In September 1599, as William Shakespeare was putting the finishing touches to Hamlet, in Southwark, a mile to the north across the Thames, a group of London merchants, artisans, adventurer and privateers formed history’s first joint-stock, limited-liability company with tradeable shares.

The East India Company developed over two centuries into “a state in the guise of a merchant”, to use English politician Burke’s phrase, with a private army 260,000 strong – twice as large as that of Britain at the time, and the proving ground of many celebrated British officers, the most famous of those being Arthur Wellesley, later to become the Duke of Wellington and who at the time of his Indian service, was the capable younger brother of the equally capable Richard Wellesley, Governor General of the principality Bengal, the keystone of the British hold on the Indian subcontinent.

At its peak, it had built a third of London’s docklands, its annual expenditure was half that of the British government, and it oversaw a third of the country’s imports and exports. For Britain, the East India Company was a gift that kept on giving. Unwittingly and haphazardly, it established and solidified British power in India and China, seeing off their European colonial competitors – the French and the Dutch, who also coveted a piece of the Indian action – and overseeing the transfer west of massive wealth to the home country. It set the keystone for the British Empire, with India, “The Raj”, the jewel in the crown.

William Dalrymple, author, historian, Indophile and longtime resident of India, has written a page-turner of a book called The Anarchy about the rise and fall of what became known as ‘The Honourable Company’ – yes, that’s what it was called with no hint of irony! It is a harrowing tale of how a small limited stock company managed to build an empire.

When the East India Company was first established, the Britain had about 1% of world GDP compared to 43% per cent for Mughal India. By the time it was wound down over one hundred and fifty years later, it had more or less inverted that. In co-opting, corrupting and conquering the powerful warlords of the fractious Mughal Empire, it effectively established the British Empire and in the process, destroyed India’s sovereignty, economy and society. The word “loot” is of Indian origin – it came to symbolize how the company drained the blood from India’s veins, sucked the marrow from out of Its bones, and sending its wealth back to Britain, many historians argue, substantially financed the nascent industrial revolution.

Sepoys of the East India Company

Granted the right to ‘‘wage war’’ in its royal charter, the Honourable Company was the first multinational corporation to run amok (a Malay word for unrestrained rampage) on a grand scale. Having established itself in eastern India, by 1765 it had control of a production and distribution network for opium that was illegally imported into China, sowing the seeds for the Opium Wars – and a Chinese animus that resonates to this day. It bought Chinese tea, which it sold in Britain and the continent, and established tea plantations in India. It was in fact company tea that ended up in Boston Harbour in 1773 – fear of what the company could do if it was granted access to the New World was one of the causes of the American Revolution.

The company effectively bankrolled the British economy, yet ironically, it was also the Bank of England’s largest creditor. It could also be said to have invented corporate lobbying. Members of the British Parliament were on retainers, and were offered shares in exchange for extending the company’s monopolies: some  two-fifths of British MPs held stock, including most members of the cabinet. Many members were in fact former employees who had repatriated millions of pounds in ill gotten gains from Bengal.  And yet, it overextended itself and its resources and was on the verge of insolvency. The contrast between the bankruptcy of the company and the vast riches of its employees was too stark not to be investigated, and indeed it was. but was deemed “too big to fail”,  and was bailed out by the British government  in 1773.

The Company’s premier enabler and exemplar was the first governor of the Bengal Presidency, Robert Clive, or Lord Clive of Plassey, as he was ennobled after a battle that demonstrated the aphorism that one should never enter a gunfight armed with just a knife. But wasn’t that just how the East – and West – was won?

Clive was a humble accountant labouring on the ledgers, but found his calling as a soldier (just like the Spanish conquistador Hernàn Cortéz “the killer” – as Neil Young called him), and rose to great heights of power and riches through remarkable grit and graft. When arraigned by parliament for his rapacity – and acquitted – he exclaimed: “My God, Mr. Chairman, at this moment I stand astonished at my own moderation!”

If ever you are in London, visit the small, quiet and shady Berkeley Square, where the fabled nightingale sang, and where Clive of India, as he became known, his mind curdled by corruption and conscience, and haunted by guilt and ghosts, cut his own throat with a blunt paper-knife. “How are the mighty fallen”. Leonard Cohen’s poet King David said that. “Not often enough!”  I said that.

Eventually, the company – whose lobbying efforts saw its original fifteen year charter last for 274 years – became an embarrassment for the English government and establishment. Its Indian “subjects” rebelled unexpectedly and violently in the Great Rebellion of 1857, and it was only by considerable military effort and repression that the British Army was able to save the company and its Indian ’empire”. In the wake of what the British called The Indian Mutiny, which saw cruel atrocities committed by Indians and Britons alike, tens of thousands of rebel sepoys (Indian soldiers in the company’s employ) were executed in vicious reprisal. As George McDonald Fraser’s antihero says in Flashman in the Great Game, “there’s nothing as cruel as a justified Christian”. Assuming full control, the British government nationalized the company in 1859. Long outliving its purpose it was wound down in 1874. Read more about what the British did for India in Weighing the White Man’s Burden  

Imagine today, a protection racket at the heart of government with the complicity of the British establishment, A company with the global reach of Facebook and Google, the economic tentacles of the likes of Halliburton and Exxon, and the military reach of Erik Prince’s mercenary armies. The corruption and criminality of the now defunct and disgraced BCAC (the so-called “Bank of Crooks and Criminals”), and the immunity and impunity of all the big corporates who took the world for a ride in the Global Financial Crisis, and not only got away with it, got governments to bail them out and we’re permitted to persist with their banditry. As Dalrymple himself has put it, The East India Company was literally Facebook with guns!

Read more about India and The Raj in In That Howling Infinite: Weighing the White Man’s Burden; Freedom at Midnight (1): the birth of India and Pakistan; Freedom at Midnight (2): the legacy of partition ; and Paradise Lost – Kashmir’s bitter legacy

Flashman in the Great Game

The Indian Mutiny – Weighing the White Man’s Burden