• The European traders who came to India have formed themselves into trading
  companies. These trading companies were issued a Charter by their
  respective governments.
• The charter generally empowered theses Companies to wage war, conclude
  treaties, conquer and occupy territories, build fortresses, etc. They had the right
  to negotiate with the kings, Nawabs and chieftains ruling in different parts of
  India.
• The English came to have an upper hand and began conquering India. By
  1856-57 the whole of India except Goa, Diu and Daman, which remained as
  Portuguese possessions and Pondicherry which remained as the French
  possession, came under the British East India Company’s rule.
• The British Government encouraged and supported this trading Company in its
  ambitions. Initially, the British Company established with the permission of
  concerned authorities, a few trading centres called “factories” but were
  actually “forts”. Thus, the merchant members of the Company also became
  warriors.

Evolution of British Paramountcy

• Lord Warren Hastings, first de facto Governor-General of India from 1773 to
  1785.
• The British East India Company pursued an aggressive policy of territorial
  expansion from early eighteenth century under Lord Hastings the first
  Governor General of India (1813).
• Under the policy of paramountcy, the company claimed that its authority
  was paramount or supreme; hence its power was greater than that of Indian
  states. It steadily spread its political domination over the country by a series of
  wars.
• The chronology of events relating to the establishment of British power in
  India is as follows:
  ▪ Winning the three Deccan Wars of 1746-48, 1748-54 and 1756-
  63, the English drove out the French from their hold in South
  India and became the dominant power there.
  ▪ The battles of Plassey (1757) and Buxar (1764) made the English
  masters of Bengal, Bihar and Orissa.
  ▪ By the Pitt’s India Act of 1784 the British Government assumed powers
  over the political and administrative activities of the East India
  Company

▪ Under Instructions from the British Government Lord Cornwallis annexed
a considerable portion of Tipu Sultan’s territory.
▪ During 1798-1805, implementing the policy of ‘Subsidiary Allaince’, Lord
Wellesley brought Hyderabad under British control and Gwalior,
Baroda, Indore, Nagpur and Poona under direct influence.
▪ During 1813-1823 Lord Hastings subdued the Marathas, the Central
States of Rajputana and Gurkhas of Nepal.
▪ Lord Emherst, who succeeded Hastings, defeated the Burmese.
▪ By the two Sikh Wars of 1845-46 and 1849 the British annexed
the Punjab.
▪ In 1856 the principality of Oudh was annexed.
▪ Under Lord Dalhousie who came to India in 1848 as Governor-General
through the “Doctrine of Lapse” several smaller principalities were taken
over by the British.
▪ After the above conquests by the British, Goa, Daman and Diu, Dadra
and Nagar Haveli remained as Portuguese
possessions and Pondicherry, Mahe and Karaikal as the French
possessions in India.
▪ The transfer of the Government of India from the East India Company to
the British Crown took place on 1st November, 1858.
The above timeline shows how the Indians lost their Independence and came to
be ruled by the East India Company under various Governor Generals (lords) of
the company and later by the British Government.

Economy and Policy under British Paramountcy

• In 1800 CE, India amounted to a whopping 20% of the total world
manufacturing output. But, by the year 1900, India had become synonymous
with poverty, its exports accounted for mere 1.7% of the total world
trade, and more than 30 million people (more than 10 percent of India’s
population) died of starvation in the 82 years of British rule.
• Paul Kennedy in his book ‘The Rise and Fall of Great Powers’ gives following
statistics of how Indian and the British fortunes reversed between 1750 –
1900. The reversal also coincides with ascendancy of British power in India.
• After 1818 when British became the major power in India Indian manufacturing
output rapidly declined while British increased. This can correlate the ascent
of British rule in India and its correlation to India’s fortunes.
• In 1757 British captured Bengal (and Bihar), in 1799, they captured Mysore,
in 1818 Marathas, the then largest power in India surrendered, and in 1849
British captured the Sikh kingdom of Punjab.

