In the Shadow of the Companies: Empires of Trade in the Orient and Informal
Entrepreneurship 1
Chris Nierstrasz (University of Warwick)
When we scratch the façade of monopoly of the Dutch (VOC) and English (EIC) East India
Companies, we find a fascinating world of private initiative and entrepreneurship. This
private initiative, which most known manifestation was private trade, was a doubly-headed
serpent for the companies, feeding it but also zapping its energy due to its venomous
nature. For historians, the understanding of how companies used private entrepreneurship
is the only way to lead them to a complete understanding of their functioning. This
viewpoint has to replace the old view of Holden Furber that the English Company was more
open to private initiative than the Dutch East India Company and thus had a competitive
edge.2 In order to do so, this article will first argue that private trade was differently
organized and, more importantly, focused, when we compare the two companies, but also
followed the same logic. This leads to a couple of questions that need to be answered. Both
the VOC and the EIC dramatically expanded their trade to Europe in the eighteenth century,
but both found ways to avoid sending over more silver. How was this possible and what is
the connection to private entrepreneurship? What was the role of private trade in the Dutch
and English East India Companies? How did the companies and private trade, both in Asia
and to Europe, interact over time? How was private trade negotiated? What were the limits
of private trade and the interaction with empire? Why did the EIC evolve into a higher level
of interaction with Asia and the VOC not? Are there any other ways of seeing private
entrepreneurship that can help us explain the development of both companies in the
eighteenth century?
1 The expansion of trade to Europe
If we look at the main goal of the Dutch and English East India Companies, trade from Asia
to Europe, both companies greatly increased their trade to Europe in the eighteenth
century. Over the whole period the trade of the VOC was increasing, both in the value of
goods brought to Europe as in their value of sales. The total purchase price of the Asian
goods rose from 250 million in the seventeenth century to 600 million in the eighteenth
century.3 The growth of the English East India Company was even more extreme, partly as a
result of poor results up to 1700, its trade grew tenfold in the eighteenth century. 4 From the
1
The research leading to these results has received funding from the European Research Council under the
European Union's Seventh Framework Programme (FP/2007-2013)/ERC Grant Agreement no. 249362. The title
of the project directed by Professor Maxine Berg at Warwick University is 'Europe's Asian Centuries: Trading
Eurasia 1600-1830'.
2
Holden Furber, Rival Empires of Trade in the Orient, 1600-1800 (London: Oxford University Press, 1976)
3
Els Jacobs, Merchant in Asia: the Trade of the Dutch East India Company during the Eighteenth Century
(Leiden: CNWS Publications, 2006), 6.
4
Furber, Rival Empires of Trade, 89-145.
Bowen dataset, we can see that the value of imports from Asia of the EIC almost tripled
between 1760 and 1790.5 Miraculous growth of trade in both cases was not achieved by a
growth of the consumption of spices, but was occasioned by the rise in consumption of new
goods such as textiles, silks, coffee and tea. The English eventually took the lead in these
news trades, while the VOC followed them close behind.6 Apart from the English and Dutch
companies, smaller companies, such as the French, Swedish, Danish and Ostend Companies,
show that expansion of trade cannot simply be caught by only looking at the Dutch and
English companies. These smaller companies, in turn, were also responsible for a further
expansion of trade to Europe. Their trade was strongly specialized in certain products or in
certain regions where these new goods were found.7 How was it possible that both the VOC
and the EIC, in a theater of increasing competition, dramatically expanded their trade in the
eighteenth century without sending out more silver from Europe?
1.1 The problem of Silver
In order to achieve the necessary growth, both the Dutch and the English East India
companies tried to finance trade to Europe from Asia in order to increase their purchasing
power in Asia. Silver was normally brought from Europe to Asia to pay for the goods the
companies returned, but alternatives existed, for instance the acceptance of bills of
exchange. The money accepted on bills of exchange consisted of private fortunes of
Europeans in Asia, often in the service of companies, who wanted to return their money to
Europe. The interaction between these two is interesting, as silver was a precious thing to
export. In theory, companies must have had a preference for bills of exchange as it excluded
the risk of losing the silver on the way out and stopped silver flowing from their country.
This seems truer for the EIC than for the VOC, as the VOC, before it had to resort to bills of
exchange, in the seventeenth century found a different alternative to the export of silver.
In the seventeenth century, the Dutch East India Company was the most successful
Company in playing the card of limiting its export of silver to Asia. The profits from the trade
the VOC conducted within Asia were responsible for this remarkable phenomenon. The VOC
skillfully organized its intra-Asian trade as a monopoly tailored to cover the financial
demands of its European trade.8 It provided direct profit as the Asian market provided for
ample opportunities of profit for trade, certainly in combination with its enforced control
over the smaller spices islands. 9 The profit from this trade was directly used to finance the
trade with Europe. At the same time, the intra-Asian trade provided the means for the VOC
to obtain goods for Europe at a better price as it had more to offer to Asian merchants in
return. 10 Silver was not wanted all over Asia as it did not serve useful purposes other
5
See Bowen dataset
Femme Gaastra, The Dutch East India Company: Expansion and Decline (Zutphen: Walburg Press, 2003), 12938.
7
Furber, Rival Empires, 211-29.
8
Jonathan Israel, The Dutch Republic: its Rise, Greatness, and Fall 1477-1800 (Oxford: Clarendon Press, 1998),
941-3 and Jacobs, Merchant in Asia, 1-4.
9
Israel, The Dutch Republic, 941-43 and Jacobs, Merchant in Asia, 1-4.
10
Gaastra, The Dutch East India Company, 121-3; Jacobs, Merchant in Asia, 1-12.
6
commodities, such as textiles, did. Direct or indirect profits from intra-Asian trade are
completely or partially responsible for the low amounts of silver the VOC exported from
1630 until 1680. The monopoly on intra-Asian trade aimed at all subjects of the VOC focused
all possible profit from Asia on the European trade. The success of the system is clearly
distinguishable as for a period of 50 years, the VOC increased its trade simply by ploughing
profits from the intra-Asian trade into the European trade. As such, the VOC simply received
back more from Asia in goods in purchase value than the value of silver it had sent to pay for
these cargos.
