“OLD JOHN COMPANY”
By the late Towers Trevorian Millett, of the Madras
Police
250 years ago a few British
merchants were humbly
petitioning the Princes and potentates of India for permission to trade in
their dominions. At the present time almost
the whole of the vast region stretching from Cape Cormorin to Thibet and from
Siam to Cabul is virtually under British rule.
It will be my endeavour to trace, accurately and concisely, the means
whereby such a marvellous transfer of power has been effected : to watch the
progress of a trading
association, composed of a few merchants, through many dangers and depressing difficulties
: to mark its feeble progress and slow development
through various stages of joint-stock associations and incorporations, into a company
protected by royal charter : its dangers
from rival companies and ultimate fusion with them into that wonderful body –
half political, half commercial – through whose agency such a work has been
performed : to describe its constitution
and the nature, progress, and effects of its commercial operations : to exhibit
the legislative proceedings and
schemes of government : in short, to
give a brief review of the early history of the Honorable East lndia Company,
familiarly yet affectionately styled by its servants “OLD JOHN COMPANY."
From the time when Vasco de
Gama weathered the
Cape of Good Hope, for nearly a hundred years, the Portuguese enjoyed, without
a rival, the commerce of the East. Vague
rumours of the wealth brought thence began, however, to excite the adventurous
spirit of the English. In 1558 a Mr.
Anthony Jenkinson made a voyage to Persia and brought back considerable treasures.
He performed the voyage seven times and
opened a considerable trade with Chinese, Indian, and Persian merchants in raw
and wrought silks, spices, and precious stones. Accidental circumstances also
brought the
admiration excited by prospects of trade with India to a great height.
Sir Francis Drake, while harassing
the
shipping of the King of Spain, took a ship from India belonging to the
Portuguese. Her cargo, which proved to
be of immense value, thoroughly aroused the cupidity of the English merchants
and a still more important capture was made when an expedition, fitted out by Sir
Walter Raleigh and commanded by Sir John Boroughs, captured, off the Azores, a
Portuguese vessel of 1600 tons with a crew of 700 men and armed with 36 cannon.
She was carried into Dartmouth, and was
the largest vessel which had ever been seen in England. Her cargo consisted
of spices, calicoes, silks,
gold, pearls, drugs, porcelain, and ebony. An Englishman named Stevens, who
had sailed
with the Portuguese from Lisbon to Goa, around the Cape of Good Hope, now
published an account of his voyage, and information regarding India began to be
drawn from various other channels. The
result of this popular excitement was a memorial addressed to the lords of the
council by “divers merchants” in 1589, asking the royal permission to send
three ships and three pinnaces on a voyage to India. The result of this memorial
is unknown; but, in
1591, the first fleet for
India sailed
under Captain Raymond. The fleet was
fitted out, not so much for trading purposes, as for cruising against the
Portuguese in the Indian seas. Its fate
was disastrous in the extreme. Before
the Cape was reached, scurvy made such ravages amongst the crews that one of
the three ships was sent back with invalids. Shortly after doubling the Cape
the largest
ship was lost in a gale, and Captain James Lancaster, after an unsuccessful
cruise in the bay of Bengal, sailed for the West Indies, where he was wrecked :
and, after innumerable hardships and privation,
managed to return to England with a few men in a French privateer. The ill-success
of this voyage damped the
ardour of the English and, for some time, nothing further was done; but, in
1595, the Dutch fitted out a fleet for
India, and its success again aroused the ambition of the British merchants; who,
in 1599, formed an association and raised
a fund of £30,000 in 101 shares. After
some time a committee of 15 was chosen to manage the affairs of the association
and to procure permission from the Queen to trade with India. The Queen was
favourably impressed with the
plan, and signified her consent : but, as
negotiations for a treaty with Spain were afoot, delays took place until, after
some months, the Queen sent John Mildenhall, overland by Constantinople, on an
embassy to the Great Mogul. The result
of the embassy was unsatisfactory, owing to the intrigues of the Portuguese
agents, but the adventurers renewed their efforts.
At last the government consented
that
preparations for an Indian voyage might be made, though the patent of incorporation
was still under consideration. The
preparations were carried out with vigour, and five ships were soon ready. Capt.