With the establishment of political authority, the British rulers deliberately fostered the growth of British trade and commerce at the cost of the Indian trade, ruining it through restrictive trade practices.

During the early stages of Industrial revolution, Indian goods that were
exceedingly competitive were levied 70 to 80 percent duties.

Even later, the machine made British goods enjoyed 10 to 27 percent duty
advantage over Indian goods manufactured by traditional means.

The British historian of India, Wilson observes: “It was stated in evidence in
1813 that cotton and silk goods of India in the period could be sold for a
profit in British markets at a price of 50 to 60 percent lower than those
fabricated in England… Without the 70 and 80 percent duty on the value of
Indian textiles, the mills of Paisley and Manchester would have been
stopped in their outset.”

Parliamentary inquiry report of 1840, states that while the British cotton and
silk goods were imported into India at a duty of 3.5 per cent and woollen
goods at 2 percent, Indian goods imported into Britain had a duty of 10
percent for cotton, 20 percent for silk and 30 percent for woollen goods.

The Policy of Subordinate Isolation

• A new phase of relations with the princely states began with the coming
  of Lord Hasting. He wanted to establish British paramountcy over Indian
  Princely states.
• In his treaties with the latter, instead of treating them on terms of equality, he
  forced them to act in subordinate cooperation. The prices lost their external
  sovereignty completely. Even in internal matters, British residents interfered
  and imposed their decisions on the rulers.
• As Lord Hastings himself noted in his private journal, “Instead of acting in the
  character of ambassador, he (Resident) assumes the functions of a
  dictator; interferes in all their private concerns, countenances refractory
  subjects against them and makes the most ostentatious exhibition of his
  exercise of authority.”
• Lord Hastings brought into subsidiary system 145 states in central India, 145
  states in Kathiawar, and 20 states in Rajputana.
• He did not want to annex these states but wanted to place them in a state of
  subordinate isolation. Wherever subsidiary system was introduced, the rulers
  became irresponsible and maladministration prevailed.
• Although theoretically the existence of Princely states as separate entities was
  recognized and guaranteed in the treaties, practically many princely states were
  annexed.
• In 1841, the Court of Directors directed the Government of India not to abandon
  any “just and honourable accession of territory and revenue. Annexation
  was justified on the ground of misgovernment by native rulers.
• In the following years after the retirement of Lord Hastings, there was rapid
  increase of the company’s influence in the internal administration of the states.
• The British Residents were usually the instruments of
  communication between the government of India and the rulers of the
  Indian states. Gradually their powers and status increased. Dalhousie annexed
  on two grounds: doctrine of lapse and misgovernment by native rulers.
• With the continuous assertion of company’s supremacy and the adoption of
  subordinate cooperation, the commercial body, East India Company became
  the executive power in India.
• Thus, the British Residents posted in each state carried on the whole
  administrative and the military function of the Indian states. By the charter Act of
  1833, the company was asked to accentuate its commercial business. With the
  act a radical change of the company’s attitude towards the Indian states was
  noticed.
• The policy of annexation and of states whenever and wherever possible
  way was laid by the court of directors in 1834. The governor-generals of this
  period were true annexationists.
• Annexation of the territories was the chief instrument for the extension of
  the territories by the British. However, the annexations were made to acquire a
  new revenue territory or on the ground of misgovernment due to the failure of the
  natural heir of the Indian states.
• Even after the establishment of the undisputed supremacy by the east India
  Company in 1818, the relation between the Indian states and the Company
  was chaotic, indefinite and contradictory.

Conclusion

• The paramountcy policy of the Governor-General is a claim to supremacy that
  has been disputed by Indian citizens.
• The policy was enacted to provide a clear and concise framework for the
  governance of India, but it has been met with criticism by those who argue
  that the Constitution of India provides for a more democratic system of
  government.
• Despite this opposition, the paramountcy policy remains in effect, and its
  impact continues to be felt throughout Indian society