Tag: Capitalism

Histories of liberal thought in India begin, almost invariably, in the early nineteenth century with Rammohan Roy (1772-1833) and James Silk Buckingham (1786-1855). Both men were vocal supporters of social and political reform in colonial India and Britain alike, and are considered pioneers of the Indian press. As self-identified liberals, Roy, Buckingham, and their followers were part of a common front against the reactionary regimes of the post-Napoleonic period and bound together by networks of direct communication. They advocated for a dismantling of the East India Company’s monopolistic privileges in the name of free trade, and criticized restrictions on vernacular newspapers and racial prejudice in the appointment of company officials. For liberals of this generation, colonial institutional reform was just one front in a larger battle between the forces of reaction and the forces of progress, whether in Bolivia, France, or Britain. They indeed formed a new public, infused by the republican spirit of the American and French revolutions, and worked tirelessly to open up a space of commercial participation and mutuality between Indians and Europeans.

To a large extent, then, the conventional periodization of Indian liberalism is almost self-evident. The early nineteenth century was clearly the moment when a self-conscious and articulate anti-absolutist public sphere first emerged in India. It is not enough, however, to point out the distinctiveness of that specific moment. Without an analysis of the social roots of Indian liberalism, it is difficult to sort out the true legacy of the early liberals, a problem that has been compounded by the stranglehold of nationalist frameworks on historical imagination. One particularly unsalutary effect of this “territorial nativism” on historical memory, to borrow a phrase from Manu Goswami, has been the increasing hostility with which the internationalist ethos of the early liberals, and especially their “collaboration” with Europeans, has been treated. Although the first generation of nationalist historians – unable to deny the contributions of the early liberals to the creation of a democratic culture in India – were defensive on the issue of “collaboration,” the tide has turned quite definitively since the 1970s. Beginning in that decade, historians launched a critique of the early liberals, accusing them of being naive visionaries at best and willing conspirators at worst. Despite some notable and important exceptions to the general trend in Andrew Sartori’s and C.A. Bayly’s scholarship, Rammohan and others now stand accused, in most accounts, of having been privileged “elites” who failed to realize the complicity of liberalism with empire. The mirror image of these claims is that early nineteenth century “popular” culture had no liberal (read “European”) ideological content.

But is it really true that liberal norms found no practical and social relevance in India? Can the political convictions of the early liberals really be dismissed as the ramblings of a few elites? A closer look at eighteenth-century Bengal, and especially at the neglected social history of demands from below for commercial liberties, suggests a very different story.  

Under Mughal rule, market taxes (called sair in official Persian) were an important component of state revenue in much of northern India including Bengal. In addition, the right of state could be evoked (usually by local administrators but sometimes by regional Nawabs or the emperor too) to justify blatantly arbitrary exactions. As Eugenia Vanina has put it, Mughal nobles and local chiefs who molested traders treated them “much like the knights in Sir Walter Scott’s Ivanhoe treated Isaac of York.” (215). Economic as well as cultural historians, however, have tended to underplay these conflicts within the social fabric of pre-colonial Bengal. This has allowed for a portrayal of both the East India Company (EIC) and Indian society as homogeneous entities, and hence for the propagation of straightforwardly nationalist readings of disputes between the company and the Nawabs of Bengal.

In an extremely influential 1998 study, for example, Sudipta Sen claimed that for Bengal’s merchants, “impositions on markets, market goers, and goods were accepted features of rural life.” (49-50) In other words, readers are asked to believe that despite heavy impositions on commerce, market culture in pre-colonial Bengal was largely consensual, and that exchange was “part of a larger moral economy of prestation that characterize(d) the relationship between rulers and subordinates.” (12) The judgment that follows from such claims is that liberal arguments for “free trade” in the late eighteenth and early-nineteenth centuries were nothing more than ideological justifications for empire.

