September 28th, 2007

The BEIC (British East India Company) and VOC were governments within governments. They didn't have autonomy, but they had a lot of things governments could do. BEIC was a political power in India. Their officer core was British but had a lot of Indians. BEIC had 125 investors who put in 72,000 pounds into the company. States were strapped for cash. A lot of states feared states with economic power. It could threaten the government, a lot of government wouldn't let that happen. A lot of governments gave and took monopolies without warning. They didn't want anybody to take away sovereignty. In Europe this option isn't available. Governments create companies where wealthy people will invest. Both government and wealth people can make money off of this arrangement. these are called Rentier States: government creates an enterprise which it takes off to the top of.
The BEIC originally had a charter of 21 year. This was in case the company grew too large. BEIC became useful to the Mughal empire. The BEIC received certain ports where it could sell its goods. At the same time the BEIC took Indian goods to Western Europe. This brings a lot of revenue to the Mughals, especially as their navy cannot reach Europe. The BEIC became a Mughal vassel. By 1670 Charles the 1st allowed for the BEIC to acquire territory (as it already sort of had a military), bring currency, build fortresses, make alliances, create war and peace, and make its own laws.It basically becomes a government.
The BEIC is a charter of the British royalty, it places its loyalty in the throne, not the parliament. At the same time, the BEIC bribes people in parliament so that they will not allow other private companies to join in on their profits (make sure they stay a monopoly). The BEIC now finds itself under British and Mughal protection. The crown gave the BEIC more power so that it would gain more money. All trade with India would be handled by BEIC, killing all other competition.
By 1750s: Mughal Empire starts breaking up to form other empires. A battle between the French and the British began, trade war. The war mainly occurred in the West Indies and India. The BEIC felt threatened by French companies. When the French lost the war, the BEIC assumed all the trading roles in India. By 1800, the BEIC controls most of India.
The BEIC becomes an important world player.