Femme Gaastra has shown that the VOC system of using profits from the intra-Asian
trade to finance trade to Europe, structurally changed after 1680.11 The VOC was no longer
capable of increasing profits from the intra-Asian trade to keep up with its expanding trade
to Europe and with increasing costs in Asia. After 1680, there was a sharp increase in
exports of silver which only ended after 1730, when exports of silver stabilized. Between
1680 and 1730, the export of more silver brought new problems for the VOC.12 Exporting
more silver simply meant borrowing more silver on short-term loans, but the limits of such a
policy soon became clear. As the ships returned the following year with what they had
purchased in Asia, the VOC paid off its loans with interest. There was, however, one
problem, namely that the VOC was unable to pay off all short-term loan, signifying that the
profits on trade were not enough to off-set the total costs of the trade. This meant that
short-term loans slowly transformed into long-term debts, which to some extent was not a
problem as the VOC had plenty of assets on its balance. Debts in the Republic of Seven
Provinces rose until in 1736 the Gentlemen XVII, the Directors of the VOC, decided to step in
and limit the loans. It was feared that the debt and the interest would otherwise spin out of
control and that the VOC would be toppled by its payment of the rents on its debts or by a
cash-flow problem.13
When it proved difficult to export more silver from Europe, the VOC turned to a
different way of financing trade, namely through accepting more money on bills of exchange
in Asia. In 1741, the Gentlemen Seventeen decided to double the amount accepted for
Europe to 2 million guilders, slowly climbing to 3 million in 1771. This meant that a total of
237 million guilders was accepted in the eighteenth century. This is a very sharp contrast
with the seventeenth century when only 30 million had been accepted.14 In the literature
this is often linked to the increasing acceptance of English money to increase Dutch trade.
11
Femme Gaastra, ‘De Verenigde Oost-Indische Compagnie in de zeventiende en achttiende eeuw: de groei
van een bedrijf. Geld tegen goederen. Een structurele verandering in het Nederlands-Aziatisch
handelsverkeer’, in Bijdragen en mededelingen betreffende de geschiedenis der Nederlanden 91 (1976), 249-72
and Femme Gaastra, Bewind en beleid bij de VOC: de financiële en commerciële politiek van de bewindhebbers,
1672-1702 (Zutphen: Walburg Pers, 1989) and Gaastra, The Dutch East India Company, 132.
12
J . R Bruijn, F. S. Gaastra and I. Schöffer, Dutch-Asiatic Shipping in the 17th and 18th Centuries (The Hague:
Nijhoff, 1979-1987) and Om Prakash, ‘Precious-metal Flows in India, Early Modern Period’, in Dennis Flynn,
Arturo Giraldez and Richard von Glahn (eds.), Global Connections and Monetary History, 1470-1800 (Aldershot:
Ashgate, 2003).
13
J. P. de Korte, De jaarlijkse financiële verantwoording in de VOC, Verenigde Oostindische Compagnie (Leiden:
Nijhoff, 1984) and Femme Gaastra, The Dutch East India Company: Expansion and Decline (Zutphen: Walburg
Pers, 2003).
14
Femme Gaastra, ‘Particuliere geldstromen binnen het VOC-bedrijf 1640-1795’. Van Gelderlezing 2002, 16-26
and Femme Gaastra, ‘Private Money for Company Trade: The Role of Bills of Exchange in Financing the Return
Cargoes of the VOC’, in Itinerario 13/1 (1994), 65-76.
The timing of the increase (1741) and the moment English really made inroads into the
Dutch bills of exchange does not fit. Increases in English demands and granting of English
bills of exchange mainly occurred after 1771 and even more after 1780.15 Yet the increase in
acceptance of bills exchange already started in the 1740s.
In the English case, silver was the main means of financing trade up to Empire
(1757). Before 1680, the English tried to copy the Dutch system of monopoly of intra-Asian
trade, but this attempt failed miserably. Without territorial control of the spices islands or
other territories in Asia, such a system did not make much sense. It was deemed better to
allow servants the right to conduct private trade and gain income from taxation. Still, as we
will see later on, the EIC kept on conducting trade in Asia if it did suit its trade. The failure of
the monopoly system meant the EIC had to rely strongly on exports of silver for its trade.
Chaudhuri has shown that the exports increased until 1757 and that this was completely in
line with the growth of trade.16 Bowen has shown that after 1760 the situation radically
changed as the EIC drastically reduced its exports of silver in favour of accepting bills of
exchange both in India and in China. In the period between 1760 and 1799 the amount of
bills of exchange the EIC accepted doubled.17 The acceptance of more bills of exchange by
the EIC was sometimes troublesome. The strong growth of bills of exchange with the
conquest of Bengal occasioned troubles in England when the Company defaulted on their
payment in 1772.18 At the same time, the emergences of the phenomena of nabobs, richly
returning servants who had made their fortunes in Asia, is said to have been accompanied
with an increasing acceptance of bills of exchange.19 The EIC even used the acceptance of
bills of exchange from Bengal in China as a means to stimulate its trade from China to
Europe. In turn, the acceptance of bills of exchange in China, boosted English private trade
between Indian and China, as these merchants brought goods of trade to China. In order to
keep up, other companies also started accepting British money in Bengal and China, which
meant a boost for their trade.20
1.2 Answers in Asia
Both companies used profits form the intra-Asian trade to limit the amounts of silver send to Asia. In
the traditional way of seeing the manner in which this intra-Asian trade was organized, historians
generally make a strong division between the VOC and the EIC. The early success of the VOC in
15
Gaastra, ‘Private Money for Company Trade’, 65-76 and Femme Gaastra, ‘De VOC en EIC in Bengalen aan de
vooravond van de vierde Engelse oorlog (1780–84)’, in Tijdschrift voor zeegeschiedenis, 20 (2001), 24-35.
Famous cases are those of VOC Director Ross in Bengal, who helped send English money to the Republic prior
to 1780.
16
K.N. Chaudhuri, The Trading World of Asia and the English East India Company, 1660-1760 (Cambridge:
Cambridge University Press, 1978), 512, Appendix 5, Table C.4
17
Bowen dataset
18
Lucy Sutherland, The East India Company in eighteenth-century politics (Hyperion Press, 1952), 213-239.
19
Tillman Nechtman, Nabobs:Empire and Identity in Eighteenth-Century Britain (Cambridge University Press,
2010).
20
Gaastra, ‘The Role of British Capital in Financing the Trade of the VOC Factory in Bengal, c.1760-1795’ in J.
Everaert and J. Parmentier (eds.), Shipping, Factories and Colonization (Brussels: Koninklijke Academie voor
Overzeese Wetenschappen, 1996), 21-8.
accruing income from its monopoly on intra-Asian trade, meant the VOC was seen as a monopolist
of intra-Asian trade for the whole of its existence. In opposition, the failure of the EIC in
monopolizing intra-Asian trade in the 17th century and the subsequent freedom of trade in the intraAsian trade have made them the champions of liberalization of trade. Needless to say, in the analysis
of success this liberalization of the EIC has been seen as key in its success against the VOC and other
competitors and even as the prime reason for the successful conquest of Bengal.21 Still, there are
many alternative ways of seeing these developments and in the rest of this paper I want to show
that private trade has to be seen in a different light. Are the above caricatures correct? What was
the role of private trade in the Dutch and English East India Companies?
