Still, inevitably, Indian entrepreneurs began to set up their own modern textile mills after 1850 and to produce cloth that could compete with the British imports. The American Civil War, by interrupting supplies of cotton from the New World, set off a brief boom in Indian cotton, but once American supplies resumed in 1865, India again suffered. As late as 1896, Indian mills produced only 8 per cent of the total cloth consumed in India. By 1913, this had grown to 20 per cent, and the setbacks faced by Britain with the disruptions of the World War I allowed Indian textile manufacturers to slowly recapture the domestic market. In 1936, 62 per cent of the cloth sold in India was made by Indians; and by the time the British left the country, 76 per cent (in 1945).
But for most of the colonial era, the story of Indian manufacturing was of dispossession, displacement and defeat. What happened to India’s textiles was replicated across the board. From the great manufacturing nation described by Sunderland, India became a mere exporter of raw materials and foodstuffs, raw cotton, as well as jute, silk, coal, opium, rice, spices and tea. With the collapse of its manufacturing and the elimination of manufactured goods from its export rosters, India’s share of world manufacturing exports fell from 27 per cent to 2 per cent under British rule. Exports from Britain to India, of course, soared, as India’s balance of trade reversed and a major exporting nation became an importer of British goods forced upon the Indian market duty-free while British laws and regulations strangled Indian products they could not have fairly competed against for quality or price.
The deindustrialization of India, begun in the late eighteenth century, was completed in the nineteenth and only slowly reversed in the twentieth. Under the British, the share of industry in India’s GDP was only 3.8 per cent in 1913, and at its peak reached 7.5 per cent when the British left in 1947. Similarly, the share of manufactured goods in India’s exports climbed only slowly to a high of 30 per cent in 1947. And at the end of British rule, modern industry employed only 2.5 million people out of India’s population of 350 million.
EXTRACTION, TAXATION AND DIAMONDS
But the ill effects of British rule did not stop there. Taxation (and theft labelled as taxation) became a favourite British form of exaction. India was treated as a cash cow; the revenues that flowed into London’s treasury were described by the Earl of Chatham as ‘the redemption of a nation…a kind of gift from heaven’. The British extracted from India approximately £18,000,000 each year between 1765 and 1815. ‘There are few kings in Europe’, wrote the Comte de Châtelet, French ambassador to London, ‘richer than the Directors of the English East India Company.’
Taxation by the Company—usually at a minimum of 50 per cent of income—was so onerous that two-thirds of the population ruled by the British in the late eighteenth century fled their lands. Durant writes that ‘[tax] defaulters were confined in cages, and exposed to the burning sun; fathers sold their children to meet the rising rates’. Unpaid taxes meant being tortured to pay up, and the wretched victim’s land being confiscated by the British. The East India Company created, for the first time in Indian history, the landless peasant, deprived of his traditional source of sustenance.
Ironically, Indian rulers in the past had largely funded their regimes not from taxing cultivators but from tapping into networks of trade, both regional and global. The Company’s rapacity was a striking departure from the prevailing norm.
Corruption, though not unknown in India, plumbed new depths under the British, especially since the Company exacted payments from Indians beyond what they could afford, and the rest had to be obtained by bribery, robbery and even murder. Everybody and everything, as the 1923 edition of the Oxford History of India noted, was on sale.
Colonialists like Robert Clive, victor of the seminal Battle of Plassey in 1757 that is seen as decisively inaugurating British rule in India, were unashamed of their cupidity and corruption. On his first return to England Clive took home £234,000 from his Indian exploits (£23 million pounds in today’s money, making him one of the richest men in Europe). He and his followers bought their ‘rotten boroughs’ in England with the proceeds of their loot in India (‘loot’ being a Hindustani word they took into their dictionaries as well as their habits), while publicly marvelling at their own self-restraint in not stealing even more than they did.
