East India Company got nationalised by the British Crown - the dawn of the British Raj - this was the beginning of the direct rule of India.

The British Raj

After 1858, Great Britain officially ruled India. As a result, Queen Victoria became the Empress of India.

The control of India got administered by a Viceroy and Governor-General - the first Viceroy and Governor-General of India was Viscount Canning. The Viceroy and Governor-General managed India’s affairs from Calcutta until the capital moved to Delhi in 1912.

The British also established Lieutenant-Governor’s in each of the provinces to administer more local matters. Affairs of which got acted upon on behalf of the British Monarchy, parliament and controlled British interests.

Queen Victoria had promised that the British government would work to better the lives of Indian citizens.

The British gave India railways (tracks increased to 10,000 miles between 1860-1880), tea, cricket and the English language (as of 2020, India is the  second-largest English speaking country) - albeit, unintentionally. Yet, famine still ran rampant, killing millions of Indians.

The British Raj had intended to increase Indian participation in governance. But, the development of India was not to be at the expense of Great Britain.

The Independence Of India

The British Crown ruled over the Indian subcontinent until 1947.

Some historians claim that the British rule of India was made possible because of how divided Indian society was. The opposing party highlight that it was Britain that fostered those divisions. Across India, Britain forged alliances with local princes. Princes gained from their loyalty to the Crown.

Research suggests that from 1870-1930, Britain took approximately one per cent of India’s wealth annually - this is less than the French, Dutch and Germans took. And, unlike other rulers, public health and life expectancy did improve under the British Raj. But, as mentioned, famine still ravaged.

The final period of the British Raj got filled with violence between Hindus and Muslims. The rising tide of violence made administering India challenging, particularly after World War II.

The British ruled over India throughout World War I and World War II. India contributed much to the British effort. Many of the Indian soldiers recruited were Sikhs from Punjab. Due to their loyalty, the Sikhs had hoped that they’d get the chance to carve out their own country, but history shows otherwise.

One of India’s most influential figures, Mahatma Gandhi, played a key role in India’s independence. In 1915, before arriving in India, Gandhi helped lead an Indian nationalist movement in South Africa. By 1920, Gandhi was the leader of the Indian National Congress, calling for independence.

In July 1947, Britain’s parliament passed the Indian Independence Act. Less than one month later, the India-Pakistan border was to come into effect. This shockingly managed hand-over resulted in one of the most significant forced migrations of the 20th century, resulting in 200,000 - 2,000,000 deaths. Sikhs suffered the most relative to their numbers.

Image by Wikimedia

Often, the picture painted of the East India Company is of a nonpartisan organisation, which had trading rights with the Mughal and Maratha Empires. But, it’s clear to see that tyranny got embedded into its founding.

For the first time in history, the East India Company showed and hopefully last that a private company can rule a country. Though the British Raj was far from perfect, it had a better intent. But, even the British Raj, with its vast colonial empire, could not wholly control a country as complex and diverse as India.

We are now in a world where the wealth of the West is drifting East.

Today, India is home to many of the world’s billionaires. Many of whose fortunes have gotten made through manipulation and influence, not much different from the behaviour of the East India Company.

Fortunately, the East India Company has no modern equivalent.

The East India Company remains history’s most petrifying lesson about the abuse of corporate power, which is key to heed lessons from this era

Join 1,000+ readers and get my weekly newsletter. It's a minute read. I share work that I have shipped, work that has piqued my curiosity, and a haiku poem I have written.
You're in! Check your inbox :)
There's an issue. Try again :)