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Appendixes

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Appendix 1 – The Company and the Commonwealth

1649–166o

The preceding chapter ends with the various English settlements that grew finally into the British Indian Empire, as will be explained more fully in the next volume. As an appendix, however, I include here Sir William Hunter’s valuable discussion of the relation of the Commonwealth under Cromwell to the affairs of India. A. V. W. J.

In 1650 the East India Company, by command of the Council of State, effaced the king’s arms still remaining on one of its ships. After the Restoration in 1660, it sought in like manner to hide the memorials of the Commonwealth, and the great charter of Cromwell disappeared from the India House. Its official historiographer, Bruce, the only annalist who has made a careful use of its archives, holds up the events of the intervening period as “an awful example” of a king and government “subverted by factions,” “duped” by a “Usurper,” and the “victim” of “guilty ambition.” To the general historian those years appeared as a disastrous “scramble for the trade of India.” Cromwell’s own life was so full of great English interests, and so crowded by European events,

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that his biographers have found no leisure for his dealings with the East India Company.

Yet the manuscript records attest how decisive those dealings were. The East India trade ceases to be a pawn sacrificed to kings and queens in the game of royal marriages. It begins to stand out as a national interest, to be maintained by European treaties and enforced by a European war. In 1640, when the governor of the Company had rebuked “the generality” for their slack subscriptions notwithstanding the king’s promises, they replied, according to the Ms. Court Book: “Until they shall see something acted by the King and State, men will not be persuaded to underwrite a new stock.” They were now to come under a ruler chary of promise, but in action intrepid.

Cromwell found the Dutch triumphant in Europe and Asia, our Indian relations with the Portuguese still left to the haphazard of local conventions on the Bombay coast, and Amboyna unavenged. He enforced from Portugal an open trade for the English in the East; from Holland he wrung the long-denied redress for the torture and judicial slaughter of Englishmen in 1623, together with the restoration of the island then seized by the Dutch. Chief of all, he definitely imposed on the Company the principle of a permanent joint stock, on which it continued until its trade was thrown open in the nineteenth century. Under Cromwell’s charter of 1657 was raised the first subscription destined not to be dissolved, but to grow into the permanent capital of the East India Company. The corporation passed,

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with little recognition of the change at the time, from its medieval to its modern basis.

Born in 1599, the year when the London merchants met in Founders’ Hall to project an East Indian voyage, Cromwell entered the House of Commons in 1628, the year of the Company’s first appeal to Parliament. His charter of 1657 inaugurated the three cyclic dates of Great Britain in the East. It was fitly commemorated by the Battle of Plassey in 1757, and by the reconquest of India after the Sepoy Revolt, exactly one hundred years later.

But before his strong hand could make its weight felt, a period intervened when there was no king in Israel. From the Battle of Edgehill, in October, 1642, to the last scene outside Whitehall in January, 1649, Charles, whatever may have been his faults, cannot be held accountable for the distresses of the East India Company. One Parliament, with the king, a majority of the Lords, and a minority of the Commons, sat at Oxford. Another Parliament, with a majority of the Commons and a minority of the Lords, sat at Westminster. It was with this London Parliament that the Company had to reckon. The Houses at Westminster could levy contributions in the capital, they collected the customs, and controlled the shipping in the Thames. In 1643 they put a curb on the Royalist members of the Company by demanding a forced loan of its ordnance, “for the fortifying of the bulwarks, now in preparation for the security of the City.” On its refusal, the Commons declared they would grant an order

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to the Committee of Fortifications to take them. So the cannon had to be given up, and the next year the Company petitioned for payment or their return.

The London Parliament was, in truth, in no mood to tolerate a king’s faction within the liberties of the City. In 1643 it cashiered the Company’s governor, sequestrated moneys due to Royalists at the India House, and forbade any dividends to be paid until the directors had had an interview with a committee of the Lords and Commons. Later in the year, the Parliamentary Government demanded a loan of £10,000, and the Company was glad to get off for half that sum. By 1644 the Royalist party in the Company was cowed, and the chief officers of its ships had taken the Solemn League and Covenant.

This coercion cost the Company dear. It had lately opened houses in Italy to dispose of its Indian goods, almost unsalable amid the troubles at home, and in 1645 one of its Royalist members, Sir Peter Rychaut, revenged his sequestrations in England by seizing three hundred bags of its pepper in Venice. Its captains, when clear of the Thames, were sometimes difficult to control. Captain Mucknell of the ship John, for example, carried his ship into Bristol and delivered it to the king’s general. He then sallied forth with three armed vessels to waylay other Indiamen, and the Company was advised to despatch two nimble pinnaces to scout among the Western Islands or Azores and warn its homeward-bound vessels of their danger.

Amid this confusion, the Company still tried to

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A street scene in Bombay

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make a show of trade. With no hope from the king, by whose charter it existed, and in little favour with Parliament, it found its position almost as isolated as that of its servants in India. Like them, it evoked from the sense of desertion a resolve to rely upon itself. It entered, as we shall see, into direct negotiations with the Portuguese ambassador in London, and it almost succeeded in coming to an arrangement with the Dutch. It also began to strike out new trade methods. In 1640, with the help of royal promises, it had tried to raise fresh capital under the name of the Fourth Joint Stock. But the public had lost confidence, and with the shares selling as low as sixty per cent., the money could not be obtained.

