The Cozens/Byrnes Merchants Networks Project - Updated 15 November 2014

The English East India Company's First Bank at Canton

By Dan Byrnes

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NB: Author's Note: This article began life in 1994 as a straightforward undergraduate essay on the question: “What major changes took place in Asian trade in the second half of the 18th Century and how did the English and Dutch East India companies adjust to these changes?” I wrote this essay the way I did, and kept copies of it, as I felt that in the literature, insufficient attention had been paid to the ways English merchants might have used such a banking facility, especially for handling profits from opium trading, more so as finally, in India, the English ejected the Dutch from trade in opium. The original format has been modified a little in order to find a footnoting style suitable for HTML coding of an ordinary webpage.

In 1858 when the East India Company (EICo) ceased to rule India, following a substantial rebellion, they had "piled up an Indian debt of 70 millions [pounds sterling]. They had in the meantime drawn a tribute from India, financially an unjust tribute, exceeding 150 millions, not including interest." (1).

(Note1: Romesh Dutt, The Economic History of India in the Victorian Age. Vol. 2. (Reprint). New York. A. M. Kelley, 1969., preface, p. xv.)

After the Dutch East India Company (VOC) ceased trading in 1795, it was discovered in 1799 that partly due to the VOC's self-delusory accounting practices, it had piled up a debt of about 134 million florins. (2)

(Note2: For a broad overview of the Dutch experience in Indonesia, J. H. Boeke, The Evolution of the Netherlands Indies Economy. Netherlands and Netherlands Indies Council, Institute of Pacific Relations, New York, 1946. Also of broad relevance is Immanuel Wallenstein, 'The Great Expansion: The Incorporation of Vast New Zones into the Capitalist World Economy (1750-1850)', Studies in History, New Series, Vol. 4, Nos. 1&2, Jan.-Dec., 1988., pp. 85-156. Boeke and Wallenstein read as though they have produced different translations of the same original material, Wallenstein simply being more modernistic. Boeke wrote before and after the Second World War, when as we now know, a process of decolonisation would occur from India east to China, with Japan's economy being deliberately revamped. Boeke's analysis is broadly compatible with modern sociological thought on the nature of Capitalism and its ills, as well as with much of what Marxists have written about the alienation of the worker in a Capitalistic system, but his remarks are sans the oft-noted portentousness of Marxist critique, which is why one draws attention to him here. (Boeke mentions particularly, p. 5, how labour in Asian countries became "bound" when implanted by a Capitalistic, world-trade orientated economy. An insightful analysis of what Marxists term "commodity fetishism", and much else of present interest in commodity handling regarding Mercantilist Capitalism to 1800, is contained in Sidney W. Mintz, Sweetness and Power: The Place of Sugar in Modern History. New York, 1985.)

Between 1803-1817, Chinese Hong merchants were in horrifying financial straits partly due to abandonment by their Imperial government, but more so since they had never originally been in a financial condition to begin to handle the volume of business which their European colleagues required to be handled. So they needed massive credit. They existed in a state of chronic difficulty due to lack of their own capital and lack of cash, exorbitant interest rates; their final failures were inevitable. By 1817, the debts of five junior Hong merchants had been liquidated, total balance due, $1,108,664. By 1802-1803, Ponqua said he owed $1,540,000 to various Chinese, also $360,000 to Europeans and $300,000 to his own government for duties. (3) An implication is that Hong insolvencies subsidised tea consumption in Europe and Britain.

Note3: Anthony Chen, Kuo-tung, The Insolvency of the Chinese Hong Merchants, 1760-1843. Ph.D thesis, Yale University. May 1990. UMI Dissertation Services. [Copy, Dept Economic History Library, UNE]; Abstract; p. 231 on Ponqua; p. 246, Table 6.1 on the liquidation of the debts of five junior Hong merchants 1812-1817; p. 258 on the final Hong failures. I am grateful to Mr Colin Disley for drawing my attention to this thesis, which I have not yet read fully by any means.

What remains unanswered is, how such fantastic debts could have arisen after Capitalism-Colonialism-Imperialism had formed, solidifying supposedly rational trading, accounting and financial practices, when profits from Asian trade generally could range from a modest 10 per cent as on short-term bonds (4) to 300 per cent on opium. (5)

Note4: H. B. Morse, 'The provision of funds for the East India Company's trade at Canton during the Eighteenth Century',. Journal of the Royal Asiatic Society, April 1922, Part 2. pp. 227-254. MF 950.05. (Dixson Library, UNE). Morse, p. 237, notes that by 1780 the EICo had established an increasingly influential station of supercargoes at Canton/Macao, whose opinions greatly influenced the Calcutta Presidency. These supercargoes provided the first year-round surveillance of commerce the British had been able to muster, and their activities one assumes were closely linked to observations made about the financial manipulations made possible by the Canton Treasury. It should be stressed that Morse wrote as early as 1922, and he does tend to be uncritical of European trading tactics in India and Asia, as was common in his day. However, Morse, pp. 252-253, notes in 1786 the China supercargoes granted Bills on Bengal at a rate of exchange that Cornwallis, newly-arrived, objected to greatly, saying it was a drain on Bengal's resources. The supercargoes here bowed to Cornwallis, but made various points on lately-reducing exchange rates for rupees, and outlined London's views on varying exchange rates between India and China. The Canton men preferred to see specie with their treasury rather than with India, as they wished to gather credit to make advances on future crops etc. Their remarks to Cornwallis can read like a veiled threat: they might refuse to advance credit to India private traders? But on the other hand, they might be able to pay 10 per cent on money left with their treasury! See also Tan Chung, The Britain-China-India trade triangle, 1771-1840. The Indian Economic and Social History Review, Vol. XI, No. 4, Dec. 1974., pp. 411-431; Chung p. 415, estimates that the EICo gross profit in importing China tea always stood higher than 10 per cent.

Note5: See Om Prakash, 'Opium Monopoly In India and Indonesia in the Eighteenth Century', Indian Economic and Social History Review, 24, 1, 1987., pp. 65-66. Prakash p. 67, asserts the new EICo opium monopoly ought to be regarded as a distinct "innovation" with important consequences. From 1765 the Patna EICo men organised all this more rigourously. The first opium buyers were Indian merchants, other British, the Dutch VOC, till the trade steadied itself, when finally opium was sold at an EICo auction at Calcutta, Prakash pp. 66-67 notes profits of 175-300 per cent were obtained from opium. So, radical alterations set in from 1773. Economic historians often utilise basic concepts such as supply and demand, of elasticity vs inelasticity of demand, more sophisticated concepts (as with Wallenstein) but the historian of Eighteenth Century economic activity needs to remain particularly aware of the increasing sophistication used by financiers, as in London and Amsterdam, as they spun complicated webs of short and long-term credit around the basic activities of gathering and transporting commodities worth exchanging; when of course, advances on credit might have been made in respect of differential profit margins over different time spans. These credit-webs cannot be quantified usefully, but the intents of their use were often linked to coercing native populations into European definitions of productivity, to harnessing traditional, diversely used croplands to what became regionalised monocultures, thereby disrupting societal patterns. These credit-webs, considered as investment lead-times, were often created so that European merchants could outpace their native merchant competitors. (It is revealing and ironic that since the 1970s, the Japanese have successfully applied this tactic in the US and Australia, using a longer investment lead-time, 30 years, than the supposedly sophisticated US traders can compete with). Treatments of world flows of bullion can also provide useful insights on broader financial issues for the period 1750-1800, but such detail is beyond the scope of this essay.

Simultaneously, from the point of view of non-Europeans in India, Asia and the Far East, gross inequities were institutionalised as Capitalism was used to re-organise production and consumption in traditional, often Muslim societies, which had often, by 1500 or so, offered a more satisfying life than any non-Mediterranean European country could offer. (6)

Note6: On China's role in stimulating a certain fatness in South East Asian trade prior to the arrival of the Portuguese and then the Europeans who eclipsed them, see K. N. Chaudhuri, Trade and Civilisation in the Indian Ocean: An Economic History from the Rise of Islam to 1750. CUP. 1989. Chaudhuri, p. 83, p. 103, attributes some of the forms of South East Asian trade to prevailing wind patterns, which seems sensible. He is less satisfying, p. 15, when he remarks, "The Indian lack of interest in sea power in the pre-modern period remains distinctly enigmatic."

Can it be that finally, Capitalism cannot offer profits and satisfactions that can be shared equitably? The Twentieth Century's unfortunate experiments with Communism (or, perhaps, State Capitalism?) have provided no useful answer, so the questions remain.

* * *

In discussing major changes taking place in Asian trade between 1750 and 1800 I have chosen to dwell on "the first bank at Canton", (7) that is, the East India Company Treasury, which operated like a merchant bank with a very wide brief. (hereafter referred to as the Canton Treasury). (8)

Note7: It has been suggested that Europeans located their trade at Canton since that area was taxed less systematically than other areas of China accessible by sail, in E. M. Gull, British Economic Interest in the Far East. OUP, London, 1943., p. 12; taxation at Canton was less systematized there than elsewhere in China. (In 1685 an Imperial Chinese decree had opened all Chinese ports to foreign trade, in which case the later European emphasis on Canton indicates that something exceptional was afoot at Canton).

Note8: Michael Greenberg, British Trade and the Opening of China, 1800-1842. CUP, 1951., p. 11. Greenberg p. 153 notes that some of the original motives to trade at China were to lend money to Hoong merchants, to conduct exchange banking regarding the use of various currencies in China; a "remarkable" deposit and loan business was developed; agency houses acted as trustees and executors, granted letters of credit to travellers, supplied temporary shortfalls for gentlemen of the Factory, and acted as investment brokers for opium. They changed money at extremely high rates of interest, 10-40 per cent.

Just as the establishment of British Penang successfully sewed together many strands of potential commercial activity, (9) the Canton Treasury sewed together more financial potentials than can easily be listed. Chief among these potentials was the possibility of reversing the flow of silver (10) from London or India to China, which was finally achieved about 1826 (according to Greenberg).

Note9: See Nicholas Tarling, Imperial Britain in South East Asia. Kuala Lumpur, OUP, 1975. Francis Light and the establishment of Penang are treated in C. M. Turnbull, The Straits Settlements, 1826-1867: Indian Presidency to Crown Colony. London, Athlone Press, 1972., pp. 1ff; also, M. P. Mayo, The life and letters of Colonel William Light. Adelaide. F. W. Preece. 1937. (It is well time Light's activities were scrutinised afresh, using new information supplementing earlier treatments). Also, John Bastin, 'Historical Sketch of Penang in 1794, with an appendix on the failure of Penang as a naval base and shipbuilding centre, by M. Stubbs Brown', pp. 1ff of Journal of the Malaysian Branch of the Royal Asiatic Society, Vol. XXXII, Part 1, May 1959. [No. P959.5J86]. [p. 5, Note 3, Contemporary reports are revealing about 1466 chests of opium from Calcutta sent on Betsy Capt Robert Geddes, date uncertain, probably in 1784. Following complicated incidents after a capture of Betsy, the Dutch took Riau and disciplined the Bugis. This was one prompt for the British establishment at Penang in 1786].

Note10: Here, after the 1757 Battle of Plassey, as demand for tea grew in Britain and Europe, one can view the eagerness of the British to gain better access to Indian mints as partly prompted by eagerness to more ably service the Chinese hunger for silver in return for tea.

It is difficult to specify when this "bank" opened its formal operations - 1773 seems appropriate - (11) but its opening coincides with a stimulating of opium sales - and who knows? - increased opium production may have been one unscrupulous European response made to the exigencies of the 1769-1772 Bengal famine? (12) (See Statistical Material, Page A, as appended).

