British East India Company

A joint-stock company that acquired an army, a revenue and eventually a subcontinent, and had to be nationalised when it lost control of them. Chartered by Elizabeth I in 1600 for the spice trade, it was outcompeted in the archipelago by the Dutch and turned to India, where it built fortified factories at Madras, Bombay and Calcutta with the permission of local rulers. Plassey in 1757 and the grant of Bengal's revenue in 1765 changed its nature entirely: it now taxed millions of people, and it used that income to buy Indian goods rather than shipping silver, which is the arrangement contemporaries called the drain. Its private armies grew to hundreds of thousands of sepoys, larger than most European forces. Parliament regulated it repeatedly from 1773 because a company with sovereign powers was a constitutional problem at home, and it lost its trade monopolies in 1813 and 1833, becoming purely an administration. The rebellion of 1857 ended it: the Crown assumed direct rule in 1858 and the company was wound up in 1874. It had also run the opium trade to China. The company was chartered on the last day of 1600 and dissolved in 1874. Its headquarters were at East India House in London. It maintained its own flag, currency, courts and diplomatic service. At its height it accounted for around half of world trade in certain commodities. Its Bengal army mutiny in 1857 was the immediate cause of its abolition. Company shareholders were compensated by the British taxpayer.

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