The Anarchy: The Relentless Rise of the East India Company

by William Dalrymple

Since the dramatic contraction of the Empire during the reign of Muhammad Shah Rangila two decades earlier, the hinterlands of Shahjahanabad had succumbed to a feral, dog-eat-dog disorder, where every village was now a self-sufficient, fortified republic, at war with its neighbours. As the Mughals gave little or no assistance to these village republics in times of trouble and invasion, the villagers saw no reason to pay their taxes.

His natural charm and talent enabled him to achieve complete domination over the mind of the Emperor … and he had absolutely no scruples with respect to honour when it was a question of attaining his objective and was quite ready to sacrifice his benefactor … His conduct was marked only by an extreme cunning and revolting cruelty. He is always seen with a rosary in his hands, but his apparent piety was like that of Aurangzeb – nothing but sheer hypocrisy. Piety is most to be feared when it is carried to excess. Barely confirmed in his appointment as Vizier, he now plotted against all who had served him best.78 Safdar Jung’s Old Delhi stronghold – the area around Purana Qila – was looted and destroyed, never to recover. According to Ghulam Hussain Khan, ‘Old Delhi, which used to be even wealthier and more populous than the new city, Shahjahanabad, was plundered and sacked so thoroughly that an infinity of people lost their consorts and children, and were totally ruined, besides numbers that were massacred.

Nevertheless, by eight o’clock on the morning of 2 January 1757, this shattered and half-ruined Calcutta was back in the hands of the Company.

From the EIC’s factory on the southern edge of Murshidabad he became aware of the mutterings of the disaffected nobles at court and hints of a possible coup, so he sent his Armenian agent, Khwaja Petrus Aratoon, to investigate. The answer came back that Mir Jafar, in his position as paymaster of the Bengal army, was prepared to offer the Company the vast sum of 2.5 crore* rupees if they would help him remove the Nawab. Further investigation revealed that the scheme had wide backing among the nobility but that Mir Jafar, an uneducated general with no talent in politics, was simply a front for the real force behind the coup – the Jagat Seth bankers. ‘They are, I can confirm, the originators of the revolution,’ wrote Jean Law many months later. ‘Without them the English would never have carried out what they have. The cause of the English had become that of the Seths.’

The bankers and merchants of Bengal who sustained Siraj ud-Daula’s regime had finally turned against him and united with the disaffected parts of his own military; now they sought to bring in the mercenary troops of the East India Company to help depose him. This was something quite new in Indian history: a group of Indian financiers plotting with an international trading corporation to use its own private security force to overthrow a regime they saw threatening the income they earned from trade.60 This was not part of any imperial masterplan. In fact, the EIC men on the ground were ignoring their strict instructions from London, which were only to repulse French attacks and avoid potentially ruinous wars with their Mughal hosts. But seeing opportunities for personal enrichment as well as political and economic gain for the Company, they dressed up the conspiracy in colours that they knew would appeal to their masters and presented the coup as if it were primarily aimed at excluding the French from Bengal for ever.

On 13 June 1757, a year to the day since Siraj had begun his attack on Calcutta, Clive sent an ultimatum to Siraj ud-Daula accusing him of breaking the terms of the Treaty of Alinagar. That same day, with a small army of 800 Europeans, 2,200 south Indian sepoys and only eight cannon, he began the historic march towards Plassey.

Clive had been due to enter the city on the 27th, but was warned by the Jagat Seths that an assassination plot was being planned. So it was only on 29 June that Clive was finally escorted into Murshidabad by Mir Jafar. Preceded by music, drums and colours, and escorted by a guard of 500 soldiers, they entered together as conquerors. Mir Jafar was handed by Clive onto the masnad, the throne platform, and saluted by him as Governor. He then stated publicly, and possibly sincerely, that the Company would not interfere with his government, but ‘attend solely to commerce’.83 The elderly general ‘took quiet possession of the Palace and Treasures and was immediately acknowledged Nabob’. The pair then went straight to pay their respects to the man who had put both where they were now: Mahtab Rai Jagat Seth. ‘I had a great deal of conversation’ with the great banker, Clive recorded, ‘As he is a person of the greatest property and influence in the three subas [provinces – Bengal, Orissa and Bihar] and of no inconsiderable weight at the Mughal court, it was natural to determine on him as the properest person to settle the affairs of that government. Accordingly, when the new Nawab returned my visit this morning, I recommended him to consult Jagat Seth on all occasions, which he readily assented to.’