Note11: In Table 3, p. 295 of Pritchard's essay, E. H. Pritchard, 'The struggle for control of the China Trade during the Eighteenth Century', Pacific Historical Review. Vol. III, 1934., pp. 280-295., there are discernible for 1771-1772 to 1774-1775, substantial drops in Goods Imported for British Trade at Canton, and likewise for Goods Exported, for both EICo trade and private trade, but a rise in both categories for Country Trade. I take it that the rise for Country traders coincided roughly with the opening of "the Canton Treasury" and the availability of new financial tactics. I also suspect the distinction Pritchard draws between "private" and country" trading is a false one, and that the apparent distinction disguises a deeper investment in opium for both of South East Asia and China considered as separate markets for opium; but that official EICo trade did indeed suffer during these few years. Chung, p. 413, Table 2, also tracks a downturn in silver-shifting by the British to China between 1771-1780, which is inexplicable if opium and other Indian products had not been used in replacing China's reception of silver. (See Statistical Material Pages A and B).

Note12: Gull p. 13 marks 1773 as a turning point for a British emphasis on opium dealing. He writes, the year 1773 was the earliest recorded for British merchants importing opium into Canton. Before 1773, the Chinese had taken about 200 chests of opium per year into China; by 1773 the volume increased to 1000 chests per year, and "it provided an acceptable substitute for silver" in balancing the trade with China. But one can only imagine in this case that the Chinese had other sources of silver to allow them balance trade in opium, and this silver must have come from non-British sources, which places an emphasis on both the supply and role of silver dollars in the economy influenced by Canton's Hong merchants. Wallenstein, meanwhile, p. 98, notes that "Only the expansion of opium production had NO (my emphasis) direct link with shifts in production elsewhere in the world-economy but was a function rather of the [EICo's] needs in the China trade." Prakash, pp. 68ff, describes the coerciveness visited upon the peasants producing opium; while it should be remembered, the peasants as land-users later paid revenues which went to the EICo as well (Prakash p. 69: at times the rate of interest charged on advances to Bengali opium producers might be 24 per cent). See Chung, p. 417, Table 3, regarding a 100 per cent rise in opium production in Bengal between 1771-1775 (the Bengal famine intervening for part of that period, but being commented as such by no writer I can recall).

But the Canton Treasury's main function in the present context was, in respect of a wide range of currency exchanges and commodity transactions, to offer Bills finally payable on the English East India directors in London. (13) Credit may have been long, but it was finally sure. (14)

Note13: Morse pp. 237-246 notes an unfortunate hiatus for EICo records 1754-1774 so (for about 1773) he is unsure just when the Canton supercargoes began issuing Bills on London, since records 1754-1774 are missing; but he feels a few years before 1775. In 1775 the EICo issued Bills worth 546,820 Spanish dollars to country traders from India. and in 1775 the Supercargoes at Canton were expecting to receive bullion from Manila, about which "foreigners" [unspecified] were glad. But the amounts were relatively modest, so Morse thinks the practice was recent. As far as I am aware, any regular British reliance on, or access to silver dollars from Manila has never been adequately explained. The Canton Treasury obviously handled Spanish dollars from Manila, and why is clear, but the how of the business remains unclear.

Note14: The beginnings of the Canton Treasury should not be judged surefooted, let alone over-confident. The new system had to grow on its own financial merits. See Greenberg, p. 22: in 1780 there were only seven "private English" ie, non-EICo men, at Canton. The only one left by 1783 was John Henry Cox, and he with Daniel Beale from 1782 began a firm which later became Jardine Matheson, who are treated in Asiya Siddiqi, 'The Business World of Jamsetjee Jejeebhoy', in Indian Economic and Social History Review, Vol. XIX, Nos. 3&4., pp. 301-304.

The commodities involved came from all over South East Asia, distributed by energetic British private and country traders who were increasingly backed by British agency houses in India (15) and who eroded Dutch monopolies. (16) In sum, the operation of this "bank" illustrated a principal brutal to communities, even to nations - wars may occur, people killed, societies harmed, but money itself shall not be damaged. Finance supervenes. (17) This approach was the culmination of Sir Josiah Child's ideas, (18) which were part product of an insistence that trade was best conducted with sword in hand.

Note 15: S. B. Singh, European Agency Houses in Bengal, 1783-1833, Calcutta. Firma K. L. Mukhopadhyay. 1966. Singh's title, emphasising 1783, suggests the India agency houses took a decade from 1773 to aggregate capital enabling them to become the Indian merchant bankers they became as the EICo slowly began to stem the drain of silver to India and turn it to British benefit. Thus, the Canton Treasury linked disparate Indian ports with London and China, and via the EICo and the London short and long-term money markets, it finally enabled linkage with many financial manoeuvres exercised as part of other colonial financial management exercised from London. This was not achieved of course without the parliamentary influence of "Nabobs" who had returned their fortunes and themselves to England before 1773, who would have known what a boon an institution such as the Canton Treasury could have represented.

Note16: It should be noted that Henry Dundas at the India Board after 1784 deliberately promoted EICo recruitment of talented young Scotsmen to go to "the East". The Dutch could arouse uncommonly strong personal antagonisms, as when on April 10, 1784, James Scott, a country trader friend of Francis Light of Penang, wrote vigourously to Hastings about the Light-Penang plan. The Dutch had bruised Scott on suspicion of supplying arms to the Selangor Malays; he was imprisoned in the guard room at Malacca. Later, Light went back to the Sultan of Kedah and obtained a suitable agreement. H. P. Clodd, Malay's First British Pioneer: the life of Francis Light. London, Luzac and Co., 1948., p. 34.

Note17: Prakash, especially pp. 77ff, mentions a suggested British-Dutch interchange of opium (an opportunity not finally exploited, however) designed to offset any "unnecessary" negative effects of European conflicts on "strictly commercial matters", matters of opium handling in which the British were already outclassing the Dutch, even by 1785, not long before Penang was established partly in response to aggressive Dutch competitiveness of 1784 about Riau. The Dutch traditionally tried to protect their interests with monopolistic practices which the more flexible, sea-powered English usually worked to undermine, on the West African coasts, in Asia. There was nothing new about an Anglo-Dutch trade war. In the 1660s, over a century before, the English in commercial wars had trounced the Dutch on the West African slave coasts precisely as the Dutch disliked competition; K. G. Davies, The Royal African Company. London, Longmans, 1960 edn. First pub in 1957., p. 42.

Note18: One might say, a Bill of Exchange, particularly as it might be years old when being presented, when duly honoured, prevented capital from being harmed by errors in statecraft, an idea rather novel by 1700, at least to the English.

Reasons to dwell on the Canton Treasury are many. Its functions had a radiating effect, influencing decisions made on the handling of China tea, Indian opium and cotton, on decisions made in London. (19) It helped increase European investment lead-time (or, generation time) over that of regional rivals in India, South East Asia and at Canton. The financial skill with which it was operated far outclassed that of its European rivals, the Dutch and French, not to speak of the Chinese Hong merchants. (20) This Treasury also aided the rise of the India agency houses, whose influence radiated into the Indian hinterland, (21) into Indian maritime trades, into the South-East Asian country trade to ports in areas such as Malaya, Sumatra, Borneo, Siam. (22)

Note 19: Useful details on individual merchants handling opium as early as 1714 during the period the Canton Treasury appeared are contained in D. K. Bassett, 'British "Country" Trade and local trade networks in the Thai and Malay States, c. 1680-1770', Modern Asian Studies, 23, 4, 1989., pp. 625-643., p. 630 (for dealers about 1714) and p. 640 (1772, with Kedah being found a good outlet for opium).

Note20: The Hong merchants laboured under considerable disadvantages partly the product of their Imperial government. See Anthony Chen, Kuo-tung, The Insolvency of the Chinese Hong Merchants, 1760-1843, cited above, variously.

Note21: On the rise in India of nineteenth century indigo plantations, financed by the agency houses which appeared in the 1780s; see Singh, cited above.

Note22: After the late 1790s, via Campbell Clarke and Co., and Palmer and Co., they also influenced the early economy of the British colony at Sydney, Australia. M. Steven, Merchant Campbell 1769-1846. Melbourne, 1965.

British country traders established Penang partly with a view to opening a free port, itself a novel idea, almost inspired for its day, and this was but one arena where British merchants outclassed their rivals. (23) (Variable customs duties having long been a bugbear for European traders).

Note23: See S. Arasaratnam, 'Trade and Political Dominion in South India, 1750-1790: Changing British-Indian Relationships', in Modern Asian Studies, 13, 1, 1979., especially pp. 31-37. Arasaratnam stresses the post-1750 boom in the China trade, and also the role in it of British country traders. He also notices that a Portuguese merchant at Madras, Anthonio de Souza, "a tax farmer of great wealth and influence", helped engross the textile business thread supply about Madras from 1771, a subtle means of displacing Indian merchants. Here, and given the popularity of Indian textiles as a commodity in South East Asia, the career of the founder of Penang, Francis Light, may provide further interest. Light from about 1769 first worked for Jourdain, Sulivan and De Souza (JSDS) of Madras, along with a country trader, Harrop. JSDS wished to develop trade with Kedah and Acheen, and Laurence Sulivan would become a deputy -chairman of the EICo in London. (As a director, Sulivan had squabbled notably with Clive of India on Clive's first return home with the hopes of engaging in a political career, perhaps since Clive's post-Plassey views on administration in India might have restricted Sulivan's urges to expand operations from India to South East Asia?). Since Light's common-law spouse, Martina Rozells, who was probably part-Portuguese, possibly from Junk Siam, is supposed 1771-1772 to have helped facilitate negotiations about Penang with the Sultan of Kedah, it is not impossible De Souza had used her to bribe the Sultan, or his nobles in order that Light could open negotiations with Kedah? Such a conspiracy theory could be consistent with Sulivan's combativeness with Clive after Plassey, versus information on the ambivalence by 1786 at Calcutta about establishing Penang, while Light's plan for Penang sought a way of avoiding Dutch dominance of the Straits of Malacca (and I daresay, trucking more widely in opium throughout South East Asia). On Light in 1771, See D.K. Bassett, p. 642.

Penang opened up ready access to South East Asian coasts, eroding the Dutch reliance on enforced monopolies, and enabling readier exchanges of an increasing variety of commodities. The proceeds of such commodity exchanges increasingly tended to flow to the Canton Treasury, enabling profits to be lodged in London.

The Canton Treasury helped guide the English trade in tea, which did much to stabilise advances made for Chinese tea cropping. (24) (25) But its success had much to do with managing China's regard of what became two prime commodities, silver and opium.

Note24: The influence of the EICo on the stabilisation of the intricacies of the London money market from the 1680s, and after the South Sea Bubble of 1720, needs little explication here. Just one classic demonstration of influence is contained in C. H. Philips, The East India Company 1784-1834. Manchester University Press, 1961., p. 8, Note 4; in 1794, 20 of 30 EICo directors had resided in India, which meant the exercise of a quite intimate contemporary reading of British financial /Imperial influences regarding dealings with India and China.