Yet individual expeditions, if conducted without a dead outlay on factories, forts, and a permanent staff in India, yielded large profits. Laying aside for the time the project of a Fourth Joint Stock, some of its members subscribed in 1641 for a Particular Voyage, which should engage no servants in the East, but pay a commission to the Third Joint Stock for selling its goods and collecting a return cargo. Others began to take heart and got together a small nucleus for the Fourth Joint Stock. This double organization of individual voyages and a general stock led to grave difficulties, as it tried to combine the early plan of Separate Voyages with the Joint Stocks, or series of voyages, which had superseded them. Yet it enabled the Company to struggle through the civil wars without altogether losing its continuity of trade.

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That fate was narrowly averted. In 1647, when the House of Lords rejected the “Ordinance for the Trade,” which the Commons had passed as a Parliamentary charter for the Company, the governor called together the shareholders. He explained to them that, while they had lost the privileges, they remained subject to the responsibilities of the royal grant. “Every man had liberty to go to India,” but the Indian princes held the Company “liable for what depredations” any Englishman might there commit. In this way they had already lost £100,000, besides another £100,000 from Courten’s trading. Courten’s Association, having reached the end of its resources, was carrying on business with counterfeit coin, pagodas, and reals, which it manufactured on a great scale at Madagascar, and so brought the English name into disgrace throughout the East. The Indian princes made the Company responsible for this and similar offences. The governor advised the brethren, therefore, “to draw home their factors and estate,” and the Company decided to wind up the Fourth Joint Stock. “In regard to the troubles of the times,” they abandoned the idea of forming a new Joint Stock, but in order that the trade might not be wholly lost, they decided to find money for another voyage.

Cromwell viewed the India trade from a national standpoint, and regarded the Company as one of several alternative methods for conducting it. When a protracted inquiry convinced him that it was the method best suited to the times, he strongly supported it. But

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throughout he had the interest not of the Company, but of the nation, in mind. As he set himself, while still a cavalry colonel, to form an army of victory at home, so he resolved, as head of the Commonwealth, to create a marine which should give England predominance abroad. The Navigation Act of 1651 served as his New Model for winning the supremacy of the seas. The East India Company, its charters, and its rivals, were merely instruments for carrying out this great design.

Yet if Cromwell long stood aloof from the Company in its domestic distresses, he lost no time in dealing with its foreign enemies. In 1650 it petitioned “the Supreme Authority of this Nation, the High Court of the Parliament of England,” for help against Holland. After a list of Dutch injuries, involving an alleged loss of two millions sterling during the past twenty years, it declared that it had repeatedly laid its wrongs before the king and Council, and had prayed in vain “that satisfaction should be demanded from the States-General.” Parliament received the petition with favour, and on the same day voted that it be referred for consideration by the Council of State. But Cromwell had Scotland on his hands, and he intended, if a Dutch war must come, to wage it on wider issues. So next year, 1651, the Company twice brought its Dutch grievances before the Council of State, and again in January, 1652. Cromwell was now ready, and the wrongs of the East India Company furnished one of the causes of the war with Holland declared in the following summer Next

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A native boat of the Persian Gulf

year the Company supplied saltpetre for the navy, and offered to equip a fleet of its own, which, with the aid of a few ships to be lent by the government, would turn the Dutch flank by carrying the war into the Indian seas. The proposal was not accepted, but compensation to the East India Company figured largely among the final spoils of victory. In 1653 a Dutch fleet threatened our factory at Surat. The Moghul government, however, did not allow private wars between Europeans within its dominions, so the Hollanders sailed to the Persian Gulf, where they captured three English ships. The Company’s trade at Bantam was also suspended during the war.

By the treaty of 1654, which restored peace, Holland pledged herself “that justice should be done upon those who were partakers or accomplices in the massacre of the English at Amboyna, as the Republic of England is pleased to term that fact,” and sent commissioners to London to settle all money claims. By this time the torturers and the tortured had alike passed away; it only remained to offer some solatium to the heirs of the victims and to compensate the Company for its losses. Twelve years previously the Company, hopeless of action by the king, was willing to compound privately with the Dutch for a payment of

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£50,000, and the negotiations had broken down only as the Dutch demanded the relinquishment of its rights in the island of Pularoon. It now produced a swollen bill of two and one-half millions sterling for Dutch injuries perpetrated from 1611 to 1652. The Dutch gravely replied by counter-claims amounting to nearly three millions.

But the Protector was not to be trifled with, and had resolved that any questions left open at the end of three months should be referred for arbitration to the Protestant Swiss Cantons. So the commissioners made short work of the huge totals, and, striking a balance, declared that the Dutch Company must pay £85,000 to the London Company, besides £3615 to the heirs or executors of the Amboyna victims, and must restore Pularoon to the English. The sum thus awarded to the London Company was more than half as much again as that for which it would, in its despondency, have settled privately with the Dutch in 1642. Oliver sternly let it know, however, that it held Pularoon only in trust, and must “plant and manage the island so that it may not be lost to the nation.”