The British had become the dominant military and political force in Bengal. They now suspected that if they grew their army sufficiently they could probably seize any part of the country they took a fancy to, and rule it either directly or through a pliant puppet. Moreover, many Indians were beginning to understand this, too, meaning that the Company would become the focus for the attentions of all the dethroned, dispossessed and dissatisfied rulers, leading to a kaleidoscope of perpetually reforming and dissolving alliances that occurred from this point and which offered the region little prospect of peace or stability.

The power of [the Mughal] Empire is greatly broken by intestine commotions, and perhaps its total ruin has been prevented only by the sums of money sent to Delly [from Bengal] … You are well acquainted with the nature & dispositions of these Musselmen: gratitude they have none; [they are] bare Men of very narrow conceptions, and have adopted a system of Politicks more peculiar to this Country than any other, viz: to attempt everything through treachery rather than force. Under these circumstances may not so weak a Prince as Mir Jafar be easily destroyed, or be influenced by others to destroy us? What then can enable us to secure our present acquisitions, or improve upon them, but such a force as leaves nothing to the power of Treachery or Ingratitude?

The young Warren Hastings, now the Company’s Resident (effectively ambassador) at Murshidabad, had been the first to sound the alarm, urging his boss to stay on and settle the anarchy he had helped unleash. In particular, he cited the growing instability at the Murshidabad court. Just before Clive left, Mir Jafar had been able to pay only three of his army’s thirteen months’ arrears of pay. As a result the unpaid troops were openly mutinous and some were starving: ‘their horses are mere skeletons,’ he wrote, ‘and their riders little better. Even the Jamadars [officers] are many of them clothed with rags.’9 It had taken only three years since Plassey to impoverish what had recently been probably the wealthiest town in India.

Nor was it just Company officials who took advantage of the situation to use force to make a fortune: passes, permissions and sepoys were available to anyone who paid enough to the Company. Mir Jafar made particularly strong complaints about a French merchant who had managed to avail himself of Company dastaks (passes) and a battalion of sepoys to impose trade on the people of Assam in ‘a very violent and arbitrary manner’.19 According to his compatriot, the Comte de Modave, M. Chevalier ‘took a great stock of salt and other articles to offload in the rich province of Assam, shielded by English passes and an escort of sepoys to safeguard his merchandise. He used this armed escort to facilitate the disposal of his goods, and as soon as he was established in the valley, sent his soldiers to the richest inhabitants, violently forcing them to purchase quantities of salt at prices determined by himself. With the same violence, he disposed of all his other trade goods.’

The morals of this nation, otherwise so worthy of respect, have here become prodigiously depraved, which cannot but cause distress to any decent and thoughtful observer. British soldiers and traders permit themselves all sorts of liberties in the pursuit of private profit or in the hope of impunity. I have seen some so far forget their duty, that they beat to death unfortunate Indians to extract money not owed to them. The country lies groaning under the Anarchy, laws have no power of sanction, morals are corrupt to the ultimate degree, the people groan under a multitude of vexations, all caused by the decay and confusion into which this once-great empire has fallen, with legitimate rulers having neither credibility nor authority. This rich and fertile land is turning into a desert. It is lost, unless some sudden general revolution restore its ancient splendour.21 Again, it fell to the young Warren Hastings, upriver in Murshidabad, to blow the whistle on many of these illicit activities, exposing the unbridled extortion now going on everywhere in the province:

This was every day becoming more likely. The absence of taxes and customs duty all added to the financial pressure on the Nawab and led to growing violence in the streets of Murshidabad where the Nawab’s hungry sepoys were now taking matters into their own hands. But it also did much to alienate powerful individuals who might otherwise have been tempted to throw in their lot with the Company-backed regime. One of the first victims of the new power equation in Bengal was an influential Kashmiri trader named Mir Ashraf. Mir Ashraf was part of a dynasty of cultured Patna-based merchant princes who had grown rich on the manufacture and trade of saltpetre, derived from the mineral nitrates which appeared naturally in the soils of Bihar. As well as being an important ingredient of gunpowder, it was also used by the Mughals to cool their drinks. Mir Ashraf’s dynasty had good political connections at the Murshidabad court, and until the Battle of Plassey they had found it easy to dominate the saltpetre trade with the support of the Nawab. This irritated their British counterparts, who were unable to compete with the Mir’s efficient procurement organisation, and who had for some years been complaining unsuccessfully that he was monopolising all saltpetre stocks and so shutting them out of the market. Before Plassey, these complaints about Mir Ashraf were simply ignored by Nawab Aliverdi Khan, who dismissed the petitions against his friend by English interlopers as absurdly presumpt...