2
Private trade
The Companies had a clear interest in their servants increasing their fortunes and in them
sending fortunes home. Private trade has always been seen as the most important way for
servants to make a fortune, or to put in the words of Nicholas Dirks: ‘If the Company
allowed no private trade, their servants must starve.’22 Still, to understand the interaction
between private trade and companies, we need to see the overall picture of private trade.
How did the companies and private trade, both in Asia and to Europe, interact over time? In
the end we will find that both companies constantly used private trade to suit their needs.
How was private trade negotiated? Was there a constant negotiation process going on,
which can be studied in its own right? And who was calling the shots, the companies or the
private traders?
2.1 Private initiative and trade to Europe
The caricature of East India Companies as monopolistic is hard to maintain even for the trade to
Europe, as both simply had strategies pursuing both monopoly and private trade. The trade was
increasingly financed from Asia, which is exemplified by the earlier mentioned amounts accepted by
both companies on bills of exchange for Europe, which rose to unprecedented heights. Still we want
to take the argument a step further, by looking at two different ways of private participation in
trade. There were two other ways of participating in the trade to Europe other than through bills of
exchange on Europe. Private trade goods have been sent along with the Company ships as part of
the privilege of the VOC servants on ships. Secondly, for some goods in some periods it was possible
to send home privately owned goods on the returning vessels against payment of recognition for
their monopoly to the companies. These trades should be seen as part of the overall trading strategy
of companies.
Private trade on ships to Europe was a normal phenomenon as Company officials were
allowed space on ships to pursue such a trade. The fact that sea fearing personal had such privileges
21
Bruce Watson, Foundation for Empire, English Private trade in India 1659-1760 (New Delhi: Vikas 1980).
Nicholas Dirks, The Scandal of Empire: India and the Creation of Imperial Britain (Cambridge, MA: The
Belknap Press of Harvard University Press, 2006), 38. ‘If the Company allowed no private trade, their servants
must starve.’
22
has been acknowledged, from sailors to captains, both for the EIC and the VOC. These most
substantial privileges were given to the officers, whose chests were considered the way they could
make their fortune, a logical consequence of their low wages.23 When the VOC worried about the
profitability of this reward, it could be augmented or decreased.24 Less know is that other VOC
servants in Asia received similar rights, although it is hard to generalize as the Company constantly
regulated and changed the rules. High officials on their return trip to Europe, often received chests
on homebound ships too, and profited from privileges similar to the officers on ships.25 Over the
eighteenth century the VOC grew increasingly worried that the combination of all the privileges of
crates was harming its profits. The trade must have been substantial, as it led to an organized trade
in chests enhancing every possible part of privilege part to the outmost:
‘(...) Among her wage-earning servants and some permitted civilians, who against the charters and
‘placaten’ of the Gentlemen Seventeen in the fatherland and de High Government in these lands, are
undercutting and harming the Company’s exclusive allowance of trade, as much as they can and to
the enormous damage and final ruin of the Company, apart from other practices and private acts, also
meddle with supplying and preparing many privileged crates for the fatherland. In order to do so, they
misuse the fact that according to rank, all can bring a chest on home faring ships. Although many and
most among those who possesses such privileges possess not so much, would even be less able to fill
these chests with their own wares. (... ) such as white and painted cloth and cloths of silk, etc, which
have been brought in to the noticeable damage and harm of the Company’s authorized and chartered
trade, whilst these traders are the cause, that every year in the fatherland the markets and shops are
filled with these private trade goods, before the Company can supply them. 26 (…)’
Apparently, crates were traded, sold to enhance trade of certain individuals, who were in the best
position to provide goods for the market. In the intra-Asian trade we have an example of how the
export from the Coromandel Coast to Batavia was monopolized by the Governor of the Coast. As he
held the power over what could be obtained at the Coast, sea faring officers had no other possibility
to make a deal with him or sell him his crates. In this manner he succeeded in extremely enhancing
his permitted trade with purchases and deals on other parcels.27 The Companies in turn, did their
outmost to cut back on excess, by providing regulations on numbers of chest and their dimensions
23
Jaap Bruin, Commanders of Dutch East India Ships in the Eighteenth Century (Woodbridge: Boydell & Brewer,
2011), 204-224.
24
J.A. van der Chijs, Nederlandsch-Indisch Plakaatboek, 1602-1811 (The Hague: Martinus Nijhoff, 1889), V,
245-246, 17 Julij 1752, Verdubbeling van de gepermitteerde lasten voor kapiteins ter zee, kapitein-luitenants
en schippers.
25
Nederlandsch-Indisch Plakaatboek, IV, 346, 15 september 1733, Toekenningaan den eersten Secretaris der
Hooge regering van het regt tot het medenemen van dezelfde bagage naar Nederland als aan Gouverneurs,
Directeuren en Raden van justitie was toegestaan nevens 36 kanassers thee
26
Nederlandsch-Indisch Plakaatboek, IV, 108-112, 27 September1717, (..) soo veel haer doenlyk is, bevorderen
en stabileren een handel van vele voornaemste Indise waeren, en onder deselve groote qualiteyten van de
fynste en beste manufacturen deser lden, als witte en geschilderde lywaten en stoffen van zyde, enz, tot
merckelyke schade en afbreuk van de Comp in haeren geauthoriseerden en geoctroyeerden handel, dewyl
soodanige reders en handelaers oorsaek syn, dat jaerlyks in het vaderland de marcten en winckels met die
particuliere goederen syn vervult, voordat de Comp de haredebiteren kan (...).
27
J.C. Nierstrasz, In the Shadow of the Company, The Dutch East India Company and its Servants, 1740-1796
(Leiden: Brill 2012), 96, table 2.
and prohibitions on the most valuable items of their own trade.28 The EIC also had to allow chests
on its ships to Europe, but this was mostly underlined by the fact it taxed the goods brought in. The
VOC only started taxing these chests after 1753, so at a much later date.29
Private trade obtained clearer dimensions in the trade to Europe when a Company simply allowed
goods to be taken on their ships against payment of recognition of their monopoly. The EIC from the
early eighteenth century allowed arrack to be imported against payment to their private trade
ledger and payment of tax.30 The VOC took it even a step further and opened up its ships to Europe
for tea on recognition and on freight. Normally, private trade with the VOC is seen as impossible as
the Dutch East India Company has always been judged on the merits of its dominance in the spice
trade. The monopoly on several valuable spices meant it had to protect these profits with monopoly
measures even against its own servants. Some trades were a different cup of tea, as they were not
the main aim of trade for the VOC. For the English, the situation was different as tea was one of its
main aims, although private trade in tea to Europe also merits further investigation. As the trade in
tea was of secondary importance, the VOC had not problems with allowing it servants, the burgers
from Batavia and even the Chinese merchants the right to send tea home on VOC ships against the
payment of recognition in Batavia. This policy started in 1683,31 but is kept from our sight until 1743,
when the VOC starts taxing tea on arrival in Europe, which meant it is taken up in the books. In this
manner in the period 1745 to 1754 10.339.565 lbs of tea on recognition was send to the Dutch
Republic while the Company itself 11.387.131 lbs of tea.32 The practice of sending private tea
continued after 1755, but was much less successful. The VOC had no problem in allowing this private
trade as it decided, it simply meant a larger slice of the market and the tea could be send along on
ships already employed for spices. The scale of the private trade let to ships of the VOC being
overloaded with tea, a recurring theme in the VOC ‘general missiven’.33 In this respect it seems the
VOC was simply attempting to obtain more control on private trade through taxation instead of it
only being allowed after 1744.
