unless the Managers of the East India Company's concerns, from any
ill-advised determination in their counsels, should take some steps, by
which their affairs should be abruptly brought to a settlement: in which
event, any disappointment or loss sustained by the Proprietors will be
chargeable upon those Managers, who thus desert their duty to their
Constituents; and not on the Public, or the Government. The Managers of
the East India Company, having so clear and responsible a duty binding
upon them, ought to be most scrupulous of failing in that duty, through
any capricious or speculative "_adherence to points not essential to
their existence_;" for, if they should sacrifice the interest of the
Proprietors by now attempting to convert their _temporary grants_ into a
_perpetual right_; although the disappointed Proprietors may arraign the
Public, yet the Public at large will, with justice, impeach the Managers
of the East India Company.
In order to open the eyes of the Proprietors to the simple fact of their
actual position, their attention was called by Gracchus, on the 13th
inst. to the consideration, whether the Company, loaded with a debt of
42,000,000l. and being unable to discharge the sum of four millions
becoming due, could reasonably expect, that if Parliament should now
come to their immediate relief, it would engage itself, _in all future
time_, for the payment of a dividend of ten and a half per cent.;
especially, if, upon any contingent winding up of the Company's affairs,
called for by their own pertinacity, their remaining resources should be
found inadequate to secure that dividend to the Proprietors? And the
possible case was suggested, of some guardian of the public purse
deeming it equitable, that in the event of Parliament being disposed to
come to the relief of the Proprietors, under such circumstances, the
latter should be called upon, on their part, to submit to some condition
of accommodation.
"An OLD PROPRIETOR" discovers in this argument of caution, only _a
direct menace_ from the Executive Government to the purses of the
Proprietors;--a plain and intelligible _threat_, that payment of their
just claims shall be withheld; and he "thanks God, that he lives in a
country, where such language will be treated with merited scorn." This
OLD PROPRIETOR should have known, that Government has never declined to
settle any accounts with the East India Company, which had been properly
authenticated: under present circumstances, it is not to be expected,
that Government should incur the responsibility of applying the public
money to discharge claims which have not been sufficiently investigated.
So far, however, is Government from having evinced any disposition to
throw unnecessary difficulties in the way of the Company's pecuniary
arrangements, that, in the midst of the present contest with the
Directors, it has granted to the Company a suspension of the payment of
between 8 and 900,000l. of tea duties, which the Company had actually
received from the buyers of the tea. It is perhaps not generally known,
that the Company formerly paid the duties upon tea upon its being
imported and landed; by which means the amount of duties was immediately
drawn into the Exchequer. To accommodate the Company, a change of
practice was allowed by Government, and the Company have been permitted
to sell their teas, in the first instance, without the interference of
the Officers of the Customs, upon condition of the Company afterwards
remitting the gross amount of duties to the Board of Revenue. Thus they
actually make their own profits upon the tea, and receive into their own
hands the Government duties, before they are called upon to pay them.
The duties actually so received by the Company, amount to the sum above
stated; and the _Old Proprietor_ will probably deem it no slight proof
of a wish on the part of Government to render an accommodation to the
Company, that, during the pending discussion, it has made arrangements
for allowing the Company an extended period, for transferring the very
considerable sum of which they have actually received the beneficial
use.
It should be always remembered, by the Company, and by the Public, as
parties in a great compact, that the privilege of an exclusive trade to
India and China has never been granted to the Company without reserve;
or, as if their possession of that exclusive benefit was, _in itself_,
the most advantageous arrangement for the public interest. The grant has
always proceeded upon a principle, of bargain and covenant; and on the
consideration of a pecuniary, advance, to be made by the Company to the
Public, as the condition for the renewal of _the lease of the public
rights in the India trade_. Upon this principle alone, has the exclusive
trade ever been conceded to the East India Company; either under its
present form, or under any of its former denominations.
To shorten the discussion, however, let the Proprietors and the Company
take the following compressed view, of the probable consequences which
would severally result, from a _compliance with_, or _rejection of_, the
proposition made by Government, as the basis of a new Charter; and let
them consider, in _which of the two_ they foresee the greatest security
for their own future interests.
If, upon maturely weighing the case before them, the Company should
accede to the proposition of Government; and if an arrangement, founded
upon that proposition, should receive the sanction of Parliament;
1. The Company will preserve _the entire China trade_; and this
principal sphere of their commercial profit, will remain undisturbed.
2. They will possess advantages for continuing to carry on the India
trade, so far superior to those of all private competitors, from _their
territorial and commercial revenues_, that, with a moderate exertion of
their activity, they may preserve almost the whole of that trade.