While Murshidabad had been falling apart, the Mughal capital of Delhi was faring even worse: like some rotting carcass preyed upon by rival packs of jackals, what was left of its riches provided intermittent sustenance to a succession of passing armies, as the city was alternately occupied and looted by Maratha raiders from the south and Afghan invaders from the north.

According to Ghulam Hussain Khan, people initially loved the idea of the return of the good order of Mughal government, but instead they ‘experienced from his unruly troops, and from his disorderly generals, every act of oppression and extortion imaginable; and, on the other hand, they saw every day what a strict discipline the English officers of those days did observe, and how amongst them that travelled, [the officers] carried so strict a hand upon their troops, as to suffer not a blade of grass to be touched; then indeed the scales were turned and when the Prince made his second expedition into those parts, I heard people load him with imprecations, and pray for victory to the English army.’

Ghulam Hussain Khan gives a moving account of Law’s brave last stand and his determination, having seen the Emperor deserted by all, and betrayed even by his commander-in-chief, to battle to the death: ‘M. Law, with a small force, and the few pieces of artillery that he could muster, bravely fought the English, and for some time he managed to withstand their immense numerical superiority. The handful of troops that followed M. Law, discouraged by the flight of the Emperor and tired of the wandering life they had hitherto led in his service, turned about and fled. M. Law, finding himself abandoned and alone, resolved not to turn his back; he bestrode one of the guns, and remained firm in that posture, waiting for the moment of death.’52 Moved by Law’s bravery, the Company commander, John Carnac, dismounted, and without taking a guard, but bringing his most senior staff officers, walked over on foot, and pulling their ‘hats from their heads, they swept the air with them, as if to make him a salaam’, pleading with Law to surrender: ‘You have done everything that can be expected from a brave man, and your name shall undoubtedly be transmitted to posterity by the pen of history,’ he begged. ‘Now loosen your sword from your loins, come amongst us, and abandon all thoughts of contending with the English.’ Law answered that if they would ‘accept this surrendering himself just as he was, he had no objections; but that as to surrendering himself with the disgrace of his being withou...

On 2 July 1761, Miran, the ‘abominable’, murderous, debauchee son of Mir Jafar, was killed – allegedly by a chance sudden strike of lightning while returning from the campaign against Shah Alam. According to John Caillaud, who was present in the camp, ‘the young nabob, was lying asleep in his tent at midnight. Though singular in itself, yet no very extraordinary circumstances attended the event. He was struck dead in the middle of a violent storm, by a flash of lightning. The fire pierced through the top of the tent, struck upon his left breast, and he perished in the flame.’55 The event, however, occurred on precisely the anniversary of Miran’s mass murder of the harem of Siraj ud-Daula and from the beginning there were rumours that his death was the result of divine intervention – or, alternatively, that it was not an accident at all, and that Miran had been murdered. The most probable candidate was said to be a bereaved concubine who had lost a sister to Miran’s murderous tendencies, and who was then said to have covered up her revenge by setting fire to the tent.56 Many rejoiced at the death of this bloodthirsty and amoral prince; but for his father, Mir Jafar, it was the last straw. As the Company demanded prompt payment of all his debts, and as his subjects and troopers revolted against him, the old man had relied more and more on the grit and resolution of his son. Without him, Mir Jafar went to pieces. ‘He had at no time been in his right senses,’ commented Ghulam ...