Note25: In Mui Hoh-cheung and Lorna M. Mui, 'William Pitt and the Enforcement of the Commutation Act, 1784-1788', English Historical Review, Vol. LXXVI, No. 300., July 1961., pp. 447-465., is a fascinating story of behind-the-scenes dealing in tea culminating in Pitt agreeing to collude with European suppliers of tea (p. 460, Messrs Voute et al of Amsterdam), partly to help put a stop to smugglers who were getting tea into Britain, obtaining supplies of tea from some of those same European suppliers. This entire scenario adds truth to a remark from Boeke, cited above, p. 11, "when the balance between supply and demand is disturbed", the demand for quality becomes stronger than the demand for quantity. This happened precisely when Europe had a potential to reduce the supply of tea into Britain in 1784-1785, and Pitt's supporters used an argument over tea quality to good effect, emphasising problems of quality with the tea currently offered by the East India Company. But it would be interesting to prove the Muis' assertions in their article by organising information on changes in tea ordering at Canton 1783-1786, and tea cropping in the Chinese hinterland, to see if, indeed, the British EICo was embarrassed, and if other Europeans at Canton did indeed have any kind of upper hand at the time. The Muis, p. 463, suggest these machinations enabled Voute et al to gain a monopoly of the European tea trade and oust smugglers and speculators from the market. Which is to say that the pejoratively-termed smugglers and speculators had merely an outlook on investment lead-times that was not appreciated by Voute et al. (See Statistical material, Page B). These were machinations of course which would have perfectly mystified Chinese (Hong) tea dealers at Canton, but they seem a good example of Boeke's remarks generally about Asian commodity producers being ground to dust in the mills of European Capitalism as Capitalism became more sophisticated in a context of world trade. It would be even more fascinating to discover what were the reactions of the EICo Canton supercargoes at the Canton Treasury when they found their superiors in London were being belaboured with surprising overtures not just from Voute et al, but prime minister Pitt! During the 1780s, the Dutch and British snarled with maritime anger in South East Asia; see Nicholas Tarling, Anglo-Dutch Rivalry in the Malay World, 1780-1824. St Lucia, CUP/Univ Queensland Press, 1962.

In brief, China's Imperial government, due to its cavalier isolationism, mishandled both silver and opium as well as the financial flooring allowed to its Hong merchants, and given this, the management of the Canton Treasury reflected a surpassing skill in handling finance. Here, British skill resulted from refining Sir Josiah Child's basic insistence before 1700 - money was simply another commodity to be bought and sold. That it took 80 years to prove Child's point reveals how novel an idea it was for its time, how much institutional resistance was given to it in both Europe and the East.

Meanwhile, so long as the Chinese Imperial government allowed its economy to remain dependent on silver bullion, it could not bring to bear financial manipulations of the (paper-based) money-market variety as exercised by the British. The British of course had practiced their financial conceptualization in India with a spectacular success all the more tragic for India. In this sense, Imperial China had failed to learn from the decline of the Mogul Empire and would suffer a similar fate at European hands.

Regarding money as a commodity created a new "umbrella environment" for bankers. As colonists and traders in India and Asia handled physical commodities - such as more tin after the opening of Penang in 1786 - financiers in India and London and Canton worked to create an array of finance manipulations seemingly able to cater for any contingency including states of war between European nations. (26)

Note26: I suspect that the Canton Treasury from 1784 was able to hold at bay, at least around China and India, an entirely new but potentially dazzling player in world trading stakes, the United States of America. The first US ship to China was Empress of China, sent by "the financier of the American revolution", Robert Morris, and the New Yorker, Daniel Parker, as noted in Ernest R. May and James C. Thomson Jr, (Eds), American-East Asian Relations: A Survey. Cambridge, Mass. Harvard University Press. 1972. See also the introduction to William Appleman Williams, Thomas McCormick, Lloyd Gardner, Walter LaFeber, (Eds and Commentators), America in Vietnam: A Documentary History. New York. W. W. Norton and Co., 1989. Morris and Parker were shortly eclipsed in US-China trade by other American merchants, and it is not clear how, except that by 1789, Morris was anyway in deep financial trouble. Pritchard, p. 294, has a table on the volumes of American trade from China after 1784, beginning with an import into China of a modest 136,450. This would refer to the voyage of Robert Morris' Empress of China, on the return of which he is well-known to have made 25 per cent profit. C. H. Philips p. 156, Note, 3, says Jefferson's embargo (nd) crippled the US East Indies trade, which Pritchard's figures tend to bear out. (He cites Furber, 'American Trade', New England Quarterly, June 1938, pp. 255-256). As well, evidently, the British at Canton forbade the US traders use of the Canton Treasury, and it is obvious that while the Americans noted the usefulness of trading opium to China, they had to obtain their supplies from Smyrna, Turkey, not India. [p. 24 of May and Thomson]. In the longer run, to 1830, the British seem to have interposed difficulties for the Americans trading to China with an eye to creating a situation where London finance became important for American cotton producers, but I am so far unsure of the outlines here, since US historians remain foggy about their initial US-China maritime history. It is also not clear if any US ships sailed about India or South East Asia after 1784, when their flag was still a novel sight. Otherwise, on Morris before 1784, see Clarence L. Ver Steeg, Robert Morris: Revolutionary Financier (with an analysis of his earlier career). New York. Octagon. 1972.

China remained a silver-hungry economy, and by 1700 had developed a taste for Spanish dollars. (27) Its insistence on dollars, as well as its disdain for European manufactures, gave its European trading partners a chronic balance-of-payments problem. The British after 1773 solved this from Canton, from 1796 from Macao, by an undercover wholesaling of opium to Chinese dealers. (28)

Note 27: Anthony Reid, 'An "Age of Commerce" in Southeast Asian History', Modern Asian Studies, Vol. 24, No. 1. 1990., pp. 1-30, variously, but especially, pp. 4-9. Reid on p. 9 mentions the arrivals at Manila of the Spanish dollar galleons. Here, it seems that information on the regular voyages of the Manila galleons has not yet been well-integrated into discussions of silver bullion flows about South East Asia and China. Just one motive, presumably, for the British to establish their Canton Treasury was to obtain silver dollars outlaid for South East Asian and/or Canton commodity deals made with non-British, or for non-British opium deals at Macao, and so relieve the EICo of the necessity to transmit dollars to Canton from either London or Calcutta. Also, Morse, cited above, pp. 238ff makes assertions about years, eg 1779-1785, in which the EICo sent NO (my emphasis) silver dollars at all in their London-China ships direct, about which one would like to know more, for it seems unbelievable. Morse otherwise gives figures on dollars it is difficult to cross-check, for lack of comparability with more recently presented information, but since he wrote in 1922 it may be better to regard his remarks as merely stimulus for further examination of questions of bullion-handling from 1771.

Note28: See Gull, p. 14, on the shift of opium warehousing from Canton to Macao due to an edict forbidding the import of opium at Canton (which only meant that corruption set in and the drug was dealt at Macao).

After the battles of Plassey (1757) and Buxar (1764), part of the complex British response involved monopolising the supply of Bengal opium, reducing its supply to the Dutch, and evolving a system where opium supplies to China, paid for by the Chinese in dollars gained from the British and their rivals in Asian trade, the French, Dutch, Danes, Swedes. This enabled the British to stem a drain of bullion from London, and/or India, to pay for Chinese tea; the physical transfer of bullion (29) was replaced by a more conceptual acceptance of Bills on the EICo in London.

Note29: Morse, p. 228, remarks, for the EICo,"...no more unprofitable way of laying down the dollar could be adopted than that of sending the actual coin over fifteen thousand miles of ocean". Laying down the dollar refers to the EICo's requirements to pay for its China purchases in silver bullion, which was usually bought from European financiers (say at Amsterdam or Paris) or directly from Spain when circumstances permitted a direct transaction.

The system was more sophisticated than anything yet known in the region. At bottom, the EICo's post-Buxar hijacking of the Bengal land revenues backed the credit required to keep the Canton Treasury afloat. (30)

Note30: The system as orchestrated from Bengal was a highly refined financial feedback loop. With the Bengal diwani of 1765, (on the diwani, see Tarling, Anglo-Dutch Rivalry, pp. 2-3) the EICo coerced peasants to produce opium, took it at great profit, fobbed off the complaining Dutch with a given amount per year, sent the rest to China, stemmed their drain of bullion from London and India by exchanging opium and other commodities for tea, then reaped land taxes from the producers of the opium, while the British profits from India were transmitted home as pounds sterling via the Canton Treasury. Thus, Bengal subsidised the revenues the British government obtained from the EICo's promotion of tea drinking, as well as often paying for the upkeep of the former EICo servants in India who had gone home to become Nabob MPs. These MPs then worked in Parliament to perpetuate this system.

* * *

The discussion so far has emphasised one great, over-arching change in Indian and Eastern trade after 1750, the financial reconceptualizations the British could implement in India, South East Asia and China once they had achieved hegemony, from 1764, over Bengal, its diwani (of 1765), and its mint. These reconceptualizations were then applied in an effort to dominate trade at China not through force or intrigue, or a combination of both, as in India, more from skill in finance handling while dealing with a Chinese economy vulnerable to its own hunger for silver. Hence, the EICo "opening" its Canton Treasury from about 1773.

Increasing the truck in opium has long been regarded as a reprehensible aspect of Europe's trade with China, but the broad evidence, regionally in South East Asia, is that the upsurge in opium handling, certainly from 1773 if not earlier, was a remarkably cross-cultural phenomenon, and some Muslim leaders were quite prepared to truck in opium. It seems the case that the distribution of Chinese people in South East Asia was a major component enhancing demand for opium outside China.

Opium was a non-perishable, low-weight/high-value commodity, and a widespread traders' taste for using opium as a pseudo-currency developed. Opium became pseudo-bullion and could be exchanged for any commodity, presumably in quantities that traders could agree on as an exchange rate. Meanwhile, to depict the physical changes in commodity handling would entail descriptions of changes in the power balances between the EICo and her traders official and unofficial, and states beyond the coasts of India, in Malaya, Siam, Sumatra, and Batavia. Reference to the opening of Penang suffices here to indicate such changes, such as in the volume of tin taken from Malaya, the reputation of Selangor. It should not be forgotten with Penang that here, British merchants dealt with Muslim states in South East Asia, and they exploited much the same vulnerabilities of these states as they had done in India, playing off wars of succession, dynastic squabbles, and the covetousness of nobles over customs revenues that was so short-sighted, those revenues finally, strangely, disappeared into British hands.

What of the Dutch responses as changes took place in South East Asian trade? (31)

Note31: See Angus Maddison, 'Dutch Income in and from Indonesia', Modern Asian Studies, Vol. 23, No 4, 1989., pp. 648-651 especially.

In general, due to a commitment to monopolistic practices, the VOC did not officially permit private Dutch traders to operate under the umbrella of the VOC reputation, nor use its financial or military resources. Many VOC servants did engage in private trade, but undercover, and they had little of the flexibility allowed to private traders by the EICo. In Holland there were not the lively debates about colonial trade, about colonial practices, about merchants acting as a quasi-government, or not, as happened in Britain in 1773-1774 (over the Boston Tea Party, the East India Regulating Act of 1773, or the 1784 India Act), the fall-out from which filtered out to affect practices in India, ultimately to make Britain the ruler of India.

The Dutch lacked the naval power of the British, nor had effectiveness in using what power they did have. (32)

Note32: Tarling, Anglo-Dutch Rivalry, variously.

If I read Tarling's treatment of Anglo-Dutch Rivalry aright, in dealing with the Dutch (London-Holland negotiations), and more so after 1786 with the establishment of Penang, the British always knew their private and country traders in India and South East Asia gave them a flexibility to trade in many commodities that the Dutch could not manage to match, precisely because of their monopolistic habits. (So long as the Canton treasury could capture the remittances of British private traders, in China, or via India, the British private traders in effect formed a second British trading company in the region that the Dutch could not discipline, nor match).

To compete with the British, the Dutch, at least officially, would have had to drag their monopolistically-orientated infrastructures with them as they went into new areas, competing with the British. They were known as brutal taskmasters to indigenous people, and by 1800 the Dutch were more inclined, on Java, to settle into managing land use for new crops such as coffee (whilst attempting to avoid regional political entanglements which the British, by comparison, relished). (In general, arriving earlier in the region, the Dutch had often made initiatives which the British later adopted, adapted, or in some cases avoided. As a matter of national temperaments, the Dutch disliked normal price competition, the British thrived on it).

