Foundation of British Rule in India!

European trade in India:

From time immemorial, India had trade relations with countries in the West.

This European trade was carried out by Arab merchants who bought things in India and sold these to European countries.

European merchants were trying to find out a route to India so that they could trade directly with the country.


This indirect trade came to an end with the discovery of a sea- route between Europe and India. Vasco da Gama of Portugal reached Calicut in 1498.

Vasco da Gama The Portuguese Trade:

The Portuguese established their headquarters in Goa, Daman and Diu on the western coast of India and established their monopoly over trade with India. The success of the Portuguese traders prompted other European countries to set up trading companies for trade with India and other parts of Asia and Africa. Thus, Holland, England, France and Denmark set up trading companies. With the arrival of other European companies, the Portuguese lost their predominance over Indian trade.

The Dutch East India Company:

The Dutch East India Company was more interested in the profitable spice trade with the islands of the East Indies. They were soon pushed out by the other European companies.

The English East India Company:

In 1600, a company popularly known as the English East India Company was established by a small group of English merchants. Queen Elizabeth, by a charter, granted them the exclusive right to trade with the East. The East India Company set up its first factory at Surat. A factory, in those days, was not a place where goods were manu­factured. It consisted of a warehouse, an office and residential quarters. They were so named as the Company officials, also called ‘factors’, resided there.


Madras became an important British trading settlement. In 1688, Bombay was transferred to the Company by King Charles II, who had received it as a dowry from the Portuguese at an annual rent of 10 pounds. The company also established trading centre at Fort William in Calcutta. By 1700 the East India Company had established three important factories in Madras, Bombay and Calcutta.

Factories of the European Companies in India-1705There was in Europe a demand for Indian goods such as indigo (a blue dye), saltpetre (used for gunpowder) and handloom textiles. Indian merchants flocked to the trading centres and the East India Company carried on profitable trade.

The French East India Company:

The French East India Company, which was formed in 1664, established trade centres at Surat, Pondicherry near Madras, Chandernagar in Bengal and Mahe near Mysore. The French East India Company was founded by the French government and its factories depended on government support.

The French Governer, Dupleix

By the 18th century, the British and the French East India Companies had emerged as the two major European trading companies in India. So a conflict between the two companies over trade and power was unavoidable. The French and the English were equally determined to monopolize the flourishing trade with India.

Anglo-French Rivalry:

In Europe, the English and the French were rivals and fought several wars. This political conflict in Europe further aggravated their commercial rivalry for supremacy in India. The conflict between the two East India Companies occurred in the Carnatic region which lies along the Coromandal coast.

A Dipiction of an Anglo-French WarThe First Carnatic War (1742-1748):

In 1740 war broke out in Europe over the problem of succession to the Austrian throne. In this war France and England fought on opposite sides. Technically, therefore, the British and the French in India were also at war with each other.


Dupleix, the French Governor in India, captured Madras. The English appealed to Anwar-ud-din, the Nawab of the Carnatic, to save Madras. The Nawab sent an army against the French. A small but disciplined and well- equipped French army completely defeated the large army of the Nawab.


The War of Austrian Succession ended in 1748. Peace came to India as well. The treaty restored Madras to the English. Thus ended the First Carnatic War without any territorial gain on either side. The war, however, had raised the prestige of the French. It had also demonstrated the superiority of western method of warfare over that of the Indian. Anwar-ud- din’s huge army was defeated by a small French force.

The Second Carnatic War:

The Second Carnatic War was the result of English and French interference in local politics with a view to making substantial gains. Dupleix had decided to use the army to establish French predominance in the Deccan.


In 1748, the rulers of both Hyderabad and Carnatic died. In Hyderabad, a bitter contest for throne ensued between Nasir Jang and Muzaffar Jang. In the Carnatic, Chanda Sahib contested the claim of Anwar-ud-din to the throne.


Dupleix decided to enhance French power by taking sides in these conflicts between rival claimants. His objective was to set up puppet governments that would support the French against the British. He signed two secret treaties with Muzaffar Jang and Chanda Sahib, claimants to the thrones of Hyderabad and the Carnatic respectively.

Robert Clive

With Dupleix’s help, Muzaffar Jang ascended the throne of Hyderabad. Nasir Jang was killed. Dupleix was handsomely rewarded. A French force under Bussy was stationed in Hyderabad. After Muzaffar Jang’s death, Salabat Jang was put on the throne. In return, Salabat Jang gave four districts in the Andhra region known as the Northern Sarkars to the French Company.