Even Warren Hastings, who greatly admired Mir Qasim’s abilities, was surprised by the speed with which he turned matters around. The new Nawab first quickly dispersed the mutinous sepoys of Murshidabad by paying them from his own treasury. He then applied himself to sorting out finances and surprised everyone with his administrative skills: ‘Mir Qasim Khan was very skilled in extracting information and in analysing written reports and accounts,’ wrote the historian Mohammad Ali Khan Ansari of Panipat. ‘He embarked immediately on the project of bringing the land of Bengal back into some sort of order.’ He called in the state accountants and tax-gatherers, examining their accounts closely to find out any peculation committed by functionaries of the previous regime. He had Raja Ram Narain [the Governor of Patna, who had helped defeat Shah Alam] brought in for questioning and demanded to see the revenue accounts for Bihar. Any sums claimed to have been made as payments for army salaries were inspected by his tax-gatherers, whom he sent to check the actual numbers of soldiers present, and to correct the record accordingly. After this, Raja Ram Narain, accused on several counts, was imprisoned. Some 15 lakhs rupees* of the Raja’s personal wealth was confiscated, together with his jewels.

After the Battle of Helsa in early January 1761, the Mughal Emperor found himself in the unexpected position of being on the run from the mercenary troops of a once humble trading company. The redcoats tracked him relentlessly. On 24 January, Major John Carnac wrote to Calcutta telling his masters, ‘We have kept following the prince ever since the action, and press so closely upon him that sometimes we find the fires of his camp still burning … His army must be totally dispersed … and he reduced so low as to be more an object of pity than fear.’

Over the next two years, 1761–2, relations between the two rival governments of Bengal became openly hostile. The cause of the steady deterioration was the violent and rapacious way private Company traders increasingly abused their privileges to penetrate the Bengali economy and undermine Mir Qasim’s rule. These private traders regularly arrested and ill-treated the Nawab’s officers, making it almost impossible for him to rule. The Nawab, in turn, became increasingly paranoid that William Ellis, the Chief Factor of the English factory in Patna, was actively fomenting a rebellion against him. Ellis had lost a leg at the siege of Calcutta in 1756 and his subsequent hatred for all things Indian made him take a perverse, almost sadistic, pleasure in disregarding Mir Qasim’s sovereignty and doing all he could to overrule his nominal independence. Henry Vansittart believed that Mir Qasim was a man much more sinned against than sinning, and in this he was seconded by his closest ally on the Council, Warren Hastings.

The passes† for searching the boats, which you formerly favoured me with, and which I sent to every chokey [check post], the Englishmen by no means regard, I cannot recount how many tortures they inflict upon my subjects and especially the poor people … And every one of these Company agents has such power, that he imprisons the local collector [the Nawab’s principal officer] and deprives him of all authority, whenever he pleases.

In October, Hastings went again to visit Mir Qasim at Monghyr, this time taking Governor Vansittart with him so that he could see what was happening with his own eyes. Both were appalled by what they witnessed and returned to Calcutta determined to end the abuses. But on arrival, the two young men failed to carry their fellow Council members with them. Instead, the majority decided to send one of their most aggressive members, Ellis’s friend James Amyatt, to make his own report, to put Mir Qasim in his place and to demand that all Company servants and managers should be entirely exempted from control by the Nawab’s government. Hastings vigorously objected: ‘It is now proposed absolving every person in our service from the jurisdiction of the [Nawab’s] Government,’ he wrote. ‘It gives them a full licence of oppressing others … Such a system of government cannot fail to create in the minds of the wretched inhabitants an abhorrence of the English name and authority, and how would it be possible for the Nawab, whilst he hears the cries of his people, which he cannot redress, not to wish to free himself from an alliance which subjects himself to such indignities?’90 As the urbane Gentil rightly noted, ‘The English would have avoided great misfortunes when they broke with the Nawab, had they but followed the wise counsel of Mr Hastings – but a few bankrupt and dissipated English councillors, who had got themselves into debt and were determined to rebuild their personal fortunes ...

In December 1762, just as Amyatt was about to leave Calcutta, Mir Qasim made a deft political move. After putting up with Ellis’s violence and aggression for two years, the Nawab finally concluded it was time to fight back and resist the encroachments of the Company. He decided to make a stand. Realising his officials were only rarely successful in forcing armed Company outposts to pay the due taxes and customs duties, he abolished such duties altogether, across his realm, ‘declaring that so long as he failed to levy duties from the rich, he would hold back his hand from doing so in the case of the poor’.92 In this way he deprived the English of their unfair advantage over local traders, even if it meant enormous losses for him personally, and for the solvency of his government. Shortly afterwards, on 11 March 1763, armed clashes began to break out between Mir Qasim’s men and those of the Company. There were scuffles in Dhaka and Jafarganj, where Mir Qasim’s representatives, backed now by his new army, began resisting the depredations of the Company managers, frequently facing off against their sepoy escorts; one of Mir Qasim’s officials went as far as issuing an order to execute anyone who claimed EIC protection.

