East India Company begins Trade in Bengal

East India Company begins trade in Bengal: British trade with India increased, and so did their power. The first English factory was set up on the banks of the river Hugli in 1651. This was the base from which the company’s traders, known at that time as “factors”, operated. As trade expanded, the company persuaded merchants and traders to come and settle near the factory. By 1696 it began building a fort around the settlement.

Demands put up by East India Company

Two years later it bribed Mughal officials into giving the Company zamindari rights over three villages.

One of these was Kalikata, which later grew into the city of Calcutta or Kolkata as it is known today.

The city of Calcutta grew from three villages where the company was given rights to collect tax. Bombay soon become a British stronghold and replaced Surat as the centre of the Company’s activities on India’s west coast.

The provinces of Bengal include present - day Bihar, Jharkhand and Odisha. It was one of the richest provinces of the subcontinent, known for its textile and silk.

It also persuaded the Mughal emperor Aurangzeb to issue a Farman granting the Company right to trade duty free.

Starting out as trades operating from small trading outposts, the Europeans’ soon established powerful colonies in the East. The European power fought bitter battles among themselves for control over the lucrative trade with East, especially India.

There were some areas of conflict between the Bengal nawabs and East India Company

Sirajuddaulah, the Nawab of Bengal , was one of the strong rulers , who refused to grant the company concessions, demanded large tributes for the company's right to trade , denied to provide any right to mint coins , and stopped it from extending its fortification.

He accused the company of deceit and claimed that the company was depriving the Bengal government of huge amounts of revenue and undermining the authority of the Nawab.

The company was refusing to pay taxes , writing disrespectful letters , and trying to humiliate the Nawab and his officials.

The Company , on its part , declared that the unjustifiable demands of the locals officials were ruining the trade of the company , and the trade could flourish only if the duties were removed.

The company also believed that to expand trade , it had to enlarge its settlements , buy up villages, and rebuild its forts. The conflicts led to confrontations and finally culminated into the famous battle of Plassey.

Sample Questions

(More Questions for each concept available in Login)

Question : 1

____________ introduced the permanent settlement of Bengal .
A. Lord Cornwallis	B. Lord Wellesley	C. Loard Warren Hastings	D. Lord Dalhousie
Right Option : A
View Explanation

Question : 2

Dupleix was the ablest governor of the ___________________
A. Dutch East India Company	B. French East India Company	C. English East India Company	D. Portuguese East India Company
Right Option : B
View Explanation