In the same summer of 1654, Cromwell put an end for ever to the exclusive claims of Portugal in the East – claims based on the Papal Bull of 1493, but embodied during a century and a half in the public law of Europe. With regard to this matter also the Company had tried to accomplish by private negotiation what royal diplomacy had failed to effect. The commercial convention between its president at Surat and the Goa

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Hookah Smokers in India

Smoking is almost as common in India as it is throughout the rest of the world, and although the Moghul Emperor. Jahangir, in the sixteenth century, like King James, issued a counterblast against tobacco, the Hindu, the Moslem, and even occasionally the Parsi, enjoys his “hookah” or “hubble-bubble,” or, if he can afford it, his briar-wood pipe and cigar.

viceroy in 1635 seemed to open the door to an international settlement of the Indies. When the instrument reached England, the Company applied to King Charles and to his minister at Madrid with this end in view, as usual without practical result. After the separation of the crowns of Spain and Portugal in 1640, our Surat president again entered into negotiations on his own account with the Goa viceroy, and obtained from him letters to the Portuguese ambassador in London. The directors in England also addressed his Excellency. But the Portuguese ambassador distrusted their amateur diplomacy and would grant no settled peace in the Indies; indeed, only a further truce for two years. In 1642 Charles I, while arranging for freedom of trade between England and Portugal, agreed that their relations in India should. remain for three years more on the basis of the local Surat–Goa Convention.

Cromwell had no liking for such private negotiations. Resenting the shelter given by Portugal to Prince Rupert’s fleet, he prepared the way for peace by Blake’s cannon, and three months after the Dutch submission he extorted a final settlement from Portugal. His Portuguese treaty of July, 1654, placed on an international basis the right of English ships to trade to any Portuguese possession in the East Indies. In all this Cromwell made no pretence of special favour to the Company. To him the India trade was one of the great English interests to be subserved by the treaties which followed European wars. Yet as the Company was a chief gainer from the national successes,

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he thought it should contribute to their cost. In 1649 the commissioners of the navy constrained it to lend £4000; in July, 1655, Cromwell borrowed from it £50,000; and in October of the same year another £10,000 to pay Blake’s seamen. These loans were strictly applied to public purposes and faithfully repaid.

But Cromwell expected from the Company not money alone. In 1652 the Council demanded from it, without success, two ships of war “for Defence of the Right and Honour of this Nation.” To secure Pularoon the Company was called, in 1656, to provide £30,000 for fortifications, guard-pinnaces, and cannon, together with a garrison of eighty Englishmen and over two hundred native soldiers. As the Dutch rooted up the spice-trees before they even pretended to deliver over the island, no speedy return could be expected. Indeed, the money had to be levied by a contribution from the shareholders of twenty per cent. on their original ventures. When, therefore, the Protector started, also in 1656, his project of a volunteer fleet, the Company found itself compelled to hold aloof. He ordered it to send representatives to arrange with other trading bodies and himself for the equipment of thirty-nine men-of-war as convoys. The wearied directors replied that the existing dues already amounted to ten per cent., and that they could not possibly pay more.

By this time Cromwell had inquired into the affairs of the Company and knew that it could not bear further burdens. But while considerate to its distresses,

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he brooked no private diplomacy such as the Company, had carried on during the late reign with the Dutch and Portuguese. In the moment of granting his charter of 1657, the Protector called it sharply to task for attempting to negotiate on its own account with Holland. The directors had sought redress from the Dutch ambassador in London for a fresh infringement of their rights in the East. His Excellency, like most foreign representatives under Cromwell’s rule, proved gracious. But the Protector intimated his displeasure at the Company’s approaching a foreign minister without his knowledge, and commanded it to submit all grievances to himself.

While Cromwell thus both strengthened and controlled the Company in regard to its foreign enemies, he intervened with reluctance between it and domestic rivals. For several years after the death of King Charles the task of constructing a government in England, and of defending it by arms, left him no leisure for trade wrangles. The Council of State, which meanwhile carried on the civil administration, found itself besieged by three sets of applicants for the Eastern traffic. Foremost among them was the Company, founding its monopoly on a royal charter, but on a royal charter so tampered with by royalty itself as to have lost much of its value. Next came Courten’s Association, which also based its claims on a royal grant. In the background the great merchants of London and Bristol, belonging to neither of these societies, clamoured for an open trade in the joint interests of themselves

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Shop of a merchant of the Vaisya caste

and the nation. We have seen that the attempt in 1647 to embody the Company’s charter into an Act of Parliament failed; the Ordinance for the Trade, although it passed through the Commons, was rejected by the House of Lords. After the king’s death in 1649, therefore, the Council of State had to face the whole question anew.

It did so in no revolutionary spirit. Without going into constitutional questions as to how far a trade-charter from King James held good under the Commonwealth, it took up the matter as it was left by the

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abortive action of Parliament in 1647. It counselled the Company to come to terms with Courten’s Association, and it refused to interfere until they themselves arrived at a settlement. Both the rivals had reached the brink of ruin. Courten’s Association, or the Assada Merchants as they were now called from their plantation on Assada Isle at Madagascar, were almost bankrupt. We have seen them reduced to carrying on their trade by a manufacture of counterfeit coin, and they had offered to surrender their factories on the Indian coast to the Company’s president at Surat, having offered him Karwar in 1645–1646 and Rajapur in 1649. In 1651, they made a similar offer of their Madagascar settlement, Assada itself. The East India Company, on its part, found it impossible either to raise a new Joint Stock or to go on with its old capital, and had to fall back on another “Particular Voyage.” Indeed, in 1649, it passed a resolution of despair not to send out any more ships, either upon the Joint Stock or Separate Voyage system after April of that year.

