The French Compagnie des Indes: Bound to Lose? A Comparison of the French and British East India Companies in the Age of the Carnatic Wars

By Patrick Charell

Eighteenth century European history was determined by the ancient rivalry between France and Great Britain. Wars, formerly limited to regional and dynastic boundaries, increasingly globalized due to economic development and the booming Atlantic trade. By the time the French had finally gained a foothold in India, the formerly dominant powers Portugal and the Netherlands had fallen into ‘décadence’.[1] They played no considerable role in eighteenth century trade to the Subcontinent, the British East India Company (EIC) and the French counterpart, the Compagnie perpétuelle des Indes (CdI), remained as rivals for economic supremacy. Though contemporary historians claim that the French were considerably better in business in Asia until the 1750s with a higher profit than the British company, Anglo-American historians tend to rank the CdI’s role in India as a mere footnote, caused by a retrospective view of the British Empire.[2] Still in 2009, James Collins mentions the CdI in a few sentences.[3]

Why do I choose the era of Jean-François Dupleix for this essay? Probably French-Indian colonial history’s best-known personality, his active time of duty spans from 1730 to 1754. One reason is that this is a manageable frame; furthermore, these years cover an era untroubled by the problematic reconstruction of the French company or the common crisis of the ancien règime in the late eighteenth century.

Structure and Organisation

By a royal decree dated May 1719, the CdI arose from a merging of two old companies, the Compagnie d’Occident (founded in 1664) and the Compagnie des Indes which had been de facto inactive since 1693 and chartered by a consortium of merchants in Saint-Malo.[4] On 30th August 1723, the operating structure was reformed once again by a new decree and a so-called Conseil des Indes was installed. It consisted of one Chef, one Président and six directors with a supportive advisor, one pair for each separate department. Four had their seats in Paris and controlled the affairs of India, China, Macau and the Mascarene Islands (Territories beyond the Cape of Good Hope), secondly Canada, Senegal and Guinea (Atlantic) while the third and fourth department organised purchasing, bookkeeping and overall accounting. Consequentially, the director residing in the major port of L’Orient had to deal with the construction, repair and supplementation of the company’s ships, whilst the sixth took over the disposal and distribution in the merchant city of Nantes.[5]

In 1698, a new English Company Trading to the East Indies (commonly called New East India Company) emerged parallel to the still existing East India Company founded almost a century before. In 1709, both companies unified and therefore stopped the trade rivalry. [6] The Charter of 1698 provided twenty-four directors elected annually by a general assembly of stockholders, called the General Court. Only thirteen actually moved to the Court of Directors domiciled in the India House, London and were directed by a Chairman and Deputy Chairman.[7] The remaining eleven directors led the single Comittes, which were subordinate to the Court of Directors. [8]

The French possessions in Asia had officially been governed by a governor-general from the Isle Bourbon (Mauritius) with cities, such as Pondicherry, being local capitals of indirect authority. In comparison, until the final nationalisation of the EIC in 1876, British-India was divided into three Presidencies: the Presidency of Bombay, of Madras (of Fort St. George) and the Presidency of Bengal (of Fort William). The presidents ruled their territories quite independently and had the authority of drawing letters of marque as well as promoting naval officers in the name of king and company.

From the very beginning of the French CdI, the executive committees as well as the stockholder meetings consisted of a wide variety in social means: Authors like Voltaire, members of the Académie française, merchants and Parisian craftsmen, people involved in the royal court, members of the ancient and patent nobility. However, foreigners also owned shares, amongst them Genoese and Englishmen! [9]

The majority of EIC shareholders originated from the London milieu, yet next to the traditional English gentry, many continental-European investors can be found.  In fact, there was a disproportionate number of Dutch investors at 21%. Until 1761 no Welsh, no Irishman nor Scotsman held any shares. [10]

In conclusion, neither company had a significant advantage based upon its inner structure. The CdI was reformed several times in its early years, yet it worked efficiently until the French revolution. The later but equally as extensive restructuring of the EIC cannot be seen as an advantage. The system of having a general assembly, a certain division of labour in management, is common to both. The EIC elected its directors, but the CdI too could rely upon professionals and experts who could support (or guide) their colleagues. Both competitors shared far more commonalities than significant differences.