With the changes the British found it possible to make in India from 1757 after the Battle of Plassey, the Dutch reaction to the newly-declared EICo monopoly on opium probably provided the clue to the British they need no longer worry about the Dutch. In 1775, when a Dutch opium dealer reached Phulwari, he was greeted enthusiastically by the opium cultivators since he might pay more than the English. (33)

Note33: Prakash, pp. 69-73.

But Griffith staved off that deal; (34) later British administrators in India kept the Dutch semi-starved of opium as a new regional quasi-currency designed to replace silver. (35)

Note34: Prakash p. 69 suggests the true beginnings of the EICo Bengal opium monopoly can be traced at September 1775, when the opium contract was awarded to one Griffith, who locked up access to opium for his own agents. Prakash, pp. 70-71, says the EICo's direct involvement in opium helped stem the drain of specie from India to China, so that finally, Indian opium and cotton became the main medium of payment for Chinese tea. Further, the opium trade became the principal vehicle for transmission home of profits earned from India, as proceeds from the China sales of opium at the disposal of EICo factors in Canton became Bills payable in London. Prakash's remarks generally are consistent with those of Chung, cited above. Here it should be noted, as the Dutch knew, the Indonesian archipelago had long been a market for the non-medicinal use of opium prior to the 1770s, when British private traders began sending it to Macao/Canton. By then, some opium bought in China evidently came back to Indonesia on Chinese junks. Given the mysteries of Chinese medicine, which reflects awarenesses of the human nervous system still largely unknown to western science, I surmise that the long-standing but small Chinese trade in opium was to obtain a drug used in palliative care. If that is the case, we can perhaps trace the British exploitation of Chinese economic weaknesses, via the opium trade, to the pains of death, given that Chinese had spread from China into South East Asia, especially to parts of Indonesia.

(Note35: On the value of Riau and Kedah/Selangor as opium outlets after 1786, see D. K. Bassett, p. 643.)

So if it was, as the argument is, that finding a way to replace bullion handling with Bills of Exchange was the essential change made in Indian and Eastern trade from 1750, and that opium dealing was part of this reconceptualization, by 1775 the British had smelt that they could outmatch the Dutch by manipulating supplies of opium by 1775.

The British used this weapon of quasi-currency against the Dutch in Asia consistently, till by 1800 they had achieved a control of Dutch territories that was orchestrated from Europe, and by then the VOC had been disbanded. The trail of Imperialist-contrived debts eroding the economies of India, South East Asia and China would be for the future to deal with.

::::::::::::::::: (Ends) :::::::::::::::::::

AN ANNOTATED BIBLIOGRAPHY

Articles

S. Arasaratnam, 'Trade and Political Dominion in South India, 1750-1790: Changing British-Indian Relationships', in Modern Asian Studies, 13, 1, 1979., pp. 19-40.

D. K. Bassett, 'British "Country" Trade and local trade networks in the Thai and Malay States, c. 1680-1770', Modern Asian Studies, 23, 4, 1989., pp. 625-643.

John Bastin, 'Historical Sketch of Penang in 1794, with an appendix on the failure of Penang as a naval base and shipbuilding centre, by M. Stubbs Brown', pp. 1ff of Journal of the Malaysian Branch of the Royal Asiatic Society, Vol. XXXII, Part 1, May 1959. [Call No. P959.5J86].

Tan Chung, 'The Britain-China-India trade triangle, 1771-1840', The Indian Economic and Social History Review, Vol. XI, No. 4, Dec. 1974., pp. 411-431.

Dianne Lewis, 'The growth of the country trade to the Straits of Malacca, 1760-1777', Journal of the Malaysian Branch of the Royal Asiatic Society., Vol. XLIII, Part 2, 1970., pp. 114-129. [Particularly on the Dutch and their relations with Kedah - see Note9 regarding Bastin's treatment of Penang].

Angus Maddison, 'Dutch Income in and from Indonesia', Modern Asian Studies, Vol. 23, No 4. 1989. [pp. 648-651 only]

H. B. Morse, 'The provision of funds for the East India Company's trade at Canton during the Eighteenth Century', Journal of the Royal Asiatic Society, April, 1922, Part 2., pp. 227-254.

Mui Hoh-cheung and Lorna M. Mui, 'William Pitt and the Enforcement of the Commutation Act, 1784-1788', English Historical Review, Vol. LXXVI, No. 300., July 1961., pp. 447-465.

Om Prakash, 'Opium Monopoly In India and Indonesia in the Eighteenth Century', Indian Economic and Social History Review, 24, 1, 1987., pp. 63-80.

E. H. Pritchard, 'The struggle for control of the China Trade during the Eighteenth Century', Pacific Historical Review, Vol. III, 1934., pp. 280-295.

Anthony Reid, 'An "Age of Commerce" in Southeast Asian History', Modern Asian Studies, Vol. 24, No. 1, 1990., pp. 1-30.

Asiya Siddiqi, 'The Business World of Jamsetjee Jejeebhoy', in Indian Economic and Social History Review, Vol. XIX, Nos. 3&4., pp. 301-304. [On Bombay opium sent to China after about 1810, and Jejeebhoy's later failing efforts to send cotton direct to England, amongst other matters of locked-up trade]

Immanuel Wallenstein, 'The Great Expansion: The Incorporation of Vast New Zones into the Capitalist World Economy (1750-1850)', Studies in History, New Series, Vol. 4, Nos. 1&2, Jan-Dec 1988., pp. 85-156.

Books

J. H. Boeke, The Evolution of the Netherlands Indies Economy. Netherlands and Netherlands Indies Council, Institute of Pacific Relations, New York, 1946.

H. P. Clodd, Malaya's First British Pioneer: the life of Francis Light. London, Luzac and Co., 1948.

K. N. Chaudhuri, Trade and Civilisation in the Indian Ocean: An Economic History from the Rise of Islam to 1750. CUP, 1989.

K. G. Davies, The Royal African Company. London, Longmans, 1960 edn. [First pub in 1957., p. 42.

] Romesh Dutt, The Economic History of India in the Victorian Age. Vol. 2. (Reprint). New York, A. M. Kelley, 1969., [preface, p. xv.]

Michael Greenberg, British Trade and the Opening of China, 1800-1842. CUP, 1951. [An extremely important title, with much detail on English country traders who became partners in Indian agency houses]

E. M. Gull, British Economic Interest in the Far East. OUP, London, 1943. [Particularly, pp. 12-23]

Ernest R. May and James C. Thomson Jr, (Eds), American-East Asian Relations: A Survey. Cambridge, Mass, Harvard University Press, 1972. [On the first US shipping visiting China from 1784]

M. P. Mayo, The life and letters of Colonel William Light. Adelaide, F. W. Preece, 1937.

Sidney W. Mintz, Sweetness and Power: The Place of Sugar in Modern History. New York, 1985.

C. H. Philips, The East India Company 1784-1834. Manchester University Press, 1961. [With particular reference to Francis Light's backers for the Penang project, Alexander Dalrymple, Sir Archibald Campbell Governor of Madras from 1786, Country Trader James Scott and Andrew Ross a JP at Madras, see Clodd, otherwise cited, p. 50].

S. B. Singh, European Agency Houses in Bengal, 1783-1833, Calcutta, Firma K. L. Mukhopadhyay, 1966.

M. Steven, Merchant Campbell 1769-1846. Melbourne, 1965.

Nicholas Tarling, Imperial Britain in South East Asia. Kuala Lumpur, OUP, 1975.

Nicholas Tarling, Anglo-Dutch Rivalry in the Malay World, 1780-1824. St Lucia, CUP/Univ Queensland Press, 1962.

C. M. Turnbull, The Straits Settlements, 1826-1867: Indian Presidency to Crown Colony. London, Athlone Press, 1972.

William Appleman Williams, Thomas McCormick, Lloyd Gardner, Walter LaFeber, (Eds and Commentators), America in Vietnam: A Documentary History. New York, W. W. Norton and Co., 1989. [introduction only]

Unpublished thesis

Anthony Chen, Kuo-tung, The Insolvency of the Chinese Hong Merchants, 1760-1843. Ph.D thesis, Yale University. May 1990. UMI Dissertation Services. [Copy, Dept Economic History Library, UNE]

GENERAL READING

Kenneth Ballhatchet and John Harrison, East India Company Studies. (Papers presented to Prof Sir Cyril Philips). Asian Studies Monograph Series. Asian Research Service, Hong Kong, 1986.

N. C. Chaudhuri, Clive of India: a political and psychological essay. London, Barrie and Jenkins, 1975.

Michael Edwardes, The Sahibs and the Lotus: The British in India. London, Constable, 1988.

Ernest Samhaber, Merchants Make History: How Trade Has Influenced the Course of History Throughout The World. London, Harrap, 1963. [with reference to the development of Bills of Exchange. But I read this book chiefly in search of information on Robert Morris' movements in Europe during the American Revolution.]

John Watney, Clive of India. Saxon House. D. C. Heath Ltd., Hants, England, 1974.

Ian Bruce Watson, Foundation for Empire: English private trade in India, 1659-1760. New Delhi, Vikas Pub. House, 1980.

Supplementary notes and remarks

On the establishment of the East India Company's "first bank" at Canton:

Other financial matters from 1773: "the first bank at Canton":

   There is another difficult matter stemming from about 1773 - the establishment of the English East India Company's "first bank" at Canton. More a kind of financial clearing house, and an innovation for its time, this "bank" could not have succeeded without profits from opium sales in China, which increased after Clive's military successes in India.

Morse notes an unfortunate hiatus for East India Company records 1754-1774, so (for about 1773) he is unsure just when England's Canton supercargoes began issuing Bills on London, but he feels, a few years before 1775.

H. B. Morse, 'The Provision of Funds for the East India Company's trade at Canton during the eighteenth century', Journal of the Royal Asiatic Society, Part 2, April 1922., pp. 227-254. [Microfilm 950.05, Dixson Library, UNE]., here, pp. 237-246. This "bank" at Canton needs to be mentioned since by the time the Australian colony was developing commercially, merchants involved were probably using its increasingly sophisticated services.

This was novel financial procedure - the English were finding more effective ways to send money home. The procedures had much to do with finding and dealing in the silver that India and China preferred to British goods or manufactures. In 1775, the Company issued Bills worth 546,820 Spanish dollars to country traders from India; and in 1775 the Supercargoes at Canton were expecting to receive bullion from Manila, about which "foreigners" [unspecified] were glad. The Spanish at Manila, officially, forbade dealing in their silver dollars. But the amounts handled were relatively modest, so Morse thinks the practice was recent. Though it is not clear how procedures developed, this new Company "bank" at Canton, or, the Canton Treasury, obviously handled Spanish dollars from Manila. Something perhaps may have been due to non-English traders - traders flying the flags of European countries more friendly to Spain than England? Some such traders were English, deserting the British flag for the flags of European powers desiring an eastern commercial presence. A few key names after 1800 began trade links with Britain's new colony at Sydney.

Questions of opium dealing:

Gull marks 1773 as a turning point for Britain's fresh emphasis on opium dealing. He writes: the year 1773 was the earliest recorded for British merchants importing opium into Canton.

E. M. Gull, British Economic Interest in the Far East. London, Oxford University Press, 1943., p. 13. Immanuel Wallenstein, 'The Great Expansion: the incorporation of vast new zones into the capitalist world economy (1750-1850)', Studies in History, New Series, Vol. 4, Nos. 1&2, January-December 1988., pp. 85-156., here, p. p. 98. Om Prakash, 'Opium monopoly in India and Indonesia in the eighteenth century', Indian Economic and Social History Review, 24, 1, 1987., pp. 63-80. Tan Chung, 'The Britain-China-India trade triangle, 1771-1840', The Indian Economic and Social History Review, Vol. 11, No. 4, December 1974., pp. 411-431., here, p. 417, table 3. See Chung, p. 417, Table 3, regarding a 100 per cent rise in opium production in Bengal between 1771-1775 (the Bengal famine intervening for part of that period, but being commented as such by disturbingly few writers).

