The last powerful Mughal rulers, Aurangzeb, established control over a very large part of the Indian territory. However, upon his demise in 1707, the empire’s grip began to weaken, giving rise to the emergence of powerful regional kingdoms. This emergence in various parts of India turned Mughals capital ineffective as a governing center. In the 18th century, British entering the subcontinent as a trading company changed the course of Indian history.

East India Company Comes To East

Royal Charter: In 1600, Queen Elizabeth-I gave sole right to to trade with the East to the East India Company:

• No Competitor: No other trading group in England could compete with the East India Company.
• Monopolised Trade: It allowed the company to explore new lands to buy goods at low prices and sell them in Europe for profit, with no fear of competition from other English trading companies.
• European Rivals: The charter could not prevent other European powers like the Portuguese, Dutch, and French who had already established a presence in the Eastern markets.
• Tradable Items: Items like fine qualities of cotton and silk, pepper, cloves, cardamom and cinnamon were of common interest to the trading companies due to their high demand.
• Competition and Clashes: Fierce competition for markets led trading companies to engage in battles, fortify posts, and clash with local rulers, blurring the lines between trade and politics.

East India Company Begins Trade in Bengal

Factory in Bengal: The first English factory set up in 1651 on the banks of Hugli river, acted as the base from where company’s traders known as “factors” operated.

• Trading Center: Initially the factory acting as a warehouse, as trade expanded, under the Company’s persuasion merchants and traders came and settled near the factory.
• Fortification: By 1696, the Company began constructing a fort around the settlement for protection.
• Rights to Company: The Company secured zamindari rights over three villages, including Kalikata, which later grew into the city of Calcutta (present day Kolkata). 
• Issuance of Farman:It also persuaded the Mughal emperor Aurangzeb to issue a farman granting the Company the right to trade duty free.
• Over Greediness:The Company’s greediness for more concessions and exploitation of existing privileges led to disputes. 
  • Example: Although Aurangzeb’s farman granted duty-free trade rights only to the Company, Company officials engaged in private trade and refused to pay duties, causing significant revenue loss for Bengal.

How Trade Led to Battle

Resistance from Capable Rulers: After the death of Aurangzeb, the regional powers started asserting their power and autonomy, Bengal was no exception. 

• Examples of Capable Rulers: Murshid Quli Khan, Alivardi Khan, and Sirajuddaulah were all capable rulers who started opposing the Company’s exploitation.
• Checks on Company: They refused to grant the Company concessions, demanded large tributes for the Company’s right to trade, denied it any right to mint coins, and stopped it from extending its fortifications.
• Allegations on Company: They accused the Company of deceit, loss of revenue, undermining the authority of the nawab and engaging in disrespectful behavior.
• Company’s Stand: The Company defended saying that unjust demands of the local officials were ruining the trade of the Company, and trade could flourish only if the duties were removed. 
  • Trade Expansion: In order to expand the trade it started enlarging its settlements, buying up villages, and rebuilding its forts.
• Cumulative Effect: In the early 18th century these disputes eventually led to confrontations and culminated in the historic Battle of Plassey.

The Battle of Plassey

Reasons

• Sirajuddaulah on Throne: Upon the death of Alivardi Khan in 1756, Sirajuddaulah assumed the position of Nawab in Bengal. 
  • Concerns for Company:The East India Company was concerned about his authority and aimed to establish a pliant ruler who would grant trade benefits. 
• Company supported Rivals: Consequently, they attempted, unsuccessfully, to support one of Sirajuddaulah’s rivals in his bid for the Nawab’s position.
• Response from Sirajuddaulah: An angered Sirajuddaulah demanded that the Company cease its interference in his realm’s politics, halt fortification efforts, and fulfill their revenue payments.
• Failed Negotiations: The Nawab conquered the English factory at Kasimbazar with 30,000 soldiers. 
  • Occupy Fort:Further marching into Calcutta to establish control over the Company’s fort.

Companies Response

• Forces Under Robert Clive: Hearing about Calcutta’s fall, Company officials in Madras sent forces under the command of Robert Clive and also held prolonged negotiations with the Nawab.
• Defeat of Sirajuddaulah: Finally, in 1757, Robert Clive defeated Sirajuddaulah at Plassey.

Reasons for Defeat 

• One of the key factors in the Nawab’s defeat was the non-participation of Mir Jafar, one of Sirajuddaulah’s commanders, who had been promised the position of nawab by Clive in exchange for his support.
• Milestone for Company: The Battle of Plassey marked a significant milestone as it represented the first major victory for the East India Company in India.

Aftermath of Battle of Plassey

• New Nawab: Mir Jafar was made the nawab, and the Company, unwilling to take over the responsibility of administration, stuck to the expansion of trade.
• Mir Kasim on Throne: The puppet Nawabs in their quest for dignity and sovereignty seemed challenging to the Company, which deposed Mir Jafar and replaced him with Mir Qasim, who was later defeated at Buxar in 1764, and Mir Jafar was reinstated.
• Deewani Rights: In 1765, the Mughal emperor appointed the Company as the Diwan of Bengal, allowing access to the province’s vast revenue resources.
• Huge Benefit to Company: This Diwani right solved the Company’s problem of having to import gold and silver from Britain to buy goods in India.
• Drain of Wealth: Revenues now finance Company expenses like maintaining troops, building the Company’s fort and offices in Calcutta and also for purchasing textiles in India.

Conclusion 

The East India Company’s arrival in India for trade gradually morphed into political control. The Battle of Plassey marked a turning point, and the Diwani rights solidified the Company’s economic and political dominance in Bengal. This paved the way for British colonialism to take root in India.