Q. 145.0( 4 Votes )

How did the East India Company establish trade in India and enter the political scene?

Answer :

East India Company was able to get charter from the ruler of England, Queen Elizabeth I which proclaimed them as the only authority to trade with the East. Their main motive was to purchase goods at a lower price and sell those goods in Europe at a higher price. However, Company was able to eliminate competition from other English trading companies but there were European powers who can trade in the Eastern markets. When English ships were reaching the west coast of Africa, round the Cape of Good Hope, and crossed the Indian Ocean, Portuguese had already established their base in Goa and controlled trade in the Western Coast of India. Even Dutch wanted to trade in the Indian Ocean and French also decided to trade with India.

Due to the increasing demand for Indian products such as fine qualities of cotton and silk, Pepper, cloves, cardamom and cinnamon, the prices of these increased. It eliminated the chance of earning a profit so European companies involved in battles to secure their position in the Indian market. They were constantly involved in attacking each other’s ships, blocked trading routes, tried to stop rival ships to move with the supplies of goods. To do trade they were involved in battles and through fortifications, they protected trading posts.


Along with this, to secure their position in the market, they came into conflict with local rulers and were trying to establish fortified settlements. Thus, East India company’s urge to secure Indian markets made it difficult to separate trade from politics and this way they entered into the political scene.


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