This was a decisive point in British Indian history. According to earlier plans, Clive should have returned to Madras to pursue the campaign against the French; but he did not. He sensed both the hostility and uncertainty of Siraj al-Daulah’s position and began to receive feelers to support a military coup. He decided to install a friendly and dependent nawab and found the right candidate in Mir Jafar, an elderly general, brother in law of Siraj al-Daulah with much influence in the army. In so acting, Clive was influenced by the example of Bussy-Castelnau at Hyderabad who had maintained himself with an Indo-French force, sustaining the Nizam,Salabat Jang, and maintaining French influence in the largest south Indian state with outstanding success. This system of a “sponsored” Indian state, controlled but not administered by the British, was the one Clive had in mind for Bengal. Initially the prospects for success seemed good. However things turned out in a very different way than anticipated because of a number of reasons not realised at the time. The local chiefs were so lacking in dynamism that they often put up little resistance to British encroachments. External danger could come from only one direction and source-the Mughal authority-and that was at the moment in dissolution. While Bussy-Castelnau had no French merchants to satisfy, the British merchants in Calcutta were ready and eager to exploit the situation. And, because the British company’s government was made up entirely of merchants, there were strong pressures to annex the sponsored state.
Before taking on Siraj al-Daulah, Clive captured the French settlement of Chandernagore, which the Nawab left to its fate lest he need British help to repulse an Afghan attack from the north. On June 23rd of that year, at the Battle of Plassey, a small village and mangrove between Calcutta and Murshidabad, the forces of the East India Company under Robert Clive defeated the army of Siraj-ul-daulah. The “battle” lasted only a few hours, and the outcome of the battle had been decided long before the soldiers came to the battlefield. The aspirant to the Nawab’s throne, Mir Jafar, had already been induced to throw in his lot with Clive, and by far the greater number of the Nawab’s soldiers were bribed to throw away their weapons, surrender prematurely, and even turn their arms against their own army.
In summary, Plassey was decided by Clive’s forces not being intimidated by superior numbers but, more importantly by being bolstered by dissensions within the Nawab’s camp and, most importantly, by Mir Jafar’s betrayal of his superior. Plassey was followed by the flight and execution of Siraj alDaulah, by the occupation of Murshidabad, the capital, and by the installation of Mir Jafar as the new nawab of Bengal.
Clive now controlled a sponsored state, and he played the part with great skill for the advantage of the British. The situation was complicated at the outset by the Nawab’s failure to find the mythical hoarded treasure with which to fulfil his financial promises to the British. The Nawab therefore looked for financial support towards other sources thus putting further burdens on the province’s economy.
Clive intervened repeatedly in affairs of Bengal. In the year 1759 he defended Patna from attack by the heir to the Mughal throne, Ali Gauhar (later Shah Alam II), who hoped to strengthen his position by acquiring Bihar. Clive also had to deal with the Dutch, who, hearing of Mir Jafar’s uneasiness with his British patrons and alarmed by the growth of British power in Bengal, sent an armament of six ships to their station at Chinsura on the Hooghly River. Though Britain was at peace with the Netherlands at the time, Clive manoeuvred the Dutch into acts of aggression, captured their fleet, defeated them on land, and exacted compensation. While the Dutch retained Chinsura they could never again challenge the British position in Bengal. Clive left Calcutta on Feb. 25, 1760, at the height of his fame and aged only 34, looking forward to an English political career. The Nawab was completely dependent on the British, to whose trade the rich resources of Bengal were now open.
Despite the success at Plassey, a variety of problems ensued in Bengal in the next few years for which Clive’s actions were directly responsible.
In particular two measures undermined the plan of a sponsored state, leading to the company’s bankruptcy on the one hand and to the virtual annexation of Bengal on the other. The first of these was an understanding with Mir Jafar, although not mentioned in the actual treaty, that personal domestic trade (i.e., trade within India) of company employees would be exempted from tolls and customs duties. The company’s trade with Europe had since 1717 been exempt from such taxes, but the application of such concessions to individual employees-or to anyone, for that matter, who held an exemption pass (dastak) -was a fiscal disaster, since the pass system was widely abused. The local traders were unable to compete against rivals with such an advantage, and even the Company itself was soon out-positioned by its own employees (who received little compensation from the company and relied on their own entrepreneurial skills to make ends meet). Even worse, many of the company employees began to adopt intimidatory tactics, employing agents who used the British name to terrorise the countryside and infringe on the company’s monopoly.
The second development was the open acceptance of gifts by British employees. This was not forbidden by the company and was, in fact, a recognised custom but it opened the floodgates of corruption. For example large amounts were paid to the armed forces and to the company officials following the fall of Murshidabad. In addition, Clive obtained a further Mughal territary and then claimed a revenue assignment, or jagir, for its upkeep, which was worth a large annual sum. These grants were nearly one-fourth of the average annual Bengal revenue and in fact represented about 6% of the then annual revenue of Great Britain. With such a forceful opening of the floodgates of loot, it was almost inevitable that the other servants of the company asked for more as a matter of right and that the company’s directors in London, with relatives and connections on the spot, preferred verbal denunciations to any resolute or sustained action.
The effects of these depredations became quickly apparent when the Murshidabad treasure turned out to be only a fraction of its rumoured value, so that the Nawab had to sell jewels, goods, and furniture to meet his obligations. The results of these measures unfolded in the next decade and continued to be felt for a generation.