James Lancaster, whose return from the
previous unsuccessful expedition I have mentioned, was appointed to the command
of the whole, and, on the 3lst Dec., the charter of privileges was obtained.
It constituted the adventurers
a body
politic and corporate, by the name of “The governor and company of merchants of
India trading to the East Indies,” and vested in them the usual privileges and powers.
The plans already adopted for the management
of their affairs by a committee of twenty-four and a chairman, both to be elected
annually, was confirmed and rendered obligatory. With a prohibition tending
to aid such places
already occupied by the subjects of states at amity with her majesty and whose
objection to rivals should be declared, the privilege of trading to the East
Indies, i.e. to all places between
the Straits of Magellan and the Cape of Good Hope, was vested in the company.
According to the principle
of the times,
the charter was exclusive, prohibiting the rest of the community from trading
within the limits specified : but permission
was accorded to the company to grant licenses to others for trading purposes. The
charter was granted for l5 years, and
might be annulled at two years’ notice if found to be disadvantageous to the
nation; but could otherwise be renewed
for a further period of 15 years if the company desired.
It is one thing, however,
to excite
enthusiasm, and another thing to keep it up, as the committee soon found out. Though
the subscription-lists were speedily filled-up,
yet the calls for payment of the instalments were imperfectly obeyed. Instead, therefore, of exacting the stipulated
sums and trading as a joint-stock company, those who had paid-up were invited to
take upon themselves the whole expenses of the voyage, and, as they sustained
the whole of the risk, to reap the whole of the profit. Over £68,000 were
thus subscribed; the fleet was fitted-out, Captain Lancaster
was again placed in command; and, on the
16th May, 1601, it sailed from Torbay.
This voyage was a great success,
and, after
establishing agents in Bantam, Lancaster returned to England, in 1603, with a
handsome profit to his owners.
From this year to 1613 eight
other
expeditions were fitted-out, and, with one exception – that of 1607, when both
ships were lost – all were prosperous, the profits generally being between 150
and 200 per cent. on the capital.
Up to this time the voyages
of the
East-Indian traders had been conducted on the terms of a regulated, rather than
a joint-stock company : each venture being
the property of a certain number of individuals, who managed it for their own
account, subject only to the general control of the company. But, on the return
of the last of the eight
expeditions mentioned, it was resolved that, in future, the business should be
carried-on as a joint-stock company only; the committee to manage for the subscribers.
The directors divided the
fund into four
portions, setting out each a fleet each year.
But the experience of these four years’ trading did not set the
management of a court of directors in a favourable light, when compared with
that of individuals taking charge of their own affairs : for, whereas the average
profit on the
previous eight voyages was 171 per cent., the average profit for the present
four ventures was only 87½ per cent.
Meanwhile the Portuguese had
embroiled
themselves with the Great Mogul, a circumstance soon taken advantage of by the
English; for, in 1614, we find them
assisting that potentate in repelling the attack of the Dutch at Swally, where
the common enemy lost a large number of men.
As a result of this exploit a firman was obtained authorising general
trade; and, in the same year, took place
the celebrated embassy of Sir Thomas Roe, who concluded a treaty in which
liberty was promised to the company to trade and establish factories in any
part of the Mogul’s dominions; Surat,
Bengal, and Sindy being particularly named.
In 1617-18 a new subscription
was opened
and was carried to the large amount of £1,600,000. This fund was called the
Company’s 2nd joint-stock, but, as the Company’s
accounts are not remarkable for clearness, we are in ignorance whether the two
funds were amalgamated or in separate accounts.
But we shall see afterwards that the directors soon had in their hands
the funds of several bodies of subscribers, which they employed separately for
the separate benefit of each, and that, in consequence, they and their agents
abroad experienced much inconvenience in preserving their accounts separate and
distinct.
The Dutch had, for years passed,
been supplanting
the Portuguese in the Indian trade, owing to the Spanish government, whose
subjects the Portuguese had become, having been busily engaged in the conquest
of the New World. The accumulations of
wealth in Holland had been very great, and the Dutch pursued their enterprises
with great vigor, while the English, harrassed by civil wars and misgovernment,
found themselves unequal competitors with a people so favourably situated as
their rivals. After wearisome
interchanges of hostilities a treaty was made at London, in 1619, by which the
English were to enjoy one-third, and
the Dutch two-thirds, of the trade in
the East. A committee of defence was
arranged, consisting of four Dutch and four English members. The two companies
were to unite in mutual
profit and defence, each providing 10 ships of war for mutual protection in
India, and the treaty was to be in force for 20 years.