Clive came back to India in 1765 and returned two years later to England with a fortune estimated at £400,000 (£40 million today). After accepting millions of rupees in ‘presents’, levying an annual tribute, helping himself to any jewels that caught his fancy from the treasuries of those he had subjugated, and reselling items in England at five times their price in India, Clive declared: ‘an opulent city lay at my mercy; its richest bankers bid against each other for my smiles; I walked through vaults which were thrown open to me alone, piled on either hand with gold and jewels… When I think of the marvellous riches of that country, and the comparatively small part which I took away, I am astonished at my own moderation.’ And the British had the gall to call him ‘Clive of India’, as if he belonged to the country, when all he really did was to ensure that a good portion of the country belonged to him.
The scale and extent of British theft in India can be gauged by the impact of Indian-acquired wealth upon England itself. In his biographical essay on Clive, the nineteenth-century politician and historian Lord Thomas Babington Macaulay went beyond the details of Clive’s life to inveigh against some of the larger forces his success had set in motion. (This is not to say Macaulay was an opponent of Empire. He served the East India Company in various capacities, and called it ‘the greatest corporation in the world’.) His diatribe was aimed at the ‘nabobs’, the term applied to East India Company employees who returned to England after making fortunes in India. It was a term famously given currency by Edmund Burke in his ferocious denunciation of the Company’s Governor General, Warren Hastings, who was impeached by Parliament in 1788 for rampant corruption and abuse of power. The word ‘nabob’, Macaulay knew, was a mispronounced transliteration of a high Indian title, nawab or prince, carrying associations of aristocracy and authority that Macaulay found problematic. Nabobs, he wrote, ‘had sprung from obscurity…they acquired great wealth…they exhibited it insolently…they spent it extravagantly’ and demonstrated the ‘awkwardness and some of the pomposity of upstarts’. They ‘raised the price of everything in their neighbourhoods, from fresh eggs to rotten boroughs…their lives outshone those of dukes…their coaches were finer than that of the Lord Mayor…the examples of their large and ill-governed households corrupted half the servants of the country…but, in spite of the stud and the crowd of menials, of the plate and the Dresden china, of the venison and Burgundy, [they] were still low men’.
It didn’t take much to make money if you were a Briton in India. Company official Richard Barwell boasted to his father in 1765 that ‘India is a sure path to [prosperity]. A moderate share of attention and your being not quite an idiot are (in the present situation of things) ample qualities for the attainment of riches.’ Nabobs were often Company officials who indulged in private trade on their own account while on the Company’s business. This was extraordinarily lucrative, given the Company’s monopoly on its own territories: profits of 25 per cent were regarded as signs of a moderate man, and vastly higher sums were the norm.
Clive’s father followed his son’s career in India closely, recognizing that the family’s fortunes depended on Indian loot. ‘As your conduct and bravery is become the publick [sic] talk of the nation,’ he wrote to his son in 1752, ‘this is the time to increase your fortune, make use of the present opportunity before you quit the Country.’ He did, buying his father and himself seats in Parliament, and acquiring a peerage (it was only in Ireland, so he renamed his County Clare estate ‘Plassey’.) The Whig politician and author Horace Walpole wrote: ‘Here was Lord Clive’s diamond house; this is Leadenhall Street, and this broken column was part of the palace of a company of merchants who were sovereigns of Bengal!
They starved millions in India by monopolies and plunder, and almost raised a famine at home by the luxury occasioned by their opulence, and by that opulence raising the prices of everything, till the poor could not purchase bread!’
The Cockerell brothers, John and Charles, both of whom served the East India Company in the second half of the eighteenth century, built an extraordinary Indian palace in the heart of the Cotswolds, complete with a green onion-shaped dome, umbrella- shaped chhatris and overhanging chhajjas, Mughal gardens, serpent fountains, a Surya temple, Shiva lingams—and with Nandi bulls guarding the estate. The mansion, Sezincote, designed by a third Cockerell brother, the architect Samuel Pepys Cockerell (who, unlike his siblings, had never been to India), still stands today, an incongruous monument to the opulence of the nabobs’ loot.
But it was Indian diamonds, which the nabobs brought back to Britain with them, that made the Empire real to the British public. They were the insignia of new money, indications that as Britain was becoming an imperial power, the country was being transformed. But old money was contemptuous of the new; many in the establishment did not want diamonds to sully the hands of good Englishmen. As Horace Walpole sneered in 1790: ‘What is England now? A sink of Indian wealth.’ Walpole hoped his nation would endeavour to act ‘more honestly’ than the nabobs did in bringing home ‘the diamonds of Bengal’. He would not, he wrote, behave like the nabobs ‘for all Lord Clive’s diamonds’.