2.2 Private trade in the intra-Asian trade
28
Nederlandsch-Indisch Plakaatboek , IV, 80, 24 julij 1716, Bepaling, dat, des vereischt, aan repatriërenden
kisten, volgens de voorgeschreven vorm en grootte, van Regeringswege zouden worden verstrekt
29
This is the first date the money brought in on the goods of the seafaring officers was put in the official books
of the VOC (See Nationaal Archief (NA), VOC, 4595, the ‘Generale Staten’ of the year 1753) in the English
Commercial legers we can find tax on private trade from the beginning of the United Company.
30
Instances of this phenomenon can be found in the commercial legers of the English East India Company.
31
Nederlandsch-Indisch Plakaatboek, III, 1678-1709, 359, 19/23 januarij.
32
Nationaal Archief (NA), VOC, 4593 4594 and 4595, the figures have been aggregated for different years and from the
different chambers, it is impossible to arrive at an exact figures for the quantity of tea on recognition imported into the
Republic as in some case, notably years 1745 and 1754, some chambers only give amounts in value not in quantity.
33
Nederlandsch-Indisch Plakaatboek, IV, 1709-1743, 28, 9 december 1712, 347; Nederlandsch-Indisch
Plakaatboek, IV, 1709-1743, 28, 13 october 1733; Generale Missiven van Gouverneurs-generaal en raden aan
Heren XVII der Verenigde Oostindische Compagnie, XI: 1743-1750, ed, W. Ph. Coolhaas (’s-Gravenhage: rijks
Geschiedskundige Publicatiën 232 1997), 20, 15 oktober 1743; Generale Missiven 232, 194, 31 december 1744;
Within both Companies a constant discussion was going on whether certain trades in Asia were the
prerogative of the Company or should be given over to the subjects of the companies. Normally, the
English have been said to have abolished all restriction on private trade after 1680. The Dutch East
India Company is basically viewed as monopolistic in the intra-Asian trade, and is said to never have
given into private trade as its intra-Asian trade and its profits made an essential part of its
organization. As the examples that will follow show, neither of these companies stuck to these
caricatures. Two other general rules seem to apply to allowing private trade in the intra-Asian trade.
First of all, if a trade in Asia was structurally profitable, the companies would always consider
starting trade for the Company, which basically meant that the companies wanted it servants to
accept their primacy in that domain. The second rule is that if private trade was judged harmful to
the interests of the Company, the Company would step in. Now, we have to keep in mind that for
both companies it was very difficult to assess what would be the most profitable way of organizing
trade and often there is not straight line in policies and regulations.
The tea trade of both Companies provides the best example of how fortunes of private
traders and the organization of company trade within and with Asia changed over time. At first, both
companies did not have direct access to supplies as neither had access to Canton. They simply
profited from the Chinese junk trade, the English from Bantam and the Dutch from Batavia. Basically,
Chinese traders brought Chinese goods to these ports, like tea, porcelain and silks, to them in
exchange for pepper. As the English lost Bantam, they lost access to a steady supply of these goods,
and tried to set up a similar trade run by its servants from Madras. As the EIC became aware of the
potential of tea in Europe, it got weary of its servants making a profit at Madras and started
curtailing their privileges and even considering ‘debarring them from trade to China’.34 After 1713
the EIC simply started direct trade and bypassed its private traders from Madras. Instead of granting
trade concessions to private traders, the Company simply conducted the trade to China itself
through direct trade, while accepting tea in India only very sporadically happened. This direct trade
continued, but from 1747 onwards half of its ships to China passed at Bombay, Madras, Calcutta or
Benculu to pick up pepper for the Chinese market, indicating the EIC was imposing itself in the trade
between India and China. Only after empire, did the EIC stimulate private trade again by accepting
bills of exchange in China instead of selling pepper itself. The tea trade is also a good example of VOC
lenience towards private initiatives. As the VOC failed to obtain direct access to the Chinese market,
even though it had exerted its military force to get it, it continued depending on the Chinese Junk
trade and Portuguese private traders for its supplies from Canton. Actually the success of this trade
both for the trade to Europe as well as for the livelihood of Batavia, presented the VOC with a
dilemma: did it want to enjoy the profits from the Chinese Junk trade for Batavia or the fruits of
direct trade for tea trade to Europe. In the end the plight was decided in the favor of direct trade,
albeit only in 1759.35
At the same time, a general change took place in the VOC’s tone towards private
trade in Asia, as the Company limited monopoly to the most profitable parts and gave up
parts of its monopoly to private trade. In 1740, Governor-General Van Imhoff was sent back
to Asia to reorganise the trade of the VOC.36 He brought with him radical ideas on how to
34
K..N. Chaudhuri, The Trading World, 386, note 5, Despatch book, 3 September 1686, vol. 91, 174.
Liu Yong, The Dutch East india Company’s Tea Trade with China, 1757-1781 (Leiden: Brill 2007).
36
Van Imhoff had first been sent back to Europe in disgrace by Governor-General Valckenier on charges of
mismanagement. He succeeded in convincing the Gentlemen Seventeen of his innocence and even of the
35
transform trade in Asia to suit the needs of Europe. He felt the VOC was too widely invested
in its intra-Asian trade, watering down profitability. A better system would be to limit the
investment to the most valuable goods, leaving the rest of the trade to VOC subjects. 37 In
turn, this free trade could be taxed and would increase the bills of exchange on Europe,
which would be handed out more liberally and without questing the provenance of fortunes
anymore. From that moment onwards private trade was no longer a taboo in VOC policy.
