The Council, as a part of their plan,
were obliged, by heavy duties, and by a limitation
of the right of emption of foreign opium to the con
tractors for the home produce, to check the influx
of that commodity from the territories of the Nabob
of Oude and the Rajah of Benares.
were obliged, by heavy duties, and by a limitation
of the right of emption of foreign opium to the con
tractors for the home produce, to check the influx
of that commodity from the territories of the Nabob
of Oude and the Rajah of Benares.
Edmund Burke
" They say, in another
place, that there is no ground for the dissatisfactions
and difficulties of the weavers: 1" that they are owing
to the delals, whose aim it is to be employed. "
This desire of being employed, and of rendering
themselves necessary, in men whose only business it
is to be employed in trade, is considered by the gentlemen of the board as no trivial offence; and accordingly they declare, " they have established it as
an invariable rule, that, whatever deficiency there might
be in the Dacca investment, no purchase of the manufactures of that quarter shall be made for account
of the Company from private merchants. We have
passed this resolution, which we deem of importance,
from a persuasion that private merchants are often
induced to make advances for Dacca goods, not by
the ordinary chance of sale, but merely from an
expectation of disposing of them at an enhanced
price to the. Company, against whom a rivalship is by
this manner encouraged "; and they say, " that they
intend to observe the same rule with respect to the
investment of other of the factories from whence similar complaints may comle. "
This positive rule is opposed to the positive direc
? ? ? ? ON THE AFFAIRS OF INDIA. 105
tions of the Company to employ those obnoxious persons by preference. How far this violent use of authority for the purpose of destroying rivalship has succeeded in reducing the price of goods to the Company has been made manifest by the facts before
stated in their place.
The recriminatory charges of the Company's agents
on the native merchants have made very little impression on your Committee. We have nothing in
favor of them but the assertion of a party powerful
and interested. In such cases of mutual assertion
and denial, your Committee are led irresistibly to
attach abuse to power, and to presume that suffering
and hardship are more likely to attend on weakness
than that any combination of unprotected individuals
is of force to prevail over influence, power, wealth,
and authority. The complaints of the native merchants ought not to have been treated in any of those
modes in which they were then treated. And when
men are in the situation of complainants against unbounded power, their abandoning their suit is far
from a full and clear proof of their complaints being
groundless. It is not because redress has been rendered impracticable that oppression does not exist;
nor is the despair of sufferers any alleviation of
their afflictions. A review of some of the most remarkable of the complaints made by the native merchants in that province is so essential for laying open the true spirit of the commercial administration, and
the real condition of those concerned in trade there,
that your Committee observing the records on this
subject and at this period full of them, they could
not think themselves justifiable in not stating them
to the House
? ? ? ? 106 NINTH REPORT OF SELECT COMMITTEE
Your Committee have found many heavy charges
of oppression against Mr. Barwell, whilst Factory
Chief at Dacca; which oppressions are stated to have
continued, and even to have been aggravated, on
complaint at Calcutta. These complaints appear ill
several memorials presented to the Supreme Council
of Calcutta, of which Mr. Barwell was a member.
They appeared yet more fully and more strongly
in a bill in Chancery filed in the Supreme Court,
which was afterwards recorded before the GovernorGeneral and Council, and transmitted to the Court of Directors.
Your Committee, struck with the magnitude and
importance of these charges, and finding that with
regard to those before the Council no regular investigation has ever taken place, and finding also thatAMr. Barwell had asserted in a Minute of Council that he had given a full answer to the allegations in that bill, ordered a copy of the answer to be laid
before your Committee, that they might be enabled
to state to the House how far it appeared to them
to be full, how far the charges were denied as to
the fact, or, where the facts might be admitted, what
justification was set up. It appeared necessary, in
order to determine on the true situation of the trade
and the merchants of that great city and district.
The Secretary to the Court of Directors has informed your Committee that no copy of the answer
is to be found in the India House; nor has your
Committee been able to discover that any has been
transmitted. On this failure, your Committee ordered an application to be made to Mr. Barwell for
a copy of his answer to the bill, and any other information with which he might be furnished with regard to that subject.
? ? ? ? ON THE AFFAIRS OF INDIA. 107
Mr. Barwell, after reciting the above letter, returned in answer what follows.
"Whether the records of the Supreme Court of
Judicature are lodged at the India House I am ignorant, but on those records my answer is certainly to be found. At this distance of time I am sorry
I cannot from memory recover the circumstances
of this affair; but this I know, that the bill did receive a complete answer, and the people the fullest satisfaction: nor is it necessary for me to remark,
that [in? ] the state of parties at that time in Bengal,
could party have brought forward any particle of that
bill supported by any verified fact, the principle that
introduced it in the proceedings of the GovernorGeneral and Council would likewise have given the verification of that one circumstance, whatever that
might have been. As I generally attend in my
place in the House, I shall with pleasure answer
any invitation of the gentlemen of the Committee to
attend their investigations up stairs with every information and light in my power to give them.
" St. James's Square, 15th April, 1783. "
Your Committee considered, that, with regard to
the matter charged in the several petitions to the
board, no sort of specific answer had been given at
the time and place where they were made, and when
and where the parties might be examined and confronted. It was considered also, that the bill had been transmitted, with other papers relating to the
same matter, to the Court of Directors, with the
knowledge and consent of Mr. Barwell, -and that
he states that his answer had been filed, and no proceedings had upon it for eighteen months. In that
? ? ? ? 108 NINTH REPORT OF SELECT COMMITTEE
situation it was thought something extraordinary
that no care was taken by him to transmit so essential a paper as his answer, and that he had no copy
of it in his hands.
Your Committee, in this difficulty, thought themselves obliged to decline ally verbal explanation from
the person who is defendant in the suit, relative to
matters which on the part of the complainant appear
upon record, and to leave the whole matter, as it is
charged, to the judgment of the House to determine
how far it may be worthy of a further inquiry, or how
far they may admit such allegations as your Committee could not think themselves justified in receiving.
To this effect your Committee ordered a letter to be
written Mr. Barwell; from whom they received the
following answer.
" SIR, - In consequence of your letter of the 17th,
I must request the favor of you to inform the Select
Committee that I expect from their justice, on any
matter of public record in which I am personally to
be brought forward to the notice of the House, that
they will at the same time point out to the House
what part of such matter has been verified, and what
parts have not nor ever were attempted to be verified, though introduced in debate and entered on the
records of the Governor-General and Council of Bengal. I am anxious the information should be complete, or the House will not be competent to judge; and if it is complete, it will preclude all explanation
as unnecessary.
"I am, Sir,
"Your most obedient humble servant,
" RICHARD BARWELL.
(St. James's Square, 22nd April, 1783.
? ? ? ? ON THE AFFAIRS OF INDIA. 109
"P. S. As I am this moment returned from the
country, I had it not in my power to be earlier in
acknowledging your letter of the 17th. "
Your Committee applied to Mr. Barwell to communicate any papers which might tend to the elucidation of matters before them in which he was concerned. This he has declined to do. Your Committee conceive that under the orders of the House
they are by no means obliged to make a complete
state of all the evidence which may tend to criminate
or exculpate every person whose transactions they
may find it expedient to report: this, if not specially
ordered, has not hitherto been, as they apprehend,
the usage of any committee of this House. It is not
for your Committee, but for the discretion of the
party, to call for, and for the wisdom of the House to
institute, such proceedings as may tend finally to condemn or acquit. The Reports of your Committee
are no charges, though they may possibly furnish
matter for charge; and no representations or observations of theirs can either clear or convict on any
proceeding which may hereafter be grounded on the
facts which they produce to the House. Their opinions are not of a judicial nature. Your Committee
has taken abundant care that every important fact in
their Report should be attended with the authority
for it, either in the course of their reflections or in
the Appendix: to report everything upon every subject before them which is to be found on the records of the Company would be to transcribe, and in the event to print, almost the whole of those voluminous papers. The matter which appears before them
is in a summary manner this.
? ? ? ? 110 NINTH REPORT OF SELECT COMMITTEE
The Dacca merchants begin by complaining that
in November, 1773, Mr. Richard Barwell, then Chief
of Dacca, had deprived them of their employment
and means of subsistence; that he had extorted from
them 44,224 Arcot rupees (4,7311. ) by the terror of
his threats, by long imprisonment, and cruel confinement in the stocks; that afterwards they were confined in a small room near the factory-gate, under
a guard of sepoys; that their food was stopped, and
they remained starving a whole day; that they were
not permitted to take their food till next day at
noon, and were again brought back to the same confinement, in which they were continued for six days,
and were not set at liberty until they had given
Mr. Barwell's banian a certificate for forty thousand
rupees; that in July, 1774, when Mr. Barwell had
left Dacca, they went to Calcutta to seek justice;
that Mr. Barwell confined them in his house at Calcutta, and sent them back under a guard of peons to
Dacca; that in December, 1774, on the arrival of the
gentlemen from Europe, they returned to Calcutta,
and preferred their complaint to the Supreme Court
of Judicature.
The bill in Chancery filed against Richard Barwell, John Shakespeare, and others, contains a minute specification of the various acts of personal cruelty said to be practised by Mr. Barwell's orders, to extort money from these people. Among other acts
of a similar nature he is charged with having ordered
the appraiser of the Company's cloths, who was an
old man, and who asserts that he had faithfully
served the Company above sixteen years without
the least censure on his conduct, to be severely
flogged without reason.