Yet only after long strife could the disputants come to terms. In 1649 they agreed that the two societies should work together as regards the general Indian trade; that Courten’s Association should retain its Assada factory at Madagascar and have liberty to traffic thence to all Asiatic and African countries; while the port to port trade in India should be reserved to the Company. The business in gold and ivory on the coast of Guinea should be open to both.

Their compact was embodied in a petition to Parliament,

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and on January 31, 1650, the House of Commons resolved: “That the trade to the East Indies should be carried on by one Company, and with one Joint Stock, and the management thereof to be under such regulations as the Parliament shall think fit, and that the East India Company should proceed upon the articles of agreement made between them and the Assada Merchants on November 21, 1649, until further orders from the Parliament.” This coalition of the rival bodies under a Parliamentary sanction formed the basis on which the India trade continued until Cromwell’s charter toward the close of the Commonwealth.

At first all was concord. The day after the Parliamentary vote, the two associations proposed to form a “United Joint Stock,” which should take over the factories in India, and continue to trade for three years. But in vain the Company’s beadle went round to the freemen with the subscription book. Money would not come in, and extraordinary methods were employed to raise capital. The Company sent letters to thirteen of the port-towns of England inviting them to join; and blank subscription books, with a preamble setting forth the nature of the adventure, were humbly laid before the Parliament and Council of State. The members of these honourable bodies would not venture a penny; and even the offer of the freedom of the Company, once so valued, failed to tempt the, general public. The thirteen port-towns were equally unresponsive. The governor had to announce that replies had been received

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from only Bristol and Exeter; and there seemed no likelihood of money being obtained from that source. The Assada Merchants having barely the funds to carry on their own business, could furnish but little to the new Joint Stock. With such sums as its own exhausted members were able to subscribe, the Company struggled on.

How hard was the struggle abundantly appears in the records. The continued existence of the Company depended not on the continuity of its trade or on its sending out a yearly succession of ships. As long as it elected in each July a governor and the other officers named in the charter of James I it preserved its existence as a body corporate in the eye of the law. In July, 1651, the question arose whether it was worthwhile to keep up this formality. The General Court decided, however, to proceed with the election of officers, although “hereafter there will be little use of any governor, in regard they are to set no ships out, nor much other business but to pay their debts.”

The fact is that the union of the Company and the Assada Merchants failed to cope with the situation. For outside these societies a body of capitalists had grown up who protested against the monopoly of the India trade as a relic of the royal prerogative no longer suited to the times. They claimed that the Eastern traffic should either be organized on the Regulated system, under which each member of a trade guild or association might traffic on his own account, as in the Turkey Company, or that it should be thrown open to

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A road scene in India in theBombay Presidency

the nation. This feeling had at first expressed itself in a demand for increased state protection of foreign trade. “It is not our conquests, but our commerce,” runs a powerful appeal by Lewes Roberts in 1641, just after the meeting of the Long Parliament, “it is not our swords but our sayls, that first spred the English name in Barbary, and thence came (sic) into Turkey, Armenia, Moscovia, Arabia, Persia, India, China, and indeed over and about the world. It is the traffic of their merchants and the boundless desires of that nation to eternize the English honour and name, that hath

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enduced them to saile and seek into all the corners of the earth.”

Under the Commonwealth the desire for an open trade to India gained strength. The Navigation Act of 1651 gave it a decisive impulse. Next year – the very year after the Company had declared that thenceforth “there will be little use of any governor, in regard they are to set no ships out “ – a new voice rang aloud to the nation: “That with all possible conveniency we enlarge our Forraign Plantations, and get further footing in Barbarie, East and West Indies.” Forasmuch as” a little spot of ground, as England is, with its Dominions, if it do not enlarge them,” will strive in vain against the growing trade of Holland and the other European powers. Men of rank once again joined with men of the City in ventures beyond the seas. Indeed in 1649 the Company had complained that the name of Lord General Fairfax stood first in the draft of a patent for the Assada Merchants which it was intended to submit to Parliament.

The outside capitalists hoped that after the three years for which the United Joint Stock of 1650 was formed, a broader basis might be adopted. But on the expiration of that period in the summer of 1653 the Company found itself too weak to attempt any new departure, and the existing arrangement continued, although no ships could be sent out. Forthwith it appeared that the outsiders had strong supporters within the Company itself. The standard of revolt was raised at a court meeting in the following December, when

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one of the generality proposed that individual members should, as under the Regulated system, be allowed to trade on their own account. The traffic was passing into the hands of interlopers, and if the Company could not send forth ships itself, why should it preclude its members from doing so?

The governing body found it difficult to answer this argument, and temporized by allowing private members to trade to India on a payment to the Company for the privilege. But the concession amounted to a change from the Joint Stock to the Regulated system, in opposition to the terms of the late Parliamentary settlement of 1650. So in March, 1654, the governing body took a firmer stand. They decided that “it is not in the power of this Court to give liberty to any private persons to trade to India; but if any do it, it is at their own peril. And thereupon the votes of Parliament were read, concerning the carrying on of the trade in a Joint Stock.”