‘As they entered the fortress, they fell on the soldiers, half of them asleep, some awake in their improvised sniper-holes,’ wrote the historian Mohammad Ali Khan Ansari. ‘They killed many, though a few crawled to safety in corners.’ The sepoys then opened the west gate of the citadel and let in the remainder of their forces who were waiting outside. Again they divided into two columns and advanced along the road to the Diwan quarter and its market. The city governor was in the citadel, and as soon as he realised the disaster that was unfolding, rushed with his troops to confront the English, and met them near the bazaar. Here there were heavy casualties on both sides. In the first moments, one of the Governor’s commanders bravely pressed forward and was wounded by a fierce volley of grape shot. The rest of the troops, seeing this, stampeded and fled. The Governor had no choice but to escape by the Eastern Gate, hoping to reach Mir Qasim in Monghyr and bring him news of the coup. His wounded commander meanwhile managed to reach the [Mughal] Chihil Sutun palace [within the fort] and bar the gate behind him, to sit it out and wait for another day on which to fight. The English now had the city in their hands. Their army scum – dark, low-caste sepoys from Telengana – set about plundering goods from shops, dispersing across the city, pillaging the homes of innocent citizens.

A week later, on 4 July 1763, the Council in Calcutta formally declared war on Mir Qasim. As a measure of their cynicism, they voted to put back on the throne his elderly father-in-law, the former Nawab, Mir Jafar. The latter had used his retirement to become a fully fledged opium addict and was now even more befuddled than before. As careless with the state finances as ever, the old Nawab promised to reimburse the Company up to Rs5 million* for the expense of fighting his ambitious son-in-law.

Observers estimated that an unprecedented host, over 150,000-strong, had now gathered from across the Mughal Empire. On one side there were the remnants of Mir Qasim’s New Army under the leadership of Sumru, whose reputation for cold-blooded ruthlessness had been greatly enhanced by the Patna Massacre. Next to these, ranged along the riverbank, were the magnificent scarlet tents of Shah Alam’s Turani Mughal cavalry. Shuja’s forces were even more diverse. There were contingents of Persian Qizilbash cavalry in their red felt hats, and 3,000 pigeon-coated and long-booted Afghan Rohillas, who had once fought with Ahmad Shah Durrani; they were mounted on both horse and camels, and armed with large-bore armour-piercing swivel guns. Then there was Madec’s regiment of French deserters, still, somewhat ironically, dressed in the uniform of the Company. But perhaps Shuja’s most feared crack troops were a large force of 6,000 dreadlocked Hindu Naga sadhus, who fought mainly on foot with clubs, swords and arrows, ash-painted but entirely naked, under their own much-feared Gossain leaders, the brothers Anupgiri and Umraogiri.

Carnac had faced a wave of mutinies among his exhausted sepoys; but as they closed in on Patna, the cracks within the Mughal forces became apparent, too. Fights broke out between the naked Naga sadhus and the Pathans, with entire platoons coming close to bloodshed. Meanwhile, rumours began to spread among the commanders that Shah Alam was in secret communication with the Company: ‘His Majesty was utterly opposed to fighting the English,’ wrote Ansari, ‘so throughout these campaigns he took no part in deliberations or planning, and during the battles stood by to observe his warring vassals from a distance.’44 ‘There was so little order and discipline amongst these troops,’ wrote Ghulam Hussain Khan, ‘and so little were the men accustomed to command, that in the very middle of the camp, they fought, killed and murdered each other, and went out a-plundering and a-marauding without the least scruple or the least control.

In the end it was, as ever, the superior discipline of the Company’s troops that won them the day. Munro liked to remind his troops that ‘regular discipline and strict obedience to orders is the only superiority that Europeans possess in this country’, and the events that day proved him right.58 Despite the loss of their baggage and ammunition, Munro’s sepoys grimly held their squares, even while suffering unprecedented casualties from the concentrated artillery fire aimed at them from Madec and Sumru’s heavy guns.

