‘THE GREATEST CORPORATION IN THE WORLD’
SET in 1814 the BBC One drama Taboo sees Tom Hardy doing battle with the East India Company, a corporation desperate to deprive him of land inherited from his father. The corporation remains one of the most powerful organisations in history, a key part of Britain’s colonial administration and a source of shame as a result of its violence and corruption. Here’s everything Taboo never told you about the company that historian Lord Macaulay called “the greatest corporation in the world”.
The Company of Merchants of London trading in the East Indies was granted a royal charter by Queen Elizabeth I. It was the first-ever limited liability company and had exclusive trading rights east of the Cape of Good Hope in Africa and west of the Straits of Magellan in South America.
Early attempts at establishing a relationship with the Mughal Empire in India were unsuccessful despite the efforts of William Hawkins, commander of a British ship who impressed the Mughal emperor with his ability to drink huge amounts of wine.
The East India Company set up its first permanent trading post in India in the town of Surat. Many more of these trading posts – known as factories – followed in places such as Bombay, Madras and Calcutta.
The Dutch governor of what is now Indonesia killed the local East India Company representative, nine other employees of the corporation and nine Japanese mercenaries. This encouraged the British to focus attentions on India where profits were booming.
The Nawab of Bengal managed to overrun Fort William, the company’s stronghold in Calcutta, with the use of 50,000 men and 500 elephants.
Many of the British did not escape and 146 surrendered to the Indian forces. They were imprisoned in a cell measuring 18ft by 14ft 10in and with only two small windows – the so-called Black Hole of Calcutta. Their cries for help were ignored and when the door was opened the following morning only 23 were still alive. The dead were still on their feet, the room being so cramped they had no nowhere to fall. One of the earliest Indian words to enter the English language was “loot”, the Hindustani slang for “plunder” as the East India Company systematically seized the treasures of the Mughal empire.
After the Battle of Plassey, successfully fought by the East India Company over the Nawab of Bengal, military leader Robert Clive (known as Clive of India) seized £2.5 million from the defeated rulers of Bengal.
Clive suffered from mental illness, now thought to be bipolar disorder. As leader of a gang of youths he had set up a protection racket in the town of Market Drayton in his native Shropshire. He was expelled from three schools and sent to India by his father who was desperate to get rid of him.
A proportion of the loot of Bengal went directly into Clive’s pocket. He returned to Britain with a personal fortune – then valued at £234,000 – that made him the richest self-made man in Europe. It was the East India Company that coined the term “civil servant”. However, the company’s operations in India were administered with a high level of corruption. Bribes were routinely handed out and officials often stole from the people they ruled. Torture by company officials was widespread both as a means of collecting tax revenue and a way of forcing Indians to comply with their efforts to maintain law and order in the colony. Techniques included beating people, tying them up and leaving them in the hot sun, suspending them from trees and cramming hot chillis into their noses. In many ways the East India Company was a model of efficiency. By the 18th century it had only 35 permanent employees in its head office yet the power it wielded was immense making companies such as Google and Amazon look puny in comparison.
Warren Hastings (who had joined the East India Company as a humble clerk in 1750) served as the first governorgeneral of India. In an infamous attempt to extort extra taxes from the Raja of Benares he sent a handful of men to imprison the Raja in his home and claim the money. However, the tax collectors were killed and the Raja escaped. Hastings then sent a larger force to get the money. Very little of the proceeds ever found its way into the company’s coffers.
In 1787 upon his return to Britain Hastings was impeached by Parliament. His trial lasted seven years, the longest impeachment proceedings in history, before – astonishingly – he was acquitted of all charges.
The government of the day passed the Tea Act which levied import taxes designed to increase the profitability of Chinese tea sold around the world by the company.
Anger at this led to the Boston Tea Party during which American patriots boarded three British ships and dumped 342 chests of tea overboard, an event that helped to spark the American Revolution.
The East India Company captured the Mughal capital of Delhi. By this stage, despite starting out with only a handful of troops deployed as security guards, it had built a private army of 260,000 soldiers – double the size of the British Army. The company’s warships were regarded as better than those of the Royal Navy and helped to win battles against enemies as powerful as the Portuguese. One of its directors described it as “an empire within an empire” and it took to describing itself as “the grandest society of merchants in the universe”. As well as creating a large administration in India it was also responsible for building much of London’s docklands and generated almost half of Britain’s trade. The East India Company became China’s main supplier of opium which it grew cheaply in Bengal.
The first Opium War, won by the British government with the help of the East India Company, was started when the Chinese emperor confiscated and destroyed large amounts of opium. As part of the subsequent peace settlement China was forced to give up Hong Kong although opium remained illegal.
The second Opium War ended with China agreeing to legalise the trade.
The Indian Mutiny began when the people rose against the company’s rule. This was started with the rumour that rifle cartridges – which had to be bitten open – were greased with either beef or pork fat, deeply offensive to Hindus and Muslims.
It was the largest revolt faced by any Western colonial power and of the 139,000 sepoys employed by the Bengal army fewer than 8,000 remained loyal to the British. The company restored order through brutal repression. All told, during the war and its aftermath, some 100,000 Indians were killed.
The British government was appalled and removed the company’s powers beginning the era of the Raj as the Crown took direct control over the territories held by the East India Company. The company was formally dissolved by an Act of Parliament.
An Indian businessman called Sanjiv Mehta bought the rights to the East India Company name. Already selling tea he is now planning to produce branded gin as well.