MERCHANT ADVENTURERS
Trading companies sail at the vanguard of imperialism
As European sailing ships conquered the oceans in the sixteenth and seventeenth centuries, trading companies sought profits in far-flung lands and became instruments of monarchs’ imperial ambitions.
The East India Company (EIC), established in 1600, and the Hudson’s Bay Company (HBC), established in 1670, were both London-based joint-stock companies whose royal charters granted them monopolies on trade in distant lands reachable by means of long sea voyages. Both companies began by establishing coastal trading posts: the HBC in the North American wilderness at the mouths of key rivers that drained into Hudson and James bays, and the EIC in populous Indian coastal cities, notably Surat, Madras (now Chennai), Bombay (now Mumbai), and Calcutta (now Kolkata).
King Charles II’s royal charter claimed to make the HBC’s governor and shareholders the “true and absolute Lords and Proprietors” of all the lands draining into Hudson Bay — a vast expanse of some 3.9 million square kilometres that the king dubbed Rupert’s Land. In fact, however, the lands were occupied by many different First Nations and Inuit communities with their own territories, laws, and systems of governance. The HBC traders developed relationships with these Indigenous peoples, who harvested furs from North America’s vast forests and bartered them for European goods such as guns, knives, axes, cooking implements, and wool blankets. The HBC faced competition from French fur traders who operated out of Montreal and other posts along the St. Lawrence River and the Great Lakes.
The first EIC charter, granted by Queen Elizabeth I in 1600, gave the company exclusive rights to trade in the “Indies,” an area that extended from the Cape of Good Hope, at the southern tip of Africa, to the Strait of Magellan, at the southern tip of South America. The company initially had difficulty gaining a foothold in this area due to competition by established Portuguese, Dutch, and Danish trading companies. The French came late to the contest, establishing the Compagnie française des Indes orientales in 1664.
The EIC’s fortunes improved in 1614–15 when the English King James I sent his personal envoy, Sir Thomas Roe, on a diplomatic mission to the powerful Mughal Emperor Jahangir, who ruled most of the Indian subcontinent. The emperor’s patronage allowed the company to establish fortified trading posts in India and to use them as a base for trade in cotton, silks, spices, salt, saltpetre, sugar, indigo, and, later, tea and opium.
Near the end of the eighteenth century — after Britain had taken over France’s North American colonies — the Hudson’s Bay Company expanded its reach by building a chain of inland trading posts across the Northwest. This was necessary because of increased inland competition from the rival Northwest Company and a devastating smallpox epidemic that swept up the continent from Mexico and killed up to eighty per cent of the population in some Indigenous communities, decimating the HBC’s workforce of voyageurs. Although the HBC remained a commercial enterprise that did not conquer
or govern its First Nations trading partners, the company’s expansion solidified the British presence in the region.
Meanwhile, in India, the mid-1700s saw the gradual weakening of the Mughal Empire and a number of conflicts — the Deccan, Mysore, Rajputana, Central India, and Sikh wars — that pitted French, English, and Indian armies against each other. Taking advantage of the situation, the East India Company used its private mercenary army to seize territory and formed diplomatic alliances that subordinated local rulers. By the 1850s it had transformed from a purely commercial enterprise into an autocratic governing corporation that controlled most of India.
The EIC established three principal trading headquarters, called presidencies: Madras Presidency in the south in 1640, Bombay Presidency in the west in 1687, and Calcutta Presidency in the east in 1690. The EIC’s subsequent territorial conquests and annexations of royal kingdoms were incorporated into these presidencies. Each presidency was administered by a Governor General; however, Calcutta eventually emerged as the capital of EIC and British administration in India from 1772 until 1911, when the capital was shifted to Delhi.
In 1857 troops in the EIC’s army rose up in revolt against it, coinciding with rising discontentment among Indian rulers due to the confiscation of their lands and possessions by the EIC, among other factors. Known to the British as the Sepoy Mutiny and to Indian historians as the First War of Indian Independence, the uprising against British rule spread across the country and resulted in a death toll that historians estimate in the hundreds of thousands. After the uprising was crushed, the British government disbanded the EIC, took over its territory, and declared Queen Victoria the Empress of India.
Unlike the EIC, the HBC had no army. However, by the mid-1800s it was coming under pressure from the British government to take a more active role in securing the Northwest against encroachment by American traders and settlers. Ill-suited for this role, in 1870 the Hudson’s Bay Company ceded ownership of Rupert’s Land to the British Crown, without the consent of — or consultation with — the First Nations, Inuit, and Métis people who lived there. In exchange, the company received 300,000 pounds in cash, 18,210 hectares of land around its trading posts (with a further option on 2.8 million hectares of land), and the right to continue its commercial operations, albeit without a monopoly. Today, the HBC is the oldest joint-stock company in the English-speaking world.