Shuja, unable to believe the sudden change of fortune, held his ground, determined to rally his troops. ‘He imagined himself already holding the lovely figure of Victory in his embrace, and suddenly he saw himself, as if in a mirror, choking in the arms of that incubus, Defeat. He remained rooted to the spot, staring disbelievingly at this horrid and sudden transformation.’ As the Mughal lines dissolved around him, it was the Naga chieftain Anupgiri, though himself badly wounded in the thigh, who persuaded Shuja ud-Daula to escape: ‘This is not the moment for an unprofitable death!’ he said. ‘We will easily win and take revenge another day.’62 Resolving to live, Shuja cantered to the bridge of boats he had thrown across the river, while the naked Nagas fought a fierce rearguard action behind him. As soon as Shuja, Sumru and he had all crossed it, the Naga leader ordered it to be destroyed behind him.

Buxar was a short and confused battle, but a bloody one: Company forces lost 850 killed, wounded or missing, of the 7,000 men they brought to the field – more than an eighth of their total; Mughal losses were many times higher, perhaps as many as 5,000 dead. For a long time the day’s outcome was uncertain. But for all this, it was still, ultimately, one of the most decisive battles in Indian history, even more so than the more famous Battle of Plassey seven years earlier. The three great armies of the Mughal world had come together to defeat the Company and expel it from India. When instead it was the Mughals that were defeated, the Company was left the dominant military force in north-east India. Buxar confirmed the Company’s control of Bengal and the coast and opened the way for them to extend their influence far inland to the west. The Company, which had started off as an enterprise dominated by privateers and former Caribbean pirates, had already transformed itself once into a relatively respectable international trading corporation, with a share price so reliable its stock was regarded almost as a form of international currency. Now the Company was transformed a second time, not just as a vehicle of trade operating from a scattering of Indian coastal enclaves, but as the ruler of a rich and expansive territorial empire extending across South Asia. For this, above all, was the moment this corporate trading organisation succeeded in laying the ground for its territorial...

The Emperor Shah Alam, meanwhile, did his best to patch up relations with the Company, with whom he had been in secret correspondence throughout the Buxar campaign. From his point of view, Buxar was a battle fought between three of his servants, all of whom had sworn fealty to the Mughal throne, and was therefore a conflict in which he must remain neutral. Throughout the battle, he remained in his tent, determined to show his disapproval of what he regarded as Shuja’s foolishly confrontational strategy.

Mughal scion still thought himself to be emperor of english ...even after buxar

It was a hugely significant moment: with one stroke of the pen, in return for a relatively modest payment of Rs2.6 million,* and Clive’s cynical promise on behalf of the Company to govern ‘agreeably to the rules of Mahomed and the law of the Empire’, the Emperor agreed to recognise all the Company’s conquests and hand over to it financial control of all north-eastern India. Henceforth, 250 East India Company clerks backed by the military force of 20,000 Indian sepoys would now run the finances of India’s three richest provinces, effectively ending independent government in Bengal for 200 years. For a stock market-listed company with profit as its main raison d’être, this was a transformative, revolutionary moment. Even though the Company’s military power was now placed within a ritualised Mughal framework, the radical change on the ground brought about by what the Company referred to as the Treaty of Allahabad was immediately apparent. As the Riyazu-s-salatin noted shortly afterwards: ‘The English have now acquired dominion over the three subahs [provinces] and have appointed their own district officers, they make assessments and collections of revenue, administer justice, appoint and dismiss collectors and perform other functions of governance. The sway and authority of the English prevails … and their soldiers are quartering themselves everywhere in the dominions of the Nawab, ostensibly as his servants, but acquiring influence over all affairs. Heaven knows what will be...

But for the people of Bengal, the granting of the Diwani was an unmitigated catastrophe. The Nawab was no longer able to provide even a modicum of protection for his people: tax collectors and farmers of revenue plundered the peasantry to raise funds from the land, and no one felt in the least bit responsible for the wellbeing of the ordinary cultivator. Merchants and weavers were forced to work for the Company at far below market rates; they also seized by force textiles made for their French and Dutch rivals. Merchants who refused to sign papers agreeing to the Company’s harsh terms were caned or jailed or were publicly humiliated by being made to rub their noses on the ground.94 A few years later, in 1769, Becher recorded, ‘it must give pain to an Englishman to think that since the accession of the Company to the Diwani, the condition of the people of the country has been worse than it was before; yet I am afraid the fact is undoubted. This fine country, which flourished under the most despotic and arbitrary government, is now verging towards ruin.’