Plans were made how to best institute it with positive effects for the VOC 38 and new
institutions were created to support private traders.39 The system was regulated from
Batavia and changes were made over time to hand over the less profitable trades to private
trade or bring profitable new trades back under monopoly. Therefore, it is essential to note
that the idea of freedom of trade was not without precedent and ran throughout the whole
period of the existence of the Company like a scarlet thread.40 The VOC shrewdly assessed
which of its trade were most profitable and kept those under monopoly. The changes of
policy towards this system can be traced over time as Governors-general held different
views on what was for the VOC and of what was for the private traders.41 The little statistical
potential efficacy of his programme of reforms which would ensure the return of the VOC to its former
splendour. He was sent back to implement his reforms and take the place of Governor-General Thedens
37
J. E. Heeres, ‘De consideratien van Van Imhoff’, in Bijdragen tot de taal- , land- en volkenkunde van
Nederlands-Indië, 66/1 (1912), 441-621. See also: Nationaal Archief (NA), Hoge Regering van Batavia (HR), 307,
Extract Generale Resolutien, 20 September 1743. ‘Taken in the Castle of Batavia in the Council of the Indies,
Tuesday the 24 September 1743. With the opening of free shipping and trade to and from this capital to
eastern and western India following the qualification of the Gentlemen Seventeen and the licence for that
purpose which has already been granted to several citizens, with the exception of the trade in spices, copper,
tin and pepper, and in the import of opium, which the Honourable Company shall reserve for itself, as has
been decided according to the proposal of the Governor-General.’
38
Nationaal Archief (NA), Collectie Alting, Consideratien, vrije vaart in Souratta, f38. Report on private trade in
Surattata by Jan Schreuder.
39
N. P. van den Berg, De Bataviasche Bank-Courant en Bank van leening 1746-1794 (Amsterdam: Van Kampen,
1870), 4-7.
40
De opkomst van het Nederlands gezag in Oost-Indië: verzamling van onuitgegeven stukken uit het oudkoloniaal archief, vol. X, xix. The idea of legalizing private trade in the VOC intra-Asian trade had already been
proposed by Governor-General J.P. Coen (1619-23 and 1627-29). During the seventeenth century, other
advocates of private trade within the VOC had spoken out, among them J. Maetsuyker (1653-78) and R. van
Goens (1678-81). Their plans were seriously considered again in the eighteenth century by Governor-General J.
van Hoorn (1704-9). Different Governors-General sent their plans to the Republic with suggestions for reforms
in the intra-Asian trade. Nor was Batavia the only place where Company servants toued with the idea of
allowing private trade. J. de Hullu, ’een advies van Mr. Pieter van Dam, advocaat der Oost-Indische Compagnie,
over een gedeeltelijk openstelling van Compagnie’s handel voor particulieren, 1662’, in Bijdrage tot de taal-,
land-, en volkenkunde,74/1 (1918), 267-98. See also Van Dam, Beschryvinge van de Oostindische Compagnie,
vol. I, xvii.
41
Mossel: Nederlandsch-Indisch Plakaatboek VI, 493-5, Mossel, 3 Augustus 1753, Extracten uit de
voorschriften nopens de vrije vaart; Ibidem, 610-1, Mossel, 13 december 1753, Vernieuwd verbod tegen
particulieren handel met zekere soorten van manufacturen. Ibidem, 651-61, 29 Maart 1754 mossel,
Voorschriften nopens particuliere vaart en handel. Opkomst, X, uitleg lijst, 223-227 en235-6; Van der Parra; :
Nederlandsch-Indisch Plakaatboek, VIII, 262-7, Van der Parra, 11 junij 1767, Extracten uit de reglementen
nopens de vrije vaart om de Oost, Noord en West; Ibidem, VIII, 31 December 1771, Van der Parra, Ibidem, 72932, Korte uittreksels uit de orders op de vrije vaart om de Oost, Noord en West. Opkomst, XI, uitleg lijst, 203213; De Klerk, Nederlandsch-Indisch Plakaatboek,, X, 300-14, De Klerk, October 1778, Extracten uit de orders
nopens de vrije vaar om de West, Oost en Noord; Ibidem, X, 234-6, Alting, 9 april 1778, Intrekking van het
bepaalde: 1_) op 1 julij 1777 nopens inkomende regten van Chinesche goederen; 2_) op 13 Mei 1774 nopens
information we have, seems to point to a decrease in the money the VOC invested in IntraAsian trade.42
After Van Imhoff, the VOC regulated private trade according to its needs, but found
not everything was in its power. Mossel decided that Van Imhoff had been too liberal and
started to issue stricter regulations on the long-distance trading routes to inhibit private
trade. He did so without completely banning private trade. His main goal was to make
private trade suit the needs of the VOC again. Mossel thought the VOC had been too liberal
in allowing private trade in absolute freedom. Not only did the VOC have problems in
enforcing its monopoly claims, but with total freedom of trade, servants become too
focussed on their own interest instead of the Company’s interests. This had led to a
situation, where young servants were able to earn more money than their seniors. This was
considered undesirable as it clouded social relations and the VOC hierarchy. In order to
restore order, Mossel did two things. He linked private trade privileges to the VOC hierarchy
and he stamped down on the exhibition of wealth by instituting a rudimentary form of
sumptuary law.43 By linking remuneration and exhibition of wealth to hierarchy, it was
believed the servants would attach new importance to serving the VOC. Van der Parra, on
taking over from Mossel, simply continued to make this system work. First, he was as
prudent as Mossel in allowing or disallowing private trade. In 1771, however, he made an
almost 180 degrees turn on his policy as he suddenly opened up trade between the Indian
subcontinent and Batavia completely.44 Factors outside of the VOC power are the only
possible explanation for this reversal. The conquest of Bengal by the EIC, made any control
of trade between Batavia and Bengal an illusion. As the English seized control of Bengal the
rules of the game changed. If the VOC was to exclude English private traders from access to
Batavia, it risked to be cut off from access to Bengal itself in retaliation. English private
traders increasingly showed up at the road-stead of Batavia and demanded goods. As the
VOC no longer had control over trade with the new English interference, Van der Parra no
longer saw any reason to exclude VOC subjects from this trade.
2.3 Bartering for private trade, Company and servants, negotiating
From the sources of the VOC, we can get a glimpse of how servants, free-burgers from Batavia and
indigenous subjects constantly argued their case on private trade. This worked two ways, towards
vrije vaart en handel; Alting: Nederlandsch-Indisch Plakaatboek, X, 469-78, Alting, 23 Februari 1781,
Voorschriften nopens de vrije vaart, april 1778; Ibidem,X, 573-577, Alting,october 1781, Alting, Extracten uit de
orders op de vrije vaart om de Oost en Noord; Opkomst, XII, 5-8, Alting, 9 October 1781.
42
Jacobs, Merchant in Asia, 373, table 47.
Nederlandsch-Indisch plakaatboek, VI, 773-795, 30 December 1754, Maatregelen ter beteugelingvan pracht
en praal.
44
Nationaal Archief (NA), Hoge Regering, 310, Extract uijt de Generaale Resolutien, 173-7, 27 May 1774. ‘The
success of the stipulations made, constant and accurate supervision that our concession is not misused to
conduct illicit trade, we have judged it not inexpedient to prescribe some general rules, and these are, first of
all, to prevail upon and encourage all prosperous servants and all other subjects of the Company, including the
Moorish merchants in Bengal and in Suratta who have some relations with the Company, to fit out ships or
other vessels for over there, or to other places where they will be admitted, secondly, to assist them with the
necessary precautions.’