In the late eighteenth and early nineteenth centuries, the nabobs’ diamonds were not hailed as jewels in Britain’s imperial crown or prized imperial symbols, as the famed Kohinoor diamond would later be. Instead they were both envied and attacked as imports that pinched the purses of domestic Britons—and threatened to change British politics fundamentally.
Perhaps the earliest Company employee to bring Indian diamonds into the headlines (and thereby consecrate Indian diamonds as an imperial trope) was Thomas Pitt, the governor of Madras. In 1702, Pitt acquired (for £24,000, it was said, itself a considerable sum beyond the reach of 99 per cent of Englishmen) a diamond said to be ‘the finest jewel in the world’. Pitt shipped the 400–carat gem to Britain, referring to it in his letters as ‘my greatest concern’ and ‘my all’. Soon after his diamond’s safe arrival in Britain, he gave up his governorship, purchased a grand estate and paid handsomely for a seat in Parliament. The British historian John Keay tells us that ‘wild rumours’ swirled around Pitt’s diamond, one suggesting that it had been ‘snatched from the eye socket of a Hindu deity or smuggled from the mines by a slave who hid it in a self-inflicted gash in his thigh’. Like the purloined jewel in the title of Wilkie Collins’s 1868 novel The Moonstone, the Pitt Diamond became a legend. It represented the wealth that was widespread in India, Britain’s power to extract that wealth, and the luxury that came with power in India—especially if you were British.
The traditional British view of wealth based it on the ownership of land, which, through its solidity, connoted an earthy stability, and since land was held for a long time, reflected hierarchy and implied a sense of permanence. This had changed somewhat thanks to the advent of the mercantile classes, but the Pitt Diamond represented a dramatically alternative model, based on something far more adventurous—colonial exploits, if not exploitation. The owners of these diamonds escaped the confinement of traditional sources of wealth for something that could be acquired by colonial enterprise rather than traditional inheritance. Fifteen years after he had brought the diamond from India, Thomas Pitt sold it to the Regent of France, the Duc d’Orléans, for the princely sum of £135,000, almost six times what he had paid for it. The astronomical amount (worth multiple millions in today’s money) bought the Pitt family a new place in English society. An Indian diamond thus gave a financial springboard to a British dynasty that would, in very short order, produce two prime ministers—his grandson William Pitt, 1st Earl of Chatham, and Chatham’s own son, William Pitt ‘the Younger’.
In other words, the nabobs and their money were changing British politics during the late eighteenth-century expansion of Britain’s Indian empire. As an essay in The Gentleman’s Magazine reported in 1786, ‘the Company providentially brings us home every year a sufficient number of a new sort of gentlemen, with new customs, manners, and principles, who fill the offices of the old country gentlemen [sic].’ The danger was that these new men would remake Britain: ‘It is plain that our constitution, if not altered, is altering at a great rate.’ The East India Company was no longer just a trading concern and had gone well beyond the terms of its original charter. Some in Britain were concerned and alarmed: they summoned Clive before Parliament to explain his actions in India and the fortune he had made there. In impeaching Hastings, Burke commented pointedly: ‘Today the Commons of Great Britain prosecutes the delinquents of India. Tomorrow these delinquents of India may be the Commons of Great Britain.’
The government of the Earl of Chatham, Pitt’s descendant, sought to assert parliamentary supremacy over the Company in 1766, but thanks to his own ill health and since many MPs were in fact East India Company shareholders, this attempt was not too successful. Indeed, it was not until the passage of Lord North’s Regulating Act of 1773 that Parliament gained some measure of control over the Company’s activities in India. But even then, a majority of MPs stood to gain from the Company’s successes, and they passed enabling legislation rather than restrictive laws. William Pitt the Younger would finally pass an India Act in 1784, establishing a Board of Control with power to endorse or dictate orders to the Company, to bring to heel the kinds of practices that had enriched his own ancestor. However, for all the talk of reform, the London Chronicle listed, in 1784, the names of twenty-nine members of Parliament with direct Indian connections; there were many more who owned shares in the Company.