Moreover, wrote Ghulam Hussain Khan, the Company’s conquests represented an entirely different form of imperial exploitation from anything India had previously experienced. He articulated, long before any other Indian, both what being a subject colony entailed, and how different this strange and utterly alien form of corporate colonialism was to Mughal rule. ‘It was quickly observed that money had commenced to become scarce in Bengal,’ he wrote. Initially no one knew whether ‘this scarcity was owing to the oppressions and exactions committed by the rulers, or the stinginess of the public expenses, or lastly of the vast exportation of coin which is carried every year to the country of England.’ But it rapidly became clear that the drain of wealth was real. It soon became common ‘to see every year five or six Englishmen, or even more, who repair to their homes with large fortunes. Lakhs upon lakhs have therefore been drained from this country.’

Greatest depression

As Macaulay later put it, the Company looked on Bengal ‘merely as a Buccaneer would look on a galleon’.101 It took five years for the full effects of this regime of unregulated plunder to become apparent; but when it did so the results were unparalleled in their horror. The stage was now set for the great 1770 Bengal famine.

In reality, there were other remedies to hand which did not require divine intervention. Famines had been a baleful feature of Indian history from time immemorial, whenever the rains failed. But for centuries, and certainly by the time of the Mughals, elaborate systems of grain stores, public works and famine relief measures had been developed to blunt the worst effect of the drought. Even now, some of the more resourceful and imaginative Mughal administrators took initiatives to import rice and set up gruel kitchens.13 Ghulam Hussain Khan was especially impressed by the work done by Shitab Rai, the new Governor of Patna. Shitab Rai had been the deputy of Raja Ram Narain and had narrowly escaped death when his master was executed by Mir Qasim.

Platoons of sepoys were marched out into the countryside to enforce payment, where they erected gibbets in prominent places to hang those who resisted the tax collection.19 Even starving families were expected to pay up; there were no remissions authorised on humanitarian grounds. Richard Becher in Murshidabad was appalled by what he saw and wrote to Calcutta for instructions: ‘Am I really quietly to stand by and see them commit the vilest acts of oppression, without being able to render the aggrieved redress?’ he asked. ‘The creatures of our government enrich themselves at the people’s expense, nay even their ruin.’

During first bengal famine

The Council argued that they had responsibilities to maintain the defences of Bengal and protect their military gains. They therefore authorised 44 per cent of their £22 million annual budget* to be spent on the army and on the building of fortifications, so rapidly increasing the size of their sepoy regiments to 26,000 sepoys.23 The only rice they stockpiled was for the use of the sepoys of their own army; there was no question of cuts to the military budget, even as a fifth of Bengal was starving to death.

This unnamed speculator was not alone: in 1770–71, at the height of the Bengal famine, an astounding £1,086,255 was transferred to London by Company executives – perhaps £100 million in modern currency.

As Bengal lay racked by famine, ‘with the greatest part of the land now entirely uncultivated … owing to the scarcity of the inhabitants’, in London, Company shareholders, relieved to see tax revenues maintained at normal levels, and aware that the share price was now higher than it had ever been – more than double its pre-Diwani rate – celebrated by voting themselves an unprecedented 12.5 per cent dividend.

That summer, the attacks on the Company took many forms. Some accused the Company of near-genocide in India; others of corrupting Parliament; others again focused on the social mountaineering of the returned Nabobs, with their dripping Indian diamonds, their newly bought estates and their rotten boroughs. Many raised the valid point that a private corporation enjoying a government trading monopoly ought not to be running an overseas empire: ‘Trade and the Sword ought not to be managed by the same people,’ wrote Arthur Young in a widely circulated pamphlet. ‘Barter and exchange is the business of merchants, not fighting of battles and dethroning of princes.’

After bengalbfamine 1770

Bolts’ solution was for the Crown to take over Bengal as a government colony, so ending the asset-stripping of the province by a for-profit Company.