The fate of this solemn engagement
is a
proof, if any were wanted, of our imperfection in the art of making
treaties. The principal stipulations
were so vague, the execution of them so dependent on so many unascertained
circumstances, that the grounds of dispute were multiplied rather than
reduced. Experience taught here, what
experience always teaches, that in all vague arrangements the advantages are
reaped by the least scrupulous and the strongest party. The voice of four Englishmen
in the council
of defence was a very poor protection against the superior capital, energy, and
armaments of the Dutch. The English, to
secure their rights, should have maintained a superior naval and military force
to that of the Dutch. Had they done so
they would have been the expellers of the Dutch from the spice-trade, and,
having themselves acquired it, would have overlooked the continent of India,
because their capital was not large enough to have extended to that trade; India
would have been left to the enterprise
of other nations; and the brilliant
empire, established by the English, would
never probably had a commencement.
However, disputes broke out
between the
companies; and the Dutch acted with so
high a hand that the English commissioners of the council of defence reported
the impracticability of continuing the English trade unless measures were taken
to check the oppressive action and overbearing insolence of the rivals. In Surat,
however, the English were able to
hold their own, and in 1622 defeated the Dutch in a severely-contested naval
engagement, following up their successes by capturing Ormus.
Feeble attempts were now made
to establish
factories at Masulipatam and at Tanjore, but these failed. A piece of land was,
however, purchased at
Armegam, a little south of Nellore, and here, in 1628, a factory was built and
fortified.
In 1631-32 a new subscription
was started
for a joint stock, and a fund of £420,700 was raised. Still we are left in darkness
with respect to
some important details. We do not know
in what degree the capital, which had been placed in the hands of the directors
by former subscriptions, had been repaid, nor indeed if it was ever repaid at
all.
With this new fund two more
expeditions
were fitted out : but of the amount of
money embarked we have no record. The
company, like most unskilful, and for that reason unprosperous, traders had
always competitors of one description or another to whom they ascribed their
own want of success. They were
continually condemning the conduct of their agents in India who had been for
years carrying on a clandestine trade on their own account, and whose gains
they said exceeded those of the directors.
At last an event occurred which appeared to involve unusual danger.
A number of persons, with
Sir William
Courten at their head, had, through a gentleman-in-waiting on the King,
prevailed on his Majesty to grant a license for a new association to trade to
India. The reasons for such a breach of
faith, as given in the license, were that the East India Company had
misconducted itself, and had accomplished nothing for the good of the nation in
proportion to the great privileges they had enjoyed nor with regard to the
amount of wealth they had spent. We may
presume that this was but the general opinion of the English nation : but it
was surely unjust to bring the charter
to a sudden termination when, by giving the notice stipulated in the original
charter, a legal end might have been put to the monopoly.
The company were in despair,
and petitioned
the King, but in vain. Courten
fitted-out a fleet, which returned in 1637 with large profits to the
adventurers.
As if the misfortunes of the
committee were
not enough, the original subscribers now demanded that their accounts should be
closed and any effects belonging to them in India brought home. A still heavier
calamity overtook them, the
King having determined on war with the Parliament, and, finding himself
destitute of money, cast his eyes on the warehouses of the company, and bought
on credit the whole of their pepper at a high price; immediately selling it
at a lower, and thus
obtaining over £50,000 in ready money.
Bonds were given, to be paid by the Customs, but only £13,000 were ever
paid.
