How one company went from humbly importing spices and tea to England, to becoming a coloniser of nations. The British East India Company.
(For the story of tea in England, click here)
Granted a royal charter by Queen Elizabeth I in 1600, it was established to create a profitable trade with the region of Asia which was called the ‘East Indies’ at the time. In fact, its full name was Governor and Company of Merchants of London Trading in the East Indies. As this name suggests, it started as a group of London merchants looking to make money from the lucrative spice trade from Asia. The company faced vast opposition from another group of English investors and merchants who felt they had been frozen out of the trade routes. In 1708, the two merged to form the United Company of Merchants Trading to the East Indies, more commonly known as ‘The East India Company’ (EIC).
Traditionally the spice route had relied on land routes across Asia and the Middle East, but the Portuguese naval technology and skill allowed them to cut out the middleman and import the products themselves, ensuring greater profits. Hence the Spanish and the Portuguese dominated the spice trade in the late 16th century. According to George Landow, it was the destruction of the Spanish Armada in 1588, that allowed the British and Dutch access to the wealthy import business (Landow 2010). However, the company struggled in the early years having come late to the game of the spice trade. They were particularly vulnerable to the Dutch East India Company (VOC) who had been established much earlier and the company frequently engaged in hostilities with the Dutch and the Portuguese.
The company achieved a major victory over the Portuguese in the Battle of Swally in 1612, at Suvali in Surat (India). The company decided to explore the feasibility of gaining a territorial foothold in mainland India, with official sanction from both Britain and the Mughal Empire and requested that the King launch a diplomatic mission. In 1612, James I instructed Sir Thomas Roe to visit the Mughal Emperor Nur-ud-din Salim Jahangir (r. 1605–1627) to arrange for a commercial treaty that would give the company exclusive rights to reside and establish factories in Surat and other areas. In return, the company offered to provide the Emperor with goods and rarities from the European market. This mission was highly successful. The company, which benefited from the imperial patronage, soon expanded its commercial trading operations. It eclipsed the Portuguese, which had established bases in Goa, Chittagong, and Bombay, Portugal later gave Bombay to England as part of the dowry of Catherine of Braganza on her marriage to King Charles II. The East India Company also launched a joint attack with the Dutch VOC on Portuguese and Spanish ships off the coast of China, which helped secure English company ports in China. The company established trading posts in Surat (1619), Madras (1639), Bombay (1668), and Calcutta (1690). By 1647, the company had 23 factories in India. The major factories became the walled forts of Fort William in Bengal, Fort St George in Madras, and Bombay Castle.
With the reduction of Spanish and Portuguese influence, it was the Dutch and the British that dominated the region and the trade routes and, in the 17th and 18th centuries, entered into a period of fierce competition that culminated in at least four Anglo-Dutch Wars between them: 1652–1654, 1665–1667, 1672–1674 and 1780–1784. Of course, waging war requires money and Britain was determined not to be defeated by the Dutch and risk losing their presence on the world stage. They had already seen the decline of the previous world powerhouse and old enemy, Spain, and were not about to let the same thing happen to them. In an act aimed at strengthening the power of the EIC, King Charles II granted the EIC (in a series of five acts around 1670) the rights to autonomous territorial acquisitions, to mint money, to command fortresses and troops and form alliances, to make war and peace, and to exercise both civil and criminal jurisdiction over the acquired areas. The company was becoming an imperial power in its own right with the backing of the British government.
It was in India where, as William Dalrymple puts it “an international corporation was transforming itself into an aggressive colonial power… Using its rapidly growing security force – its army had grown to 260,000 men by 1803 – it swiftly subdued and seized an entire subcontinent. (William n.d.) It is hard to imagine the sheer power and control the EIC had when we think of global brands today. Luckily, Facebook, Amazon and Google do not own their own private military armies or collect and control their own private taxes. Many companies have tried to blend state power for their own gains and thankfully failed. One reason why the EIC was able to act beyond the state power was because many within the British government were invested in the company succeeding and generating more profit. Nearly a quarter of MP’s in 1765 held company stock, which would have plummeted in value had the Crown taken over. For the same reason, the need to protect the company from foreign competition became a major aim of British foreign policy. (William n.d.)
It was only with the 1857 India Mutiny when the British government’s Colonial Office took full control of the EIC. The company had lost their monopoly in 1813, acting as the government’s agent rather than its own mini state and by 1873, the EIC had faded out of existence.
“In many ways the EIC was a model of corporate efficiency: 100 years into its history, it had only 35 permanent employees in its head office. Nevertheless, that skeleton staff executed a corporate coup unparalleled in history: the military conquest, subjugation and plunder of vast tracts of southern Asia. It almost certainly remains the supreme act of corporate violence in world history. For all the power wielded today by the world’s largest corporations – whether ExxonMobil, Walmart or Google – they are tame beasts compared with the ravaging territorial appetites of the militarised East India Company. Yet if history shows anything, it is that in the intimate dance between the power of the state and that of the corporation, while the latter can be regulated, it will use all the resources in its power to resist.”
William, Dalrymple. n.d. The East India Company: The original corporate raiders
Lots of thanks to…
@somesourcessay and @its.personalgirls on Instagram for your help and suggestions with the title.
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Sources (because I don’t know everything)
Haynes, Gerard Cohen-Vrignaud, Stephanie Metz, Jody Dunville, Shannon Heath, Julia P. McLeod, Kat Powell, Brent Robida, John Stromski, Brandon. n.d. British East India Company. Accessed 5 24, 2020. http://web.utk.edu/~gerard/romanticpolitics/britisheastindia.html.
Landow, George P. 2010. The British East India Company—the Company that Owned a Nation. ”George P. Landow”. Accessed 5 24, 2020. http://victorianweb.org/history/empire/india/eic.html.
William, Dalrymple. n.d. The East India Company: The original corporate raiders. Accessed 5 24, 2020. https://www.theguardian.com/world/2015/mar/04/east-india-company-original-corporate-raiders.
Further Reading
The Anarchy: The Relentless Rise of the East India Company by William Dalrymple. Available at at Waterstones and Amazon
The Corporation that Changed the World: How the East India Company Shaped the Modern Multinational by Nick Robins. Available at Amazon.
The East India Company: The World’s Most Powerful Corporation by Tirthankar Roy. Available at Amazon and Waterstones.
thehistorymonsteruk.wordpress.com 
Fascinating stuff, Eleanor. I’d love to know what that grand-looking building is on the right of the picture of Deptford.
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