Before 1773, the Chinese had taken about 200 chests of opium per year into China; by 1773 the volume increased to 1000 chests per year, and "it provided an acceptable substitute for silver" in balancing the trade with China. But one can only imagine in this case that the Chinese had other sources of silver to allow them a trade balance in opium; and this silver must have come from non-British sources, which places an emphasis on both the supply and role of silver dollars in the economy influenced by Canton's Hong merchants. Wallenstein, meanwhile, notes that "Only the expansion of opium production had NO (my emphasis) direct link with shifts in production elsewhere in the world-economy but was a function rather of the [East India Company's] needs in the China trade." Prakash describes the coerciveness visited upon the peasants producing opium; while it should be remembered, the peasants as land-users later paid revenues which went to the Company as well. (At times, the rate of interest charged on advances to Bengali opium producers might be 24 per cent).

The beginnings of Britain's new "Canton Treasury" should not be judged surefooted, let alone over-confident. The new system had to grow on its own financial merits.

Michael Greenberg, British Trade and the Opening of China, 1800-1842. Cambridge University Press, 1951., p. 22.

In 1780 there were only seven "private English" at Canton, that is, non-East India Company Englishmen. The only one left by 1783 was John Henry Cox, son of a London maker of automatons of which the Chinese were especially fond; and Cox with Daniel Beale from 1782 began a firm which later became Jardine Matheson.

As is treated in Asiya Siddiqi, `The Business World of Jamsetjee Jejeebhoy', Indian Economic and Social History Review, Vol. XIX, Nos. 3&4, July-December, 1982, pp. 301-304.

An Indian historian, S. B. Singh, emphasising the year 1783, suggests that notable India agency houses took a decade from 1773 to aggregate capital enabling them to become the Indian merchant bankers they became, as the East India Company slowly began to stem the drain of silver to India and turn it to British benefit.

S. B. Singh, European Agency Houses in Bengal, 1783-1833, Calcutta, Firma K. L. Mukhopadhyay, 1966.

Thus, the "Canton Treasury" linked disparate Indian ports with London and China, and via the Company at home, with London's short and long-term money markets. This was not achieved of course without the parliamentary influence of "Nabobs" who had returned their fortunes and themselves to England before 1773, who would have known what a boon an institution such as the Canton Treasury could have represented.  The year 1773, then, proposed watersheds for financial sophistication in Britain's eastern trade. David Scott Senior, however, was a different kind of Nabob returning home from India in 1786, since he worked to 1799 and later to do much to reorganise Britain's eastern trade, including the opium trade, in way which has taken a long time to surface into history as far as Scott's "individual work" is concerned.

But even before discussion of the establishment from the early 1770s of the East India Company's "first bank at Canton", and its probable role in the sophistication of the opium trade, arises another matter also pertinent to the opium trade. This is the war between Clive of India, and chairman of the East India Company in London, Laurence Sulivan.

Here, see Nirad C. Chaudhuri, Clive of India: A Political and Psychological Essay. London, Barrie and Jenkins, 1975. Also, Edward Thompson and G. T. Garratt, Rise and Fulfilment of British Rule in India. Allahabad, Central Book Depot, 1969. (Text and bibliography on Clive of India and Laurence Sulivan as a non-Imperialist free trader.); Henry Dodwell, Dupleix and Clive: The Beginnings of Empire. London, Frank Cass and Co., 1967.; John Watney, Clive of India. Saxon House, Hants, England, D. C. Heath Ltd., 1974. See also Norman Baker, 'Changing attitudes towards government in eighteenth century Britain', in Anne Whiteman, J. S. Bromley and P. G. M. Dickson, (Eds.), Statesmen, Scholars and Merchants: Essays in Eighteenth Century History presented to Dame Lucy Sutherland. Oxford at the Clarendon Press, 1973. See also Lucy Stewart Sutherland, The City of London and Opposition to Government: A Study in the Rise of Metropolitan Radicalism. London, Athlone Press, 1958.

Here, Sulivan poses a mystery apart from the mysteries of Clive's military successes in India, the sources of his fortune, and Clive's unusual personality.

Once established with his fortune in India, Clive planned to return home to begin a commercial-political career in London. He met great resistance from the then Company deputy-chairman (under chairman Payne), and chairman succeeding Payne, Laurence Sulivan. Clive and Sulivan, and their camp followers, conducted a famous feud. The oddity however is that Sulivan is known only for this feud, he is not known in British commercial history as any sort of businessman in his own right. The problem needs to be considered in some detail. In brief, the squabble was over whether, following Clive's military successes against the faltering, post-Mogul powers, and the French under Dupleix, the English East India Company would engage in more formal sorts of control in India (a governmental role), or remain as more a non-Imperialist trader. Sulivan was of the non-Imperialist position, a position which lost in political force, with the result that the free British traders in the British East, "the country traders", worked in zones that were officially "de-controlled". Which is partly how the British opium trade became so lucrative, conducted in often-clandestine and shadowy ways.

Here, and also on Penang, see also Dianne Lewis, `The Growth of the Country Trade to the Straits of Malacca, 1760-1777', Journal of the Malaysian Branch of the Royal Asiatic Society, Vol. 43, Part 2, 1970., pp. 114-129.

This was the system of Dual Control, on which Lord Curzon once commented, "Had a Committee been assembled from the padded chambers of Bedlam, they could hardly have devised anything more extravagant in its madness or more mischievous in its operation"...

Laurence Sulivan, (1713-1786), was of Cork, Ireland, later of London. He married to Elizabeth Owen, and had a son Stephen (later an opium dealer). Laurence by 1740 was an aide to the governor of Bengal. In 1753 Laurence returned to England to became am East India Company director 1755-1786. He was Company chairman in 1758-1759, 1760-62 and 1781-1782. Sulivan would have known that from 1733, control of Company affairs at Canton had been vested in a select committee of supercargoes resident in Macao and migrating annually to Canton during the trading season. They had orders to oversee the actions of English country traders. Their problem was: what to sell to China?

The Chinese were paid in silver, usually Spanish dollars (which were possibly part-supplied from Manila in the Philippines via the annual Spanish treasure galleon from Acapulco in Mexico, to Manila?). The Chinese were interested in Indian cotton, pepper and opium, paid in silver, but the Chinese forbade the export of silver.

So the East India Company simply exchanged silver for bills payable in London. And the English country traders (not tied to Company regulations) carried opium since Company regulations forbade Company ships to carry opium, probably by about the 1760s. It does appear, that the reason Sulivan is so little-known in his own right is that he was early involved in the opium trade, and that this has been hidden.

Rather confusingly, one of the few sets of consistent clues about Sulivan's business career is lodged in Clodd's book on Francis Light, the Britisher credited with establishing Penang as a new port. (Light's son William is later noted for surveying the site of Adelaide, South Australia).

H. P. Clodd, Malaya's First British Pioneer: The Life of Francis Light. London, Luzac and Co., 1948. Geoffrey Dutton, Founder of a City: The Life of Colonel William Light, First Surveyor-General of the Colony of South Australia, Founder of Adelaide, 1786-1839. Melbourne, Cheshire, 1960. See also: Nicholas Tarling, Imperial Britain in South-East Asia. OUP, 1975. Nicholas Tarling, Anglo-Dutch Rivalry in the Malay World, 1780-1824. St Lucia, Cambridge University Press/University of Queensland Press, 1962. Nicholas Tarling, 'Pirates and convicts: British interest in the Andaman and Nicobar Islands in the mid-nineteenth century,', Chapter 10 of Nicholas Tarling, Imperial Britain in South-East Asia. Kuala Lumpur, Oxford University Press, 1975. See Chapter 3, ',The Prince of Merchants and the Lion City'. [On John Palmer, "Prince of Merchants"].

Francis Light, it seems, was a sometime-associate of an often-noted-yet-little-known India firm, Jourdain, Sulivan and De Souza. The name Jourdain can be found in East India Company listings from about 1610, early in the company's history, but there seems no genealogical connection between that early name, and the name found in Light's time. The name De Souza was a relatively common Portuguese trader name of the period, but nothing genealogically useful arises here. The name Sulivan seems to be that of Laurence Sulivan here. Their firm operated on the eastern coasts of India, not the western.

Clodd writes, that soon after arriving in India, Francis Light was given command of an Indian-owned country ship belonging to the Madras firm of Jourdain, Sulivan and De Souza, who wanted to create agencies at Acheen and Kedah. Light was first sent to Acheen as joint agent with one Mr Harrop... and it appears, that off and on, Sulivan's firm, often against the odds posed by East India Company attitudes, promoted the notion of a new port being established about the Malayan coast - with the final result being Penang. From his earliest contacts, Light got on well with the Muslim governments of Kedah, partly as he offered military aid with Sepoys.

Sir Richard Winstedt has written re an implied promise of military aid: "The acquisition of Penang is the blackest spot on the British record in Malaysia,"

. Dutton, Life of Colonel William Light, p. 16.

Arasaratnam has commented on the enormous post-1750 (or post-Clive) growth in private English trade from India to South-East Asia from the 1750s onwards, interests which in 1786 produced the search for a British settlement on the Malay Peninsula which resulted in founding of Penang.

S. Arasaratnam, Trade and Political Dominion in South India, 1750-1790: Changing British-Indian Relationships', Modern Asian Studies, 13, 1, 1979, pp. 19-40, p. 37. For information on the settlement of Penang: C. M. Turnbull, The Straits Settlements, 1826-1867: Indian Presidency to Crown Colony. London, Athlone Press, 1972.

Further to Penang, see John Bastin, 'A Historical Sketch of the circumstances which led to the settlement of Penang and of the trade to the eastward previous to, and since that period', Journal of the Malayan Branch of the Royal Asiatic Society, Vol. XXXII, Part 1, 1959., pp. 5ff. [See also, with the same article, in the same journal, M. Stubbs Brown, Appendix A, The Failure of Penang as a naval base and shipbuilding centre. An associated oft-cited title is H. B. Morse, The Chronicles of the East India Company trading to China. Oxford, 1929.; See

D. J. M. Tate, The Making of Modern South-East Asia. Vol. 2. The Western Impact: Economic and Social Change. Kuala Lumpur, Oxford University Press, 1971-1979., Vol. 1, p. 149ff, pp. 162-165, on F. Light see pp. 170-177, 232, 245. British acquire Penang, pp. 41, pp. 95-99.

Imperialist propaganda of the 1930s variety might put it thus:

"Malaya is one of the most striking examples of the administrative genius of the British people in moulding and bringing a region where anarchy and rapine had prevailed for centuries to conditions of peace and prosperity..." The area would have fallen to the Dutch if Francis Light made not his initiatives.

See A. Francis Steuart, 'The Founders of Penang and Adelaide, 1901', The Journal of the Indian Archipelago, Notices of Penang, edited by J. R. Logan.

Francis Light is mentioned in the Malayan Branch of the Royal Asiatic Society, 1925, including an article by Mr. L. A. Mills writing on British Malaya, 1824-1867, with a tribute to Francis Light.

Royal Asiatic Society also published in 1894, 'A Memoir of Capt. Francis Light by A. M. Skinner, CMG; in 1923, Early Days in Penang by Rev. Keppel Garnier; in 1929, A Contribution to the Early History of Penang by Mr. F. G. Stevens; in 1935, The History of Malaya by Sir Richard Winstedt. Cf, Sir Frank Swettenham, British Malaya. London, 1906. See also: T. H. Reid in The Malayan Peninsula, with material on Light's first attempt in 1771 to secure Penang. Clodd meantime studied the correspondence in the India Record Office.