Bases and Factories

One can agree with Michael Mann that just with the final transition to territorial powers, the European trade companies could interfere in the Indian production and distribution. [11] The EIC had already achieved that with the purchase of the former crown colony Bombay from Charles II in 1698, after obtaining local governmental permission to found factories in cities of Gujarat, Hindustan, Bengalen and Carnatic, ‘and in other places’ in the 1650s and 1660s. [12] St George and St David next to the cities of Masulipatnam, Pulicat, Armagaon at the Coromandel Coast.

Around 1740 the French CdI owned numerous factories and bases, too. At the Coromandel Coast, Pondicherry and Carical, as well as Yanano close to Masulipatnam, flew the fleur-de-lis, such as Patna at Hugli River and Chandernagore in close proximity to British Calcutta and Mahé at the Malabar Coast.[13]

French bases had been less numerous, yet they concentrated on important fortified cities and were thus better established. To cut it short: When Dupleix was appointed general-governor in 1742, the CdI could feel superior to the British rival: Pondicherry, Mahé, Patna, Chandernagore and Yanano versus Bombay, Calcutta and Madras.

Fleets

Apart from the number of bases on site, the fleet and its size determined success or failure of naval business. For an authentic evaluation, the ships which solely sailed under the flag of the East India Companies shall be counted because still in 1781 there was a distinct difference made between ships and troops of the EIC and those of the crown. Between 1730 and 1771 William Henry Sykes had enlisted 220 ships belonging to the CdI. To be more precise: 1719 -1754, 37 ships had been applied, in the midst of the 1750s Sykes counted up to 79 ships with an average cargo capacity of 725 tons.[14]

Even though this might sound fairly impressive, in the period of 1730 to 1755 the EIC had 204 ships under contract[15]! Especially in times of war and crisis, this gave an inestimable advantage over the French CdI, as ships ensured, next to the mere economic purposes, the protection and supply of the distant bases.

War and Peace: Diplomacy

At the time frame of this essay there was no such thing as a dependent relationship concerning the Indian rulers. On the contrary, the companies had to arrange themselves with the crumbling imperial administration as well as the freshly emerged dynasties to create a basis for future economic projects. Depending on the location of the base, they saw themselves as bribe-paying subjects to the Nawāb of Aurengabad, the Nizam-ul-Mulk of Hyderabad or some other local grand prince; not the least of whom was the Great Moghul as the nominal supreme leader. To them all European companies not only paid tribute but also asked for active help against each other as a subordinate conciliator or as a protecting power. At best, the companies could function on the surface only, and even that was dependent on the financial interests of the Indian princes.

The EIC profited from the early struggles of the CdI between 1682 and 1719, as it ceased to exist as a political subject in that time. The British were able to convince many local potentates they were the better ally. However, Jean-François Dupleix managed to restore both French reliability and credit with his personal dedication, charm and ruthlessness.[16] Additionally he adapted the local traditions and displayed great luxury in both his clothing and representation in order to level up to the Indian princes in a high context – language, strengthening the French company’s position, even though the management in Paris and officials ad loco did not fully understand that strategy.

Neither did the British agents show difficulties in using local customs for their purpose. Yet in England, perhaps owing to a different religion and lifestyle than in France, the distinct political rite of mutual gifting (nazr) had not been fully understood until the 19th century. In the Regulation Act of 1761 this clash of cultures escalated, taking the nazr for mere corruption: ‘Not the management, no judge, governor or common employee was allowed to accept any present, gift, donation, gratuity, or reward, pecuniary or otherwise’ in future.[17]

The military campaigns executed by the CdI and the EIC changed drastically during the War of Spanish Succession 1701-14 and the Seven Years War 1740-48. In the West and East Indies they had focused on the protection of their trade in earlier operations until a more offensive strategy merged in order to prevent the enemy’s victory by all costs, destroying the base of his income to enforce peace.[18]

The French crown, never allowing local initiatives, had to bear the decisive strategic disadvantage of being a continental power with primarily European ambitions. Simultaneous warfare in Europe, Africa, America and India caused France to ‘sit between chairs’ Paul Kennedy commented.[19]

On the other hand, the mercantile-oriented British foreign policy won thanks to the focus on naval power. Furthermore, the initiative laid with non-governmental organisations such as the EIC was then ratified by London.