Issue was thus definitely joined between the two great parties which have always divided mercantile opinion in England with regard to the Indian trade. Under the first Stuarts the conflict was waged between the Company and individuals or associations licensed, in infringement of the Company’s charter, by the king, Under the Commonwealth it widened into a struggle between the conservative section of the Company and a forward party within itself, but allied to the outside capitalists who claimed an open trade to India. Under the Restoration it became a war of law-suits between

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the Company and the independent mercantile community at large; a war ended only by the great Parliamentary amalgamation after the Revolution. That settlement lasted down to the 19th century, when even its broad basis was found too narrow for the expansive forces of British commerce, and the Act of 1813 threw open the India-trade to the nation. The records of the East India Company form a concentrated history of the English hatred of monopoly; of the Company’s efforts to maintain exclusive privileges by from time to time widening its doors, as long as the country believed exclusive privileges necessary for the India trade; and of their abolition as soon as the country thought them no longer required.

Meanwhile the Parliamentary settlement of 1650, in subjecting the trade to further regulation by the Commons, provided for such difficulties as arose under the Commonwealth. The Council of State recognized the claims of the outside merchants by a cautious yet liberal issue of licenses for private trade to India. Cromwell’s name begins to appear in connection with these grants, not only to individuals, but also to the Merchant Adventurers, and it seemed to onlookers both at home and abroad that the Company was doomed. Nine months after it had taken up its rigid attitude against private trading by its own members in 1654, the Amsterdam burghers received “advice that the Lord Protector will dissolve the East India Company at London, and declare the navigation and commerce to the Indies to be free and open.” The mere rumour

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Dacca, Near Calcutta, in Bengal.

of the nationalizing of England’s Eastern trade sent a thrill of apprehension through Holland.

Meanwhile the expansive forces within the Company burst forth beyond control. In the autumn of 1654 the section of its freemen in favour of private enterprise had petitioned the Council of State that the East India trade be still carried on by a company, but with liberty for the members individually to trade with their own capital and ships in such way as they might deem most to their advantage.

The Company urged in reply that the experience of forty years proved that the India trade could be conducted only by an association strongly bound together by a series of Joint Stocks, and that the plan of Separate Voyages had been given up after a full trial; that the Company had now factories beneath fourteen native sovereigns, together with a costly equipment necessary for the protection of so distant a trade; and that, under its engagements with the Indian powers,

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it was held responsible by them for depredations or misconduct of all Englishmen in the East. It accordingly prayed the Protector to grant it a new and wider charter, to the exclusion of private trade.

In 1654, therefore, Cromwell found himself called on to decide between the three sets of applicants: the outside capitalists who desired that the commerce with India should be thrown open to the nation; the governing body of the Company who asked for wider privileges upon the basis of a series of exclusive Joint Stocks; and the section of its members who desired that the Company should be transferred from the Joint Stock to the Regulated system. His clear eye saw that if the India trade were to be thrown open to the nation, it must be protected by the national arms. He realized that neither the navy nor the land forces of the Commonwealth was adapted for such a task. He accordingly eased the situation by granting trade licenses to individual outsiders, and referred the main question as to the future constitution of the Company to the Council of State.

The Council soon found itself plunged in a quagmire of irreconcilable claims. A question even arose as to which of the several sets of adventurers really represented the Company. When the Dutch compensation of £85,000 came to be distributed, the survivors or heirs of the Third Joint Stock, of the Fourth Joint Stock, and of the United Joint Stock asserted their several rights to it. The Council could find a way out of its bewilderment only by referring their titles to arbitration,

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and meanwhile, in 1655, lodged the money with trustees. Cromwell hastened a decision by borrowing £50,000 of the compensation fund for the State.

If such a confusion of claims existed within the Company itself, the conflict on the wider issue as to the future management of the India trade may be imagined. During two years the Council of State laboured for a settlement in vain. The governing body of the Company lost hope, and its Court of Committees resolved in 1656 to sell its “privileges and houses in India ... to some Englishmen,” at a valuation of £14,000, retaining, however, a share with the purchasers in the future trade. But the General Court overruled this decision, and on October 20, 1656, sent up one more petition to Cromwell.

On the very same day the Protector, under his own hand, referred the petition to the Council of State, and took care that that body now appointed a committee which should carry his own vigorous resolve into its task. While great names and high office gave weight to its deliberations, the actual work was entrusted to a man in whom he placed complete confidence. Colonel Philip Jones, after suffering much and fighting hard on behalf of the Parliament, became a leading member of the Council of State and filled important offices under the Commonwealth. In the previous year, 1655, Oliver had selected him as sole arbiter in a delicate question between England and Portugal; in 1657 he was one of the committee appointed to offer to Cromwell the crown: and as controller of the household he superintended

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the Protector’s funeral in 1658. It was on this tried friend that Oliver chiefly leant for advice “in what manner the East India trade might be lest managed for the public good and its own encouragement.” Colonel Jones was specially charged “to take care thereof.”

His prompt action indicates that Cromwell had already made up his mind on the evidence before him. In six weeks Colonel Jones and his colleagues accomplished what the Council of State had failed to do during two years – they arrived at a settlement for the India trade. The committee’s report was signed by only three members: one of whom, Colonel William Sydenham, had lately stood forth in Parliament as Cromwell’s mouthpiece for religious toleration; another, Colonel Philip Jones, already mentioned, was the controller of his household; while the third, Sir Charles Wolseley, was his most intimate confidant. They were of the opinion that the India trade should be carried on by one company on the basis of a United Joint Stock, yet they sent the matter back to the Council of State as being too high for them to decide. The Council of State again procrastinated, but under severe pressure, as we shall see, adopted the report, and referred it for final orders to the Protector.