43
freeing trade or towards keeping competition out of trade. In such, this development is as much
entangled with the financial wellbeing of the Companies and of the private traders. There seems to
be collusion between the Companies and private traders. As such, a strange dynamic with the
hierarchy of the Companies existed. As everybody realized private trade was the way of making of
fortune, high placed servants tried to use their power to keep out competition. Since the servants
were convinced that only they and they alone had right to the privileges granted by the VOC, they
jealously guarded what they had. Inevitably, the arrival of these intrusive free-burghers, who
completely stood in their right according to the regulations could lead to unrest as their presence
caused disruptive ripples in the established trading patterns. For instance, A Dutch Free burgher was
told off by the VOC officials on the coast when he tried to impede on their private trade:
“First, you know all too well that in the smaller VOC settlements almost nobody but the chiefs and their
deputies, and they alone, participate in trade and that when a ship arrives there are almost never enough
desired goods to satisfy what they require to send or sell to friends on the ships for a substantial advance
in cash or by exchange. You need no great stretch of the imagination to understand that after I have
assembled goods of whatever kind, I have absolutely no intention of giving them away for a mere trifle.
Were you to be charged at the same rate as we sell, you would pay 20 per cent over and above that price,
therefore your profit would be piddling and of no account, since people charge an extra 5 per cent on
commission in Batavia, apart from charging you tax and other sundry small sums there. If you are
fostering plans to engage in such a project, you will have to promise the friends on the ship 60 per cent
on what they take, because, were you not do so, you would be taking the bread out of their mouths and
you will readily comprehend that you would have great difficulty in finding people who would want to
engage in such a commission and others will stand in the way of those who might want to. So, as a good
friend, I advise you to abandon your plans, news of which has already spread along the Coast like wildfire,
which many people will deem very strange and, to tell you the honest truth will be judged far too
greedy.” 45
Trade was strongly hierarchical and as VOC servants also held privileges of private trade on
VOC-ships, they had a very strong position to dominate trade. These officials also made grateful use
of their own particular privileges in the trade to Batavia. For instance, members of the High
Government enjoyed a special privilege called huijsgebruijk or ‘personal use’. This stipulation
entitled them to import every imaginable product from all over Asia into Batavia, providing it was for
their own personal use. This restriction had been instituted to curtail excessive importations. Still,
this seem to be lost on deaf ears, as high placed officials amongst themselves admitted to using it for
commercial ends leading to unequal competition for other traders. If they really did intend to
procure goods from the length and breadth of the continent, the members of the High Government
needed the collaboration of local employees. When he was Chief of Pulicat, Van Eck was
approached for the first time to supply goods for ‘personal use’, a service which had been provided
by former chiefs.46 He saw no reason to halt this practice when he was promoted to Governor of the
Coast, a position in which he was asked to supply the needs of the Director-General and even the
Governor-General himself. When Van Eck was promoted to Governor of Ceylon, he continued to
supply ‘huisgebruijck’ products. In other words, the supply of commodities for ‘personal use’ was
45
46
Nationaal Archief (NA), Coll. Van Eck 29, doc 152, 8 August 1758, Van Eck to Faure.
NA, Coll. Van Eck 13, doc. No 1, 18 October 1754, N.N. to Van Eck.
just as much institutionalized as permitted freight and Van Eck was always extremely helpful in
fulfilling commissions.47
At the same time, the company relied on information from the same servants on how to best
organize private trade, so both the company and the servants would profit. Servants and subjects,
were also keen to lobby for the way they thought it would be best to organize certain trades.48 For
instance, as said the VOC asked its servants on the Indian subcontinent to help them devise plans for
the organization of private trade. Even before the plans were received, free burgers started trading.
When the Gentlemen Seventeen decided that Ceylon should be excluded from freedom of trade, it
was the High Government who favoured private trade, resulting into partial opening of trade. Even
the ‘perkeniers’ the people in charge of the spice plantations on the spice islands, started requesting
private trade privileges and the VOC was willing to try as they believed this would improve the
‘perkeniers’ position and their eagerness to plant more spices. At the same time, burgers also
requested for the end to the prohibition of importing textiles into Banda. And several other requests
were made an acknowledged over time. Even Governors-General who have been said to have been
totally against private trade, opened up trades to private trade when it suited the Company, even
Mossel.49
Just as much as the VOC was more open to private trade as thought, the EIC ad its servants used
power to have it their way in private trade. The EIC also protected its own interest, for instance by
forbidding its subjects to serve Dutch private traders. The competition between Dutch and English
private trade on the Coromandel Coast was often one of cooperation, but the display of power was
always used. When Van Eck decided to send one of his ships to Manila with aid of the VOC governor
at Malacca and the Armenians of Madras, the English governor of Madras, Pigot, asked to be
included as one European ship from the Coromandel per year was better than two ships. Since the
English were at war with France at that time, the other partners thought it unwise to include him in
their plans. This infuriated Pigot, who threatened to ban the Armenian merchants from Madras. As
Van Eck was promoted to Governor of Ceylon soon after, we do not know what happened exactly
afterwards, but we do know that the first thing Pigot did when he heard the Spanish joined the
French against the English, was to send a English fleet to Manila. Although the fleet took Manila in
1762, Pigot was severely reprimanded for his endeavors as it smelled like his own interest were
behind the expedition.50
47
Chris Nierstrasz, In the Shadow of the Company, 174-176.
Generale Missiven van Gouverneurs-generaal en raden aan Heren XVII der Verenigde Oostindische
Compagnie, XI: 1743-1750, ed, W. Ph. Coolhaas (’s-Gravenhage: rijks Geschiedskundige Publicatiën 232, 1997),
31 December 1743, and subsequent follow-up from different regions, for instance: NA, Collection Alting 38,
Consideratien, vrije vaart Suratta.
49
Generale Missiven 258, 28, 31 december 1756; Ibidem, 117, 15 oktober 1757;Ibidem, 258, 152, 31 december
1757, (…) Sumatra’s westcust, Belangende den handel hebben wij om sodanige reedenen als bij onse resolutie
van den 10e junij in ’t breede staan vermeld, beslooten de gepreviligeerde handel-socieëtijt ten deesen custe af
te schaffen en daarenteegen de in den jaare 1749 opengestelde, dog in anno 1751 weeder ingetrokken, vrije
vaart van deese hoofdplaats op Sumatra’s Westkust, voor soverre ’s Compagnies limiten sig uytstrekken, dat is
van Sinkol. Of het noordelijkste van Baros af, tot aan het zuyderlijkste van ’t Indrapourse rijk en van daar na
herwaards, van nu af aan weder open te stellen voor alle en een iegelijk, hetzij dienaren van de Compagmie, of
derzelver onderdanen, met seculsie van alle vreemdelingen, ook van wat natie dezelve mogte weesen (…) and
Ibidem, 214, 25 april 1758,
50
For more elaboration on the story: Chris Nierstrasz, In the Shadow of the Company, 116-117.