Conclusion

The Compagnie perpétuelle des Indes had excellently established itself through its organisational abilities following its reestablishment in 1719. Differences in the corporate structure can be seen as marginal. Until the Carnatic wars in the midst of the eighteenth century, the CdI made more profitable deals than their British rival. The Indian bases and factories with the headquarters of Pondicherry were located in larger cities, and were therefore more secure, lucrative and politically important. The growing frequency of wars between the European powers devastated both nations’ economies, though the international financial market of London cushioned many damages.

The major disadvantage both the CdI and the continental Great Power France in general had was their inferior navy and merchant fleet, both in number and quality, to the seafaring Great Britain. Only through its supremacy at sea did the EIC find itself able to gain the upper hand in the struggle for India. This dominance caused a stabilization of prices and a higher tonnage of goods intended to be shipped. Moreover, it convinced more Indian princes to look at the British as the only worthwhile ally. Therefore, the answer to the question must be: the CdI did not suffer under any sort of birth defect, nor did any major mistakes cause its downfall.

 

[1] Paul Gaffarel. Les colonies françaises (Paris 1880) p. 243.

[2] Michael Mann. Geschichte Südasiens 1500 bis heute (Darmstadt 2010), p. 69.

[3] James Collins. The State in Early Modern France (Cambridge, New York, Melbourne 2009), p. 117.

[4] Phillipe Haudrère. La Compagnie Française des Indes au XVIIIe siecle 1719 – 1795 (Paris 1989).Vol. 1, p. 40.

[5] Ibid., p. 436.

[6] The Charter of the ‘New’ East India Company, S. 193f. See India Office Records of the British Library: History and scope. Online: http://www.bl.uk/reshelp/findhelpregion/asia/india/indiaofficerecords/indiaofficescope/indiaofficehistoryscope.html [06.11.2014].

[7] See Vincent Harlow (Ed.). British Colonial Developments 1774 – 1834. Select Documents (Oxford 1967), p. 4.

[8] John Keag. The Honorable Company. A History of the English East India Company (New York/ Oxford/ Singapur 1991), p. 114.

[9] Haudrère (1989), p. 50 – 54 & 169 – 171.

[10] Huw Bowen. The Business of Empire: The East India Company and imperial Britain, 1755 – 1833 (Cambridge/ New York/ Melbourne 2006). 3. ed., p. 111.

[11] Mann (2010), p.  82.

[12] A. I. Chicherov. India. Economic development in the 16th – 18th centuries. Outline history of crafts and trade (Moscow 1971), p. 117.

[13] Peter Wende. Das Britische Empire. Geschichte eines Weltreichs (Munich 2009). 2d ed., p.95.

[14] See William Henry Sykes. Vital Statistics of the East India Company’s Armies in India. European and Native. In: Journal of the Statistical Society of London, 10 (May  1847), Nr. 2, p. 100 – 131. Online http://www.jstor.org/stable/2337686 [08.08.2013].

[15] Register of English merchant shipping, 1500 – ca. 1900. British National Maritime Museum, AML/G/2.

[16] Henry Weber, Henry. La Compagnie Francaise des Indes 1604 – 1875 (Paris 1904) p. 388.

[17] North’s Regulating Act, 1773 (Clauses relating to the organization of the Company). In: Patrick Tuck (ed.). The East India Company 1600 – 1858, Vol. 2 (New York 1998) p. 111 – 116.

[18] Julian Corbett. England in the Seven Years’ War, Vol. 1 (London 1992) p. 120.

[19] Paul Kennedy. The Rise and Fall of the Great Powers (New York 1987) p. 152.

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