? ? ? ? ON THE AFFAIRS OF INDIA. 111
In the manner of confining the delals, with ten of
their servants, it is charged on him, that, " when he
first ordered them to be put into the stocks, it was
at a time when the weather was exceedingly bad
and the rain very heavy, without allowing them the
least covering for their heads or any part of their
body, or anything to raise them from the wet ground;
in which condition they were continued for many
hours, until the said Richard Barwell thought proper
to remove them into a far worse state, if possible,
as if studying to exercise the most cruel acts of barbarity on them, &c. ; and that during their imprisonment they were frequently carried to and tortured ill the stocks ill the middle of the day, when the
scorching heat of the sun was insupportable, notwithstanding which they were denied the least covering. "
These men assert that they had served the Company without blame for thirty years,- a period commencing long before the power of the Company in India.
It was no slight'aggravation of this severity, that
the objects were not young, nor of the lowest of
the people, who might, by the vigor of their constitutions, or by the habits of hardship, be enabled to
bear up against treatment so full of rigor. They
were aged persons; they were men of a reputable
profession.
The account given by these merchants of their first
journey to Calcutta, in July, 1774, is circumstantial
and remarkable. They say, " that, on their arrival,
to their astonishment, they soon learned that the Governor, who had formerly been violently enraged against
the said Richard Barwellfor different improprieties in
his conduct, was now reconciled to him; and that ever
? ? ? ? 112 NINTH REPORT OF SELECT COMMITTEE
since there was a certainty of his Majesty's appointments taking place in India, from being the most inveterate enemies they were now become the most intimate friends; and that this account soon taught them to believe they were not any nearer justice from their journey to Calcutta than they had been before at Dacca. " When this bill of complaint was, in 1776, laid be.
fore the Council, to be transmitted to the Court of
Directors, Mr. Barwell complained of the introduc
tion of such a paper, and asserted, that he had answered to every particular of it on oath about eighteen
months, and that during this long period no attempt
had been made to controvert, refute, or even to reply
to it.
He did not, however, think it proper to enter his
answer on the records along with the bill of whose
introduction he complained.
On the declarations made by Mr. Barwell in his
minute (September, 1776) your Committee observe,
that, considering him only as an individual under
prosecution in a court of justice, it might be sufficient for him to exhibit his defence in the court
where he was accused; but that, as a member of
government, specifically charged before that very
government with abusing the powers of his office
in a very extraordinary manner, and for purposes
(as they allege) highly corrupt and criminal, it appears to your Committee hardly sufficient to say that
he had answered elsewhere. The matter was to go
before the Court of Directors, to whom the question
of his conduct in that situation, a situation of the
highest power and trust, was as much at least a question of state as a matter of redress to be solely left
to the discretion, capacity, or perseverance of indi
? ? ? ? ON THE AFFAIRS OF INDIA. 113
viduals. Mr. Barwell might possibly be generous
enough to take no advantage of his eminent situation; but these unfortunate people would rather look to his power than his disposition. In general, a man
so circumstanced and so charged (though we do not
know this to be the case with Mr. Barwell) might
easily contrive by legal advantages to escape. The
plaintiffs being at a great distance from the seat of
government, and possibly affected by fear or fatigue,
or seeing the impossibility of sustaining with the
ruins of fortunes never perhaps very opulent a suit
against wealth, power, and influence, a compromise
might even take place, in which circumstances might
make the complainants gladly acquiesce. But the
public injury is not in the least repaired by the ac.
quiescence of individuals, as it touched the honor of
the very highest parts of government. In the opinion of your Committee some means ought to have been taken to bring the bill to a discussion on the
merits; or supposing that such decree could not be
obtained by reason of any failure of proceeding on
the part of the plaintiffs, that some process official or
juridical ought to have been instituted against them
which might prove them guilty of slander and defamation in as authentic a manner as they had made their charge, before the Council as well as the Court.
By the determination of Mr. Hurst, and the resolutions of the Board of Trade, it is much to be ap -- prehended that the native mercantile interest must
be exceedingly reduced. The above-mentioned resolutions of the Board of Trade, if executed in their rigor, must almost inevitably accomplish its ruin. .
The subsequent transactions are covered with an
obscurity which your Committee have not been able.
VOL. VIII. 8
? ? ? ? 114 NINTH REPORT OF SELECT COMMITTEE
to dispel. All which they can collect, but that by
no means distinctly, is, that, as those who trade for
the Company in the articles of investment may also
trade for themselves in the same articles, the old opportunities of confounding the capacities must remain, and all the oppressions by which this confusion has been attended. The Company's investments, as
the General Letter from Bengal of the 20th of November, 1775, par. 28, states the matter, " are never at a
stand; advances are made and goods are received all
the year round. " Balances, the grand instrument of
oppression, naturally accumulate on poor manufacturers who are intrusted with money. Where there is
not a vigorous rivalship, not only tolerated, but encouraged, it is impossible ever to redeem the manufacturers from the servitude induced by those unpaid balances.
No such rivalship does exist: the policy practised
and avowed is directly against it. The reason assigned in the Board of Trade's letter of the 28th of
November, 1778, for its making their advances early
in the season is, to prevent the foreign merchants
and private traders interfering with the purchase of
their (the Company's) assortments. " They also refer to the means taken to prevent this interference in
their letter of 26th January, 1779. " It is impossible that the small part of the trade should not fall
into the hands of those who, with the name and authority of the governing persons, have such extensive
contracts in their hands. It appears in evidence that
natives can hardly trade to the best advantage, (your
Committee doubt whether they can trade to any advantage at all,) if not joined with or countenanced
by British subjects. The Directors were in 1775 so
? ? ? ? ON THE AFFAIRS OF INDIA. 115
strongly impressed with this notion, and conceived
the native merchants to have been even then reduced
to so low a state, that, notwithstanding the Company's earnest desire of giving them a preference,
they " doubt whether there are at this time in Bengal native merchants possessed of property adequate to such undertaking, or of credit and responsibility
sufficient to make it safe and prudent to trust them
with such sums as might be necessary to enable them
to fulfil their engagements with the Company. "
The effect which so long continued a monopoly,
followed by a preemption, and then by partial preferences supported by power, must necessarily have in weakening the mercantile capital, and disabling the
merchants from all undertakings of magnitude, is but
too visible. However, a witness of understanding
and credit does not believe the capitals of the natives
to be yet so reduced as to disable them from partaking in the trade, if they were otherwise able to put themselves on an equal footing with Europeans.
The difficulties at the outset will, however, be considerable. For the long continuance of abuse has in some measure conformed the whole trade of the country to its false principle. To make a sudden change, therefore, might destroy the few advantages which attend any trade, without securing those which must flow from one established upon sound mercantile
principles, whenever such a trade can be established.
The fact is, that the forcible direction which the trade
of India has had towards Europe, to the neglect, or
rather to the total abandoning, of the Asiatic, has of
itself tended to carry even the internal business from
the native merchant. The revival of trade in the native hands is of absolute necessity; but your Comn
? ? ? ? 116 NINTH REPORT OF SELECT COMMITTEE
mittee is of Opinion that it will rather be the effect
of a regular-progressive course of endeavors for that
purpose than of any one regulation, however wisely
conceived.
After this examination into the condition of the
trade and traders in the principal articles provided
for the investment to Europe, your Committee proceeded to take into consideration those articles the produce of which, after sale in Bengal, is to form a
part of the fund for the purchase of other articles of
investment, or to make a part of it in kind. These
are, 1st, Opium, --2ndly, Saltpetre, -- and, 3rdly,
Salt. These are all monopolized.
OPIUM.
THE first of the internal authorized monopolies is
that of opium. This drug, extracted from a species
of the poppy, is of extensive consumption in most of
the Eastern markets. The best is produced in the
province of Bahar: in Bengal it is of an inferior sort,
though of late it has been improved. This monopoly
is to be traced to the very origin of our influence in
Bengal. It is stated to have begun at Patna so early
as the year 1761, but it received no considerable degree of strength or consistence until the year 1765, when the acquisition of the Duann6 opened a wide
field for all projects of this nature. It was then
adopted and owned as a resource for persons in
office,- was managed chiefly by the civil servants of
the Patna factory, and for their own benefit. The
policy was justified on the usual principles on which
monopolies are supported, and on some peculiar to
the commodity, to the nature of the trade, and to the
? ? ? ? ON THE AFFAIRS OF INDIA. 117
state of the country: the security against adultera
tion; the prevention of the excessive home consumption of a pernicious drug; the stopping an excessive competition, which by an over-proportioned supply
would at length destroy the market abroad; the inability of the cultivator to proceed in an expensive
and precarious culture without a large advance of
capital; and, lastly, the incapacity of private merchants to supply that capital on the feeble security of wretched farmers.
These were the principal topics on which the monopoly was supported. The last topic leads to a
serious consideration on the state of the country;
for, in pushing it, the gentlemen argued, that, in case
such private merchants should advance the necessary capital, the lower cultivators " would get money in abundance. " Admitting this fact, it seems to be a
part of the policy of this monopoly to prevent the
cultivator from obtaining the natural fruits of his
labor. Dealing with a private merchant, he could
not get money in abundance, unless his commodity
could produce an abundant profit. Further reasons,
relative to the peace and good order of the province,
were assigned for thus preventing the course of trade
from the equitable distribution of the advantages of
the produce, in which the first, the poorest, and the
most laborious producer ought to have his first share.