Sen’s interpretation, however—which has made a lasting impression not only on economic and political historians of Bengal, but also on scholars of religion, including recent works by Hugh B. Urban, Bhaskar Mukhopadhyay, and Kaustubh Mani Sengupta—does not do justice to the complexity of social relations in eighteenth-century Bengal for at least three reasons. First, one ought to remember that the rapid growth of the city of Calcutta during the first half of the eighteenth century created the possibility for “collaboration” between British and Indian merchants, and for the emergence of a liberal politics of free trade in Bengal much before Rammohan Ray was even born. In the decades immediately preceding colonial rule in Bengal, artisans, merchants, and indigenous officials alike migrated in large numbers to Calcutta, often from places as far away as Dhaka and Murshidabad. The result was a gradual transformation of Calcutta into a commercial rather than an agricultural center. Between 1713 and 1747, for example, the proportion of market taxes to total revenue from the town increased from 13 to 37 per cent, even as total revenue itself increased by about 80 per cent, as Farhat Hasan has shown. The growth of Calcutta and of other factory towns with European presence meant that by the 1720s, the interests of British and Indian merchants were thoroughly enmeshed with regard to both foreign and inland trade. The sale of dastaks (passes that allowed duty-free trade)to non-Englishmen was a massive “business,” but one conducted strictly on the private account of the EIC’s servants. As early as 1720, the EIC’s gomastah (agent) Raghunandan was arrested for protecting the goods of other merchants from the payment of customs dues under the Company dastak. Indian merchants also sought refuge in Calcutta under the EIC to evade duties, and in 1755, a group of merchants claimed that they should be shielded from the Nawab’s demands for taxes while “under the protection of the Hon. English Flag.”[1]

Second, the Indian merchants to whom free trade and company protection mattered the most came from modest backgrounds. For great merchant and banking elites, such as the Armenian Khwaja Wazid and the Jagat Seths (an honorific title meaning “bankers to the world”), private trade was a major nuisance because it threatened to weaken their monopoly control over trade and currency. It was the smaller traders who lacked access to the Nawab’s court that stood to benefit the most from attaching themselves to the company. A large number of such traders, lacking monopoly farms and royal favour, dealt primarily in subsistence goods such as rice for the internal market of Bengal, acting as middlemen between rural production and local hats (periodic markets) and ganjs (market towns).

Finally, the belief that Mughal officials in Bengal were proud defenders of the law is untenable, for there is ample evidence that illegal tolls and taxes were very often no more than bribes demanded by revenue officials.[2] In short, not only was the “conflict” in the eighteenth century not a simple binary one between the EIC and the Mughal state, Sudipta Sen’s claim that refusals to pay duties (whether by the EIC or by Asians) constituted “a travesty of the rules of gift and exchange in the merchant-aristocratic society of contemporary northern India,” (62-63) is itself based on the implausible belief that all taxation was justified, whose evasion can therefore only be interpreted as a crime. On the contrary, the heavy-handedness of the pre-colonial state was, in fact, the first object of proto-liberal critique in Bengal.

This social interpretation of internal conflicts within Bengal’s emergent commercial society fits well with recent revisionist readings of the ideological roots of the Second British Empire.[3] Broadly, the revisionists have shown that both in 1757 and in the years immediately preceding 1765, a faction of free traders within the EIC along with their Indian counterparts tried to radically reorder political institutions in ways that would allow commercial enterprise to flourish. Especially in the early 1760s, the “maverick council” within the EIC managed to build a broad coalition made up of Indian, Arab, Chinese, and Armenian merchants and bankers; the Indian manufacturers whose products the company servants and their commercial allies sold in Indian and other Asian markets; and, most crucially, the Mughal emperor Shah Alam II in Delhi himself. To overcome the crisis of authority in Bengal, the maverick council sought to place the province under the direct authority of emperor Shah Alam II. Such a move would accomplish, the council believed, a second Glorious Revolution, laying the foundation for a new Mughal empire of liberty, a natural partner to a liberal British polity. In such an empire, both the Hanoverian and the Timurid “crowns” would represent a new revolutionary sovereignty, so that there could arise no question of divided allegiances.[4]