3. They will possess _the regulation and control of the India trade_, so
far as depends upon the Indian Governments; and as those Governments
will continue in the exercise of the executive power, all the private
Merchants, who may repair to the ports and harbours within the extensive
limits of their jurisdiction, will of course _be subject to the
authority of their Government_.
4. They will retain the whole patronage and expenditure of a revenue of
upwards of _Fifteen Millions_ sterling per annum in India, together with
very extensive establishments at home, depending upon that revenue.
5. The accounts between the Public and the Company, being brought to no
sudden and violent crisis of settlement, may be amicably and leisurely
adjusted, with a view to mutual convenience.
On the other hand, should the Company incautiously drop the _substance_
to pursue the _shadow_, and refuse the proposition of Government; and
should Parliament, upon a full and deliberate consideration of the
actual circumstances of the Company, deem it more advisable to bring
their accounts with the Public to a thorough investigation and final
settlement, than to admit the Company's new pretensions to _a perpetual
monopoly_;
1. The Company will lose as much of the China trade as may fall into the
hands of the private merchants, who _think_ they shall be able to sell
tea 85 per cent. cheaper than the Company.
2. They will lose the control of the India commerce, _and will carry on
their traffic in India as subjects_, in common with the private British
merchants.
3. By that loss, voluntarily incurred, they may throw the greatest part
of the trade into the hands of the private traders.
4. They will _lose the patronage of India, and the establishments
depending upon it_; which they will thus compel Parliament, contrary to
the disposition of Government, to place under different arrangements.
5. The accounts between the Public and the Company must be referred for
investigation to Commissioners of Inquiry, to be finally settled and
adjusted.
It is now for the Proprietors, after well considering these two
alternatives, to determine, under _which of the two_ their dividend will
be _most secure_.
With regard to Constitutional objections against taking the Government
of India out of the hands of the Company (upon which objection their
confidence in their present pretensions chiefly reposes), it is
difficult to conceive that the wisdom of Parliament, after the
experience of so many years, is unequal to the task of devising a system
as good as that of the Company, without incurring the evil which those
Constitutional objections suppose. The Company's Government, it must be
recollected, has been a production of chance, and has grown by the
progress of accidental events. It has, indeed, answered far better in
practice than could have been expected, if we consider its origin; and
therefore, it is not desirable that it should be materially altered;
neither is it likely that any such alteration of the system should be
contemplated, unless the indiscretion of the Company should impose upon
Parliament the necessity of resorting to that measure. But it certainly
does not seem to be a measure insuperably difficult, to preserve
whatever is really good in the present system, and even to remedy some
of its defects, without departing from the path of experience, and
resorting to improvements of theory and experiment.
There is one point of view, however, in which such a system would
acquire an evident advantage over that which has hitherto obtained: viz.
that it would, in every Session, be liable to the revision of
Parliament, and to the immediate correction of every error which might
be observed, and to such further continual improvements as experience
might direct; _not being embarrassed by the compact of a Charter_.
GRACCHUS.
LETTER VIII.
_Wednesday, February 17, 1813._
It is very observable, that the objections which have been made by the
East India Company to the admission of ships, returning from India, to
import and dispose of their cargoes at any other place than the Port of
London, are not founded so much upon any statement of the injury which
the trade of the Company would sustain by admitting them, as upon a
provident regard for the adventurers themselves, and a caution held out
to them not to entertain an expectation of benefiting by any commercial
speculation in India; since the long experience of the Company has
enabled them to show, that it must be ultimately ruinous to the
speculator. The sum of the experience, alleged by those who have come
forward to defend this point, is, "_That it is not practicable to extend
the consumption of European manufactures generally in India_;" and the
facts which they have asserted in support of this experimental argument,
and upon which they rest its strength, are these four following:
1. That the natives of India entertain a strong characteristic aversion,
to engage in commercial transactions with foreigners.
2. That their religious prejudices, customs, habits, and tastes, render
it impossible that they should ever become consumers of our
manufactures, to any extent.
3. That their poverty opposes an insuperable bar to such consumption.
4. That these facts and their consequences are demonstrated in the
examples of the Portuguese and the Dutch, who were not able to carry
their export commerce with India to any considerable extent.
Let us take these several propositions in their order; and examine, how
far they possess that force of truth, which the Company has supposed to
belong to them.
1. In the infancy of the European intercourse with India, the sole
object of those who engaged in its commerce was, to procure the produce
and commodities of the East. In this pursuit, so far were the natives
from opposing any obstacles to their endeavours, that they were found
disposed to afford every facility to a traffic, which brought them
_specie_ in exchange for their manufactures, and for the productions of
their soil. This fact, which is established by every writer who treated
upon the subject of the India commerce during that period, would of
itself constitute a complete answer to those who advance the
proposition, that the natives of India are averse, through an
established prejudice, to engage in commercial transactions with
foreigners.