The cultivators, they add, would squander part of
the money, and not be able to complete their engage.
ments to the full; lawsuits, and even battles, would
ensue between the factors, contending for a deficient
produce; and the farmers would discourage the culture of an object which brought so much disturbance into their d;;,ricts. This competition, the operation
? ? ? ? 118 NINTH REPORT OF SELECT COMMITTEE
of which they endeavor to prevent, is the natural corrective of the abuse, and the best remedy which could
be applied to the disorder, even supposing its probable existence.
Upon whatever reasons or pretences the monopoly
of opium was supported, the real motive appears to
be the profit of those who were in hopes to be concerned in it. As these profits promised to be very
considerable, at length it engaged the attention of
the Company; and after many discussions, and various plans of application, it was at length taken for
their benefit, and the produce of the sale ordered to
be employed in the purchase of goods for their investment.
In the year 1773 it had been taken out of the
hands of the Council of Patna, and leased to two of
the natives, - but for a year only. The contractors
were to supply a certain quantity of opium at a given
price. Half the value was to be paid to those contractors in advance, and the other half on the delivery.
The proceedings on this contract demonstrated the
futility of all the principles on which the monopoly
was founded.
The Council, as a part of their plan,
were obliged, by heavy duties, and by a limitation
of the right of emption of foreign opium to the con
tractors for the home produce, to check the influx
of that commodity from the territories of the Nabob
of Oude and the Rajah of Benares. In these countries no monopoly existed; and yet there the commodity was of such a quality and so abundant as to bear the duty, and even with the duty in some
degree to rival the monopolist even in his own market. There was no complaint in those countries of
? ? ? ? ON THE AFFAIRS OF INDIA. 119
want of advances to cultivators, or of lawsuits and
tumults among the factors; nor was there any appearance of the multitude of other evils which had
been so much dreaded from the vivacity of competition.
On the other hand, several of the precautions inserted in this contract, and repeated in all the subsequent, strongly indicated the evils against which
it is extremely difficult, if not impossible, to guard
a monopoly of this nature and in that country. For
in the first contract entered into with the two natives it was strictly forbidden to compel the tenants
to the cultivation of this drug. Indeed, very shocking rumors had gone abroad, and they were aggravated by an opinion universally prevalent, that, even in the season immediately following that dreadful
famine which swept off one third of the inhabitants
of Bengal, several of the poorer farmers were compelled to plough up the fields they had sown with
grain in order to plant them with poppies for the
benefit of the engrossers of opium. This opinion
grew into a strong presumption, when it was seen
that in the next year the produce of opium (contrary to what might be naturally expected in a year
following such a dearth) was nearly doubled. It
is true, that, when the quantity of land necessary for
the production of the largest quantity of opium is
considered, it is not just to attribute that famine to
these practices, nor to any that were or could be
used; yet, where such practices did prevail, they
must have been very oppressive to individuals, extremely insulting to the feelings of the people, and
must tend to bring great and deserved discredit on
the British government. The English are a people
? ? ? ? 120 NINTH REPORT OF SELECT COMMITTEE
who appear in India as a conquering nation; all
dealing with them is therefore, more or less, a dealing with power. It is such when they trade on a private account; and it is much more so in any
authorized monopoly, where the hand of government, which ought never to appear but to protect,
is felt as the instrument in every act of oppression.
Abuses must exist in a trade and a revenue so constituted, and there is no effectual cure for them but to entirely cut off their cause.
Things continued in this train, until the great
revolution in the Company's government was wrought
by the Regulating Act of the thirteenth of the king;
In 1775 the new Council-General appointed by the
act took this troublesome business again into consideration. General Clavering, Colonel Monson, and Mr. Francis expressed such strong doubts of the
propriety of this and of all other monopolies, that
the Directors, in their letter of the year following,
left the Council at liberty to throw the trade open,
under a duty, if they should find it practicable.
But General Clavering, who most severely censured
monopoly in general, thought that this monopoly
ought to be retained,- but for a reason which shows
his opinion of the wretched state of the country: for
he supposed it impossible, with the power and influence which must attend British subjects in all
their transactions, that monopoly could be avoided;
and he preferred an avowed monopoly, which brought
benefit to government, to a virtual engrossing, attended with profit only to individuals. But in this opinion he did not seem to be joined by Mr. Francis,
who thought the suppression of this and of all monopolies to be practicable, and strongly recommended
? ? ? ? ON THE AFFAIRS OF INDIA. 121
their abolition in a plan sent to the Court of Directors the year following. *
The Council, however, submitting to the opinion
of this necessity, endeavored to render that dubious
engagement as beneficial as possible to the Company. They began by putting up the contract to the
highest bidder. The proposals were to be sealed.
When the seals came to be opened, a very extraordinary scene appeared. Every step in this business
develops more and more the effect of this junction
of public monopoly and private influence. Four
English and eight natives were candidates for the
contract; three of the English far overbid the eight
natives. They who consider that the natives, from
their superior dexterity, from their knowledge of
the country and of business, and from their extreme
industry, vigilance, and parsimony, are generally an
over-match for Europeans, and indeed are, and must
ultimately be, employed by them in all transactions
whatsoever, will find it very extraordinary that they
did not by the best offers secure this dealing to themselves. It can be attributed to this cause, and this
only, - that they were conscious, that, without power
and influence to subdue the cultivators of the land
to their own purposes, they never could afford to
engage on the lowest possible terms. Those whose
power entered into the calculation of their profits
could offer, as they did offer, terms without comparison better; and therefore one of the English bidders, without partiality, secured the preference. The contract to this first bidder, Mr. Griffiths, was
prolonged from year to year; and as during that
* Vide Mr. Francis's plan in Appendix, No. 14, to the Select
Committee's Sixth Report.
? ? ? ? 122 NINTH REPORT OF SELECT COMMITTEE
time frequent complaints were made by him to the
Council Board, on the principle that the years answered very differently, and that the. business of one
year ran into the other, reasons or excuses were furnished for giving the next contract to Mr. Mackenzie
for three years. This third contract was not put up
to auction, as the second had been, and as this ought
to have been. The terms were, indeed, something
better for the Company; and the engagement was
subject to qualifications, which, though they did not
remove the objection to the breach of the Company's
orders, prevented the hands of the Directors from being tied up. A proviso was inserted in the contract,
that it should not be anyways binding, if the Company by orders from home should alter the existing
practice with regard to such dealing.
Whilst these things were going on, the evils which
this monopoly was in show and pretence formed to
prevent still existed, and those which were naturally
to be expected from a monopoly existed too. Complaints were made of the bad quality of the opium;
trials were made, and on those trials the opium was
found faulty. An office of inspection at Calcutta, to
ascertain its goodness, was established, and directions
given to the Provincial Councils at the places of
growth to certify the quantity and quality of the coinmodity transmitted to the Presidency.
In 1776, notwithstanding an engagement in the
contract strictly prohibiting all compulsory culture of
the poppy, information was given to a member of the
Council-General, that fields green with rice had been
forcibly ploughed up to make way for that plant,and that this was done in the presence of several English gentlemen, who beheld the spectacle with a just
? ? ? ? ON THE AFFAIRS OF INDIA. 123
and natural indignation. The board, struck with
this representation, ordered the Council of Patna to
make an inquiry into the fact; but your Committee
tan find no return whatsoever to this order. The
complaints were not solely on the part of the cultivators against the contractor. The contractor for opium made loud complaints against the inferior collectors of the landed revenue, stating their undue and vexatious exactions from the cultivators of opium, -
their throwing these unfortunate people into prison
upon frivolous pretences, by which the tenants were
ruined, and the contractor's advances lost. He stated, that, if the contractor should interfere in favor
of the cultivator, then a deficiency would be caused
to appear in the landed revenues, and that deficiency would be charged on his interposition; he
desired, therefore, that the cultivators of opium
should be taken out of the general system of the
landed revenue, and put under " his protection. "
Here the effect naturally to be expected from the
clashing of inconsistent revenues appeared in its full
light, as well as the state of the unfortunate peasants
of Bengal between such rival protectors, where the
ploughman, flying from the tax-gatherer, is obliged
to take refuge under the wings of the monopolist.
No dispute arises amongst the English subjects which
does not divulge the misery of the natives; when the
former are in harmony, all is well with the latter.
This monopoly continuing and gathering strength
through a succession of contractors, and being probably a most lucrative dealing, it grew to be every
day a greater object of competition. The Council of
Patna endeavored to recover the contract, or at least
the agency, by the most inviting terms; and in this
? ? ? ? 124 NINTH REPORT OF SELECT COMMITTEE
eager state of mutual complaint and competition
between private men and public bodies things continued until the arrival in Bengal of Mr. Stephen
Sulivan, son of Mr. Sulivan, Chairman of the East
India Company, which soon put an end to all strife
and emulation.
To form a clear judgment on the decisive step
taken at this period, it is proper to keep in view the
opinion of the Court of Directors concerning monopolies, against which they had uniformly declared in
the most precise terms. They never submitted to
them, but as to a present necessity; it was therefore
not necessary for them to express any particular approbation of a clause in Mr. Mackenzie's contract
which was made in favor of their own liberty.