During the years 1761-65, the maverick council and its allies tried valiantly to actualize their anti-monopolistic project. In the end, it was only the contingent defeat of liberalism in Britain, and the victory of a neo-Tory coalition in the 1764 EIC elections in London that turned the tide against them. This alliance between the monopoly interests within the company and the neo-Tories in Britain led by Robert Clive and George Grenville (also well-known for his imposition of stamp duties on the Atlantic colonies in 1765), had very different ideas about the future position of Bengal within the British empire. Instead of marching the EIC army to Delhi and proclaiming Shah Alam II as the emperor, the neo-Tories withdrew into Bengal in 1765, but not before they had acquired the diwani (the right to collect land revenue)for Bengal, Bihar, and Orissa. With an extractive and illiberal empire thus established, a systematic assault on all ties between Asian and British free traders was begun. At the same time, the revenue collected in Bengal was used to pay for the EIC’s own procurement of manufactures from the province. The hopes for a radically open-ended commercial society were thereby quashed, and Bengal ended up paying for its own exports.

In spite of a slew of illiberal reforms between 1765 and 1773, however, the impulses towards free trade did not die a meek death. In fact, people found innovative ways of making their demands heard. From the mid-1770s up to the Charter Act of 1813, conflicts over the establishment of “prejudicial” markets, complaints from weavers and merchants against excessive duties, as well as disputes between the EIC and Indian merchants were ubiquitous. Although the existence of such conflicts is acknowledged by social and economic historians —see, for example, the works by Rajat Datta and Tilottama Mukherjee—there is no comprehensive interpretation of their normative content and implications. I do not believe it is possible, as Sudipta Sen does, to reduce the multiple claims made by a variety of stakeholders during this period to a one-dimensional narrative about the imposition of “European” principles of “free trade” on an unwilling colony.

Nevertheless, based on my own preliminary research in the colonial archive, I can confidently insist on two points. First, that the claims and counter-claims made in many legal cases of the period indicate that the company-state had a hard time finding a balance between demands for commercial freedoms from below, the right of the state to revenue, and the privileges that persons of status in Bengal hoped to enjoy. The need for maintaining such a balance arose because expansive commercialization, which pre-dated British rule, had made it increasingly difficult to keep the market subordinate to prevailing structures of civic and political authority. Even more striking is the fact that sophisticated political-economic arguments, such as the distinction between rent and market taxes, were used by those opposing the barriers to entry created by the colonial state and local figures of authority. Although Indian free traders were unsuccessful in winning concessions more often than not, they were sometimes able to force the EIC to accept that no real justifications for its nepotism and extractive policies could be found. In other words, political-economic arguments were adopted and used in Bengal neither because they had been imposed from outside, nor because indigenous elites in the early nineteenth century mimicked their colonial rulers, but because people in Bengal found an object for political economy in their own commercial aspirations and in the barriers that such aspirations came up against.[5]

A social history of the conflictual rather than consensual market culture in eighteenth-century Bengal is thus possible and necessary, but yet to be fully written. If attempted, such a history shall allow for a better grasp of the social – and very often the ‘subaltern’ – origins of the articulate ‘elite’ liberalism that emerged in the early nineteenth century. To undertake such an attempt, however, historians need to move beyond well-entrenched nationalist myths about eighteenth-century Bengal, and to concede that demands for commercial liberties were expressive of deeply felt aspirations for a more liberal and just institutional order.

[1] British Library, IOR/P/1/28: Calcutta Public Proceedings (August 11 and 19, 1755), 297, 323-324, 409.

[2] Spencer Leonard, “A Fit of Absence of Mind? Illiberal Imperialism and the Founding of British India, 1757-1776.” PhD. Dissertation, University of Chicago, 2010, 137.

[3] Leonard, “A Fit of Absence of Mind?” and James M. Vaughn, The Politics of Empire at the Accession of George III: The East India Company and the Crisis and Transformation of Britain’s Imperial State (New Haven: Yale University Press, 2019).

[4] Leonard, “A Fit of Absence of Mind?” 18.

[5] The relevant EIC records include, but perhaps are not limited to, the “sayer” (anglicized version of sair) and “customs” proceedings of the Board of Revenue, the “commercial” proceedings of the Board of Trade, as well as the general proceedings of the Bengal Revenue Council and the Calcutta Committee of Revenue. These are housed partly in the British Library in London, and partly in the West Bengal State Archives in Kolkata.