08-11-2009, 11:48 PM
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Founded in 1600 by a marginal island state in northwest Europe to gain seaborne access to Asia's luxury trade, the London-based company evolved to become the dominant commercial power in the east. The turning point came in 1757, when one of its more unscrupulous executives, Robert Clive, deployed the company's private army, a healthy dose of bribes and ingenious fraud to defeat the nawab (prince) of Bengal at the battle of Plassey.
In the looting that followed, Clive netted £2.5 million for the company, and £234,000 for himself - equivalent today to a £232 million windfall for his employers and a cool £22 million success fee for himself. Historical convention views Plassey as the first step in the creation of the British empire in India. But it is perhaps better understood as the company's most successful business deal.
Back in London, the company's share price rose sharply when news hit the markets, and would spike even higher the following decade, when it took control of Bengal's diwani (tax system) - a bit like Wal-Mart running the Internal Revenue Service in today's United States. With this acquisition began the systematic drain of wealth that would continue under corporate control until 1858, and thereafter under the British Raj until 1947. More immediately, the company's takeover of Bengal contributed to a devastating famine in 1770 that killed between a third and a half of the population, leaving a "jungle inhabited only by wild beasts".
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The East India Company: the future of the past
In the looting that followed, Clive netted £2.5 million for the company, and £234,000 for himself - equivalent today to a £232 million windfall for his employers and a cool £22 million success fee for himself. Historical convention views Plassey as the first step in the creation of the British empire in India. But it is perhaps better understood as the company's most successful business deal.
Back in London, the company's share price rose sharply when news hit the markets, and would spike even higher the following decade, when it took control of Bengal's diwani (tax system) - a bit like Wal-Mart running the Internal Revenue Service in today's United States. With this acquisition began the systematic drain of wealth that would continue under corporate control until 1858, and thereafter under the British Raj until 1947. More immediately, the company's takeover of Bengal contributed to a devastating famine in 1770 that killed between a third and a half of the population, leaving a "jungle inhabited only by wild beasts".
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The East India Company: the future of the past