Every motive led them to preserve it. On the
security of that clause they could alone have suffered to pass over in silence (for they never approved) the grant of the contract which contained it for three years. It must also be remembered that
they had from the beginning positively directed that
the contract should be put up to public auction;
and this not having been done in Mr. Mackenzie's
case, they severely reprimanded the Governor-General and Council in their letter of the 23rd December, 1778.
The Court of Directors were perfectly right in
showing themselves tenacious of this regulation,not so much to secure the best practicable revenue
from their monopoly whilst it existed, but for a much
more essential reason, that is, from the corrective
which this method administered to that monopoly
itself: it prevented the British contractor from becoming doubly terrible to the natives, when they
? ? ? ? ON THE AFFAIRS OF INDIA. 125
should see that his contract was in effect a grant, and
therefore indicated particular favor and private influence with the ruling members of an absolute government.
On the expiration of Mr. Mackenzie's term, and
but a few months after Mr. Sulivan's arrival, the
Governor-General, as if the contract was a matter
of patronage, and not of dealing, pitched upon Mr.
Sulivan as the most proper person for the management of this critical concern. Mr. Sulivan, though a
perfect stranger to Bengal, and to that sort and to all
sorts of local commerce, made no difficulty of accepting it. The Governor-General was so fearful that his
true motives in this business should be mistaken, or
that the smallest suspicion should arise of his attending to the Company's orders, that, far from putting
up the contract (which, on account of its known
profits, had become the object of such pursuit) to
public auction, he did not wait for receiving so much
as a private proposal from Mr. Sulivan. The Secretary perceived that in the rough draught of the contract the old recital of a proposal to the board was inserted as a matter of course, but was contrary to
the fact; he therefore remarked it to Mr. Hastings.
Mr Hastings, with great indifference, ordered that
recital to be omitted; and the omission, with the remark that led to it, has, with the same easy indifference, been sent over to his masters.
The Governor-General and Council declare themselves apprehensive that Mr. Sulivan might be a loser
by his bargain, upon account of troubles which they
supposed existing in the country which was the object
of it. This was the more indulgent, because the contractor was tolerably secured against all losses. He
? ? ? ? 126 NINTH REPORT OF SELECT COMMITTEE
received a certain price for his commodity; but he was
not obliged to pay any certain price to the cultivator,
who, having no other market than his, must sell it to
him at his own terms. He was to receive half the
yearly payment by advance, and he was not obliged
to advance to the cultivator more than what he
thought expedient; but if this should not be enough,
he might, if he pleased, draw the whole payment before the total delivery: such were the terms of the
engagement with him. He is a contractor of a new
species, who employs no capital whatsoever of his
own, and has the market of compulsion at his entire command. But all these securities were not
sufficient for the anxious attention of the Supreme
Council to Mr. Sulivan's welfare: Mr. Hastings had
before given him the contract without any proposal on his part; and to make their gift perfect, in
a second instance they proceed a step beyond their
former ill precedent, and they contract with Mr. Sulivan for four years.
Nothing appears to have been considered but the
benefit of the contractor, and for this purpose the
solicitude shown in all the provisions could not be
exceeded. One of the first things that struck Mr.
Hastings as a blemish on his gift was the largeness
of the penalty which he had on former occasions settled as the sanction of the contract: this he now discovered to be so great as to be likely to frustrate its end by the impossibility of recovering so large a sum.
How a large penalty can prevent the recovery of any,
even the smallest part of it, is not quite apparent.
In so vast a concern as that of opium, a fraud which
at first view may not appear of much importance,
and which may be very difficult in the discovery,
? ? ? ? ON THE AFFAIRS OF INDIA. 127
may easily counterbalance the reduced penalty in this
contract, which was settled in favor of Mr. Sulivan at
about 20,0001.
Monopolies were (as the House has observed) only tolerated evils, and at best upon trial; a clause,
therefore, was inserted in the contracts to Mackenzie,
annulling the obligation, if the Court of Directors
should resolve to abolish the monopoly; but at the
request of Mr. Sulivan the contract was without difficulty purged of this obnoxious clause. The term
was made absolute, the monopoly rendered irrevocable, and the discretion of the Directors wholly excluded. Mr. Hastings declared the reserved condition to be no longer necessary, " because the Directors
had approved the monopoly. "
The Chiefs and Councils at the principal factories
had been obliged to certify the quantity and quality
of the opium before its transport to Calcutta; and
their control over the contractor had been assigned
as the reason for not leaving to those factories the
management of this monopoly. Now things were
changed. Orders were sent to discontinue this measure of invidious precaution, and the opium was sent
to Calcutta without anything done to ascertain its
quality or even its quantity.
An office of inspection had been also appointed
to examine the quality of the opium on its delivery
at the capital settlement. In order to ease Mr. Sulivan from this troublesome formality, Mr. Hastings
abolished the office; so that Mr. Sulivan was then
totally freed from all examination or control whatsoever, either first or last.
These extraordinary changes in favor of Mr. Sulivan were attended with losses to others, and seem to
? ? ? ? 128 NINTH REPORT OF SELECT COMMITTEE
have excited much discontent. This discontent it
was necessary in some manner to appease. The
vendue-master, who was deprived of his accustomed
dues on the public sales of the opium by the private dealing, made a formal complaint to the board
against this, as well as other proceedings relative to
the same business. He attributed the private sale
to " reasons of state "; and this strong reflection both
on the Board of Trade and the Council Board was
passed over without observation. He was quieted by
appointing him to the duty of these very inspectors
whose office had been just abolished as useless. The
House will judge of the efficacy of the revival of this
office by the motives to it, and by Mr. Hastings giving that to one as a compensation which had been executed by several as a duty. However, the orders for taking away the precautionary inspection at Patna
still remained in force.
Some benefits, which had been given to former contractors at the discretion of the board, were no longer
held under that loose indulgence, but were secured to
Mr. Sulivan by his contract. Other indulgences, of a
lesser nature, and to which no considerable objection
could be made, were on the application of a Mr.
Benn, calling himself his attorney, granted.
Your Committee, examining Mr. Higginson, late a
member of the Board of Trade, on that subject, were
illformed, that this contract, very soon after the makilg, was generally understood at Calcutta to have
been sold to this Mr. Benn, but he could not particularize the sum for which it had been assigned, -- and
that Mr. Benn had afterwards sold it to a Mr. Young.
By this transaction it appears clearly that the contract
was given to Mr. Sulivan for no other purpose than
? ? ? ? ON THE AFFAIRS OF INDIA. 129
to supply him with a sum of money; and the sale and
re-sale seem strongly to indicate that the reduction of
the penalty, and the other favorable conditions, were
not granted for his ease in a business which he never
was to execute, but to heighten the value of the object
which he was to sell. Mr. Sulivan was at the time in
Mr. Hastings's family, accompanied him in his progresses, and held the office of Judge-Advocate.
The monopoly given for these purposes thus permanently secured, all power of reformation cut off,
and almost every precaution against fraud and oppression removed, the Supreme Council found, or pretended to find, that the commodity for which they had just made such a contract was not a salable article, -- and in consequence of this opinion, or pretence,,
entered upon a daring speculation hitherto unthought
of, that of sending the commodity on the Company's
account to the market of Canton. The Council alleged, that, the Dutch being driven from Bengal, and
the seas being infested with privateers, this commodity had none, or a very dull and depreciated demand.
Had this been true, Mr. Hastings's conduct could
admit of no excuse. He ought not to burden a, falling
market by long and heavy engagements. He, ought
studiously to have kept in his power the means of
proportioning the supply to the demand. But his:
arguments, and those of the Council on that occasionl, do not deserve the smallest attention. Facts, to
which there is no testimony but the assertion of those
who produce them in apology for the ill consequences
of their own irregular actions, cannot be admitted.
Mr. Hastings and the Council had nothing at all to
do with that business: the Court of Directors had
wholly taken the management of opium out of his.
VOL VIII. 9
? ? ? ? 130 NINTH REPORT OF SELECT COMMITTEE
and their hands, and by a solemn adjudication fixed
it in the Board of Trade. But after it had continued there some years, Mr. Hastings, a little before his
grant of the monopoly to Mr. Sulivan, thought proper
to reverse the decree of his masters, and by his own
authority to recall it to the Council. By this step he
became responsible for all the consequences.