Francis Light (1740-1794) the founder of Penang, merchant in cotton, possibly also dealing in opium, was of Woodbridge, Suffolk, illegitimate son of Squire William Negus and his lover, Mary Light. (Francis' son William was probably son of Francis' lover, Martina Rozells.)

A critic of Light's role was a later governor of Penang, Sir Robert Townsend Farquhar, (1776-1830), Bart. Son of Dr Sir Walter Farquhar, Bart, and Anne Stephenson. (Sir Robert married Maria Frances Geslip Latour.) Sir Robert was once in charge of an expedition to attack Amboyna - East Indies. He was also an uncle of the opium trader later noted here, Walter Stephenson Davidson, of Dent and Co. Sir Robert became an East India Company director about 1807; he once suggested that Britain abandon its convict colony at Botany Bay and go for Madagascar.

For criticism of Light, see Anthony Webster, `British Expansion in South-East Asia and the role of Robert Farquar, Lieutenant-Governor of Penang, 1804-1805', The Journal of Imperial and Commonwealth History, 1993-1994. Robert is not seen as a relative of William Farquhar, British commandant at Malacca about 1803. Clodd, Francis Light, pp. 140-148. Burke's Landed Gentry for Parker formerly Wells of Houghton Lodge. Burke's Peerage and Baronetage for Farquhar. Sir Robert's own DNB. See also Anthony Webster, 'The Political Economy of Trade Liberalization: The East India Company Charter Act of 1813', Economic History Review, Series 2, XL,III, 3, 1990., pp. 404-419. (Also especially valuable re the unusual attitude held by Barings about India trade.)

Francis Light entered the navy in 1759, as midshipman, later moving into East India Company service. He got command of a country ship for Jourdain, Sulivan and De Souza (a firm never otherwise described or outlined). Shortly, Light and a Mr Harrop went to Achin, unsuccessfully, to make a depot. Light had a fort at Kedah harbour by 1771, and by then he was writing to Jourdain, Sulivan and De Souza about bringing in Sepoys, but they as country traders could engage in no military activity; and Warren Hastings could not assist either. An associate of Light's at Kedah was Hon. Edward Monkton, and his mission also was a failure. Light however teamed up with "his friend", James Scott. (And as noted above, it is not known if this James Scott was related to the reorganiser from 1799 of the opium trade, David Scott Senior).

Monckton was the fifth son of Viscount Galway, and he'd joined the Madras civil service in 1762. Monckton was a partner of Madras free merchant George Smith, who wanted tin for China ships, Monckton married the daughter of the governor, Lord Pigot, in 1776. He died in 1832. See H. D. Love, Vestiges of Old Madras, 1640-1800. London, 1913.

In Dutton's book, p. xiii, p. 3, Francis Light is a "tough, practical sailor and trader", ... "of the true character of the empire-builder, in which personal interest and patriotism, an eye for profits and 'vision', love of adventure and honest administrative ability are so astonishingly mixed..."

Meanwhile, the definitive version of the Sulivan-Clive fight is said to be in work by Sutherland. More is known about the backers of Clive than of Sulivan.

Lucy Stewart Sutherland, The East India Company in Eighteenth Century Politics. Oxford at the Clarendon Press, 1952. On personages, see also: Sir Lewis Namier and John Brooke, The History of Parliament: The House of Commons, 1754-1790. [Two Vols.] London, Parliament Trust of Her Majesty's Stationery Office, London, 1964., for notes on various personages. Sir Lewis Namier, The Structure of Politics at the Accession of George III. Edn 2. London, Macmillan, 1957. Lewis Namier, England in the Age of the American Revolution. London, Macmillan. Edition 2., 1961.

Clive at seventeen became a writer (lawyer) for the East India Company in the early 1740s, but turned to the military. He took part in the siege of Pondicherry in October 1748. Dodwell in his book on Dupleix and Clive suggests that Clive may have been addicted to opium to end of his life, before he suicided. Certainly, Clive's story at times seems surrounded by men interested in opium trading: the British after all removed the Dutch from opium trade pathways. Clive had money affairs in 1753 with Walsh, Vansittart and Maskelyne. By 1754 he'd become a Whig MP for Sandwich for a rotten borough in Cornwall, but he was unseated by 23 March 23, 1755, so in April he left for India again. Various soldiers of Clive's time "doing well" included: Eyre Coote, Richard Smith, Thomas Rumbold, Richard Barwell, Nathaniel Middleton and Paul Benfield a speculator in debts of the Nawbab of Arcot.

References include: Entry, Clive of India, Encyclopedia Britannica.

Some of the beneficiaries of Clive's successes in India included: Clive's secretary Mr Watts got £117,000, Major Kirkpatrick got £60,750, Mr Walsh got £56,250, lesser figures got less. Gov. Vansittart was given £58,333. Mr Howell got £30,937. Confusingly, it is said, a sum of £7000 from India for Clive went through Laurence Sulivan. All up, about 125 nabobs got an average of £145,000 each. Kindleberger says Clive remitted £190,280,000 home between 1755 and 1759, with £210,000 coming on the enthronement of Meer Jaffier. Plus £27,000 per year from a jagir. Commenting on matters after the Battle of Plassey, Charles P. Kindleberger, A Financial History of Western Europe. London, George Allen and Unwin, 1984., p. 235.

Item re 1766: We find that by 1776, the French appointed a consul to Canton, and three seasons later a Scot, John Reid, later an opium trader, who had worked for the English East Company in Bengal. Reid became consul for Austria, or, his Imperial Majesty of Vienna. Mr [Laurence] Sulivan was closely examined by a committee on papers brought to London by John Shakespear, who had been trying to speak truth about the doings of the Supreme Court (in India) and at the same time "trying to be favourable" to the governor-general's plan (there was at the time no governor-general in India) in placing provincial courts under the Chief Justice.

On Sulivan, see Clodd, Francis Light, p. 6. Valentine, British Establishment 1760-1784, p. 842 of Vol. 2. See Coates, Macao, from p. 62. See Lt-Col Shakespear on Shakespear of Shadwell from pp. 42 in Chapter, India, 1767-1781, when in 1781 one John Shakespear brought papers from India, and had to speak on matters Indian, including Warren Hastings, and Sir Elijah Impey.

Once this John Shakespear was examined, his connections with India ceased (?!) but his son Arthur later observed that the Prince of Wales had backed John Shakespear as an aspiring EICo director, but Shakespear lost. (The reporter here, a descendant, Lt-Col Shakespear, does not go into the conflict between Clive of India and Sulivan.) Later, Lord Moira as governor-general in India wanted John Shakespear to go out to India again for a situation in Bengal worth £10,000 per year, but Lord Liverpool as prime minister insisted on Home Govt's right to make that particular appointment.

See Lt. Col Shakespear, p. 46. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790. Vol. 3, p. 509.

We can also consider a friend of Clive, Henry Vansittart (1732-1770 died at sea), governor of Bengal 1760-1764, or of Ormond Street, London, and also a member of the "Hell-fire club". Son of Arthur Vansittart and Martha Stonhouse. He married Emilia (Amelia) Morse. He had a place at Foxley. He by 1756 was a member of the Council at Madras, and a Company director 1769 till death. His DNB entry claims he has been unfairly treated by writers on India re Clive and abuses in Bengal. He was an early friend of Robert Clive at Fort St George.

I. B. Watson, Foundation, p. 115. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 3, p. 575. Valentine, British Establishment 1760-1784, Vol. 2, pp. 884-885. Burke's Landed Gentry for Thorntons. His own entry in DNB.

A relative... Joseph Walsh governor of Fort St George, married to Elizabeth Maskelyne. Related to the family of Clive of India.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 3, p. 602. His son's entry, Valentine, British Establishment 1760-1784, p. 903.

One of Clive backers/agents was John Walsh (1726-1795), MP, son of East India Company governor Joseph Walsh (above) of Fort St George and Elizabeth Maskelyne. He was a cousin of Clive. Walsh was a merchant in India, secretary to Clive and paymaster to Madras troops in 1757-1759. Walsh came home with a fortune, and laid Clive's plans before Pitt. He was elected MP in 1761, and joined the Royal Society. A became a trustee of Clive's will, and dealt with George Clive re money at Gosling's bank. (John's parents had died and he was brought up by his uncle Capt. John Walsh of EICo marine service.) John, Clive's cousin, got a fortune of £56,250 after the fall of Siraja-duala. In London he promoted the ideas of Chase Price to Clive of India, and seems to have had a major debt to Robert Mackintosh(?). John Walsh had a secretary, D. Davies.

Namier/Brooke indicate that Clive's own money was remitted home to his father in the names of Sir Edward Clive, Richard Clive, William Belchier, and William Smyth King.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 1, p. 224. See also Burke's Peerage and Baronetage for Powis. Some of Clive's descendants are listed in the DNB entry for Earl1 Plymouth. See also GEC, Peerage, Saint Germans, p. 311; Powis, p. 652.

Backed Clive. William Belchier Banker (died 1772), MP, married Jane Ironside wife1 and Frances Thomson. He bankrupts in 1760. He received much money remitted by Clive, but became a failed banker with Belchier and Ironside, later with How. He was later of 34 Nicholas Lane.

Namier, Structure of Politics, p. 55.

Secretary of Clive, Henry Strachey,

He is secretary to Clive in N. Chaudhuri, Clive, p. 433.

Clive's main opponents in Parliament were Burgoyne and Thurlow, his chief supporters were Wedderburn, whom Clive brought in from the pocket borough of Bishop's Castle, Conway and Lord George Germaine. By 1763, some East India Company figures backing Clive were: J. Boyd, G. Rooke, W. Thomson, Richard Smith. Another of Clive's bankers was Thomas Devon of Child's bank, who later abandoned Clive.

Backed Clive, Thomas Devon, banker at Child's Bank, active about 1762, backed Clive but then abandoned him.

Lucy Sutherland, The East India Company in Eighteenth Century Politics, p. 118ff.

Also amongst Clive's backers was banker Joseph Salvador who had Treasury connections. A Scots family, John Johnstone and his brother, governor George Johnstone, plus their uncle, Lord Elibank. (This John Johnstone is said to have survived the Black Hole of Calcutta, and took £300,000 out of India; he had many brothers, including Sir James Johnstone of Westerhall, and William Johnstone who married an heiress of a Pultney fortune and changed his name.)

Lucy Sutherland, The East India Company in Eighteenth Century Politics, p. 117. Valentine, British Establishment 1760-1784, re Robert Barker (1732-1789) assisting Clive at Plassey and Barker's later trip in 1762 to the Philippines.

Some personages: The father of Clive of India was lawyer and MP of Salop, Richard Clive (1693-1771), the son of George Clive and Elizabeth Amphlett. He married Rebecca Gaskell. He became a commissioner of bankrupts, and was first cousin of MP Sir Edward Clive.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790. Vol. 3, p. 224. Namier, Structure of Politics, table, p. 245.

Item: Margaret Maskelyne (1736-1816), daughter of Edmund Maskelyne of Purton and Elizabeth Booth. She married Robert Clive Baron1 Clive.

See Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, variously. Burke's Peerage and Baronetage, for Powis. GEC, Peerage, Saint Germans, p. 311; Powis, p. 652.

A Clive relative/ally was banker with Goslings and MP George Clive, active 1779, son of Rev. Benjamin Clive and Susannah Floyer. He married Sydney Bolton. He had gone to India in 1755, and by 1757 was an army agent getting a fortune of £15-20,000. He returned home in 1760 and joined Gosling's bank as a partner, till his death. He engaged in "splitting" of East India Company stock for Clive. He also dealt with money coming home from the names Carnac, John Call, Turner, Swinton, Gregory and Dr Fullarton, who promised to do business with Gosling. This man dealt closely with John Walsh and Luke Scrafton.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 223. Burke's Peerage and Baronetage for Clive of Whitfield.

