Decline of Mughals & 18th-Century India — Part 7: Rise of British Power
Part 7: Rise of British power from trade to territorial control — Battle of Plassey, Buxar, Dual Government of Bengal, and the Regulating Act of 1773.
Modern India — Part 1 of 5
5. Rise of British Power: From Trade to Territorial Control
The English East India Company, established on 31 December 1600, spent its first century and a half as a commercial enterprise. The Portuguese and Dutch were eased out through a combination of military pressure and diplomatic maneuvering at the Mughal court. By the eighteenth century, the Company faced only the French as a serious European rival.
Three converging factors drove the Company's transition to political power. First, the expansion of European production and trade and the emergence of aggressive nation-states in Europe created competitive pressures that pushed the Company towards territorial control. Second, the decline of Mughal authority provided the opportunity — succession disputes offered ready pretexts for intervention. Third, and crucially, the Company's own financial needs were decisive: it needed revenue to maintain trade and pay its growing military forces, and territorial acquisition appeared the most reliable solution. The Company's interest in conquering Bengal was two-fold — protection of its trade and control over Bengal's revenue, with the intention of remitting surplus revenue as tribute through the channel of investment in Bengal goods.
The conquest of Bengal was the decisive step. Siraj-ud-daula was defeated at the Battle of Plassey in 1757 — a battle that was as much a conspiracy as a military contest, enabled by Mir Jafar's treachery. Mir Jafar, who replaced Siraj, granted the Company the zamindari of 24 Parganas. Mir Kasim (1760) initially appeared more cooperative, granting Burdwan, Midnapore, and Chittagong to Company servants, but then refused to accept the misuse of trading privileges that oppressed his officials and subjects. He joined the Nawab of Awadh and the Mughal emperor in confronting the British at the Battle of Buxar in 1764. The Company won convincingly.
The subsequent arrangements (1765) inaugurated the Dual Government of Bengal: the Company held diwani (revenue) rights while the Nawab nominally retained nizamat (law and order), holding responsibility while the Company extracted revenue. An estimated 5.7 million pounds were drained from Bengal in the years 1766 to 1768 alone — a figure acknowledged even by senior British officials as representing unjust and corrupt rule causing untold misery. The value of Bengal goods exported rose from £400,000 in 1765 to approximately £1 million by the late 1770s.
The administrative abuses forced the end of Dual Government in 1772. The Regulating Act of 1773 marked the formal introduction of British constitutional governance — a Governor-General and Council to administer Bengal and supervise Bombay and Madras; a Supreme Court of Judicature at Calcutta. British principles thereafter permeated deep: separation of judiciary from executive; civil courts that averaged 200,000 cases per year by the early nineteenth century; and the police system reshaped under Cornwallis. The establishment of British Government control over the Company's administration and policies marked the replacement of the indigenous political system by an imperial system subservient to metropolitan interests.