As diwan, the company became the chief financial administrator of the territory under its control.

Now it had to think of administrating the land and organizing revenue in such a way that could yield
enough money. As a trading company, it had to also to ensure when to buy the products and when
to sell them

Being an alien power, it needed to pacify all those who had ruled in the past. Those who held the
local power had to be controlled but could not be completely eliminated

The company wanted high land revenues but was unwilling to setup any regular system of revenue
collection

Permanent settlement

This was an revenue system by Charles Earl Cornwallis in 1793. In this system, rajas and taluqdars
were seen as zamindars who were assigned the job of collecting revenue and to submit it to the
company. The revenue to be paid to the company was fixed and would be never increased in future.
The british government felt that this will lead to investment In land for improving it by the zamindars

As higher revenues from the cultivators will be profitable to zamindars as the revenue to be paid to
the company was fixed but the tax the planter had to pay to the zamindar was not fixed and that
altered according to the revenues made the the farmer so this means that the rest of the money
after paying to the company would directly go to the zamindars

Advantages-

There was a regular flow of cash in the company’s coffer

It inspired zamindars to invest in improvement of the land

It was easy to deal will some zamindars rather than so many peasants

Disadvantages

The revenue fixed by the company that had to be paid to it was very high. The zamindars were
unable to pay the revenues and those who were not able to do so lost their zamindari

When the situation changed and the cultivation expanded, then too zamindars were not interested
in investing in improvement of land as after a long time they saw a possibility of earning without the
risk of investing in land

When the revenue increased, there were no gains for the company as the revenue was fixed
permanently
On the other hand, village headman and planters found the system extremely oppressive. The
revenue was too high that the planter had to pay. He often had to take loans from money lenders to
pay the taxes and rents and if he fails to pay, he was evicted from the land he had cultivated for his
future generations

Mahalwari system-

This system was introduced by Holt Mackenzie in 1822.

According to him, village was an important social institution in north Indian society and needed to be
preserved. Then in his charge collectors went from village to village, inspecting the land, checking its
fertility and then the estimated revenue from each mahal was calculated

The revenue was to be revised periodically

Village headman was given the job of collecting revenues from the peasants

Munro system-

The system was also known as ryotwari system

This system was gradually tried on a small scale by Captain Alexander read on the part of territories
of Tipu sultan which were taken over by the east india company after his death.

Subsequently developed by Thomas Munro, this system was expanded all over the south india

In south india the re were no or very less zamindars so in this system, the company directly dealt
with the ryots

Advantages- Planters were not left on the mercy of zamindars as the company directly dealt with the
cultivators

The revenue could be revised periodically and when ever the company wanted

It gave more security to the cultivators

Disadvantages-

After a time being, it was clear that there was something wrong in all of the systems

The revenues were too high that were to be paid by the planters

Due to these high revenues, the planters left the villages and the villages deserted
The officials though that the new revenue system would transform the peasants into rich
enterprising farmers but it did not happen so.

Why high demand for Indian indigo-

Indigo is an tropical plant grows only in temperate zone. By the thirteenth century, indigo was being
used by cloth manufactures in Italy, Britain France etc but only a small amount of indigo reached
Britain due to its high price.

Therefore the cloth manufactures had to depend on woad for dying the cloth but woad gives a dull
and pale colour whereas indigo gives rich blue color

By the end of the eighteenth century, the cloth market in Britain rose up and Britain began to be
industrialized and it expanded its cotton and silk production which lead to increase in demand for
cloth dyes.

While the demand for the cloth dyes increased, existing supplies from west Indies and Australia

Stopped for several reasons

The indigo production also fell by half from 1783 to 1783

Due to this britains dependency on Indian indigo increased . Due to all thsese reasons Britain was
looking desperately for new indigo supplies

As india was a big producer or indigo their dependency on Indian indigo increased

How was indigo cultivated

There were mainly two systems of indigo cultivation- nij and ryoti system

NIj system- In nij system, planter grew the indigo on land the land which was directly under his
control which he bought or got on lease

Problems with the nij cultivation

Indigo could be cultivated only on fertile land but they were already occupied.

Planters needed large compact blocks around the factory so they tried to evict the farmers present
their from their land

Labour was needed precisely to cultivate indigo which was usually s v b b b hjjhbusy
with their indigo cultivation