48
3. Empire and private entrepreneurship
The dynamic between empire and the stipulations on private trade show that private trade, at least
for servants, become problematic with the attainment of Empire. In a situation where Companies
had no empire, allowing private trade privilege was the only way Companies could reward their
servants and allow them a fortune. Not allowing servants any privilege basically meant leaving them
to starve as the remuneration they received from the company was very meager and insufficient
indeed. 51
The Dutch East India Company was most careful on private trade in regions where it held
territorial possessions, Ceylon, Moluccas and Batavia as these possessions were strongly linked with
the spice monopolies. Its efforts were geared towards keeping the profits to the Company, but at
the same time it shared more of its profits of the monopoly and government with its servants to
guarantee the monopoly. VOC servants behaved accordingly. If we look at Van Eck, who made his
way up the ladder in the 1750s en 1760s to Governor of the Coromandel and Ceylon, we
have a good opportunity to compare how servants of the VOC viewed the income from
private trade in comparison to the income from other sources. Van Eck made his fortune as
governor of the Coromandel Coast through private trade, while when he became governor
of Ceylon he moved into fortune from government. During his career on the Coromandel,
he constantly complaint about insufficient privilege in private trade, while no complaints
exist for the period of his stay in Ceylon. The fortunes he made in his time on the Coast en in
Ceylon proof that empire without the right to private trade was more advantageous for
making a fortune than private trade privileges: Van Eck earns 300.000 guilders in his 3 years
as governor of the territorial possessions of the VOC in Ceylon, while in the twenty years
before he was able to scrape a similar amount of money together. His complaints about
private trade as a governor of the Coromandel Coast are mainly aimed at illustrating his
feeling of being worse off than his predecessors who had other forms of income. When he
officially asked for more privileges the High Government simply laughed off his request.52
The higher risks in acquiring a fortune as the VOC declined, also explains why the VOC
servants were more readily willing to stay in Asia in relation to its English counterparts. VOC
servants stayed in Asia and family networks started to operate to give its members a head
start in the hierarchy and at the same time to provide capital to grasp opportunities.
The occurrence of military and political conflict offered servants of both companies a
way to make their fortunes in one stroke, while the companies tried to restrain their
servants from plunging the company into conflict for such a selfish reason. Certainly,
although both the EIC and VOC had imperialistic tendencies, neither fostered any plans for
51
Nicholas Dirks, The Scandal of Empire: India and the Creation of Imperial Britain (Cambridge, MA: The
Belknap Press of Harvard University Press, 2006), 38. ‘If the Company allowed no private trade, their servants
must starve.’
52
NA, Coll. Van Eck 27, doc. No. 33, 31 Janaury 1760, Faure to Van Eck.
territorial expansion, nor did either desire territorial expansion. In fact, it would seem that
the contrary was the case.53 Not enthusiastic about taking risks, the Directors of both
Companies constantly strove to bridle the aggressive ‘sub-imperialism’ of their servants.54
The conclusion that neither the Companies nor the European States wanted territorial
expansion leaves just one possible group of European actors who could have spurred on the
expansion: the servants on the spot. The reason for their eagerness to pursue war is that it
was the most rewarding activity for any servants, but there existed a difference in the way
the Dutch and English companies were able to control their warmongering servants. It
seems the Dutch East India was better able resist such exploits by its servants. The Dutch
India Company extended its influence both on Java and Ceylon, but in both cases without
much conquest or moving on taxation. The VOC servant’s behaviour in India and in Ceylon in
the eighteenth century is thought to be much less ruthless and warlike than in the
seventeenth century.55 The EIC ended up with conquest of Bengal and more importantly of
its taxation at the instigation of its servants. At the same time, militarily, the Dutch
discovered they were no longer the paramount power in Asia. During the battle of Bedara,
they were beaten both on land and on sea. The sea battle is most telling as the Dutch far
outnumbered the English ships and still lost. This was mainly due to the fact that the English
had man-of-war from Europe at their disposal, while the Dutch only had merchant vessels at
their disposal. On land, the support from state-supported troops from Europe, gave the EIC
servants to have more freedom to do what they wanted. The lack of such support in the
Dutch case, meant that the Directors in Holland decided the amount of involvement and the
duration of military campaign as they controlled and they alone controlled the military
power available to servants.
The attainment of empire in itself, was a means for individuals to obtain fortunes. Even
stronger, it needs to be acknowledged that the actual acquirement of empire was rooted in the
pursuit of personal fortunes. The direct loot from battles such as Plassey was enormous and has
been documented. A staggering £638,575 was shared among the higher officers and officials after
the battle of Plassey. The commander of the British forces, Sir Robert Clive, in one swoop made
£211,500 and divided the rest of the sum down the hierarchy, which was also normal in other
successful campaigns. 56 At the same time, Clive obtained lavish bribes after installing a Nawab of
Bengal more to the liking of the English.57 As Clive realised that his new acquired fortune might be
considered a bit excessive, he decided to send the some home through bills of exchange on the VOC,
who accepted around £472,000 from him in Bengal.58 This is the fortune Clive acquired in India and
does not seem connected to the yearly ‘Jaggir’ of £27,000 Clive received annual from the Nawab.
Every time a Nawab of Bengal was overthrown after 1757, the English had a means to ask the new
Nawab for new rewards. Clive defended these gifts as follows:
53
Michael Fisher, The Politics of the British Annexation of India, 1757-1857 (Delhi: Oxford University Press
1993), 13-14 and Dirks, The Scandal of Empire, 40.
54
Dirks, The Scandal of Empire, 14 and Ronald Robinson and John Gallagher, Africa and the Victorians: The
Official Mind of Imperialism (London: Macmillan, 1961).
55
George Winius and Marcus Vink, The Merchant-Warrior Pacified: the VOC (the Dutch East India Company)
and Its Changing Political Economy in India (Delhi: Oxford University Press, 1991).
56
James Holzman, The Nabobs in England: a Study of the Returned Anglo-Indian, 1760-1785 (New York:
Columbia University Press, 1926), 10.
57
Winius and Vink, Merchant warrior Pacified, 126.
58
Femme Gaastra, ‘British Capital for the VOC in Bengal: Private fortunes and Financial Transactions by
Servants of the Dutch and English East India Companies in Bengal, c.1760-1790’, Unpublished paper, Delhi
School of Economics (New Delhi, 1994) and Femme Gaastra, Private Money for the Company Trade. The Role
of the Bills of Exchange in Financing the Return Cargoes of the VOC, In Itinerario, `18/1 (1994), 73.