Meanwhile trade was languishing
for want of
funds, and the agents in the east attempted to supply, by loans, the failure of
supplies from home. An effort was made,
in 1642, to raise a new subscription, but only £105,000 was produced, for the
English now thoroughly distrusted joint-stock enterprises in the east. During
this time the agents of the company, finding
Armegum unsuitable for their purpose, obtained the permission of a native chief
to build a fort at Madrasapatam. The
works were begun in 1640, and the place named Fort Saint George. During the
wars between the King and the
Parliament the affairs of the company seemed to get worse and worse, and great
complaints were made by the agents abroad, who urged a separation of the
stocks. At last, after long arbitrations
and consequent delays, the company and the rival merchant adventurers effected
a coalition. On the strength of this
union a new subscription was opened in 1657 and filled up to the amount of
£786,000. A settlement was made with
holders of former stocks and the directors started afresh under much improved
conditions, having now but one general fund to administer. But the operations
of the new joint-stock
were not more prosperous than those of the old.
On the accession of Charles
II. a new
charter was granted to the company and, in addition to their ancient
privileges, they were invested with authority to make war or peace with any
native states not being Christians, and to seize unlicensed persons and to send
them to England. These were important
privileges and, with the right of administering justice, consigned almost all
the powers of government to the discretion of the directors and their
servants. Still the company’s business
was feeble and unprofitable. In 1668
Bombay, which formed part of the dowry of the Infanta Catherine, was offered to
the company by the King of England, and was accepted by them at an annual rent
of £10 in gold !
In 1664 Sivajee, the founder
of the
Mahratta dynasty, while waging war against the Mogul, attacked Surat. The company’s
servants retired to their
factory and, calling to their aid the ships’ crews, made so brave a defence
that Sivajee, after pillaging the town, retired. The Mogul was so pleased with
this exhibition
of bravery that he thanked the governor and gave new privileges of trade to the
company.
In 1670 another attack was
again
successfully repulsed.
The wages granted by the company
were at
this period very small. Sir George
Oxenden, when elected to be president and chief director of Surat and of all
other factories in India, received a salary of £300 and a gratuity of £200 in
compensation for private trade – an evil which the company were most earnestly
labouring to suppress.
The time, however, was now
approaching when
the weakness and improvidence which had so long characterised the operations of
the English in India was drawing to a close; for the tonnage sent to India greatly
increased and also in proportion the values of the cargoes. The trade to Bengal
increased so much in
value that it was raised into a separate agency, instead of being a branch of
Fort St. George. The difficulties which
now occurred in directing the operations of the company began to be
serious. The directors, from their
ignorance of local circumstances, often transmitted orders which would have
been dangerous for their servants to have executed. Their agents abroad often
took upon
themselves, and with good reason, to disregard the orders which they
received. A door being thus opened for
discretionary conduct the instructions of the directors were naturally as often
disregarded for the convenience of the agents abroad as for the company at
home. Disregard of their authority and
continued violation of their explicit orders was a frequent subject of
uneasiness and indignation of the directors.
Nor was this all. From quarrels
regarding rank and precedence arose animosity among the agents; and, to cure
this evil, seniority was adopted
as a principle of promotion; but
nomination to the important office of member of council at the agencies and presidencies
was reserved to the directors.
Amid all these difficulties
the company was
again threatened by competition of their fellow subjects. Among various means
used by William III. to
support his government and to raise money was the plan of establishing a new
East-India company, the capital of which was to be lent to the crown. This,
though a wilful and scandalous
violation of the charter of the existing company, was, after much opposition,
carried into effect; and the “general
company”, or English company, was incorporated in 1698, the old company being
called the “London company.”
But this new company was not
allowed to
trade in quiet by the wronged London company;
and as it had neither the experience, the enterprise, nor the capital of
the latter, its operations proved it to be a very unequal competitor.
We find, in 1698, that
the old company sent
out 13 ships, of 1500 tons aggregate burden, and stock worth £525,000; while
the rival company sent out but three
ships and stock worth £178,000. As might
have been expected, the rivalry of two companies in India produced the most
unhappy results, and, after several acts of violence on the part of either, it
was found absolutely necessary to amalgamate the two; after which a wearisome
arbitration was
carried into effect, and, on the 22nd of July, 1702, the rival
companies took the common name of “The united company of merchants trading to
the East Indies.”