The Board of Trade appear, indeed, to merit reprelelnsion for disposing of the opium by private contract,
as by that means the unerring standard of the public
market cannot be applied to it. But they justified
themselves by their success; and one of their members informed your Committee that their last sale had
been a good one: and though he apprehended a fall
in the next, it was not such as in the opinion of your
Committee could justify the Council-General in having recourse to untried and hazardous speculations of
commerce. It appears that there must have been a
market, and one sufficiently lively. They assign as a
reason of this assigned [alleged? ] dulness of demand,
that the Dutch had been expelled from Bengal, and
could not carry the usual quantity to Batavia. But
the Danes were not expelled from Bengal, and Portuguese ships traded there: neither of them were interdicted at Batavia, and the trade to the eastern ports was free to them. The Danes actually applied for and
obtained an increase of the quantity to which their
purchases had been limited; and as they asked, so they
received this indulgence as a great favor. It does not
appear that they were not very ready to supply the
place of the Dutch. On the other hand, there is no
doubt that the Dutch would most gladly receive an
article, convenient, if not necessary, to the circulation of their commerce, from the Danes, or under any
? ?
place, that there is no ground for the dissatisfactions
and difficulties of the weavers: 1" that they are owing
to the delals, whose aim it is to be employed. "
This desire of being employed, and of rendering
themselves necessary, in men whose only business it
is to be employed in trade, is considered by the gentlemen of the board as no trivial offence; and accordingly they declare, " they have established it as
an invariable rule, that, whatever deficiency there might
be in the Dacca investment, no purchase of the manufactures of that quarter shall be made for account
of the Company from private merchants. We have
passed this resolution, which we deem of importance,
from a persuasion that private merchants are often
induced to make advances for Dacca goods, not by
the ordinary chance of sale, but merely from an
expectation of disposing of them at an enhanced
price to the. Company, against whom a rivalship is by
this manner encouraged "; and they say, " that they
intend to observe the same rule with respect to the
investment of other of the factories from whence similar complaints may comle. "
This positive rule is opposed to the positive direc
? ? ? ? ON THE AFFAIRS OF INDIA. 105
tions of the Company to employ those obnoxious persons by preference. How far this violent use of authority for the purpose of destroying rivalship has succeeded in reducing the price of goods to the Company has been made manifest by the facts before
stated in their place.
The recriminatory charges of the Company's agents
on the native merchants have made very little impression on your Committee. We have nothing in
favor of them but the assertion of a party powerful
and interested. In such cases of mutual assertion
and denial, your Committee are led irresistibly to
attach abuse to power, and to presume that suffering
and hardship are more likely to attend on weakness
than that any combination of unprotected individuals
is of force to prevail over influence, power, wealth,
and authority. The complaints of the native merchants ought not to have been treated in any of those
modes in which they were then treated. And when
men are in the situation of complainants against unbounded power, their abandoning their suit is far
from a full and clear proof of their complaints being
groundless. It is not because redress has been rendered impracticable that oppression does not exist;
nor is the despair of sufferers any alleviation of
their afflictions. A review of some of the most remarkable of the complaints made by the native merchants in that province is so essential for laying open the true spirit of the commercial administration, and
the real condition of those concerned in trade there,
that your Committee observing the records on this
subject and at this period full of them, they could
not think themselves justifiable in not stating them
to the House
? ? ? ? 106 NINTH REPORT OF SELECT COMMITTEE
Your Committee have found many heavy charges
of oppression against Mr. Barwell, whilst Factory
Chief at Dacca; which oppressions are stated to have
continued, and even to have been aggravated, on
complaint at Calcutta. These complaints appear ill
several memorials presented to the Supreme Council
of Calcutta, of which Mr. Barwell was a member.
They appeared yet more fully and more strongly
in a bill in Chancery filed in the Supreme Court,
which was afterwards recorded before the GovernorGeneral and Council, and transmitted to the Court of Directors.
Your Committee, struck with the magnitude and
importance of these charges, and finding that with
regard to those before the Council no regular investigation has ever taken place, and finding also thatAMr. Barwell had asserted in a Minute of Council that he had given a full answer to the allegations in that bill, ordered a copy of the answer to be laid
before your Committee, that they might be enabled
to state to the House how far it appeared to them
to be full, how far the charges were denied as to
the fact, or, where the facts might be admitted, what
justification was set up. It appeared necessary, in
order to determine on the true situation of the trade
and the merchants of that great city and district.
The Secretary to the Court of Directors has informed your Committee that no copy of the answer
is to be found in the India House; nor has your
Committee been able to discover that any has been
transmitted. On this failure, your Committee ordered an application to be made to Mr. Barwell for
a copy of his answer to the bill, and any other information with which he might be furnished with regard to that subject.
? ? ? ? ON THE AFFAIRS OF INDIA. 107
Mr. Barwell, after reciting the above letter, returned in answer what follows.
"Whether the records of the Supreme Court of
Judicature are lodged at the India House I am ignorant, but on those records my answer is certainly to be found. At this distance of time I am sorry
I cannot from memory recover the circumstances
of this affair; but this I know, that the bill did receive a complete answer, and the people the fullest satisfaction: nor is it necessary for me to remark,
that [in? ] the state of parties at that time in Bengal,
could party have brought forward any particle of that
bill supported by any verified fact, the principle that
introduced it in the proceedings of the GovernorGeneral and Council would likewise have given the verification of that one circumstance, whatever that
might have been. As I generally attend in my
place in the House, I shall with pleasure answer
any invitation of the gentlemen of the Committee to
attend their investigations up stairs with every information and light in my power to give them.
" St. James's Square, 15th April, 1783. "
Your Committee considered, that, with regard to
the matter charged in the several petitions to the
board, no sort of specific answer had been given at
the time and place where they were made, and when
and where the parties might be examined and confronted. It was considered also, that the bill had been transmitted, with other papers relating to the
same matter, to the Court of Directors, with the
knowledge and consent of Mr. Barwell, -and that
he states that his answer had been filed, and no proceedings had upon it for eighteen months. In that
? ? ? ? 108 NINTH REPORT OF SELECT COMMITTEE
situation it was thought something extraordinary
that no care was taken by him to transmit so essential a paper as his answer, and that he had no copy
of it in his hands.
Your Committee, in this difficulty, thought themselves obliged to decline ally verbal explanation from
the person who is defendant in the suit, relative to
matters which on the part of the complainant appear
upon record, and to leave the whole matter, as it is
charged, to the judgment of the House to determine
how far it may be worthy of a further inquiry, or how
far they may admit such allegations as your Committee could not think themselves justified in receiving.
To this effect your Committee ordered a letter to be
written Mr. Barwell; from whom they received the
following answer.
" SIR, - In consequence of your letter of the 17th,
I must request the favor of you to inform the Select
Committee that I expect from their justice, on any
matter of public record in which I am personally to
be brought forward to the notice of the House, that
they will at the same time point out to the House
what part of such matter has been verified, and what
parts have not nor ever were attempted to be verified, though introduced in debate and entered on the
records of the Governor-General and Council of Bengal. I am anxious the information should be complete, or the House will not be competent to judge; and if it is complete, it will preclude all explanation
as unnecessary.
"I am, Sir,
"Your most obedient humble servant,
" RICHARD BARWELL.
(St. James's Square, 22nd April, 1783.
? ? ? ? ON THE AFFAIRS OF INDIA. 109
"P. S. As I am this moment returned from the
country, I had it not in my power to be earlier in
acknowledging your letter of the 17th. "
Your Committee applied to Mr. Barwell to communicate any papers which might tend to the elucidation of matters before them in which he was concerned. This he has declined to do. Your Committee conceive that under the orders of the House
they are by no means obliged to make a complete
state of all the evidence which may tend to criminate
or exculpate every person whose transactions they
may find it expedient to report: this, if not specially
ordered, has not hitherto been, as they apprehend,
the usage of any committee of this House. It is not
for your Committee, but for the discretion of the
party, to call for, and for the wisdom of the House to
institute, such proceedings as may tend finally to condemn or acquit. The Reports of your Committee
are no charges, though they may possibly furnish
matter for charge; and no representations or observations of theirs can either clear or convict on any
proceeding which may hereafter be grounded on the
facts which they produce to the House. Their opinions are not of a judicial nature. Your Committee
has taken abundant care that every important fact in
their Report should be attended with the authority
for it, either in the course of their reflections or in
the Appendix: to report everything upon every subject before them which is to be found on the records of the Company would be to transcribe, and in the event to print, almost the whole of those voluminous papers. The matter which appears before them
is in a summary manner this.
? ? ? ? 110 NINTH REPORT OF SELECT COMMITTEE
The Dacca merchants begin by complaining that
in November, 1773, Mr. Richard Barwell, then Chief
of Dacca, had deprived them of their employment
and means of subsistence; that he had extorted from
them 44,224 Arcot rupees (4,7311. ) by the terror of
his threats, by long imprisonment, and cruel confinement in the stocks; that afterwards they were confined in a small room near the factory-gate, under
a guard of sepoys; that their food was stopped, and
they remained starving a whole day; that they were
not permitted to take their food till next day at
noon, and were again brought back to the same confinement, in which they were continued for six days,
and were not set at liberty until they had given
Mr. Barwell's banian a certificate for forty thousand
rupees; that in July, 1774, when Mr. Barwell had
left Dacca, they went to Calcutta to seek justice;
that Mr. Barwell confined them in his house at Calcutta, and sent them back under a guard of peons to
Dacca; that in December, 1774, on the arrival of the
gentlemen from Europe, they returned to Calcutta,
and preferred their complaint to the Supreme Court
of Judicature.
The bill in Chancery filed against Richard Barwell, John Shakespeare, and others, contains a minute specification of the various acts of personal cruelty said to be practised by Mr. Barwell's orders, to extort money from these people. Among other acts
of a similar nature he is charged with having ordered
the appraiser of the Company's cloths, who was an
old man, and who asserts that he had faithfully
served the Company above sixteen years without
the least censure on his conduct, to be severely
flogged without reason.