‘When presents are received as the price of services to the Nation, to the Company and to that
Prince who bestowed those presents; when they are not exacted from him by compulsion;
when he is in a state of independence and can do with his money what he pleases; and when
they are not received to the disadvantage of the Company, he holds presents so received not
dishonourable.’59
This development of such behaviour and obtaining of excessive fortunes even led to the introduction
of a new word in the English language: ‘Nabob’. Derived from ‘Nawab’, the official term for a
governor in the Moghul empire, the word obtained a transferred sense of ‘a person of great wealth;
specificially, one who has returned from India with a large fortune acquired there; a very rich and
luxurious person’.60
With the attainment of empire, government took the place of plunder as the main means of
acquiring fortune, both in the Dutch and in the English case. The English situation of taking bribes
and gifts dramatically changed with attainment of Empire. On the Coromandel Coast, the military
power meant EIC governors had room to negotiate bribes. As they also reached the highest echelons
of Indian power, they also reached they highest level of gift giving and bribes taking. For instance,
when Governor Pigot reinstored a Nawab his realm, he received £300,000 as a ‘gift’. When he was
succeeded by Palk, he demanded £50,000 from the Nawab, as he could not possibly receive less
than his predecessor, also highlighting the inflatory nature of such claims.61In the case of the VOC,
the attainment of empire lies outside of the scope of this article, but the servants of the VOC had a
similar interaction between ‘gifts and bribes’ and government. ‘No land better to skim off. People do
not disdain to offer money for anything, because of their inveterate depraved, customs. As the
discovery of many cases has revealed, many things are for sale. In Ceylon, Custumado is a highly
significant word as Hadat is among the Javanese.’62 The lures of gifts and bribes related to empire
logically had a longer tradition with the VOC, though excessive cases of Nabobs are not known.
Apparently, government of Dutch colonial empire meant opportunities that were hard to resist for
VOC servants. As the quote above indicates, the offering and taking of bribes was a normal situation
for those in power, be it Europeans or Asians. Power simply meant money and even in trading
settlements the purchase power of the Company meant possibilities for obtaining bribes and gifts
from the people after favorable decisions on their behalf. This behavior was simply the reality as
gifts and tribute formed the core of any relation of power in Asia, and was used by Europeans to
their own advantage.63
The difference of the power base of the English and Dutch also provides us with
alternative explanations for phenomenon that have been associated with English superiority
in the intra-Asian trade. The use of military force by the English, even brought down what
was still left of the VOC’s claims to monopoly in the intra-Asian trade. The English in a next
step used their political power to enforce a total breach in the VOC monopoly. When Peace
was signed after the Fourth Anglo-Dutch War (1780-1784), the English stipulated free access
to all Dutch ports in Asia, even to the Spice Islands. As it was pointless to allow English
private traders but not allow such rights to its own subjects, slowly the VOC came to terms
59
Lucy Sutherland, East India Company in Eighteenth Century Politics (Oxford: Clarendon Press, 1962), 54 note
I Reports from Committees of the House of Commons, iii, 148.
60
Holzman, Nabobs, 7.
61
Pamela Nightingale, Fortune and Integrity: A study of Moral Attitudes in the Indian Diary of George Paterson,
1769-1774 (Delhi: Oxford University Press, 1985), 94-96.
62
G. Hodenpijl, ‘De inkomsten an een rechtschapen Gouverneur van Ceylon in den Compagniestijd’, in De
Indische Gids, 42 (1920), 412.
63
For examples of VOC servants taking gifts and bribes see: Nierstrasz, In the Shadow of the Company, 157164
with the fact that it should completely leave behind any idea of controlling the intra-Asian
trade for its own needs.64 Even stronger, as the position of the VOC further deteriorated,
further exploitation of the monopoly between Asia and Europe was searched by the VOC. As
long as goods were shipped on VOC ships, VOC subjects were allowed to ship private trade
on homeward bound VOC ships when refraining from monopoly goods and on payment of a
fee.65 At the same time, the presence of English armies since the War of Austrian Succession
(1740-48), meant a stimulant to Dutch private trade and as such can also explain for the
expansion of English country trade before Plassey.
Empire also meant exclusion or protection of markets and production, even against
servants. For the VOC and its monopoly this has already been clear, but English control over
Bengal also changed the EIC’s stance on private trade and the way the trade of Bengal
should be managed. In the English literature, there are ways of finding out the viewpoints of
servants on private trade. Different stories about how they excluded others, mainly through
wielding the weapon of taxation, are known. Before the conquest, servants had already
tried to exclude free merchants from the trade from Bengal by imposing a higher tax on
their trade.66 They also saw trade of certain area as their possession.67 The best known
example of such proceedings is the monopolization of the salt, betel-nut and tobacco in
Bengal by several highly placed servants there, which in turn was found detrimental for the
EIC.68 The resulting radical increase of income after Plassey, partly fuelled through military
expansion in combination with new private trade possibilities, is the main reasons the
Directors in England decided to ban EIC servants from participating in private trade. As the
servants also had other ways of finding remuneration of similar proportions to and probably
exceeding that of VOC servants in the regions they controlled, it was no longer thought
necessary to let them pursue private trade.69 This decision probably marked the beginning
of a major trading innovation, the Agency House, in which servants invested their fortunes
while other English subjects outside the service of the EIC were left to conduct intra-Asian
trade to the bills of exchange made available in China. The fact that the Dutch were much
less able to conquer colonies might be part of the reason an innovation in the direction of
Agency Houses did not take place in their case and Dutch private trade and the VOC quickly
lost to this new form of competition in Asia.70
64
Arsip Nasional Republik Indonesia, Hoge Regering 4516, July 1783, Plan Radermacher, 1-13 and ANRI, Hoge
Regering 4396, 21 March 1785, Considerations from Ambon, fo. 1-3.
65
Ingrid Dillo, De nadagen van de Verenigde Oostindische Compagnie, 1783-1795: schepen en zeevarenden
(Amsterdam: De Bataafsche Leeuw,1992), 191-5.
66
Peter Marshall, East Indian fortunes: the British in Bengal in the eighteenth century (Oxford: Clarendon Press,
1976), 54 and 74; Watson, Foundation, 119 and 135.
67
Bruce Watson, Foundation for Empire, English Private Trade in India 1659-1760 (New Delhi: Vikas 1980), 126.
68
William Bolts, Considerations on India affairs; particularly respecting the present state of Bengal and its
dependencies (London 1772), Volume I, 164-166.
69
Dirks, Scandal of Empire, 53 H.V. Bowen, Elites, Enterprise and the Making of the British Overseas Empire
1688-1775 (New York 1996), 184.
70
Marshall, Fortunes, 46.