Trade in Bengal By East India Company | Class 8 History Notes

Trade-In Bengal by East India Company: According to the syllabus of NCERT Class 8, History – Chapter 2: From Trade to Territory: The Company Establishes Power: With the demise of Aurangzeb, the mighty Mughal Empire began to fracture, paving the way for the rise of regional powers across the Indian subcontinent. In the wake of Aurangzeb’s death in 1707, Mughal governors and influential zamindars started to assert their control, leading to the fragmentation of central authority in Delhi.

This period of political turbulence set the stage for the emergence of a new force on the horizon by the latter half of the eighteenth century. As the Mughal Empire weakened, an entity known as the East India Company began to make its mark, heralding significant shifts in trade, governance, and ultimately, the destiny of the Indian subcontinent.

Trade in Bengal By East India Company – Class-8 Notes

East India Company Comes East

The East India Company’s journey to the East marked a significant turning point in history. In 1600, the East India Company obtained a charter from Queen Elizabeth I of England, granting it exclusive trading rights with the East. This charter gave the Company a monopoly in English trade, allowing it to explore new lands for goods at favorable prices.

• Unlike other English trading groups, the Company did not face competition due to its royal charter.
• However, the charter did not deter other European powers from entering Eastern markets.
• By the early 17th century, the Portuguese had already established their presence in India, particularly in Goa, following Vasco da Gama’s discovery of the sea route in 1498.
• The Dutch and French also began exploring trade opportunities in the Indian Ocean.
• Competition among European companies for goods like cotton, silk, and spices drove prices up, reducing profits.
• Intense competition led to conflicts between trading companies, including battles at sea and blockades of trade routes.
• The Company’s efforts to protect its interests led to conflicts with local rulers, blurring the lines between trade and politics.
• These developments illustrate the challenges the Company faced as it expanded its operations into the East

East India Company Begins Trade in Bengal

The East India Company’s entry into Bengal marked a significant chapter in the history of trade in the Indian subcontinent.The East India Company established its presence in Bengal with the following facts:

• In 1651, the Company set up its first English factory on the banks of the river Hugli.
• This factory served as the operational base for the Company’s traders, known as “factors.”
• The factory included a warehouse for storing export goods and offices for Company officials.
• As trade expanded, the Company encouraged merchants and traders to settle near the factory.
• By 1696, the Company began constructing a fort around the settlement for protection.
• Within two years, the Company obtained zamindari rights over three villages, including Kalikata, which later became Kolkata.
• The Company also secured a farman from Mughal Emperor Aurangzeb, granting it the right to trade duty-free.
• Despite Aurangzeb’s farman, Company officials engaged in private trade and refused to pay duties, causing revenue loss for Bengal.
• The Nawab of Bengal, Murshid Quli Khan, was forced to protest against the Company’s actions.

How Trade led to Battles

The conflict between the East India Company and the nawabs of Bengal escalated during the early 18th century due to various reasons:

• After the death of Aurangzeb, the nawabs of Bengal, like other regional powers, sought to assert their power and independence.
• Leaders such as Murshid Quli Khan, Alivardi Khan, and Sirajuddaulah became Nawabs of Bengal, each known for their strong rule.
• The nawabs refused to grant concessions to the Company, demanded hefty tributes for trading rights, and prevented the Company from minting coins or expanding its fortifications.
• They accused the Company of deceit, claiming it deprived the Bengal government of revenue and undermined their authority.
• The Company countered by stating that unjust demands hindered trade, insisting that removing duties was necessary for trade to thrive.
• The Company believed expanding settlements, purchasing villages, and fortifying structures were essential for trade expansion.
• These disputes over trade and authority ultimately led to tensions and battles between the Company and the nawabs of Bengal.