Bankers: Clive of India used the bank Cliffe, Walpole and Clarke, and also Sir Francis Gosling and Robert Gosling. Clive also used Thomas Lane around 1762-1763. The partner of George Clive, Fleet Street banker Sir Francis Gosling (1702-1768), was son of Robert Gosling and Elizabeth Douce.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 223. Sutherland, The East India Company in Eighteenth Century Politics. Burke's Landed Gentry for Gosling of Thrimley House formerly of Hassobury.

Backed Clive. Charles Chase Price (1731-1777), MP, son of John Price and Elizabeth Chace wife2 He married Susan Glanville. His daughter married Bamber Gascoyne Jnr. He dealt with associates of Clive of India.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790 Vol. 3, p. 326. He is MP for Leominster. Burke's Peerage and Baronetage for Green-Price.

Backed Clive, maybe, Warren Hastings (1732-1818), governor-general of India, impeached, son of Rev. Peniston Hastings and Hester Warren. Hastings sailed on ship London for Calcutta as a writer in January 1750, having thrown aside a promising academic start. (Hastings' s military secretary was General William Palmer, whose descendant Sophia married Sydney trader Robert Campbell.) Marshall says Hastings' fortune was about £50,000. Warren's sister Anne married London Attorney John Woodman. Sir Francis Sykes Bart 1, (c1730-1804) looked after Hastings' affairs in England. Hastings like Clive banked with Goslings of Fleet Street. Hastings once dealt with free merchant Capt John Price (respondentia re three ships Calcutta-to-China. (See P. J. Marshall, co-dealers, p. 296.) Hastings's London agent was once Lauchlan Macleane who got in trouble, drowned on his way home to England, the Macleane problem caused an undescribed crisis in the affairs of Laurence Sulivan (died 1786). Here, Richard Barwell a soldier done well from Clive's affairs in India, helped out Sulivan, who died £23,000. Sulivan;s son Stephen (1742-1821) gained a fortune in India with Hastings' help, as an opium contractor, Judge-Advocate General and agent victualler for the British Squadron 1781-1785. A partner in a business firm with Hastings was one T. Hancock. Who's Who in Boswell, p. 154. H. P. Clodd on Francis Light, p. 7.

See P. J. Marshall, 'The Personal Fortune of Warren Hastings', Economic History Review, Series 2, Vol. XVII, Nos. 1, 2, 3, 1964-1965., pp. 284-300. See also Foster, John Company, pp. 214ff.

Backed Clive. A confusing story unfolds. East India Company speculator Lauchlan Maclean (1727-1778), MP, once governor of St. Vincent, 1766, under secretary of state, 1766-1768, collector at Philadelphia, 1772, comptroller of army accounts in Bengal 1772-1773, commissary of musters Bengal 1773. He practised medicine early in Philadelphia, bought much land in the West Indies, was an intimate of radical John Wilkes. Maclean took in with the 1766 speculative boom in EICo stock, in Paris, Amsterdam and London markets, involving Lord Verney and William Burke, dealt with Sir George Colebrooke, and began to manage the EICo affairs of the Sulivan faction. He suffered badly in the 1769 collapse of EICo stock, went down by £90,000 and was totally ruined. By 1775 he was a paid agent of Warren Hastings and the Nawbab of Arcot.

He may be the Lauchlan, not Donald, see Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 3, p. 93.

Backed Clive: Thomas MP Gov Madras Rumbold (1736-1791), Sir, Bart1, son of William Rumbold of EICo and Navy, and Dorothy Cheney. Rumbold had two wives, Joanna Law wife2 and Frances Berriman wife1. He backs Clive's faction. His family had strong EICo links. Gov Madras.

He is noted variously in Trotter's biography of Warren Hastings. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 3, p. 381. GEC, Peerage, Rivers, p. 32. Stenton, British Parlt, Vol. 2, p. 335. His own DNB entry.

Backed Sulivan. EICo figure and MP Sir Robert Fletcher (1738-1776), son of Robert Fletcher and Elizabeth Lyon, he married Anne Pybus. He is in the "batta mutiny" against Clive. He imprisons Lord Pigot. He is an ally of Sulivan against Clive in India.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 440. Item in Indian Dictionary of Biography, item per Patricia Iseke.

Sir John Call FRS MP 1786 (1732-1801), of Tiverton, Devon, son of John Call of Cornwall and Jane Mill. He married Philadelphia Battie and went blind in 1795. He was an "armchair colonist" with views given to government on proposals for a convict colony at New Holland. Call's later expressed views on the British East seem an outgrowth of the Clive-Sulivan divisions of opinion.

See also, David Mackay, 'Banished to Botany Bay: the fate of the relentless historian', a response', pp. 214-216, a riposte to Alan Frost, 'Historians, handling documents, transgressions and transportable offences', Australian Historical Studies, Vol. 25, April 1992-October 1993., pp. 192-213, and p . 215. GEC, Peerage, Aylmer, p. 370; Castle Stewart, p. 98. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 176. Valentine, British Establishment 1760-1784. The definitive work on the debts of the Nawbab of Arcot is J. D. Gurney, The Debts of the Nawbab of Arcot, 1763-1776., Oxford Ph.D, 1968. See Frost, Convicts and Empire, on Call, pp. 21ff, and p. 203, re the Nawbab of Arcot and Call's financial dealings with the Nawbab. Call knew Paul Benfield, one of the major creditors of the Nawbab of Arcot. H. Richmond, The Navy in India, 1763-1783. London, Ernest Benn, 1931. (Call had a cousin Thomas in Burke's Peerage and Baronetage for Brooke of Brookeborough who marries into that line. His youngest daughter is in Burke's Peerage and Baronetage for Mackinnon. In 1784 Call became a partner in bank Pybus and Co of 148 New Bond St. He had been engineer at Madras, worked closely with Clive and amassed a fortune. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 176.

Sulivan for still-unclear reasons had been fractious before Clive's Indian successes became conspicuous. Sulivan helped organize a revolt of East India Company proprietors in 1758 and then waged constant electoral warfare on Clive in the 1760s. Sulivan wanted reform which curbed the Court of Directors' powers.

On the power struggle, see Sutherland, The East India Company in Eighteenth Century Politics, p. 46.

(Bowen, Revenue and Reform, p. 46 cites (Note 46) Sulivan's paper to Lord Shelburne on the condition of the East India Company and an outline plan for reform, 1767, Clements Library, Landsdowne MSS 90, f.84. On Sulivan's views on the Company and re Bengal providing £400,000 per year to government, see Bowen, Revenue and Reform, pp. 64-68.)

On Laurence Sulivan see H. V. Bowen, Revenue and Reform: the Indian problem in British Politics, 1757-1773. Sydney, CUP, 1991. see p. 33 re merchant names for a list of leading speakers on the EICo and Indian issues. H. V. Bowen p. 31ff, cf, H. V. Bowen, '"Dipped in the Traffic": East India Stockholders in the House of Commons, 1768-1774', Parliamentary History, 5, 1986, pp. 40-42.

The account said to be definitive of the Clive-Sulivan power struggle is to be found in Sutherland, The East India Company in Eighteenth Century Politics, Chs. 4-5, p. 31. Bowen's book, it is said, p. 40 cites A [1773] List of the names of all the Proprietors of East India Stock [9 Mar 1773]. One senior East India promoter of Clive was Sir George Colebrooke in 1766 and later.

See also J. M. Holzman, The Nabobs in England, 1760-1815: A Study of the Returned Anglo-Indian. New York, 1926; H. C. Bowen, Revenue and Reform, pp. 41ff. For 1772-1773, while the East India Company built up its tea inventory problems which helped provoke the Boston Tea Party, the Company's chairman of directors was Sir George Colebrooke; p. 46, p. 54. See Sutherland, The East India Company in Eighteenth Century Politics, citing her own title 'Sir George Colebrooke's World Corner in Alum', Economic History, supplement, Economic Journal, Feb. 1936., pp. 237ff.

Backed Clive Sir George Colebrooke (1729-1809), Bart2 Gov EICo, army/government contractor, Whig, son of James Colebrooke of London and Mary Hudson. His son is the Sanskrit scholar noted in Encyclopedia Britannica. He is a government contractor in Namier, Structure of Politics, p. 440, notes. In 1762 he had a contract to remit money to forces in America, one contract with Thomlinson, Nesbit and Hanbury. By 1766 he was a speculator in EICo stocks, and projected the Vandalia settlement in America (Ohio Valley). In 1767 he was elected a director of EICo, in 1768, chairman in 1769-1772. Colebrooke backed Clive and knew the Johnstone family who assisted Clive; he was in a coalition with Sulivan as engineered by Lord North (?), but was left a creditor of Lachlan Macleane and Mary Barwell sister of Richard. He was semi-partner with Sir James Cockburn Bart8 and an excessive speculator on the stock market in 1772 at time of the Fordyce crash. In 1771 he lost a speculation of £170,000 in hemp and he'd wanted to corner the world supply of alum. He entered his father's bank, and was left in sole control by deaths. Colebrooke became ostentatiously wealthy, and wanted to buy land in Scotland. His wife had plantations in Antigua and he had Grenada land worth £50,000. Colebrooke helped build the first London stock exchange in 1772 and speculated ambitiously in raw materials. His bank closed in 1773 and he bankrupted . Colebrooke was Company chairman in 1772 when deputy-chairman was Laurence Sulivan.

See Lucy Sutherland, The East India Company in Eighteenth Century Politics. Valentine, British Establishment 1760-1784, p. 191. Cf., Lucy Sutherland, 'Sir George Colebrooke's world corner in alum, 1771-1773', Economic History, 3, 1936, pp. 237-257, cited in See J. Price on Joshua Johnson in London, p. 163, Note 39. His daughter in Burke's Peerage and Baronetage for Grant of Dalvey. GEC, Peerage, Tankerville, p. 634. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 235. VIP see R. B. Sheridan on 'colonial gentry of Antigua', p. 349.

Backed Sulivan Mary Barwell, active around 1770, daughter of EICo governor William Barwell and Elizabeth Pierce. Mary is the only woman known to have organised an EICo voting interest in the post-1764 Clive vs Sulivan conflict. Barwell family supported Colebrooke and L. Sulivan.

Hodson Lists. Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 60. Sutherland, The East India Company in Eighteenth Century Politics, p. 244.

Backed Clive, MP Robert Jones, EICo director, active about 1774, of Clement's Lane Lombard St, London and Babraham, Cambs. Director EICo 1754-1758, 1765-1769. He began as a Lisbon trader, and in 1743 went into partnership with Thomas Tierney father of George Tierney later MP. Jones acted politically for Sandwich. Jones's brother John became receiver land tax of Berkshire. Robert had a victualling contract for troops in Nova Scotia 1770 till his death. He loaned heavily to government, some £100,000 in his jobbing account at the bank, 1760-1763. He lost his EICo seat in the Clive/Sulivan dispute where he supported Clive. He remained unhappy his daughter had married Adeane, so he made his grandson Robert Jones his chief heir.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 691. Burke's Landed Gentry for Adeane of Babraham.

Backs Sulivan Henry Boulton (1709-1773), governor EICo Crabb, son of father unknown and a widow, Hester Crabb. He at first followed Laurence Sulivan but moved to the Clive camp. He became EICo paymaster various, director, EICo 1753-56, 58-61, 63-65, 67-70, 1772 till death, deputy-chairman 1764-65, chairman 1765-66, 1768-69, (around the time of Sulivan's pushing and shoving) and 1773 till death,. He added the name Boulton in 1746. He became known as Henry Crabb, later Henry Crabb Boulton, about 1754.