When the ingenuity of the French and German artists enabled the
speculators in this traffic to introduce _works of fancy_, we learn from
Tavernier, who made six several journeys, between the years 1645 and
1670, from France to India, by various routes, that the Rajahs of
Hindostan and of the Deccan, as well as the Mahomedan princes of those
countries, admitted him into their states; that the articles of
manufacture which he introduced were received and purchased with an
avidity which encouraged him to continue, for so many years, the pursuit
of that commerce; that he found the natives of India, spread over the
whole range of country from the Indus to the Caspian Sea, engaged in the
active prosecution of foreign traffic; and that the number of _Banyans_
(the chief commercial cast of Hindoos) at that time established at
Ispahan, were not less than ten thousand. Forster, who, in a more recent
period, followed Tavernier in one of the routes which he had traversed,
informs us, that, in the year 1783, he found Banyans established at
Astrachan, within the Russian empire. And we further learn from Bruce,
that the principal agents of commerce at Mocha and Jedda, in the Red
Sea, were Banyans; and that they had even extended themselves into
Abyssinia. No stronger evidence, therefore, can be required to make it
manifest, that foreign as well as internal trade has been in all ages,
and still continues to be at the present day, a common practice, and a
favourite pursuit of the Hindoos.
2. With regard to the restrictive operation of the religious prejudices
and customs of the Hindoos, against the adoption of foreign articles of
manufacture; Mr. Colebrooke, lately a Member of the Supreme Council, and
an eminent Oriental scholar, has furnished us with information upon this
subject, equally important and decisive. In an unpublished work, on the
Agriculture and Commerce of Bengal, cited in _The Edinburgh Review_, for
November 1812, that gentleman observes, that, according to the
sentiments of the Hindoos, "All things come _undefiled_ from _the
shop_;" or, in the words of Menu, "The hands of an artist employed in
his art are always pure; and so is every vendible commodity when exposed
to sale: that woollens are purified by a single exposure to air, while
water is necessary to purify other clothes." Proceeding with these
principles, he further informs us, "That the rainy season and winter of
India afford real occasion for the use of woollens; that the fabrics of
Europe are always preferred; and, if the articles were adapted in the
manufacture to the Indian use, and the price reduced, the consumption
would descend from the middle even to the more numerous classes. That
the natives of India do not want a taste for porcelaine, and other
elegant wares; that they require vast quantities of metallic vessels,
and of hardware; that, considering the greatness of the population, and
the disposition of the natives to use European manufactures, it cannot
be doubted, that a great vend might be found, and that the demand will
increase with the restoration of wealth."
The authority of Mr. Colebrooke on this subject would be conclusive,
even if it stood alone: but it may be supported by a reference to the
opinion of many persons, who have been resident in the great cities of
India. Those persons would be found to testify, that at Delhi, at
Lucknow, at Hydrabad, Mysore, and Tanjore, in all the capitals, whether
Hindoo or Mahomedan, a taste prevails amongst the natives for a variety
of articles of European manufacture. The late Nabob of Oude, was known
to have affected the European dress; as may be seen by the costume of
his picture, in the possession of the Marquis Wellesley.
A large assortment of cut glass lustres has been provided by order, for
the Soubahdar of the Deccan; and a person is now proceeding to India,
with the license of the Company, for the express purpose of arranging
them, when they shall have reached his palace of Hydrabad.
The Rajah of Mysore (and, in the same manner, many of the Serdars of
that state), is frequently clothed in scarlet cloth; his servants are
generally dressed in woollen of that colour; and he often travels in an
English carriage, driven by postillions, who are habited in the English
costume. The Rajah of Tanjore exhibits in his palace a colossal marble
statue of himself, wrought by the hand of Flaxman; and the monument of
his revered Mentor, the late celebrated missionary Swartz, sculptured by
the same eminent artist, was executed and sent to Tanjore, at the
express and urgent desire of that enlightened Prince.
We must further observe, that so far are the religious and civil habits
of the Hindoos from obstructing the intercourse of trade, that their
policy has connected trade with religion; and the great festivals of
their worship, are at the same time the appointed periods and scenes of
their most active commerce. Jaggernaut, Ramisseram, Tripetty, are the
most celebrated places of Hindoo devotion within the British dominions;
and every one who has resided in India must know, that _fairs_ are held
at those places at the periods, when the greatest concourse of pilgrims
is drawn to them by the celebration of their religious rites and
ceremonies. In further illustration of the disposition of the natives to
traffic, in every way by which profit can be derived, the following fact
may be stated; which can be attested by every officer who served with
the army under Sir Arthur Wellesley (now Marquis of Wellington), against
the Mahrattas, in 1803. The distant and severe service in which that
army had been engaged, had exhausted the store of European necessaries
with which it had advanced against the enemy; and the officers arrived
at Poonah, almost destitute of those comforts and accommodations. But
they found the native merchants of that capital provided with the most
essential of those several articles, and they were soon supplied,
through the agency of those merchants, with every thing for which they
had occasion. Poonah is the capital of a Brahmin government; and,
therefore, this single fact would serve to furnish a complete answer to
every thing that has been asserted, against the practicability of
introducing and extending the manufactures of Europe into every part of
Hindostan.