The Battle of Plassey

The Battle of Plassey was a pivotal event in the history of British rule in India. Here’s how it unfolded:

• After the death of Alivardi Khan in 1756, Sirajuddaulah ascended to the position of Nawab of Bengal.
• The East India Company, fearing Sirajuddaulah’s power, sought a puppet ruler who would grant trade concessions and other privileges.
• Sirajuddaulah, angered by the Company’s interference, demanded they cease meddling in his affairs, dismantle fortifications, and pay owed revenues.
• When negotiations failed, Sirajuddaulah marched with his army to capture the English factory at Kassimbazar and then Calcutta.
• Company officials from Madras sent forces led by Robert Clive to counter Sirajuddaulah’s advances.
• After prolonged negotiations, in 1757, Clive led the Company’s army against Sirajuddaulah at Plassey.
• One of the main reasons for Sirajuddaulah’s defeat was the betrayal of his commander, Mir Jafar, who sided with Clive in exchange for the promise of becoming nawab.
• The Battle of Plassey marked a significant victory for the Company and paved the way for its expansion in India.
• Following the battle, Sirajuddaulah was assassinated, and Mir Jafar was made the nawab.
• Despite being unwilling to directly administer territories, the Company realized it needed more control to ensure trade interests.
• After several shifts in nawabs, in 1765, the Mughal emperor appointed the Company as the Diwan of Bengal, granting it control over revenue collection.
• This appointment allowed the Company to use Bengal’s vast revenue resources to finance its operations, marking a significant shift in its economic strategy.

Company Officials become “Nabobs”

The term “nawabs” signified not only increased power and authority for the East India Company but also sparked ambitions among its servants. Each Company official began to envision a lifestyle akin to that of nawabs. After the Battle of Plassey, where the Company gained significant victories, actual nawabs of Bengal were compelled to offer land and substantial sums of money as personal gifts to Company officials. Figures like Robert Clive exemplified this trend, amassing vast fortunes in India. Clive’s wealth, accumulated during his tenure in India, was staggering, reaching £401,102 by the time he left in 1767.

Despite his initial intentions to combat corruption within the Company, Clive himself faced scrutiny by the British Parliament over suspicions regarding his wealth. While some officials, like Clive, succeeded in acquiring wealth, many succumbed to disease and warfare in India. However, the aspiration for wealth persisted among Company officials, stemming from humble origins and driven by the desire for a comfortable life upon returning to Britain. Those who returned with riches were mockingly labeled “nabobs,” an Anglicized term derived from “nawab.” Seen as social climbers and upstarts in British society, these nabobs flaunted their wealth, drawing ridicule in plays and cartoons.

Conclusion

The East India Company’s trade in Bengal had far-reaching consequences, shaping the course of history in the Indian subcontinent. The Company’s entry into Bengal marked a significant chapter in trade dynamics, as it obtained exclusive rights and established factories and settlements. However, tensions arose between the Company and the nawabs of Bengal, leading to conflicts and battles. The aftermath of the Battle of Plassey saw Company officials amassing vast wealth, sparking scrutiny and accusations of corruption. While some officials prospered, many faced early deaths in India. The Company’s trade activities not only transformed economic landscapes but also fueled political turmoil and social tensions. The legacy of the Company’s trade in Bengal serves as a reminder of the complexities and consequences of colonial expansion and economic exploitation.

FAQ’s on “Trade-In Bengal by East India Company”

Why was the East India Company granted exclusive trading rights with the East?

Queen Elizabeth I granted the Company a charter in 1600, giving it a monopoly on English trade in the East.

How did the Company Establish its presence in Bengal?

The Company set up its first English factory on the Hugli River in 1651, which served as its operational base.

What were the Company’s objectives in Bengal?

The Company aimed to expand trade and protect its interests by building settlements, obtaining rights over villages, and securing trade privileges.

What challenges did the Company face in Bengal?

The Company faced resistance from local rulers like the Nawab of Bengal, who accused it of deceit and unfair trade practices.

What led to conflicts between the Company and the nawabs of Bengal?

Disputes over trade concessions, taxation, and authority escalated tensions between the Company and the nawabs.

What significant event marked the Company’s rise in Bengal?

The Battle of Plassey in 1757, where the Company defeated the forces of Sirajuddaulah, marked a turning point in its dominance in Bengal.

How did Company officials amass wealth in India?

Company officials like Robert Clive accumulated vast fortunes through gifts from local rulers and trade profits.