In the Carnatic also, Chanda Sahib, with Dupleix’s assistance, defeated and killed Anwar- ud-din and became the Nawab. Muhammad Ali, the son of Anwar-ud-din, escaped to Trichinopoly. Chanda Sahib rewarded the French with a grant of 80 villages.

The French had achieved tremendous success both in Hyderabad and the Carnatic. French candidates had been put on the thrones of both the places. In addition, the French had got jagirs, huge sums of money and the Northern Sarkars.

The success of Dupleix did not go unnoticed by the English. They decided to install Mohammad Ali on the throne of Arcot. Robert Clive attacked and captured Arcot, the capital of the Carnatic. In the war that followed, Chanda Sahib was defeated, captured and put to death. Mohammad Ali was installed as the ruler.

The French Government initiated peace negotiations. Dupleix was recalled. The Northern Sarkars was the only territorial gain that the French made after the Second Carnatic War.

The Second Carnatic War restored British prestige and established their control over the Carnatic.

The Third Carnatic War:


In the year 1756, Seven Years War broke out in Europe. With the outbreak of hostilities between England and France in Europe, the Third Carnatic War started in India. The French Government sent Count de Lally to replace Dupleix. Clive was replaced by Eyre Coote.


In order to strengthen himself, Lally recalled Bussy from Hyderabad. The English at once secured Northern Sarkars from the Nizam of Hyderabad. Lally was finally defeated by Sir Eyre Coote in the Battle of Wandiwash in 1760.


The war in India ended with the end of the war in Europe. The French possessions were restored by the treaty but they were not allowed to fortify them. The French dream of establishing an empire in India was shattered. The Northern Sarkars passed into the hands of the English. The English East India Company emerged as the strongest power in South India. They could now derive political and economic advantages without being challenged by any other foreign power.

Reasons for English Success:

1. The English East India Company was a private enterprise owned by British merchants capable of taking risks. The British Government did not interfere in the affairs of the Company. The French East India Company, on the other hand, was a Government concern. The French Government was not willing to finance the Company’s heavy war expenses.

2. The English Company was financially much stronger than the French. After the conquest of Bengal, it had huge resources at its command. The French Company suffered from lack of resources.

3. The superior naval strength of the English contributed enormously to their success. A strong English navy helped the Company to bring reinforcement from home. Moreover, their supplies landed at their naval base in Bombay. The French naval base in distant Mauritius caused considerable delay and put them at a disadvantage.

4. The French generals quarrelled among themselves. But the English generals offered united resistance to the French. There was hardly any coordination between the French army and the navy.

5. The recall of Dupleix proved disastrous to the French. Possibly, he alone could have given the leadership which the French Company urgently needed.

Rise of British Power in Bengal (Conquest of Bengal):

Bengal was the first kingdom to be occupied by the British in India. It was the most fertile and the richest of India’s provinces. The province was also well-known for its textiles, silk and saltpetre. The East India Company carried on profitable trade with this province. The enormous resources of Bengal came in handy for financing the British expansion.

In 1717, the Company had secured from the Mughal Emperor Farrukhsiyar a farman granting it the right to carry on trade in Bengal without paying any duty to the government. The employees of the Company, though permitted to carry on private trade, would have to pay taxes like the Indian merchants.


The farman was a perpetual source of conflict between the Company and the Nawab of Bengal. The Nawab lost revenue from trade. More importantly, he protested against the misuse of the dastak or permit by Company’s servants who carried on private trade.

The Battle of Plassey:

In 1756 Siraj-ud-daula succeeded his grandfather Alivardi Khan as the Nawab of Bengal. The English victory in the Carnatic had already made Siraj-ud-daula apprehensive of the growing power of the East India Company. He wanted to curb their power.

Meanwhile, the English started fortifying Calcutta without obtaining permission from the Nawab. This amounted to ignoring his sovereign power. The infuriated Nawab marched to Calcutta and occupied Fort William in June 1756. Most of the English soldiers fled to Fulta.

Siraj-ud-daula after conquering Calcutta marched back to Murshidabad. Siraj’s success, however, was short-lived. Robert Clive arrived with a strong military force and reconquered Calcutta at the beginning of 1757. He compelled the Nawab to concede all the demands of the English including the right to fortify Calcutta.

