Spices, Silk, and the British East India Trade
The British East India trade was the seedbed of the British Empire in Asia. The trade was, in its earliest phase, a long-distance luxury trade: pepper, cloves, nutmeg, mace, raw silk, and porcelain, carried in East Indiamen of 1,000 tons, sold in London at auction, and re-distributed through the European trading houses. The transition from a luxury trade to a bulk trade was the work of the late seventeenth and early eighteenth centuries. The transition from a trading interest to a territorial power was the work of the mid-eighteenth century. The transition from a private Company’s interest to a state interest was the work of the 1813 and 1833 Charter Acts. Holden Furber’s Rival Empires of Trade in the Orient, 1600–1800 (1976) remains the standard account of the trading phase. K. N. Chaudhuri’s The Trading World of Asia and the English East India Company (1978) is the indispensable analysis.
The Spice Trade
The English East India Company was founded to break into the spice trade. The pepper of the Malabar Coast, the cloves of the Moluccas, the nutmeg and mace of the Banda Islands, and the cinnamon of Ceylon were the commodities the English, the Dutch, the Portuguese, and the French had been contesting since the 1590s. The first English East India voyage, under James Lancaster, set out in February 1601 and returned in September 1603 with a cargo that included pepper, cloves, and mace. The first substantial English factory in the East Indies was established at Bantam in 1603, and the East India Company maintained factories in the Spice Islands throughout the seventeenth century. The Dutch East India Company (VOC), which had the better strategic position and the larger fleet, gradually squeezed the English out of the principal spice-producing islands. The 1623 Amboyna Massacre, in which the Dutch executed twenty English Company servants on a charge of conspiracy, marked the limit of the English commercial position in the Moluccas.
The English re-orientation of the spice trade was the work of the 1650s and 1660s, when the Company moved its principal Indian factories to Surat (1612), Madras (1639), and Bombay (1661). The pepper of the Malabar Coast and the Coromandel Coast, exported through Surat and Madras, became the principal spice of the English East India trade. The Company’s 1668 acquisition of Bombay, the 1690 founding of Calcutta, and the 1709 conversion of the Company from a regulated to a joint-stock company, with capital of £3.2 million, were the institutional moments of the re-orientation. The English spice trade was, by the 1690s, an Indian pepper trade, with English buyers operating from Indian ports and Indian merchants operating as the principal suppliers. The 1786 acquisition of Penang from the Sultan of Kedah and the 1819 founding of Singapore by Stamford Raffles were the late-Victorian extensions of the same re-orientation.
The Silk Trade
The British silk trade with the East Indies had three phases. The first phase, 1660s–1750s, was the raw silk of Bengal: the mulberry-fed silk of the Gangetic plain, exported through the Company’s factories at Kasimbazar and Malda, sold at auction in London, and re-exported to the European silk-weaving centres of Lyon, Spitalfields, and the Krefeld silk industry. The second phase, 1750s–1830s, was the Chinese raw silk and the Chinese silk piece-goods exported through Canton (Guangzhou) by the Company’s Canton factory, the only legal channel of European trade with the Qing empire. The 1793 Macartney Mission, in which Lord Macartney failed to persuade the Qianlong Emperor to relax the Canton system, marked the limit of British diplomatic leverage on the Qing. The third phase, 1830s–1950s, was the post-Chinese-Opium-War phase, in which British imports of Chinese silk were partly replaced by the Indian silk produced in Bengal, Mysore, and Kashmir.
The 1834 abolition of the East India Company’s monopoly on the British trade with China was the institutional moment the Canton system was replaced by the Treaty Port system. The 1842 Treaty of Nanking, the 1858 Treaty of Tientsin, and the 1860 Convention of Peking established the system of treaty ports through which British merchants could trade with China on terms set by the British state. The treaty ports were the precondition of the late-Victorian British tea trade, the British Indian tea trade, and the post-1945 Japanese silk re-export trade.
The Tea Trade
The British tea trade was, by 1800, the largest single component of the British imports from Asia, and the East India Company was the largest single importer. The Company’s Canton factory, the only European channel of trade with the Qing, controlled the British tea supply. The 1813 Charter Act opened the Indian trade to private British merchants, and the 1833 Charter Act opened the China trade. The 1834 abolition of the Company’s monopoly on the China trade, the 1834 establishment of the British Superintendency of Trade in China, and the 1842 Treaty of Nanking’s opening of five Chinese ports to British trade produced the conditions for a substantial expansion of the British private tea trade. The 1849 founding of the Java tea trade by the Dutch, the 1850s Indian tea plantations in Assam and Darjeeling, and the 1880s Ceylon tea plantations supplied the bulk of the British tea market. The 1840 transfer of the British tea market from China to India is the structural shift the tea trade records.
The 1850s and 1860s saw the rapid expansion of the British Indian tea trade. The 1850 founding of the Assam Tea Company, the 1863 founding of the Indian Tea Association, and the 1888 introduction of the Indian Tea Cess Act were the institutional moments. The British tea-broker system in London — the 1846 founding of the London Tea Brokers’ Association, the 1880s consolidation of the trade in Mincing Lane — was the marketing layer. The economic history of the trade, in Tirthankar Roy’s The Economic History of India, 1857–1947 (2000) and in Kenneth Pomeranz’s The Great Divergence (2000), is the standard scholarly account.
The 1813 and 1833 Charter Acts
The 1813 Charter Act, which received the Royal Assent on 21 June 1813, ended the East India Company’s monopoly on the British trade with India. The Act was, in the political economy of the time, the moment the British state officially converted the Company from a commercial monopoly to a territorial administrator. The 1833 Charter Act, which received the Royal Assent on 28 August 1833, ended the Company’s monopoly on the British trade with China and converted the Company into a purely governmental body. The 1833 Act was the work of the Whig Government of Charles Grey, the Benthamite political economists, and the Manchester cotton manufacturers. The 1813 Act had opened the Indian trade. The 1833 Act opened the China trade. The two Acts together produced the free-trade system inside the British Empire in Asia.
The 1813 Charter Act contained a passage that read, in its preamble, that the trade in tea and other Chinese articles “shall be free to all His Majesty’s Subjects, in such Manner, and subject to such Regulations, as shall be hereafter provided.” The preamble is the founding document of the modern British commercial system in Asia. The political argument for the 1833 Act was the same as the political argument for the 1813 Act: the Company’s monopoly was a private tax on British consumers of East Indian goods, and the abolition of the monopoly would produce a substantial expansion of the trade.
Historiographical Note
The historiography of the British East India trade has been shaped by three interventions. Holden Furber’s Rival Empires of Trade in the Orient, 1600–1800 (1976) reframed the period as one in which the European trading companies operated inside an Asian trading world. K. N. Chaudhuri’s The Trading World of Asia and the English East India Company (1978) provided the analytical apparatus. Tirthankar Roy’s The Economic History of India, 1857–1947 (2000) extended the analysis into the late-Victorian and Edwardian periods. The unresolved question is the weight to assign to the British commercial logic and to the Asian commercial logic in explaining the 1600–1858 period. The present generation of historians has, on the whole, declined to give the British Empire’s commercial legacy a clean bill of health.