To the decision of this great issue Cromwell brought a slow but effective training. He had been a member of the Commission of Trade and Plantations in 1643, at the moment when the commercial prerogatives of the Crown passed in reality from the king to the Parliament.

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Years of war and internal struggle followed. But as soon as Cromwell firmly established the Commonwealth, his mercantile policy took a definite shape. The Navigation Act of 1651 laid the foundation of England’s mercantile ascendency, and formed a chief cause of the Dutch war in the following year. Even before Cromwell granted peace to Holland, he seems to have resolved on a similar assertion of power over the Catholic nations. From Portugal he enforced the English liberty of trade in the East Indies; and his West Indian expedition against Spain, in 1654–1655, had its origin in mercantile not less than in political reasons. Not only in European waters, but throughout all the ocean-world from Malabar to Hispaniola, Oliver determined to make England supreme. In 1655 the chief economic writer of the time presented to the Protector his mature work, and in the same year Cromwell appointed the Committee of Trade – ”a great concernment of the Commonwealth,” says Carlyle,” which his Highness is eagerly set upon.’ “

Cromwell perceived that, as the time had not yet come for an open trade to India, to be supported by a national fleet in Asiatic seas, the real question lay between a Regulated Company, the members of which might trade on their individual account, and a Joint Stock Company. The analogy of the Turkey Company, confidently relied on by the advocates of the Regulated system, did not bear scrutiny. For the dealings of the Turkey Company were chiefly with the Mediterranean powers – Venetians, Spaniards, Barbary Corsairs, and

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Turks – within the reach of English diplomacy and of English reprisals. When the Doge laid prohibitive customs on our Levant trade, Elizabeth forbade the Venetian import into England of the raisins of Corinth and the wines of Candia, until the Adriatic Republic should take off its imposts. Cromwell had just given sharp proof to Spain and the Barbary Corsairs that they were both within range of his guns. As regards Turkey, the very year after James I granted a charter in perpetuity to the merchants of England in the Levant, it was found necessary to appoint an English envoy to the Grand Seignior, and to establish consuls within his dominions. International relations sprang up and eventually developed into a system of consular jurisdiction for the protection of English subjects in the eastern Mediterranean. It is said that in 1685 the only English diplomatic agent with the title of ambassador resided at Constantinople, and was paid in part by the Turkey Company. But no statesman believed, in 1657, that the Moghul Empire could be called to a reckoning by English diplomacy or arms, or that the Commonwealth should maintain a permanent embassy at Agra, and a cordon of consuls around the Indian coast. The plea for a Regulated East India Company from the analogy of the Regulated Turkey Company proved to be no argument at all.

The real evidence which confronted Cromwell lay in the history of the East India Company itself. Even before Elizabeth granted her charter, its founders had declared in 1599 “that the trade of the Indias being

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Domes of a mosque of the Moghul period

so far remote from hence cannot be traded but in a joint and united stock.” Yet the actual charters of Elizabeth and James contained no reference to the subject, nor was a continuous joint stock ever raised. The truth is that the term “Joint Stock” had to the founders in 1599 a very different meaning from that connoted by its modern development, the “Joint Stock Company.” It signified only a subscription for a joint voyage,

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whose accounts were to be wound up and the capital repaid when the ships came home. The East India Company was a body corporate with an exclusive grant of the India trade from the Crown, and it conducted its business by forming successive groups among its own members for raising joint stock subscriptions for successive and distinct ventures.

At first, indeed, it differed but slightly from the Turkey and other Regulated Companies of mediaeval commerce, except that the right of separate trading passed from the individual freemen to successive groups of freemen – a statement which must be taken subject to the full explanation given in the chapter on the Constitution of the Company in the preceding volume. On this basis the Company equipped its first nine voyages. When the system of Separate Voyages proved too weak to cope with its Portuguese and Dutch rivals in the East, it raised a series of Joint Stock subscriptions, each of which supplied the capital for a distinct series of voyages. But the Joint Stock subscription was designed only for a limited number of years, at the end of which it was to be wound up – in short, the original system of Separate Voyages gave place to a system of separate series of voyages. Every new Joint Stock was intended to take over at a valuation the factories of its predecessor in India. In this rudimentary form of Joint Stock the group of members took the place of the individual freeman, as the group of voyages took the place of the individual venture, in a “Regulated” association like the Turkey Company.

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Amid the troubles of the Civil War the system of separate series or groups of voyages broke down. But although money could not be raised for a series of voyages, there were, as we have seen, men both inside and outside the Company ready to stake a sufficient sum for a single voyage, if freed from the burden of the capital sunk in India. Such attempts to combine the original system of Separate Voyages with that of Joint Stock series of voyages led to a demand for the individual freedom of each member of the Company to trade on his own account – in short, for a reversion from the successive and distinct series of Joint Stocks back to the old Regulated system. The resistance of the governing body of the Company to this demand produced the petitions and counter-petitions on which the Council of State had so long been unable to decide.

