The British East India Company was chartered by Queen Elizabeth I for developing trade and commerce with Asia. The principle cause for introducing the British East India Company was to break the monopoly of the Dutch in spice trade with the East Indies. The English East India Company established its first factory in the year 1611 at Machilipatnam located in the Indian state of Andhra Pradesh. The Mughal emperors who were ruling India at that time gave the British unlimited privileges and control over many things in the economy. Read about the history of East India Company.
The East India Company started to flourish and reap profits from
exports. It began to transform from a trading company to a ruling
endeavor after it won the battle of Plassey against the ruler of Bengal,
Siraj - ud - daullah in the year 1757. Slowly, the company got the
rights to collect revenues and taxes from people in place of the Mughal
ruler. However, the administration of the East India Company was
disastrous and the people turned against them in no time.
During the famine of 1769-70, the East India Company did absolutely
nothing to help the people and the state of Bengal was reduced from a
rich princely state to an impoverished state. Almost one third of the
people died as a result of the famine which triggered off resentment
among the rest of the population. The employees of the company were busy
saving themselves and were very harsh and greedy.
Though the East India Company had profits in exports and trading, it
incurred huge expenses in military maintenance due to which it was
evident that the company would be destroyed. The state government
intervened in time and gave funds to the company so that it would
function like before. In 1773, the Regulating Act was passed which
provided the company with greater parliamentary control over the state
and placed India under the rule of a Governor General.
Warren Hastings was the first British Governor General to rule India.
He expanded the British rule rapidly in India. He was succeeded by Lord
Cornwallis in the year 1784. Lord Cornwallis introduced the Permanent
Settlement wherein it was stated the British would collect land revenues
from the Zamindars till eternity. The East India Company did its best to
remove all Indian rivals it had and during the administration of Lord
Wellesley the expansion of British Empire took place with ruthless
force. It was during his administration that the kingdom of Mysore was
annexed after fierce battle with Tipu Sultan and then eventually the
state of Punjab was conquered. The East India Company thus had the
control over entire India with the annexation of Punjab.
Lord Dalhousie was the next Governor who introduced the Doctrine of
Lapse, which agitated the rulers of the princely states. According to
the doctrine, a province would automatically go to the British if there
is no male heir to the throne. Pensions were stopped and it was
announced that rulers after Bahadur Shah would not be given the title of
King. All these factors were responsible for triggering the Indians
against them and they revolted against the East India Company. Thus,
East India Company saw its downfall and the administration of India went
directly under the crown.