3. That the poverty of a large majority of the native subjects of our
Indian Empire is such, as to disable them from acquiring our
manufactures, is certainly true; but it is no less true, that a very
considerable portion of that population possess the means of indulging
in every article of convenience and luxury, both native and European. It
has been very generally stated, that there are only _two_ classes of
people in India, the very rich and the very poor. But a minute
investigation into the society of India, would discover the error of
this statement, and would show, that there exists a third and _middle_
class, far removed from the condition of either of the others; greatly
exceeding in number the former of these, and falling far short of the
latter. This class, as they certainly possess the means, would, if
proper steps were taken, materially contribute to the demand and
consumption of many of our home manufactures.
4. With respect to the evidence, attempted to be drawn from the ill
success of the Portuguese and Dutch traders, we are to observe, that the
situation of the Portuguese and the Dutch, during the period when they
were in possession of the European trade with India, was so exceedingly
different from that of the British nation at the present moment, that it
is scarcely possible to draw a sound comparison between them. The native
Governments were at that time powerful; and the establishments of the
Portuguese, and afterwards of the Dutch, extended but a short distance
from the sea-coast; the manufactures of Europe were, in a manner, in
their infancy; and neither Portugal nor Holland were manufacturing
countries. Whereas, the British empire is now established over the
richest and most populous regions of India, and its influence is
extended even further than its dominion; the manufactures of the United
Kingdom have attained a degree of perfection, which never has been
equalled; they can be fashioned to the tastes, the wants, and the
caprices of every nation and climate; and certainly, the interests of
the country call for the cultivation of every channel, which can be
opened for the enlargement of our commerce.
We cannot better conclude these observations, than by applying the
circumstantial evidence which they afford, to Mr. Dundas's letter of the
2d April 1800; in which that Minister admitted the fact, of a
_progressively increasing_ consumption; but, at the same time,
conceived, that the _customs of the natives_ would prescribe _limits_ to
its extension. "I do not mean to say," says he, "that the exports from
this country to India have not been _very considerably increased of late
years_; and I make no doubt that, from recent circumstances, _they may
be still considerably increased_. But the prospect, _from the causes I
have already referred to_, must always be a limited one." What these
causes are he thus explains:--"The export trade to India can never be
extended to any degree, proportionate to the wealth and population of
the Indian Empire; neither can the returns upon it be very profitable to
individuals. Those who attend to _the manners_, _the manufactures_,
_the food_, _the raiment_, _the moral and religious prejudices of that
country_, can be at no loss to trace _the causes_ why this proposition
must be _a true one_."
The evidence which has been produced demonstrates, that neither the
manners, raiments, nor prejudices of Hindostan, are of a nature to
impede the introduction of articles of European manufacture; and it thus
proves, that _the causes_ assigned for the limitation of our export
trade, are not calculated to impose any such limitation. What, then, it
may be asked, are the causes, why the consumption of the manufactures of
Europe in India has in no degree kept pace with the extension of our
territories, and of their population? The examination of this branch of
our subject would carry us to too great a length on the present
occasion, and will therefore best be reserved for a separate
communication.
GRACCHUS.
LETTER IX.
_Saturday, March 20, 1813._
In searching for the _causes_, which have prevented an extensive
introduction of the British manufactures into the countries subject to
the dominion or influence of the British Crown in India, it naturally
occurs; that no measure appears ever to have been concerted, for the
general purpose of alluring the attention of the natives of India to the
articles of European importation. This neglect, has evidently arisen
from the opinions which have been so erroneously entertained, concerning
the civil and religious prejudices of the Hindoos.
The evidence of Mr. Colebrooke has been adduced, to prove that those
opinions are wholly unfounded; the following extracts from the Travels
of Forster, in the years 1782-3, will further evince, that the Hindoos,
far from entertaining any indisposition to engage in commercial dealings
with strangers, have widely extended themselves in different foreign
countries for that express purpose.
HERAT.--"At Herat, I found in two Karavanseras about one hundred Hindoo
merchants, who, by the maintenance of a brisk commerce, and by
extending a long chain of credit, have become valuable subjects to the
Government. When the Hindoos cross the Attock, they usually put on the
dress of a northern Asiatic, being seldom seen without a long cloth
coat, and a high cap[5]."