The economic and political theorist Thomas Pownall wrote how ‘people now at last begin to view those Indian affairs, not simply as financial appendages connected to the Empire; but from the participation of their revenues being wrought into the very frame of our finances … people tremble with horror even at the imagination of the downfall of this Indian part of our system; knowing that it must necessarily involve with its fall, the ruin of the whole edifice of the British Empire’.57 This was certainly the view of the King. George III wrote that he believed ‘the real glory of this nation’ depended on the wealth of India which offered ‘the only safe method of extracting this country out of its lamentable situation owing to the load of debt it labours under’.58 On 26 November, Parliament was recalled to discuss the East India Company’s financial crisis, as well as the now widespread allegations of corruption and malpractice made against individual EIC servants: the contrast between the bankruptcy of the Company and the vast riches of its employees was too stark not to be investigated. There was also a personal element to this: 40 per cent of MPs owned EIC stock and their finances had all been severely damaged by the fall in its value.

On 18 December 1772, the directors of the East India Company were summoned to the Houses of Parliament. There they were fiercely examined by General John Burgoyne’s Select Committee, which had been set up to investigate EIC abuses in India, and particularly accusations of embezzlement and bribe-taking. Charges of corruption were levelled against several EIC servants, including Clive, who Burgoyne described as the ‘oldest, if not principal delinquent’.

Clive responded on 21 May 1773 with one of his most famous speeches, saying he objected strongly to being treated like ‘a common sheep-stealer’. After Plassey, he thundered, ‘a great prince was dependent on my pleasure; an opulent city lay at my mercy; its richest bankers bid against each other for my smiles; I walked through vaults which were thrown open to me alone, piled on either hand with gold and jewels! Mr Chairman, at this moment I stand astonished by my own moderation.’ Clive talked powerfully in his own defence for two hours. Making a final plea, ‘leave me my honour, take away my fortune’, he walked out of the chamber, tears in his eyes, followed by loud and repeated cries of ‘Hear, hear!’ Entering his carriage, he drove back home, not knowing whether he had ‘a sixpence to call his own in the morning’.61 The debate lasted long into the night, with a growing majority of speakers rising to attack Burgoyne’s motion. The Resolution was eventually rendered harmless by a series of amendments and another praising Clive’s ‘great and meritorious services to this country’. In the end, after an all-night debate, Clive had been cleared by a vote of 95 for censure to 155 for clearing his name.62 The Prime Minister, Lord North, may have lost one battle, but he was still determined to bring the EIC to heel. Shortly after Burgoyne’s bill of censure had been defeated, he declared, ‘I think, sir, it is allowed that Parliament have a right over the East India Company … Such continu...

But, in return, the Company agreed to subject itself to a Regulating Act, defined by Lord North’s India Bill of June 1773, which would bring the EIC under greater parliamentary scrutiny. Parliament would also get to appoint a Governor General who would now oversee not just the Bengal Presidency but those of Madras and Bombay as well.

Not long after his return to England, on 22 November 1774, at the age of only forty-nine, Robert Clive committed suicide in his townhouse in Berkeley Square.

On 19 October 1774, the three Crown councillors appointed by the statutes of the Regulating Act, Philip Francis, General Clavering and Colonel Monson, finally docked in Calcutta. They were immediately offended to be given a seventeen-, not a twenty-one-gun salute, and by the ‘mean and dishonourable’ reception:

The second power was a new force, which in the 1770s was just emerging and beginning to flex its military muscles: the Mysore Sultanate of Haidar Ali and his formidable warrior son, Tipu Sultan. Haidar, who was of Punjabi origin, had risen in the ranks of the Mysore army, where he introduced many of the innovations he had learned from observing French troops at work in the Carnatic Wars. In the early 1760s he deposed the reigning Wodiyar Raja of Mysore and seized control of his state in what today might be called a military coup, rapidly increasing the size of Mysore’s army and using it to occupy the lands of a succession of small neighbouring rulers. He imported French officers to train his troops and French engineers to rebuild the defences of the island fortress of Srirangapatnam.

In many other respects, too, the Mysore troops were more innovative and tactically ahead of the Company armies. They had mastered the art of firing rockets from their camel cavalry to disperse hostile cavalry formations, for example, long before William Congreve’s rocket system was adopted by the British army.98 Haidar and Tipu had also developed a large bullock ‘park’ of white Deccani cattle to allow them rapidly to deploy infantry and their supplies through their kingdom, a logistical innovation later borrowed by the Company.