By 1818, the EIC was the paramount political power in India, with direct control over two thirds of the subcontinent’s landmass and indirect control over the rest. Expansion continued and rivals such as the Maratha people in western India and Tipu Sultan of Mysore were defeated. At the same time, the company expanded its influence over local rulers in the south, until by the 1770s the balance of power had fundamentally changed.

After military victories at the battles of Plassey (1757) and Buxar (1764), the EIC was granted the diwani of Bengal – control over the administration of the region and the right to collect tax revenue. Such military advantages made the EIC a powerful player in local conflicts and disputes, as did the financial support offered by some local Indian merchants and bankers, who saw in the EIC's increasing influence an unmissable commercial opportunity. As well as maintaining a large standing army consisting primarily of sepoys (Indian mercenary soldiers trained in European military techniques), the EIC was able to call on British naval power and crown troops garrisoned in India. This particularly increased the strategic importance of the EIC's Indian footholds, and the country’s coastline became crucial to further imperial expansion in Asia and Africa. They grappled to maintain their trading privileges in the face of declining central Mughal authority and the emergence of dynamic individual successor states.Įuropean competitors also began to have an increased presence on the subcontinent, with France emerging as a major national and imperial rival during the War of Austrian Succession and the Seven Years War. Initially a junior partner in the Mughal empire’s sophisticated commercial networks, in the 18th century, the EIC became increasingly involved in subcontinental politics. Listen: William Dalrymple explains how a single London corporation took over the Mughal empire and became a major imperial power on this episode of the HistoryExtra podcast. Although always volatile, EIC shares became an important bellwether of the British economy and the company emerged as one of London's most powerful financial institutions. The company grew in both size and influence across the 17th and 18th centuries. Meanwhile, the ‘joint stock’ organisation of the company spread the cost and risk of individual voyages between investors.

From these coastal toeholds, they orchestrated the profitable trade in spices, textiles and luxury goods on which their commercial success was predicated, dealing with Indian artisans and producers primarily through Indian middlemen. With Emperor Jehangir’s permission, they began to build small bases, or factories, on India's eastern and western coasts.

“This was a corporation that could topple kings”: William Dalrymple on the East India Company.

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