? ? ? ? ON THE AFFAIRS OF INDIA. 111
In the manner of confining the delals, with ten of
their servants, it is charged on him, that, " when he
first ordered them to be put into the stocks, it was
at a time when the weather was exceedingly bad
and the rain very heavy, without allowing them the
least covering for their heads or any part of their
body, or anything to raise them from the wet ground;
in which condition they were continued for many
hours, until the said Richard Barwell thought proper
to remove them into a far worse state, if possible,
as if studying to exercise the most cruel acts of barbarity on them, &c. ; and that during their imprisonment they were frequently carried to and tortured ill the stocks ill the middle of the day, when the
scorching heat of the sun was insupportable, notwithstanding which they were denied the least covering. "
These men assert that they had served the Company without blame for thirty years,- a period commencing long before the power of the Company in India.
It was no slight'aggravation of this severity, that
the objects were not young, nor of the lowest of
the people, who might, by the vigor of their constitutions, or by the habits of hardship, be enabled to
bear up against treatment so full of rigor. They
were aged persons; they were men of a reputable
profession.
The account given by these merchants of their first
journey to Calcutta, in July, 1774, is circumstantial
and remarkable. They say, " that, on their arrival,
to their astonishment, they soon learned that the Governor, who had formerly been violently enraged against
the said Richard Barwellfor different improprieties in
his conduct, was now reconciled to him; and that ever
? ? ? ? 112 NINTH REPORT OF SELECT COMMITTEE
since there was a certainty of his Majesty's appointments taking place in India, from being the most inveterate enemies they were now become the most intimate friends; and that this account soon taught them to believe they were not any nearer justice from their journey to Calcutta than they had been before at Dacca. " When this bill of complaint was, in 1776, laid be.
fore the Council, to be transmitted to the Court of
Directors, Mr. Barwell complained of the introduc
tion of such a paper, and asserted, that he had answered to every particular of it on oath about eighteen
months, and that during this long period no attempt
had been made to controvert, refute, or even to reply
to it.
He did not, however, think it proper to enter his
answer on the records along with the bill of whose
introduction he complained.
On the declarations made by Mr. Barwell in his
minute (September, 1776) your Committee observe,
that, considering him only as an individual under
prosecution in a court of justice, it might be sufficient for him to exhibit his defence in the court
where he was accused; but that, as a member of
government, specifically charged before that very
government with abusing the powers of his office
in a very extraordinary manner, and for purposes
(as they allege) highly corrupt and criminal, it appears to your Committee hardly sufficient to say that
he had answered elsewhere. The matter was to go
before the Court of Directors, to whom the question
of his conduct in that situation, a situation of the
highest power and trust, was as much at least a question of state as a matter of redress to be solely left
to the discretion, capacity, or perseverance of indi
? ? ? ? ON THE AFFAIRS OF INDIA. 113
viduals. Mr. Barwell might possibly be generous
enough to take no advantage of his eminent situation; but these unfortunate people would rather look to his power than his disposition. In general, a man
so circumstanced and so charged (though we do not
know this to be the case with Mr. Barwell) might
easily contrive by legal advantages to escape. The
plaintiffs being at a great distance from the seat of
government, and possibly affected by fear or fatigue,
or seeing the impossibility of sustaining with the
ruins of fortunes never perhaps very opulent a suit
against wealth, power, and influence, a compromise
might even take place, in which circumstances might
make the complainants gladly acquiesce. But the
public injury is not in the least repaired by the ac.
quiescence of individuals, as it touched the honor of
the very highest parts of government. In the opinion of your Committee some means ought to have been taken to bring the bill to a discussion on the
merits; or supposing that such decree could not be
obtained by reason of any failure of proceeding on
the part of the plaintiffs, that some process official or
juridical ought to have been instituted against them
which might prove them guilty of slander and defamation in as authentic a manner as they had made their charge, before the Council as well as the Court.
By the determination of Mr. Hurst, and the resolutions of the Board of Trade, it is much to be ap -- prehended that the native mercantile interest must
be exceedingly reduced. The above-mentioned resolutions of the Board of Trade, if executed in their rigor, must almost inevitably accomplish its ruin. .
The subsequent transactions are covered with an
obscurity which your Committee have not been able.
VOL. VIII. 8
? ? ? ? 114 NINTH REPORT OF SELECT COMMITTEE
to dispel. All which they can collect, but that by
no means distinctly, is, that, as those who trade for
the Company in the articles of investment may also
trade for themselves in the same articles, the old opportunities of confounding the capacities must remain, and all the oppressions by which this confusion has been attended. The Company's investments, as
the General Letter from Bengal of the 20th of November, 1775, par. 28, states the matter, " are never at a
stand; advances are made and goods are received all
the year round. " Balances, the grand instrument of
oppression, naturally accumulate on poor manufacturers who are intrusted with money. Where there is
not a vigorous rivalship, not only tolerated, but encouraged, it is impossible ever to redeem the manufacturers from the servitude induced by those unpaid balances.
No such rivalship does exist: the policy practised
and avowed is directly against it. The reason assigned in the Board of Trade's letter of the 28th of
November, 1778, for its making their advances early
in the season is, to prevent the foreign merchants
and private traders interfering with the purchase of
their (the Company's) assortments. " They also refer to the means taken to prevent this interference in
their letter of 26th January, 1779. " It is impossible that the small part of the trade should not fall
into the hands of those who, with the name and authority of the governing persons, have such extensive
contracts in their hands. It appears in evidence that
natives can hardly trade to the best advantage, (your
Committee doubt whether they can trade to any advantage at all,) if not joined with or countenanced
by British subjects. The Directors were in 1775 so
? ? ? ? ON THE AFFAIRS OF INDIA. 115
strongly impressed with this notion, and conceived
the native merchants to have been even then reduced
to so low a state, that, notwithstanding the Company's earnest desire of giving them a preference,
they " doubt whether there are at this time in Bengal native merchants possessed of property adequate to such undertaking, or of credit and responsibility
sufficient to make it safe and prudent to trust them
with such sums as might be necessary to enable them
to fulfil their engagements with the Company. "
The effect which so long continued a monopoly,
followed by a preemption, and then by partial preferences supported by power, must necessarily have in weakening the mercantile capital, and disabling the
merchants from all undertakings of magnitude, is but
too visible. However, a witness of understanding
and credit does not believe the capitals of the natives
to be yet so reduced as to disable them from partaking in the trade, if they were otherwise able to put themselves on an equal footing with Europeans.
The difficulties at the outset will, however, be considerable. For the long continuance of abuse has in some measure conformed the whole trade of the country to its false principle. To make a sudden change, therefore, might destroy the few advantages which attend any trade, without securing those which must flow from one established upon sound mercantile
principles, whenever such a trade can be established.
The fact is, that the forcible direction which the trade
of India has had towards Europe, to the neglect, or
rather to the total abandoning, of the Asiatic, has of
itself tended to carry even the internal business from
the native merchant. The revival of trade in the native hands is of absolute necessity; but your Comn
? ? ? ? 116 NINTH REPORT OF SELECT COMMITTEE
mittee is of Opinion that it will rather be the effect
of a regular-progressive course of endeavors for that
purpose than of any one regulation, however wisely
conceived.
After this examination into the condition of the
trade and traders in the principal articles provided
for the investment to Europe, your Committee proceeded to take into consideration those articles the produce of which, after sale in Bengal, is to form a
part of the fund for the purchase of other articles of
investment, or to make a part of it in kind. These
are, 1st, Opium, --2ndly, Saltpetre, -- and, 3rdly,
Salt. These are all monopolized.
OPIUM.
THE first of the internal authorized monopolies is
that of opium. This drug, extracted from a species
of the poppy, is of extensive consumption in most of
the Eastern markets. The best is produced in the
province of Bahar: in Bengal it is of an inferior sort,
though of late it has been improved. This monopoly
is to be traced to the very origin of our influence in
Bengal. It is stated to have begun at Patna so early
as the year 1761, but it received no considerable degree of strength or consistence until the year 1765, when the acquisition of the Duann6 opened a wide
field for all projects of this nature. It was then
adopted and owned as a resource for persons in
office,- was managed chiefly by the civil servants of
the Patna factory, and for their own benefit. The
policy was justified on the usual principles on which
monopolies are supported, and on some peculiar to
the commodity, to the nature of the trade, and to the
? ? ? ? ON THE AFFAIRS OF INDIA. 117
state of the country: the security against adultera
tion; the prevention of the excessive home consumption of a pernicious drug; the stopping an excessive competition, which by an over-proportioned supply
would at length destroy the market abroad; the inability of the cultivator to proceed in an expensive
and precarious culture without a large advance of
capital; and, lastly, the incapacity of private merchants to supply that capital on the feeble security of wretched farmers.
These were the principal topics on which the monopoly was supported. The last topic leads to a
serious consideration on the state of the country;
for, in pushing it, the gentlemen argued, that, in case
such private merchants should advance the necessary capital, the lower cultivators " would get money in abundance. " Admitting this fact, it seems to be a
part of the policy of this monopoly to prevent the
cultivator from obtaining the natural fruits of his
labor. Dealing with a private merchant, he could
not get money in abundance, unless his commodity
could produce an abundant profit. Further reasons,
relative to the peace and good order of the province,
were assigned for thus preventing the course of trade
from the equitable distribution of the advantages of
the produce, in which the first, the poorest, and the
most laborious producer ought to have his first share.
