The Extension of British Power to Imperial Proportions, 1760-1856

Post Clive Chaos in Bengal, 1760-1772

The departure of Clive signalled the release of acquisitive urges by the company’s Bengal servants. These urges were so strong that Clive’s successor as the governor, Henry Vansittart, found himself unable to control them. Under the company’s constitution, he had only one vote in the council and could be overruled by others. During these years, the body of British merchants, not considering themselves bound by any ethical standards and social restraints in India, suddenly found that they had effective but undefined authority over the whole of a large and rich province. Their thoughts naturally got focussed on looting as much wealth as fast as possible.

The first step was the deposition of the Nawab Mir Jafar on the grounds of old age and incompetence. He was replaced by his son-in-law, Mir Qasim, after the latter had paid a large gratuity to the company and to Vansittart personally. In addition, he ceded to the British the districts of Burdwan, Midnapore, and Chittagong. The Nawab had lost substantial land revenue and the lucrative tolls on the British merchants’ private trade; the company on the other hand was receiving no remittances from Britain, because the directors considered that Bengal should pay for itself.

Mir Qasim removed his capital to Munger (in Bihar) where he hoped that British interference would decrease, asserted his authority in the districts, and raised a disciplined force under an Armenian officer. He then turned to the company and negotiated a settlement with Vansittart, by which the company’s merchants were to pay an ad valorem duty of 9%, against an Indian merchant’s duty of 40%. At this the Calcutta council revolted, reducing the company’s duty to 2.5% and on salt only. The breach came in 1763, when Mir Qasim, after defeat in pitched battles, fled to Awadh. The next year Mir Qasim returned with the emperor Shah Alam II and his minister Shuja al-Daulah for a decisive conflict with the forces of the British East India Company, commanded by Major Hector Munro. In this famous Battle of Buxar, the lack of basic co-ordination among the three desperate allies caused their debacle. This critical battle confirmed the British in the control of Bengal and Bihar after their initial success at Plassey in 1757.

The battle marked the end of the attempt to rule Bengal through a puppet Nawab; thenceforth the company took control. In 1765 it was granted the power to collect revenues in Bengal, and Clive began his second governorship, which continued until 1767.

Clive’s Second Innings and the Dual Government

The news of the Mir Qasim campaign reached London at the same time as the victory of Clive’s faction in the company over that of Lawrence Sullivan. Clive used it to get himself appointed governor with power to act over the head of the council; he intended to bring about administrative reforms and a political settlement. He arrived in May 1765 to find that the British victory at Buxar had left Shah Alam at British mercy but had created a situation of deep confusion in other respects. Mir Jafar had been restored to power but soon died; his second son succeeded him after bestowing lavish gratuities to the company. The British merchants and their agents were the unresisted predators of the Bengal economy, and no one knew the next step to take.

Clive acted with extraordinary vigour. Within a few days of his arrival he had set up a Select Committee; and, by the time he left less then two years later, he had brought about another revolution in the Company’s position.

Among the significant steps taken by Clive were:

  • He fixed his frontier at the borders of Bihar and Awadh.
  • Shah Alam was given the districts of Kora and Allahabad, and he settled in the latter city, with a tribute from Bengal that was only 10% of its estimated revenue.
  • Shuja al-Daulah received back Awadh, with a guarantee of its security, in return for paying the troops involved and a cash indemnity.
  • These two were to be buffers between the company and the Marathas and any possible raiders from the north.

Clive also took steps to settle Bengal’s own status. Since the Mughal emperor still had much influence, Clive obtained from Shah Alam the dewanee, or revenue-collecting power, in Bengal and Bihar (the company thus became the imperial diwan for those two provinces). The Nawab was left in charge of the judiciary and magistracy, but he was helpless because he had no army and could get money to raise one only from the company.

This was Clive’s system of “dual government.” The actual administration remained in Indian hands, and for superintendence Clive appointed a deputy diwan, Muhammad Rida Khan, who was simultaneously appointed the nawab’s deputy as well. Thus the company, acting in the name of the emperor and using Indian personnel and the traditional apparatus of government, now ruled Bengal.

  • Within the company, Clive enforced his authority by accepting some resignations and enforcing the removal of other officials. Gifts amounting to a value of more than 4,000 rupees were forbidden, and those between that figure and 1,000 rupees were only to be received with official consent.
  • The regulation of private trade proved to be more difficult, for the company paid virtually no salaries. Clive formed a Society of Trade, which operated the salt monopoly, to provide salaries on a graduated scale; but the company directors disallowed this on the ground of expense, and two years later they replaced it by commissions on the revenue, which cost the company more.
  • Clive also dealt with bloated military allowances with equal vigour, in the process even overcoming a mutiny headed by a brigade commander. He used a legacy from Mir Jafar to start the first pension fund for the Indian army.

The Company as an Empire Builder

The year 1765, when Clive arrived in India, marked the real beginning of the British Empire in India as a territorial dominion. However, the regime he established was really a private dominion of the East India Company. It was not a British colony, and it fitted into the highly flexible structure of the dying Mughal empire. The structure of the administration was Mughal, not British, and its operators were Indian, personified by the deputy Nawab Muhammad Rida Khan. It was a continuation of the traditional state under British control. This ‘Company Bahadur’ state continued through the governorship of Warren Hastings and in essence until the early 19th century, although Lord Cornwallis (Governor-General, 1786-1793 and 1805) largely substituted British for Indian personnel. The revenue was collected by the officers of the deputy nawab; the law administered was the current Islamic criminal code, with the traditional personal codes of the Hindu and Muslim communities; the language of administration was Persian. Only the army marked a major break with the past, with its British officers, its discipline, and its adoption of Western organisation and tactics.


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