For nearly 50 years after
the union of the
rival companies the history of the British connection with India presents
nothing but a detail of the operations of trade, varied only by the efforts of
the company to obtain the protection of native princes, and to exclude all
others seeking similar privileges. So
humble were the views of the directors that we find they objected to pay £100 for
a carriage and a pair of horses to be used by the president of Calcutta,
observing that if their servants wanted such superfluities they themselves must
pay for them out of their own pockets. I
may read here the description of the progress of the Embassy, sent from
Calcutta to THE EMPEROR (as the Mogul emperor, Ferrokshall, was styled.) (Vide
Auber’s India, vol. 1, pages 16-17.)
In the year 1744 war was declared
between
England and France, and Madras was taken from the English by the French, under
Labordonnais. It may not be uninteresting
to give a brief account of Madras. (Vide
Mill’s India, vol. III, pages 46-47.)
In 1749 news reached India
of the signature
of peace at Aix-la-Chapelle, by which treaty Madras was restored to the
English. During the war the French and
English, in the other presidencies, were prevented by the native magnates from
committing any hostile acts against each other.
Notwithstanding its mishaps
in Madras the
company’s dividend during the war was never less than 3 per cent.
With 1749 begins a new era
in the history
of the East India company. Up to the
present they had occupied the position of humble traders, endeavouring to
preserve a footing in India under the protection, or oppression, of the native
powers. But with this year begins those
wars and brilliant exploits with which history has made you all familiar, and
which it would be uninteresting, if not wearisome, to recount fully.
I have presumed to think that
all are not
so perfectly acquainted with the earlier periods of the company’s history, and have,
as you perceive, dwelt on them at some length.
I cannot, however, pass on to the “beginning of the end” of the East
India company without referring to an account of the defence of Arcot by Robert
Clive – a defence which at once placed the hero in the foremost rank of
military commanders. Vide Thornton’s
India, vol. I, p. 103, 111.
Time does not permit me to
do more than
allude to the tragedy of the Black Hole of Calcutta, and to the swift vengeance
taken by Clive at Plassey, A.D. 1757.
From this date the rise of the British power in India is known to every
schoolboy. I will now sum-up a few of
the causes which led to that awful scene of massacre and ruin – of slow, but
sure and terrible, retributions, which Sir John Kaye has so eloquently recorded
– the Indian mutiny, which was the death-blow of the company’s rule in
India. Vide Sir John Kaye’s
Lepezar
: vol. i, pages 180, 181, and 183.
You all know the story of
the greased
cartridges and the mutiny. Many, if not
most of us, remember the awful news coming to England. You all know how sternly
it was suppressed
and at what cost of life and treasure. At
the close of that terrible time Her Majesty assumed the control of India and
issued her famous proclamation of religious equality. On the 1st Nov., 1857,
THE HONORABLE EAST
INDIA COMPANY ceased to exist.
Since its decease India has
made rapid
strides in prosperity and general civilization, but the change has not always
proved to be for good. The old
Haileybury civilian has given place to the competition wallah. The Suez Canal
has brought India within three
weeks’ steam from England. The type of
officer who made India his home for life, throwing his love into his labour,
has disappeared. Men go to India for a
few years, caring little about the country and carrying their European
peculiarities with them. We look in vain
for such men as Munro, Henry and John Lawrence, Nicholson, Herbert
Edwardes. It is still much disputed whether we are, or
are not, going too fast – cramming hasty, often imperfect, legislation on the
people ere they are sufficiently advanced to receive it. With officers, knowing
nothing and caring
less about their men, anxious only to put-in enough service to qualify for
furlough, to get out of the country as fast as possible, we may hesitate with
reason to declare that we are better off now.
The best proof of the kindly yet firm rule of the old régime that I can
give you is that while
admitting the many superiorities in modern style of rule Europeans and natives
still speak with affectionate regret of the
good old days of Old John Company.
Source: The Cornishman (Penzance) Thursday 28 May 1885 p. 7, 4 June 1885 p.
7, 11 June 1885 p. 7 and 18 June 1885 p. 7.
References
in text:
Auber, Peter. History
of the rise and progress of British power in India. London,
W. H. Allen, 1846. 2 v.
Kaye, Sir John William. A
history of the Sepoy war in India, 1857-1858. London,
W. H. Allen, 1870-1879. 3 v.
Mill, James. The
history of British India. London ,
J. Madden, 1858. 9 v.
Thornton, Edward The
history of the British Empire in India.
London, W. H. Allen, 1841-1845. 6
v.
