East India Company comes east.

Sumit was watching a movie about the British Empire and thought about how the Britishers came to India and gained so much control.

He went to his mother and asked her how exactly did the Britishers come to India and why. How did they gain so much power in India?

His mother said that It all started in 1600, when Queen Elizabeth I granted permission to East India Company to trade with the east.

The East India Company came to lands of east, bought goods at cheaper prices and sold them at higher prices in western countries.

Like the English, other companies like the French, the Portuguese and the Dutch also came to east for trading which led to trade wars.

Let us understand the history of trading and wars.

Vasco Da Gama discovered the sea route in 1498 and later the Portuguese took over the western coast and established a base in Goa.

The Dutch companies too, were looking for ways to trade in the Indian Ocean in the early seventeenth century.

After the Dutch, the French traders got into the trading business and the French East India came to India.

All the companies which came to India were interested to buy things like silk and cotton.

Indian spices too were in great demand in European markets and they were also exported on a large scale.

The prices of the spices, cotton and silk went up because of the competition. The profits they used to earn became almost nil.

The companies thought that the only way they could end competition was to destroy the competitors.

They sank ships of the rival companies and blocked their routes. The purpose behind all this was to save their business.

The war led to conflicts with the local rulers of India and the company found it difficult to separate trade from politics.

In 1651, the East Indian Company set up the first English factory near the river Hugli in Bengal.

The factory also had a warehouse and an office where the company officials sat for meetings. By 1696, the British began building a fort around that area.

Later they bribed the Mughal officials to grant zamindari rights of 3 villages to them.

One of the villages was Kalikata around which they built fort William which is now known as Calcutta.

They also persuaded Aurangzeb to issue a farman to grant them rights to trade duty free.

Duty free means to trade without paying the taxes to the local government. The company did not stop there, they wanted more.

Even after the duty free trade, the officials of the company had to pay taxes. After some time, the officials refused to pay taxes.

This led to a huge loss of revenue for Bengal. After the death of Aurangzeb, the Nawabs of Bengal started becoming more powerful. They stopped the company’s concessions.

They also demanded large amounts from the company to trade and stopped them from minting coins.

The company declared that the Nawabs were demanding too much and it was making trade difficult for them. They wanted to expand the trade, so they had to enlarge settlements and buy villages.

These conflicts between the Nawabs and the company led to the famous Battles of Plassey and Buxar.

Let us now look at a short recap of East India Company comes east.


The East India company wanted to grow more powerful, so it took permission from Queen Elizabeth I to trade with the east.

That was the only company which was allowed to trade with the east and thus they became powerful.

The Royal charter however could not stop other countries to trade with the east and now, the East India company had competition from the Dutch, the French and the Portuguese.

The other competitors also wanted to buy same things as the British which led to competition.

Competition led to higher purchase prices and lower profits.

After defeating other European competitors, now the company started to fight with local rulers in Bengal for more profit. This led to battles in Bengal.