Colonel Jones’s report was presented to the Council of State on December 18, 1656. That body renewed its old hesitations, and the Company, in anger and despair, resolved on January 14, 1657, that unless a decision were received within a month, it would make sale of its factories, rights, and customs in India “to any natives of this commonwealth to and for their own proper use.” There was now no mention of its taking a share with the purchasers, and it evidently contemplated a complete withdrawal from the trade. It ordered bills of sale to be hung up in the London Exchange. The Council of State; thus galvanized into action, summoned the Company and the rival merchant adventurers for a final hearing, and advised the Protector

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Smaller Gopura in West Court, Madura

“that the trade of India be managed by a United Joint Stock exclusive of all others.” Forthwith, on February 10, 1657, Cromwell directed that a committee should sit to draw up a charter, which on October 19th passed the Broad Seal of England.

After the Restoration the Company hastened to purge itself of complicity with the Commonwealth, and the document disappeared. A diligent inquiry now leaves no hope that a copy survives in England, Holland, or the East. But although the charter has perished, I have been able, from contemporary documents, to piece together its main provisions. It ratified the charter of James I with slight modifications, and gave additional privileges. As new coast towns had sprung into vigour, the original three ports (London, Dartmouth, and Plymouth), from which bullion might be exported, were to be increased to seven. On the other hand, the clauses granting the powers of Law Martial and immunity from customs, tonnage, and poundage, and certain other privileges, were to be omitted, and left to be dealt with by special orders from the Protector, who should also have the right to recall the charter if he saw cause. Cromwell’s charter, in fact, combined the substance of the Royal Charter of 1609 with the more continuous government-control provided by the Parliamentary grant of 1650. The Protector promised that his settlement should in the next session be confirmed by Act of Parliament.

Cromwell died the following year before a Parliamentary sanction could be obtained, and his charter

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formed the last word of the Commonwealth on the three sets of proposals which had so long divided English merchants: namely, for an open commerce to India, for a Regulated Company, and for a Joint Stock Company. He reconstituted the India trade on the basis of “One Joint Stock.” The words “Joint Stock” do not occur in the charters of Elizabeth or James I, nor, indeed, in any royal charter until that of 1686. The Company’s so called “Joint Stocks” had been merely successive subscriptions for separate sets of voyages; each set being a distinct and several adventure to be wound up at the end of a fixed number of years. The idea of a united joint stock, which emerged in the Parliamentary settlement of 1650, developed under Cromwell’s charter of 1657 into a united and continuous joint stock.

The change was wrought not by Cromwell alone, but by Cromwell representing the spirit of the times. If the Protector prescribed unity, the Company interpreted unity to imply also continuity and permanence. The very day that the charter passed the Broad Seal, a General Court held at the India House laid down the conditions under which it should be carried out. These conditions, as finally settled, threw open the freedom of the Company to the public for the nominal sum of £5. They admitted not only the members of the various groups who had made up the old East India and Assada Companies, together with their servants and apprentices, but also all those Merchant Adventurers and private traders in India who might be willing to

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A crowd in a busy Indian Emporium.

throw their possessions, at a fair valuation, into the common stock.

That stock was not to be dissolved after the expiration of a few years, as had always been provided in former subscriptions. An appraisement of the Company’s property was to be made at the end of seven years, and thereafter at the end of every three years, so that any shareholder who wished to retire might do so, and receive the current value of his original subscription.

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But the Joint Stock was to continue as the common capital of the Company, and the money drawn out by retiring members was to be made good by “any other persons” who chose to join the Company. As a matter of fact, these triennial appraisements resolved themselves into periodical statements of assets by which the members and the public might regulate their dealings in the stock.

Cromwell thus laid the groundwork of the modern constitution of the East India Company. Under the regulations based on his charter, it cast its mediaeval skin, shook off the traditions of the Regulated system, and grew into one united, continuous, and permanent Joint Stock Corporation in the full sense of the words.

These new conditions of unity and permanence drew forth a large capital of £739,782 – of which only one-half was called up. The minimum subscription was fixed at £100; a contributor had a vote for each £500 of his holding; and £1000 qualified for election to the committee. Small adventurers might club together to make up £500, and appoint one of their number to vote for them. The actual management of the Company was vested, as under the royal. charters, in a governor, deputy-governor, treasurer, and a committee of twenty-four. With the ample funds at its disposal, the new association bought up the factories, forts, customs, and privileges of the old Company in the East, including the island of Pularoon, for £20,000; arranged for taking over the properties of individual adventurers in

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India at a valuation; and resolved to unite the Guinea traffic in gold and elephant tusks with the India trade.

While thus amalgamating the various conflicting interests into one permanent Joint Stock, the new Company provided ample safeguards for its own monopoly. Outside traders continued subject to the same penalties as those laid down by King James’s charter – the confiscation of their ship and cargo. Members inside the Company, who might still hanker after the Regulated system and be tempted to trade on their own account, were to forfeit their whole stock or holding to the rest of the shareholders. Fair consideration was extended to all actually engaged, under whatever show of title, in Indian ventures in the past; but there was to be no mercy for private traders, whether inside the Company or outside it, in the future.

Although resolved on a firm control of its individual members, the Company made provision for a steady flow of new men from the generality to its governing body. That body consisted, as I have said, of a governor, deputy-governor, and committee of twenty-four. But eight members of the committee were to retire in rotation each July, and no governor or deputy-governor was to serve for more than two successive years. The freemen were also to be relieved of the old inconvenience of having to receive their individual shares of the profits in pepper, calicoes, or other Indian commodities, and all dividends were henceforth to be paid in cash. In the East the New Company received in return

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for its £20,000 the Old Company’s factories at Surat, with dependencies on the Bombay coast; at Fort St. George, with dependencies on the Madras coast and in the Bay of Bengal; at Bantam, with dependencies at Jambi, Macassar, and Pularoon; and at Gombroon on the Persian Gulf.