The playwright Richard Sheridan was scathing in his denunciation of the Company, whose operations ‘combined the meanness of a pedlar with the profligacy of a pirate… Thus it was [that] they united the mock majesty of a bloody sceptre with the little traffic of a merchant’s counting-house, wielding a truncheon with the one hand, and picking a pocket with the other’.
Nor were Company officials unaware of the impact of their actions. Baron Teignmouth, who as John Shore went on to serve as Governor General of India from 1793–97, pointed out in a Minute as early as 1789 that the East India Company were both merchants and sovereigns in India: ‘in the former capacity, they engross its trade, whilst in the latter, they appropriate its revenues’. Teignmouth pointed to the iniquity of the policies of extraction, the drain of currency (silver) and resources from the country to Europe, and the resultant collapse of India’s internal trade, which had flourished before the Company’s depredations.
There are many accounts of the perfidy, chicanery and cupidity with which the Company extracted wealth from the native princes, and went on to overthrow them and take over their territories; it would be tiresome today to regurgitate stories that have been in circulation since the late eighteenth century, when the British Parliament unsuccessfully impeached Warren Hastings, arguably one of the most rapacious of the Company’s many venal Governors General. But a couple of examples will serve to illustrate the point I’m making. Hastings accepted substantial personal bribes and then went on to wage war against the bribe-giver (one wonders whether to deplore his avarice or admire him for the fact that despite being ‘paid for’, he refused to be ‘bought’). His brazenness in such matters compels admiration: when he tortured and exacted every last ounce of treasure from the assets of the widowed Begums of Oude, Hastings duly informed the Council that he had received a ‘gift’ of 10 lakh rupees (£100,000 in those days, a considerable fortune) from the spoils and requested their formal permission to keep it for himself. The Council, mindful no doubt of the larger sum that would go on the Company’s balance sheet, readily concurred.
Burke, in his opening speech at the impeachment of Hastings, also accused the East India Company of ‘cruelties unheard of and
devastations almost without name…crimes which have their rise in the wicked dispositions of men in avarice, rapacity, pride, cruelty, malignity, haughtiness, insolence’. He described in colourfully painful detail the violation of Bengali women by the British-assigned tax collectors—‘they were dragged out, naked and exposed to the public view, and scourged before all the people…they put the nipples of the women into the sharp edges of split bamboos and tore them from their bodies’—leading Sheridan’s wife to swoon in horror in Parliament, from where she had to be carried out in distress. More indictments followed in the mellifluous and stentorian voices of Sheridan and Charles James Fox, but in the end, Hastings was acquitted, restoring the image of the Empire in the eyes of the British public and serving to justify its continuing rapacity for a century and a half more.
But the problem went well beyond Hastings. The preacher William Howitt speaking in 1839, while the Company was still in power, lamented that ‘the scene of exaction, rapacity, and plunder which India became in our hands, and that upon the whole body of the population, forms one of the most disgraceful portions of human history… There was but one object in going thither, and one interest when there. It was a soil made sacred, or rather, doomed, to the exclusive plunder of a privileged number. The highest officers in the government had the strongest motives to corruption, and therefore could by no possibility attempt to check the same corruption in those below them… Every man, in every department, whether civil, military, or mercantile, was in the certain receipt of splendid presents.’
Even Lord Macaulay (who, as we have seen, thought very highly of the Company, and was employed by it for several years) was moved to write: ‘the misgovernment of the English was carried to such a point as seemed incompatible with the existence of society… The servants of the Company forced the natives to buy dear and sell cheap… Enormous fortunes were thus rapidly accumulated at Calcutta, while thirty millions of human beings were reduced to the extremity of wretchedness. They had never [had to live] under tyranny like this…’ Macaulay added that whereas evil regimes could be overthrown by an oppressed people, the English were not so easily dislodged. Such an indictment, coming from a liberal Englishman and an architect of the Empire, with whom we will have other bones to pick later, is impossible to contradict.