Different people have very different ideas about the British East India Company (EIC). David Roos at The British Broadcasting Network tells viewers that it was “the CIA, the NSA, and the biggest, baddest multinational corporation on Earth” all wrapped into one.¹ Historian Ron Harris sees the East India Company as a “turning point” in the development of the Industrial Revolution, globalization, and imperialism.² Its story is often told as a grand adventure by swashbuckling merchants and oldiers who had a "pioneering spirit...impeccable pedigree, and enviable heritage.”³ Others, such as British historian William Dalrymple calls the EIC “the supreme act of corporate violence in world history.”⁴

So, what was this company? How should we remember it—or them? Were they heroic adventurers? The creators of the modern world? A vile band of mercenaries and corporate criminals? Let’s start with the basics.

A great trading company

The EIC was a corporation based in Britain that operated from 1600 to 1874. During this period, it became incredibly wealthy and wielded more power than many governments did at that time. The EIC’s story is complex and, at times, a little sordid. As a company, it was backward and poorly run at the same time that it was innovative and revolutionary. Its success was more a result of good fortune than heroics. Its activities affected the lives of millions of people, including the four we will describe in this article.

The East India Company was founded in London, England, in 1600. It was intended to be a company that imported high-quality goods like textiles and spices from the Mughal Empire in India. It was a new kind of joint stock company—a company with lots of small stockholders who each made a profit. But it was also a chartered company—like the Portuguese Company of the Indies and the Dutch East India Company—which means they were licensed to operate by the King of England. Between 1600 and 1750, some big changes in England and Mughal India opened big opportunities for the Company.

The declining Mughal Empire

The Mughal Empire in 1600 was one of the richest and most powerful states in the world. But by the 1700s, it had run into trouble. The Mughal Empire was at war with many rivals, including the Muslim Persians and Hindu Marathas. War was expensive, and Mughal rulers had little control over their merchants and bankers. They found it difficult to tax trade or borrow from bankers. As money ran out, Mughal leaders began to fight among each other rather than against their enemies. This financial issue was just one factor in the decline of the Empire.

Imad ul-Mulk is one important character in this story. A 17-year-old official, ul-Mulk seized power in the capital city of Delhi with the help of the Marathas—one of the Mughal’s enemies. He arrested the emperor and put a puppet prince in his place. In this, and in similar sorts of conflicts, thousands died and the empire was weakened.

Having done a great deal of damage, ul-Mulk was eventually thrown out of power by enemies who had recruited some European soldiers to join them—in this case, 200 Frenchmen. This fact points to another lucky break for the East India Company. Between about 1750 and 1780, for just a short time, Europeans had a military advantage over the Mughals. Their guns and strategies were simply superior. This helped the EIC a great deal.

Rulers, mercenaries, and drug dealers

Until around 1750, the EIC was mostly made up of merchants. Most of the Company’s officials were young men, sent out at the age of 16 to keep trade flowing. Some made their fortunes, but many died young. One of these young men was Robert Clive. Clive arrived in India in 1744, just as the Mughal Empire was declining. As Britain and France went to war with each other around the world during the Seven Years War, each supported rival factions within the Mughal Empire. In 1757, Clive led EIC forces to a major victory over a French-Bengali force that allowed the EIC to seize the rich Mughal province of Bengal.

Thanks to Clive’s victory, the East India Company became a government as well as a trading company. In practice, they ruled Bengal. That meant they could control trade and production, buying goods at low cost from local producers and selling them at a profit in Europe. It meant they could levy taxes on the local population. And it allowed them to loot the Bengali treasury. Clive, still a young man, soon returned home and retired as one of Britain’s wealthiest people.

Clive and other wealthy officers of the EIC weren’t the only people returning to Europe. Many Company officials married or cohabited with local women, and the result was the birth of a whole class of young people of mixed heritage. They often had a hard time, as they weren’t accepted in Indian or British society. One of these young people was Mary Wilson. Her mother was from Hyderabad, India, but her father was EIC officer Henry Russell. When he returned home to Britain, her father brought her with him. but he never acknowledged her as legitimate. Instead, she was given a different surname and he refused to support her financially, despite having made a fortune himself.