The small price paid for these acquisitions is explained by the circumstances of the times. On the Persian Gulf the agents of the Old Company had struggled on amid oppressions and exactions, not because they hoped to do any trade, but merely on the chance of reasserting, at some future day, the English right to half the customs of Gombroon under the treaty of 1622. Bantam seemed again to be passing under the power of the Dutch, English ships were intercepted in the narrow seas, and the port was about to suffer a regular blockade. Nor did the political state of India itself warrant any large price for English possessions on that continent.

The military convulsions, amid which Aurangzib seized the throne, rudely interrupted the order that the Moghul Empire had during a century imposed. Surat castle was seized and the town pillaged on behalf of one of the claimants; and the distracted president complained “that it was equally dangerous to solicit, or to accept of, protection, it being impossible to foresee who might ultimately be the Moghul.” In Southern India, the first great act of Maratha hostility to the Moghuls took place in May, 1657. On the east coast, the Madras Council in despair resolved for the second

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The Emperor Aurangzib and his Court

time to withdraw the factories from Bengal. Their own existence was threatened by the war between the Golkonda king and his dependents, and by the still more dreaded approach of the Maratha hordes.

Thus in the very year that Cromwell’s charter reconstituted the Company on its permanent basis at home, the English in the Eastern seas, from the Persian Gulf to the island of Java, stood face to face with ruin. In India itself, the firm Moghul rule, under whose shelter our settlements on the continent had grown up, was for the first time assailed by that combination of Moslem

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disunion and Hindu confederate force which, during the next fifty years, broke up the empire.

The new Company went courageously to work. It decided that Surat, then in the grip of civil war, should be its sole presidency in India, and that the factories at Madras, Bengal, Bantam, and the Persian Gulf should be distinct agencies subordinate thereto. All these settlements were destitute alike of money and men. On the Persian Gulf the bare subsistence of the factory consumed the customs of Gombroon and the whole profits of the trade. The late Company had ordered the establishment at Madras to be reduced to two factors with a guard of ten soldiers, and to a single factor at Masulipatam. From every English settlement in the East came the same story of decay. The new Company at once resolved to send out such a staff as never had sailed to India.

In January, 1658, it selected seventeen of the late Company’s most likely stations in the East, from China to the Persian Gulf, and appointed to them ninety-one factors and assistants, well supplied with goods and bullion for the re-establishment of the trade. When an adventurer, under plea of a license from the Commonwealth, shipped mortars and shells for one of the rival claimants to the Moghul throne, the Company firmly remonstrated with Cromwell, and at the same time despatched a consignment to undersell the interloper. On the west coast of Africa it bought up Fort Comantine, together with the charter, rights, and trade of the Guinea Company, for the modest sum of £1300. In

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the mid-ocean it resolved to fortify St. Helena, as a half-way house for the Indian fleets. In the Far East it projected a place of strength at Pularoon, and applied to Richard Cromwell for letters to the emperors of China and Japan. From the charter of 1657 the Company drew a new life, whose pulsations reached its farthest factories in Asia. Against European aggressors it boldly claimed the aid of the Commonwealth. More than once it invoked Cromwell’s intervention against Holland; and the Company’s last transaction with the Protector was still another petition against the Dutch. Three weeks later the strong ruler was dead, and about to be laid with royal pomp in Westminster Abbey.

After the Restoration men dug up his body from its sepulchre among kings, hung it on a gallows, and shovelled the headless trunk into a felon’s grave. But though they might tear out his laws from the statute-book and hide away his charters, there was one part of his life’s work which they could not destroy. He found the English in the East struggling, humiliated, in despair. He left them with their future assured. He was the first ruler of England who realized that the India trade was no private preserve of the sovereign and his nominees, but a concern of the nation, to be maintained by national diplomacy and defended by the national arms. His union of conflicting Anglo-Indian interests in 1657 anticipated the great Parliamentary fusion of those interests fifty years later. Under his charter the East India Company transformed

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itself from a feeble relic of the medieval trade-guild into the vigorous forerunner of the modern Joint Stock Company. A large and continuous capital, always capable of automatic increase, took the place of a successions of uncertain subscriptions, each of them intended to be dissolved at the end of a few years.

While Cromwell thus renewed the East India Company and placed it on its permanent basis at home, abroad he secured for England the recognition of her right to a free expansion in the East. The arrogant claims of the Catholic powers in Asia he blew from the cannon’s mouth. Our great Protestant compeer had to learn that similarity in religion formed no excuse for commercial wrong-doing. Cromwell’s sea-rivalry with Holland hardened and set into a national tradition, which dominated the feeling of the English trading classes for thirty years; and in the end led to the overthrow of the Dutch supremacy in Asia and to the establishment of our own. The head which planned these great designs was set to shrivel on a pole. But if the grandson of Cromwell’s secretary, Milton, died as parish clerk in Madras, both the grandson and great-grandson of the Protector lived to be governors of Bengal.

This collection transcribed by Chris Gage
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