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East India Company

A Private British Company With Its Own Powerful Army Dominated India

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Officers of the East India Company being entertained by local musicians.
Getty Images

By
Robert McNamara
Updated on January 29, 2020

The East India Company was a private company which, after a long series of wars and
diplomatic efforts, came to rule India in the 19th century.

Chartered by Queen Elizabeth I on December 31, 1600, the original company comprised a group
of London merchants who hoped to trade for spices at islands in present day Indonesia. Ships of
the company's first voyage sailed from England in February 1601.
After a series of conflicts with Dutch and Portuguese traders active in the Spice Islands, the East
India Company concentrated its efforts on trading on the Indian subcontinent.

The East India Company Began to Focus on Importing From India

In the early 1600s the East India Company began dealing with the Mogul rulers of India. On the
Indian coasts, English traders set up outposts which would eventually become the cities of
Bombay, Madras, and Calcutta.

Numerous products, including silk, cotton, sugar, tea, and opium, began to be exported out of
India. In return, English goods, including wool, silver, and other metals, were shipped to India.

The company found itself having to hire its own armies to defend trading posts. And over time
what began as a commercial enterprise also became a military and diplomatic organization.

British Influence Spread Across India in the 1700s

In the early 1700s the Mogul Empire was collapsing, and various invaders, including Persians
and Afghans, entered India. But the major threat to British interests came from the French, who
began seizing British trading posts.

At the Battle of Plassey, in 1757, forces of the East India Company, though greatly outnumbered,
defeated Indian forces backed by the French. The British, led by Robert Clive, had successfully
checked the French incursions. And the company took possession of Bengal, an important
region of northeastern India, which greatly increased the company's holdings.

In the late 1700s, company officials became notorious for returning to England and showing off
the enormous wealth they had accumulated while in India. They were referred to as "nabobs,"
which was the English pronunciation of nawab, the word for a Mogul leader.

Alarmed by reports of enormous corruption in India, the British government began to take
some control over company affairs. The government began appointing the company's highest
official, the governor-general.

The first man to hold the governor-general position, Warren Hastings, was eventually
impeached when members of Parliament became resentful at the economic excesses of the
nabobs.

The East India Company In the Early 1800s

The successor to Hastings, Lord Cornwallis (who is remembered in America for having
surrendered to George Washington during his military service in the American War of
Independence) served as governor-general from 1786 to 1793. Cornwallis set a pattern which
would be followed for years, instituting reforms and rooting out the corruption which allowed
employees of the company to amass great personal fortunes.

Richard Wellesley, who served as governor general in India from 1798 to 1805 was instrumental
in extending the rule of the company in India. He ordered the invasion and acquisition of
Mysore in 1799. And the first decades of the 19th century became an era of military successes
and territorial acquisitions for the company.

In 1833 the Government of India act enacted by Parliament actually ended the company's
trading business, and the company essentially became the de facto government in India.

In the late 1840s and 1850s the governor-general of India, Lord Dalhousie, began to utilize a
policy known as the "doctrine of lapse" to acquire territory. The policy held that if an Indian
ruler died without an heir, or was known to be incompetent, the British could take the territory.

The British expanded their territory, and their income, by using the doctrine. But it was seen as
illegitimate by the Indian population and led to discord.

Religious Discord Led to the 1857 Sepoy Mutiny

Throughout the 1830s and 1840s tensions increased between the company and the Indian
population. In addition to acquisitions of land by the British causing widespread resentment,
there were many problems centered on issues of religion.

A number of Christian missionaries had been allowed into India by the East India Company.
And the native population started to become convinced that the British intended to convert the
entire Indian subcontinent to Christianity.

In the late 1850s the introduction of a new type of cartridge for the Enfield rifle became a focal
point. The cartridges were wrapped in paper which had been coated with grease, so as to make
it easier to slide the cartridge down a rifle barrel.

Among the native soldiers employed by the company, who were known as sepoys, rumors
spread that the grease used in manufacturing the cartridges was derived from cows and pigs. As
those animals were forbidden to Hindus and Muslims, there were even suspicions that the
British purposely intended to undermine the religions of the Indian population.

Outrage over the use of grease, and a refusal to use the new rifle cartridges, led to the bloody
Sepoy Mutiny in the spring and summer of 1857.

The outbreak of violence, which was also known as the Indian Revolt of 1857, effectively
brought about the end of the East India Company.

Following the uprising in India, the British government dissolved the company. Parliament
passed the Government of India Act of 1858, which ended the company's role in India and
declared that India would be governed by the British crown.

The company's impressive headquarters in London, East India House, was torn down in 1861.

In 1876 Queen Victoria would declare herself "Empress of India." And the British would retain
control of India until independence was achieved in the late 1940s.

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