The cultivators, they add, would squander part of
the money, and not be able to complete their engage.
ments to the full; lawsuits, and even battles, would
ensue between the factors, contending for a deficient
produce; and the farmers would discourage the culture of an object which brought so much disturbance into their d;;,ricts. This competition, the operation
? ? ? ? 118 NINTH REPORT OF SELECT COMMITTEE
of which they endeavor to prevent, is the natural corrective of the abuse, and the best remedy which could
be applied to the disorder, even supposing its probable existence.
Upon whatever reasons or pretences the monopoly
of opium was supported, the real motive appears to
be the profit of those who were in hopes to be concerned in it. As these profits promised to be very
considerable, at length it engaged the attention of
the Company; and after many discussions, and various plans of application, it was at length taken for
their benefit, and the produce of the sale ordered to
be employed in the purchase of goods for their investment.
In the year 1773 it had been taken out of the
hands of the Council of Patna, and leased to two of
the natives, - but for a year only. The contractors
were to supply a certain quantity of opium at a given
price. Half the value was to be paid to those contractors in advance, and the other half on the delivery.
The proceedings on this contract demonstrated the
futility of all the principles on which the monopoly
was founded.
The Council, as a part of their plan,
were obliged, by heavy duties, and by a limitation
of the right of emption of foreign opium to the con
tractors for the home produce, to check the influx
of that commodity from the territories of the Nabob
of Oude and the Rajah of Benares. In these countries no monopoly existed; and yet there the commodity was of such a quality and so abundant as to bear the duty, and even with the duty in some
degree to rival the monopolist even in his own market. There was no complaint in those countries of
? ? ? ? ON THE AFFAIRS OF INDIA. 119
want of advances to cultivators, or of lawsuits and
tumults among the factors; nor was there any appearance of the multitude of other evils which had
been so much dreaded from the vivacity of competition.
On the other hand, several of the precautions inserted in this contract, and repeated in all the subsequent, strongly indicated the evils against which
it is extremely difficult, if not impossible, to guard
a monopoly of this nature and in that country. For
in the first contract entered into with the two natives it was strictly forbidden to compel the tenants
to the cultivation of this drug. Indeed, very shocking rumors had gone abroad, and they were aggravated by an opinion universally prevalent, that, even in the season immediately following that dreadful
famine which swept off one third of the inhabitants
of Bengal, several of the poorer farmers were compelled to plough up the fields they had sown with
grain in order to plant them with poppies for the
benefit of the engrossers of opium. This opinion
grew into a strong presumption, when it was seen
that in the next year the produce of opium (contrary to what might be naturally expected in a year
following such a dearth) was nearly doubled. It
is true, that, when the quantity of land necessary for
the production of the largest quantity of opium is
considered, it is not just to attribute that famine to
these practices, nor to any that were or could be
used; yet, where such practices did prevail, they
must have been very oppressive to individuals, extremely insulting to the feelings of the people, and
must tend to bring great and deserved discredit on
the British government. The English are a people
? ? ? ? 120 NINTH REPORT OF SELECT COMMITTEE
who appear in India as a conquering nation; all
dealing with them is therefore, more or less, a dealing with power. It is such when they trade on a private account; and it is much more so in any
authorized monopoly, where the hand of government, which ought never to appear but to protect,
is felt as the instrument in every act of oppression.
Abuses must exist in a trade and a revenue so constituted, and there is no effectual cure for them but to entirely cut off their cause.
Things continued in this train, until the great
revolution in the Company's government was wrought
by the Regulating Act of the thirteenth of the king;
In 1775 the new Council-General appointed by the
act took this troublesome business again into consideration. General Clavering, Colonel Monson, and Mr. Francis expressed such strong doubts of the
propriety of this and of all other monopolies, that
the Directors, in their letter of the year following,
left the Council at liberty to throw the trade open,
under a duty, if they should find it practicable.
But General Clavering, who most severely censured
monopoly in general, thought that this monopoly
ought to be retained,- but for a reason which shows
his opinion of the wretched state of the country: for
he supposed it impossible, with the power and influence which must attend British subjects in all
their transactions, that monopoly could be avoided;
and he preferred an avowed monopoly, which brought
benefit to government, to a virtual engrossing, attended with profit only to individuals. But in this opinion he did not seem to be joined by Mr. Francis,
who thought the suppression of this and of all monopolies to be practicable, and strongly recommended
? ? ? ? ON THE AFFAIRS OF INDIA. 121
their abolition in a plan sent to the Court of Directors the year following. *
The Council, however, submitting to the opinion
of this necessity, endeavored to render that dubious
engagement as beneficial as possible to the Company. They began by putting up the contract to the
highest bidder. The proposals were to be sealed.
When the seals came to be opened, a very extraordinary scene appeared. Every step in this business
develops more and more the effect of this junction
of public monopoly and private influence. Four
English and eight natives were candidates for the
contract; three of the English far overbid the eight
natives. They who consider that the natives, from
their superior dexterity, from their knowledge of
the country and of business, and from their extreme
industry, vigilance, and parsimony, are generally an
over-match for Europeans, and indeed are, and must
ultimately be, employed by them in all transactions
whatsoever, will find it very extraordinary that they
did not by the best offers secure this dealing to themselves. It can be attributed to this cause, and this
only, - that they were conscious, that, without power
and influence to subdue the cultivators of the land
to their own purposes, they never could afford to
engage on the lowest possible terms. Those whose
power entered into the calculation of their profits
could offer, as they did offer, terms without comparison better; and therefore one of the English bidders, without partiality, secured the preference. The contract to this first bidder, Mr. Griffiths, was
prolonged from year to year; and as during that
* Vide Mr. Francis's plan in Appendix, No. 14, to the Select
Committee's Sixth Report.
? ? ? ? 122 NINTH REPORT OF SELECT COMMITTEE
time frequent complaints were made by him to the
Council Board, on the principle that the years answered very differently, and that the. business of one
year ran into the other, reasons or excuses were furnished for giving the next contract to Mr. Mackenzie
for three years. This third contract was not put up
to auction, as the second had been, and as this ought
to have been. The terms were, indeed, something
better for the Company; and the engagement was
subject to qualifications, which, though they did not
remove the objection to the breach of the Company's
orders, prevented the hands of the Directors from being tied up. A proviso was inserted in the contract,
that it should not be anyways binding, if the Company by orders from home should alter the existing
practice with regard to such dealing.
Whilst these things were going on, the evils which
this monopoly was in show and pretence formed to
prevent still existed, and those which were naturally
to be expected from a monopoly existed too. Complaints were made of the bad quality of the opium;
trials were made, and on those trials the opium was
found faulty. An office of inspection at Calcutta, to
ascertain its goodness, was established, and directions
given to the Provincial Councils at the places of
growth to certify the quantity and quality of the coinmodity transmitted to the Presidency.
In 1776, notwithstanding an engagement in the
contract strictly prohibiting all compulsory culture of
the poppy, information was given to a member of the
Council-General, that fields green with rice had been
forcibly ploughed up to make way for that plant,and that this was done in the presence of several English gentlemen, who beheld the spectacle with a just
? ? ? ? ON THE AFFAIRS OF INDIA. 123
and natural indignation. The board, struck with
this representation, ordered the Council of Patna to
make an inquiry into the fact; but your Committee
tan find no return whatsoever to this order. The
complaints were not solely on the part of the cultivators against the contractor. The contractor for opium made loud complaints against the inferior collectors of the landed revenue, stating their undue and vexatious exactions from the cultivators of opium, -
their throwing these unfortunate people into prison
upon frivolous pretences, by which the tenants were
ruined, and the contractor's advances lost. He stated, that, if the contractor should interfere in favor
of the cultivator, then a deficiency would be caused
to appear in the landed revenues, and that deficiency would be charged on his interposition; he
desired, therefore, that the cultivators of opium
should be taken out of the general system of the
landed revenue, and put under " his protection. "
Here the effect naturally to be expected from the
clashing of inconsistent revenues appeared in its full
light, as well as the state of the unfortunate peasants
of Bengal between such rival protectors, where the
ploughman, flying from the tax-gatherer, is obliged
to take refuge under the wings of the monopolist.
No dispute arises amongst the English subjects which
does not divulge the misery of the natives; when the
former are in harmony, all is well with the latter.
This monopoly continuing and gathering strength
through a succession of contractors, and being probably a most lucrative dealing, it grew to be every
day a greater object of competition. The Council of
Patna endeavored to recover the contract, or at least
the agency, by the most inviting terms; and in this
? ? ? ? 124 NINTH REPORT OF SELECT COMMITTEE
eager state of mutual complaint and competition
between private men and public bodies things continued until the arrival in Bengal of Mr. Stephen
Sulivan, son of Mr. Sulivan, Chairman of the East
India Company, which soon put an end to all strife
and emulation.
To form a clear judgment on the decisive step
taken at this period, it is proper to keep in view the
opinion of the Court of Directors concerning monopolies, against which they had uniformly declared in
the most precise terms. They never submitted to
them, but as to a present necessity; it was therefore
not necessary for them to express any particular approbation of a clause in Mr. Mackenzie's contract
which was made in favor of their own liberty.