Namier/Brooke, The History of Parliament: The House of Commons, 1754-1790, Vol. 2, p. 267. Sutherland, William Braund, p. 117.

And lastly, ignoring the Clive-Sulivan dispute? EICo governor John Payne (1708-1764) of No. 9 Lothbury. He took his money into a new bank just before his death, Smiths Payne Smiths. His parents are unknown, wife unknown, but he had a brother Edward. The Smith-Payne bank was "probably" a founder of the London Bankers Clearing House in 1770, with fair sums circulated there in 1777 by Smith and Payne. After John Payne died the family firm moved to 18 Lombard Street, a site which was purchased in 1782 by Phoenix Fire Insurance Co. Smith Payne and Smith as bank ended at No 1 Lombard Street. One author notes that Payne probably "presided" over the value of the achievements of Clive of India at the time he was chairman. No. 9 Lothbury in those days abutted onto Coleman Street. The family firm of linen drapers by 1758 had a capital of £48,000.

See Burke's Landed Gentry for Lane formerly Pickard-Cambridge of Poxwell. He has a brother, Edward: see Lucy Sutherland, A London Merchant, 1695-1774: William Braund. London, OUP, 1933., p. 117. Leighton, Smiths the Bankers, pp. 68ff; the Smith-Payne bank opened with a capital of 16,963/8/71/2d. p. 53.

In 1767, Sulivan warned that the East India Company directors might be tempted to extend their conquests to China (an easy acquisition?) at a time when London was concerned - November 1767 - about how much specie was going to China. There was also the matter of the disastrous Bengal famine, caused by drought and crop failures (and British mismanagement of resources) of 1768 and 1769, which cost the lives of about one third of Bengal's population.

Bowen, Revenue and Reform, pp. 95-119. The resulting trade losses from the Bengal famine incidentally are not discussed by British writers, but drastic statistical slides are obvious in Dutch figures on Bengal's trade for the period of the famine! Bowen (p. 179) writes, Sulivan declared the native population of Bengal would never part with their money except by compulsion.

Sulivan's backers included: P. Godfrey, C. Gough, H. Plant, T. Phipps, T. Rous, H. Savage, T. Tulie, G. Dudley, all of whom had been in India. Yet no one records anything of Sulivan's partners!

Lucy Stewart Sutherland, The East India Company in Eighteenth Century Politics. Oxford at the Clarendon Press, 1952., p. 66.

Possibly, Sulivan's unclear motives had something to do with Light's activities, as follows:

From October 1760 to 1761 about four British country ships traded with Selangor. Two country ships were Cornish and Neptune, seized by the Dutch for importing opium to Selangor, leading Calcutta to protest. A first recorded visit to the Riau capital of the Johore Empire was in 1765 when Plassey Capt. Austin called there; trade well developed by 1771.

In 1766, Jourdain of the firm Jordain, Sulivan and De Souza (JSDS) sent Indian Trader to Achin, their man was Gowan (sic) Harrop, factor for Madras at Achin, who used bills of exchange to be drawn on Jourdain; JSDS sent Light to Achin to Kedah in 1770 and got tin in their own ships. By early 1772 they had sent goods worth nearly £120,000 to Achin, most to go to Canton. (Bugis had attacked Kedah in 1771.)

Another East India Company man to view Kedah and its prospects was Charles Desvoeux. Also, Giles Holloway was turned away by the Sultan of Kedah in late 1771. In November 1780 Eyre Coote, the commander-in-chief in India, warned London the French in Pondicherry were storing provisions and raising troops to fight Hyder Ali, who had invaded the Carnatic. So, Lawrence Sulivan and William James of the Company directors approached Lord Hillsborough, secretary of state for the northern department, in November 1781 with a proposal to destroy Pondicherry altogether. Britain also wanted to seize the French settlement in the Seychelles Islands and to establish a British fort at Achin, with other settlements being made at Nicobar and Andaman Islands.

Sulivan also feared that Bencoolen would fall to the Dutch, taking pepper. He had heard rumours that William Bolts would work for "Austria" and open an Austrian settlement in the Nicobars and was looking at Achin.

On Bolts, see Frost, Convicts and Empire, p. 47.

Hillsborough sent Sulivan's and James' views to George III and then circularised India on the need to establish a British base at Achin. In September 1782, Henry Botham of the East India Company was sent to open a British fort at Achin. Achin would only accept a resident agent, and this became I. Y. Kinloch early in 1784, but he was in Achin only a short time.

Forrest scouted for the Company and had a view to forestall the French, though he mostly wanted to avoid unwelcome entanglements with anyone. Riau was taken by the Dutch in 1784.

In 1782 Betsy a Company ship had gone to Riau to sell opium, to meet "a loan raised by Warren Hastings for the Canton remittance". The French captured Betsy with Dutch help, and this raised a war with Raja Haji and the Dutch East India Company.

Here, a good friend of Light and Scott was Thomas Mercer, who had been shipping bullion to Canton. In 1772, Mercer was captain of a country ship Generous Friend and in 1774 he was on Crescent. Mercer was in Kedah in January 1772 and James Scott was in touch with him at Selangor in 1783. Crescent sailed to Canton. By then, James Scott was "a famous country trader" and had once met Forrest out scouting. Scott had begun promoting the establishment of Penang from 1780.

E. H. Pritchard, The Crucial Years of Early Anglo-Chinese Relations, 1750-1800. Pullman, Washington, 1936. David E. Owen, British Opium Policy in China and India. New Haven, 1934. D. K. Bassett, British Trade and Policy in Indonesia and Malaysia in the late Eighteenth Century, Ch. 3 of British Commercial and strategic interest in the Malay Peninsula during the late eighteenth century. Inter Documentation Company, Zug, Switzerland., Aug 1971., pp. 50-71.

Sulivan's firm with all of this still seems to have gotten its way concerning the establishment of Penang - and the taste of "free merchant opium" seems to remain.

Horsea Ballon Morse, 'The Provision of Funds for the East India Company's Trade at Canton during the Eighteenth Century', Journal of the Royal Asiatic Society, 1922, April, Part 2. (Rare); Om Prakash, Opium Monopoly in India and Indonesia in the C18th.; Earl Hamilton Pritchard, 'The Struggle for Control of the China Trade during the Eighteenth Century', Pacific Historical Review, Vol. III, 1934., pp. 280-295. Conrad E. Wright, Merchants and Mandarins: New York and the Early China Trade, in New York and the China Trade. New York, New York Historical Society, 1984., pp. 17-54.;

Assistants to Light's plans for Penang were James Scott, Andrew Ross, Sir Archibald Campbell and Alexander Dalrymple.

H. P. Clodd, Malay's First British Pioneer: The Life of Francis Light. London, Luzac and Co., 1948., pp. 50-54. J. C. Pasqual, An Historical Memoir of Penang, Penang Gazette, May 25, 1922, cited in Clodd, Life of Francis Light, p. 46.

One Walter Pigou remained as Light's "writer" from the establishment of Penang. Light's friends and agents by 1793 were Fairlie and Co. of Calcutta, Light's executors along with George Doughty (who had a sister Abigail). Light, who died of malaria, named as his executor in India, Fairlie and Co., (William Fairlie of Calcutta, who retired in 1810 with a fortune of about £300,000.) Light for the education of his son William sent money to John Ferguson and Co. In England, James Scott died 1810 with a fortune of £203,000 but contract debts of £333,628 and a mortgage of £88,500, with £68,500 of that mortgage with Fairlie, Gilmore and Co. Dutton says Fairlie at some time had funds with Messrs Carnegy and Co. of Prince of Wales Island. Did Laurence Sulivan (died 1786) influence matters for establishment of Penang in 1786? There is an ideological similarity between the views of Sulivan, and his feud with Clive, and the activities of Light, which seems to leave unspoken (in London) one important matter, an interest in opium!

Geoffrey Dutton, Founder of a City: The Life of Colonel William Light, First Surveyor-General of the Colony of South Australia, Founder of Adelaide, 1786-1839. Melbourne, Cheshire, 1960.) pp. 20-25.

There is another mysterious matter of opium dealing, concerning the name Baring. MP William Baring (1779-1820), MP, son of banker Francis Baring and Harriet Herring, married widow Frances Thomson. Bulley sees him as an opium and cotton dealer in Bulley, Bombay Ships, pp. 108-112ff. He had years in India, also, it seems, China.

Burke's Peerage and Baronetage for Northbrook, and for Eden (as Frances Thomson had been married to one Arthur Eden). Capt. William Henry Baring (1819-1906), son of William and Frances Thomson, married Elizabeth Hamersley about 21 April, 1849. Burke's Peerage and Baronetage for Northbrook.

Another little-mentioned matter with the early history of Penang is the use of Indian convict labour. Clodd (p. 120) does mention "Indian convict labourers". After 1786, Frost mentions them in Convicts and Empire p. 142, p. 148, also mentioning that an associate of Sir Joseph Banks, the botanist Kyd, fortified Penang. By 1787, British India was also looking at the Andaman and Nicobar Islands, and, would Port Cornwallis on the Andamans eclipse the strategic usefulness of Penang?

D. J. M. Tate, The Making of Modern South-East Asia. Vol. 2. The Western Impact: Economic and Social Change. Kuala Lumpur, Oxford University Press, pp. 162ff notes Singapore's trade grew rapidly and shortly eclipsed that of Penang. Penang dominated the trade of her own area, from the Mergui archipelago to the north across to the shores of northern Sumatra, down the west cost of the Malayan Peninsula. Penang's trading spheres versus that of Singapore represented a natural division between the south-eastern and north-western sectors of the region. Penang was a good market for easterning only till 1819, and traders from the east had to face the pirates of the area and contrary winds as they sailed up the Straits of Malacca. Once Singapore opened, it ate into Penang, the eastward trade vanished "overnight", and in three years writes Tate, the value of the trade at Singapore had surpassed that of Penang. A recession had set in after 1810, however, and the British occupation of Java had helped. The British war of 1812 with US broke off other valuable commerce in the region. Penang failed to develop into a great naval base. Calcutta had raised Penang to a presidency in 1805 in anticipation it might become a great naval base, but by 1810 it was clear that this would not happen at Penang, so Penang was left, though with top-heavy administration. Singapore won its regional battle by 1819. Tate, Making of Modern South-East Asia, Vol. 2, pp. 149ff. See also A. F. Steuart, Founders of Penang and Adelaide, p. 45. Clodd, Life of Francis Light, pp. 134-136.

Surveyor-General of Adelaide, William Light (1786-1839), son of Francis Light and Martina Rozells married firstly Miss Perois and then Mary Bennet (who had a fortune). When he was 21 in England he met the Prince Regent, who "liked him". When William Light, son of Francis, the friend of James Scott, was trying to regain his father's money, it is said he initiated a suit against Jardines, as they had probably bought the debts of Scott's firm which had gone bankrupt by about 1819, and Fairlie's firm, which had also gone bankrupt by then.

See W. Light's ADB entry. A. F. Stuart, The Founders of Penang and Adelaide. nd; Thomas Gill, 'The Life of Light', South Australian Branch of the Royal Geographical Society nd. Geoffrey Dutton, Founder of a City: The Life of Colonel William Light, First Surveyor-General of the Colony of South Australia, Founder of Adelaide, 1786-1839. Sydney, Seal Books, 1971. Mary Penelope Mayo, The Life and Letters of Colonel William Light. Adelaide, E. W. Preece, 1937. . H. P. Clodd, Malay's First British Pioneer: The Life of Francis Light. London, Luzac and Co., 1948. Dr. A. Grenfell Price, Founders and Pioneers of South Australia. Geoffrey Dutton, Founder of a City: The Life of Colonel William Light, First Surveyor-General of the Colony of South Australia, Founder of Adelaide, 1786-1839. Melbourne, Cheshire, 1960.

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