The EIC used its military advantage to good effect. Recruiting tens of thousands of locals and arming them with European weapons, the EIC merchants became mercenaries, selling their services to whoever would pay them the most. It was this military force that allowed the Company to slowly expand its control outside of Bengal, soon becoming the true ruler of much of South Asia.

The EIC also had one other huge advantage—its alliance with Indian bankers. You see, while the Mughal Emperors had generally not liked or cooperated with the wealthy Indian financial community, the merchants of the EIC were very willing to borrow money from these bankers and were careful to always pay them back. Indian bankers were as much a part of this multinational corporation as British investors were.

Aided by loans from Indian bankers, the EIC moved into a new industry in the nineteenth century—the drug trade. EIC officers recognized that there was a huge market for opium, especially in China but also in Europe. Soon, huge parts of Bengal were growing poppy and turning it into a drug. In 1840, when China began to refuse to allow EIC opium into the country, the Company’s troops, aided by the British government, went to war to force China to reopen trade.

Mismanagement and collapse

It sounds like the EIC was an incredibly successful company, but in many ways, it was terribly mismanaged. One example of this is the Great Bengal Famine of 1770, in which 7 to 10 million Bengalis died. This famine was partly caused by three years of crop failures. But more important, EIC officers sought to make money from the famine, holding back grain and raising prices in order to make a profit. Many Bengalis couldn’t pay and starved. The Company was pleased to report a huge economic windfall for its investors. After the famine, however, the British government held the Company accountable, and began to regulate it.

The end of the Company was caused by a different failure, however. By the mid-nineteenth century, the EIC was widely hated in South Asia. Much of its power was thanks to a locally recruited army. But when that army turned against the Company, it was in trouble. In 1857, a rumor spread that the ammunition the troops were given was greased with cow fat (forbidden to Hindus) and pig fat (forbidden to Muslims).

These local troops, also known as sepoys, began to revolt. One of the leaders was a young man named Mangal Pandey. He appears to have encouraged his fellows to overthrow the British officers. Although he was arrested and later executed, the mutiny spread and soon turned into the 1857 Indian Rebellion. Soon most of the region was in flames.

Although British troops eventually defeated the uprising, it had become clear that the Company was not a competent ruler, and the British Empire took over control of India directly. The Company deteriorated until it went out of business in 1874.

The legacy of the EIC

Historians today disagree on how to regard the Company. On the one hand, as a joint stock company its innovations laid some foundation for the modern world. On the other hand, it profited from forced labor, violence, drug production, and outright theft.

Some historians see the EIC as a model for the modern state. Within Bengal and other territories, the Company formed courts and administrative units and a bureaucracy of officials to run the new territory. A lot of these institutions were borrowed from either Mughal or English government traditions. And there was also a lot of mismanagement that contributed to both the 1770 famine and the 1857 uprising.

What we can say is that the EIC had a huge impact on both global affairs and individual lives. It made some people rich, and impoverished many others. It transferred huge amounts of wealth from India and China to Great Britain, and it helped to launch the British Empire and Industrial Revolution. If we are to understand the world today, we must understand the role played by this deeply flawed corporation that helped shape the modern world.

1 Anita Singh, “BBC to Break ‘Taboo’ with ‘Inaccurate’ Portrayal of East India Company,” The Telegraph, Apr. 4, 2014. http://www.telegraph.co.uk/culture/tvandradio/bbc/10743407/BBC-to-break-Taboo-with-inaccurate-portrayal-of-East-India-Company.html
2 Ron Harris, Going the Distance: Eurasian Trade and the Rise of the Business Corporation, 1400–1700, Princeton University Press, 2020, 5.
3 Rachel Rickard Straus, "East India Co. Is Back, with Indian Owner," The Economic Times, Aug. 16, 2010. https://economictimes.indiatimes.com/news/company/corporate-trends/east-india-co-is-back-with-indian-owner/articleshow/6316967.cms?from=mdr
4 William Dalrymple, The Anarchy: The Relentless Rise of the East India Company, Bloomsbury Publishing, 2019.