Every motive led them to preserve it. On the
security of that clause they could alone have suffered to pass over in silence (for they never approved) the grant of the contract which contained it for three years. It must also be remembered that
they had from the beginning positively directed that
the contract should be put up to public auction;
and this not having been done in Mr. Mackenzie's
case, they severely reprimanded the Governor-General and Council in their letter of the 23rd December, 1778.
The Court of Directors were perfectly right in
showing themselves tenacious of this regulation,not so much to secure the best practicable revenue
from their monopoly whilst it existed, but for a much
more essential reason, that is, from the corrective
which this method administered to that monopoly
itself: it prevented the British contractor from becoming doubly terrible to the natives, when they
? ? ? ? ON THE AFFAIRS OF INDIA. 125
should see that his contract was in effect a grant, and
therefore indicated particular favor and private influence with the ruling members of an absolute government.
On the expiration of Mr. Mackenzie's term, and
but a few months after Mr. Sulivan's arrival, the
Governor-General, as if the contract was a matter
of patronage, and not of dealing, pitched upon Mr.
Sulivan as the most proper person for the management of this critical concern. Mr. Sulivan, though a
perfect stranger to Bengal, and to that sort and to all
sorts of local commerce, made no difficulty of accepting it. The Governor-General was so fearful that his
true motives in this business should be mistaken, or
that the smallest suspicion should arise of his attending to the Company's orders, that, far from putting
up the contract (which, on account of its known
profits, had become the object of such pursuit) to
public auction, he did not wait for receiving so much
as a private proposal from Mr. Sulivan. The Secretary perceived that in the rough draught of the contract the old recital of a proposal to the board was inserted as a matter of course, but was contrary to
the fact; he therefore remarked it to Mr. Hastings.
Mr Hastings, with great indifference, ordered that
recital to be omitted; and the omission, with the remark that led to it, has, with the same easy indifference, been sent over to his masters.
The Governor-General and Council declare themselves apprehensive that Mr. Sulivan might be a loser
by his bargain, upon account of troubles which they
supposed existing in the country which was the object
of it. This was the more indulgent, because the contractor was tolerably secured against all losses. He
? ? ? ? 126 NINTH REPORT OF SELECT COMMITTEE
received a certain price for his commodity; but he was
not obliged to pay any certain price to the cultivator,
who, having no other market than his, must sell it to
him at his own terms. He was to receive half the
yearly payment by advance, and he was not obliged
to advance to the cultivator more than what he
thought expedient; but if this should not be enough,
he might, if he pleased, draw the whole payment before the total delivery: such were the terms of the
engagement with him. He is a contractor of a new
species, who employs no capital whatsoever of his
own, and has the market of compulsion at his entire command. But all these securities were not
sufficient for the anxious attention of the Supreme
Council to Mr. Sulivan's welfare: Mr. Hastings had
before given him the contract without any proposal on his part; and to make their gift perfect, in
a second instance they proceed a step beyond their
former ill precedent, and they contract with Mr. Sulivan for four years.
Nothing appears to have been considered but the
benefit of the contractor, and for this purpose the
solicitude shown in all the provisions could not be
exceeded. One of the first things that struck Mr.
Hastings as a blemish on his gift was the largeness
of the penalty which he had on former occasions settled as the sanction of the contract: this he now discovered to be so great as to be likely to frustrate its end by the impossibility of recovering so large a sum.
How a large penalty can prevent the recovery of any,
even the smallest part of it, is not quite apparent.
In so vast a concern as that of opium, a fraud which
at first view may not appear of much importance,
and which may be very difficult in the discovery,
? ? ? ? ON THE AFFAIRS OF INDIA. 127
may easily counterbalance the reduced penalty in this
contract, which was settled in favor of Mr. Sulivan at
about 20,0001.
Monopolies were (as the House has observed) only tolerated evils, and at best upon trial; a clause,
therefore, was inserted in the contracts to Mackenzie,
annulling the obligation, if the Court of Directors
should resolve to abolish the monopoly; but at the
request of Mr. Sulivan the contract was without difficulty purged of this obnoxious clause. The term
was made absolute, the monopoly rendered irrevocable, and the discretion of the Directors wholly excluded. Mr. Hastings declared the reserved condition to be no longer necessary, " because the Directors
had approved the monopoly. "
The Chiefs and Councils at the principal factories
had been obliged to certify the quantity and quality
of the opium before its transport to Calcutta; and
their control over the contractor had been assigned
as the reason for not leaving to those factories the
management of this monopoly. Now things were
changed. Orders were sent to discontinue this measure of invidious precaution, and the opium was sent
to Calcutta without anything done to ascertain its
quality or even its quantity.
An office of inspection had been also appointed
to examine the quality of the opium on its delivery
at the capital settlement. In order to ease Mr. Sulivan from this troublesome formality, Mr. Hastings
abolished the office; so that Mr. Sulivan was then
totally freed from all examination or control whatsoever, either first or last.
These extraordinary changes in favor of Mr. Sulivan were attended with losses to others, and seem to
? ? ? ? 128 NINTH REPORT OF SELECT COMMITTEE
have excited much discontent. This discontent it
was necessary in some manner to appease. The
vendue-master, who was deprived of his accustomed
dues on the public sales of the opium by the private dealing, made a formal complaint to the board
against this, as well as other proceedings relative to
the same business. He attributed the private sale
to " reasons of state "; and this strong reflection both
on the Board of Trade and the Council Board was
passed over without observation. He was quieted by
appointing him to the duty of these very inspectors
whose office had been just abolished as useless. The
House will judge of the efficacy of the revival of this
office by the motives to it, and by Mr. Hastings giving that to one as a compensation which had been executed by several as a duty. However, the orders for taking away the precautionary inspection at Patna
still remained in force.
Some benefits, which had been given to former contractors at the discretion of the board, were no longer
held under that loose indulgence, but were secured to
Mr. Sulivan by his contract. Other indulgences, of a
lesser nature, and to which no considerable objection
could be made, were on the application of a Mr.
Benn, calling himself his attorney, granted.
Your Committee, examining Mr. Higginson, late a
member of the Board of Trade, on that subject, were
illformed, that this contract, very soon after the makilg, was generally understood at Calcutta to have
been sold to this Mr. Benn, but he could not particularize the sum for which it had been assigned, -- and
that Mr. Benn had afterwards sold it to a Mr. Young.
By this transaction it appears clearly that the contract
was given to Mr. Sulivan for no other purpose than
? ? ? ? ON THE AFFAIRS OF INDIA. 129
to supply him with a sum of money; and the sale and
re-sale seem strongly to indicate that the reduction of
the penalty, and the other favorable conditions, were
not granted for his ease in a business which he never
was to execute, but to heighten the value of the object
which he was to sell. Mr. Sulivan was at the time in
Mr. Hastings's family, accompanied him in his progresses, and held the office of Judge-Advocate.
The monopoly given for these purposes thus permanently secured, all power of reformation cut off,
and almost every precaution against fraud and oppression removed, the Supreme Council found, or pretended to find, that the commodity for which they had just made such a contract was not a salable article, -- and in consequence of this opinion, or pretence,,
entered upon a daring speculation hitherto unthought
of, that of sending the commodity on the Company's
account to the market of Canton. The Council alleged, that, the Dutch being driven from Bengal, and
the seas being infested with privateers, this commodity had none, or a very dull and depreciated demand.
Had this been true, Mr. Hastings's conduct could
admit of no excuse. He ought not to burden a, falling
market by long and heavy engagements. He, ought
studiously to have kept in his power the means of
proportioning the supply to the demand. But his:
arguments, and those of the Council on that occasionl, do not deserve the smallest attention. Facts, to
which there is no testimony but the assertion of those
who produce them in apology for the ill consequences
of their own irregular actions, cannot be admitted.
Mr. Hastings and the Council had nothing at all to
do with that business: the Court of Directors had
wholly taken the management of opium out of his.
VOL VIII. 9
? ? ? ? 130 NINTH REPORT OF SELECT COMMITTEE
and their hands, and by a solemn adjudication fixed
it in the Board of Trade. But after it had continued there some years, Mr. Hastings, a little before his
grant of the monopoly to Mr. Sulivan, thought proper
to reverse the decree of his masters, and by his own
authority to recall it to the Council. By this step he
became responsible for all the consequences.
The Board of Trade appear, indeed, to merit reprelelnsion for disposing of the opium by private contract,
as by that means the unerring standard of the public
market cannot be applied to it. But they justified
themselves by their success; and one of their members informed your Committee that their last sale had
been a good one: and though he apprehended a fall
in the next, it was not such as in the opinion of your
Committee could justify the Council-General in having recourse to untried and hazardous speculations of
commerce. It appears that there must have been a
market, and one sufficiently lively. They assign as a
reason of this assigned [alleged? ] dulness of demand,
that the Dutch had been expelled from Bengal, and
could not carry the usual quantity to Batavia. But
the Danes were not expelled from Bengal, and Portuguese ships traded there: neither of them were interdicted at Batavia, and the trade to the eastern ports was free to them. The Danes actually applied for and
obtained an increase of the quantity to which their
purchases had been limited; and as they asked, so they
received this indulgence as a great favor. It does not
appear that they were not very ready to supply the
place of the Dutch. On the other hand, there is no
doubt that the Dutch would most gladly receive an
article, convenient, if not necessary, to the circulation of their commerce, from the Danes, or under any
? ?