Fort William

The English, however, were not satisfied. They wanted to install a puppet Nawab on the throne of Bengal. Clive entered into a conspiracy with Mir Jafar, the com­mander of the Nawab’s army, and others to over­throw Siraj-ud-daula. Mir Jafar would be made the Nawab of Bengal in re­turn of a huge sum of money as reward to the Company.

Mir Jafar

The British now pre­sented the Nawab with an impossible set of de­mands. Both sides realised that war was inevitable. The two armies met at the field of Plassey, just over 20 miles south of Murshidabad, on 23rd June 1757.

Battle of Plassey

The fateful battle of Plassey was a battle only in name. The major part of the Nawab’s army under Mir Jafar took no part in the fighting. The Nawab was forced to flee. But he was captured and put to death by Mir Jafar’s son, Miran.


The Battle of Plassey made the English the virtual masters of Bengal. It placed the vast wealth of Bengal in the hands of the British. These resources helped them to win battles in the Carnatic. Mir Jafar was a puppet in the hands of the English. The victory in the battle of Plassey transformed a mere trading company into a political power. It paved the way for the establishment of British rule in India.

Mir Jafar was a weak and inefficient ruler. He had gifted a jagir to Clive and rich presents to others in the Company in return for the Nawab ship. The treasury had become empty and Mir Jafar was unable to meet the ever- increasing demands of the Company and its officials. So Mir Jafar was deposed and his son-in-law Mir Qasim was put on the throne. Mir Qasim handed over the zamindaris of Burdwan, Midnapore and Chittagong as a reward to the Company.

Battle of Buxar:

Mir Qasim was the last Nawab of Bengal who endeavoured to reassert royal authority. To consolidate his power he introduced several reforms and organised a disciplined and well-equipped army trained by Europeans. To improve his finances he attempted to check the misuse of dastak (or permit) by the Company’s servants who carried on duty-free private trade.

This abuse ruined honest Indian traders through unfair competition and deprived the Nawab of large revenue. Mir Qasim took the drastic step of abolishing all duties on internal trade, thus putting English and Indian merchants on the same footing. This made the English furious. They could not accept this big loss and decided to overthrow him.

In 1763, war broke out between Mir Qasim and the English. The Nawab who was defeated escaped to Awadh. Mir Jafar was reinstated on the throne. Mir Qasim formed an alliance with the Nawab of Awadh and Shah Alam II, the Mughal Emperor. The combined army was decisively defeated at the Battle of Buxar in 1764. Mir Qasim fled.

The Battle of Buxar is one of the most decisive battles of Indian history. It finally established the British as masters of Bengal, Bihar and Orissa and gave them control over Awadh and the Mughal Emperor. The reinstallation of Mir Jafar as the Nawab sealed the fate of independent Nawabship in Bengal.

The treaty of Allahabad and grant of the Diwani by shah Alam:

In 1765, the Treaty of Allahabad was signed by Clive with Shuja-ud-daula and Shah Alam II. According to the terms of the treaty:

Awadh was restored to Shuja-ud-daula on payment of 50 lakhs of rupees to the Company. The districts of Kora and Allahabad were taken away from Awadh. In return, the Company promised to protect Awadh from external threat.

The districts of Kora and Allahabad were given to the Mughal Emperor. In addition, an annual payment of 26 lakhs of rupees was to be given to the Emperor. In return the Mughal Emperor granted the Diwani of Bengal, Bihar and Orissa to the East India Company. The Diwani gave to the Company the right to collect revenue from these provinces. This marked the first step towards the direct administration of Bengal by the Company. The Company got the legal right to control Bengal.

Dual government in Bengal:

In 1765 a dual government was established in Bengal, Bihar and Orissa. By virtue of the Diwani, the East India Company directly collected revenue from these areas. At the same time the Company enjoyed military power and criminal jurisdiction over these areas.

However, the administration of the kingdom was left in the hands of the Nawab. This arrangement was called ‘dual government’. Thus, the Nawab was burdened with the responsibility of administering the country without the resources for running it efficiently.

The Company which had control over the resources had no responsibility of administering the country. Obviously the Company was unwilling to spend the revenue it collected on the administration and welfare of the people.

This system of dual government resulted in utter misery for the people. The revenue officials extorted money from poor peasants who were forced to starve. The year 1770 witnessed the most severe famine of the century. About one- third of the population perished. At the time of Clive’s departure to England, the British were no longer mere traders in Bengal. They were legally the rulers of the province.