Assignment

BA (Hons) History IV Semester 2019

AKSHAT TYAGI
Roll No. 1184

Introduction

The 18th Century represents a very complex socio-economic transition from

during the Mughal rule to the Company rule. Unlike the earlier assumptions about
linear degradation of politics and economic wealth, there are new emerging
perspectives about the period. In the following essay we make a thorough analysis
of these disagreements.

Socio-economic conditions of the 18th Century

Historians of the Aligarh School have presented several powerful arguments about
the decline of the Mughals in the 18th Century. It has been argued that the fiscal
collapse of the Mughal state was due to Jagir and Mansab i.e their own policies
rather than other factors. There was also additional pressure on the state
exchequer because of expansionist wars, rebellions and the attempt by the
Mughal state to accommodate newer elements in the higher echelons of the
administration i.e. within the mansabdari system.

It is argued that the main cause of dissatisfaction among the larger populace was
due to the high demand of patronage without the availability of enough jagirs to
award. Habib has argued that the revenue demand on the peasantry was high and
with the transferability of jagirs the tendency of mansabdars to squeeze the
peasantry grew. Abandonment of land, flight to more hospitable regions or open
rebellion were the paths that the Mughal peasantry took to resist growing
exploitation. According to this perspective the rebellions of Jats, Satnamis,
Marathas and Sikhs were really the peasant revolts against the Mughal Sultanate.

It can be safely said that Aligarh Historians believe that the Mughal ruler dug a
grave for themselves by being unable to satisfy their base of mansabdars and in
the process also upsetting peasants. Their centralised financial system was unable
to innovate in rapidly shifting contexts of the 18th century.

But there is also an alternative perspective about the abundance of jagirs. Awadh
and Punjab were fairly opulent provinces, and thus the rebellions there was more
than just peasant disgruntlement. This was a serious challenge to the ‘high
revenue leading to exploitation – leading to poverty – leading to rebellion’
argument. It is argued that contrary to the Aligarh school these zamindars were
revolting because of their unwillingness to share the wealth with the Mughal state.
Similarly some historians are of the opinion that distant provinces were more or
less unimpacted by the Mughal administration so the argument about excessive
centralised control actually falls flat on its feet.

The two broad contexts of debate are : decline of the Mughal state did not indicate
an overall economic decline. Political and social forms also survived in areas where
the Mughal reach had been limited.

A useful understanding about the post-Mughal political formations can be drawn

by classifying them into three categories - successor states, warrior states and
compact states.

Successor states included provinces like Bengal, Awadh and Hyderabad which
were relatively large and succeeded Mughal administration in entirety in their
respective regions. Murshid Quli Khan, Saadat Khan, Asaf Jah had always been
significant players in local politicals even under the hood of the Mughal emperors.
They leveraged the moment of Mughal decline to create for themselves
independent futures merging the earlier institutions of nizamat and diwani. Even
while they continued to acknowledge Mughal crown as their patron, they in effect
stopped following fiscal and military obligations.

The second type of state was the ‘warrior state’ built by communities who,
originating in parts of the Mughal empire, had been at war with the Mughal state
and had acquired statist ambitions in the process. The most prominent examples
were the Marathas and the Sikhs.

And the third category included states that were the most unstately of the three,
the ’compact states’ like those of Mysore in the south or Rohillas in the north.

However amongst the three, there were some broad similarities, for instance the
states started tilting towards military fiscalism. This meant garnering financial
resources, finding a social base and building an effective standing army. The
military upgradation put additional fiscal pressures on the small revenue base of
these anyway small states. This in effect meant freeing the state from dependence
on the local aristocracy and organizing a state around war. Removing middlemen
meant the state could increase its share of revenue as well as provide relief to the
peasant. As a result of such rigorous management, Mysore became one of the
most prosperous states in the 18th century and also famous for its well equipped
standing army of 60,000 soldiers.

There was also greater participation of merchants in the politics of the provinces.
Social relationships dangerously mingled with the monetary ones.Rents, houses,
proprietary rights of landholders and village headmen, statuses and offices were
leased and sub-leased as relationships between various groups changed. The new
states also used this process of sharing power to incorporate groups other than
merchants and bankers in their quest for military might and capital. The Marathas
and Sikhs maintained ties of reciprocity and patronage with enterprising peasant
castes, mercenaries and pioneer settlers on frontier lands in an attempt to broaden
the base of their rule. In Bengal the banking family of the Jagat Seths became
chief financiers of the nawabs, providing credit and participating in revenue
farming.

It is principally the rise of these small intermediaries and their wealth accumulation
that was the basis of the new provincial kingdoms of the 18th century. They
pocketed the most from a degrading Mughal power, and acquired the dominant
role. Other than participating in trade they lent money to rulers and stood as
guarantors of revenue. Another important group were the Muslim gentry – scribes,
accountants and other petty officials who with the weakening of the Mughals
rapidly grew roots in local society forming the nuclei of new settlements like
qasbas. These were people who had intimate and long experience of managing
bazaars and revenue accounts.

Cultural Gentrification was an important feature in these new communities and

kingdoms including the establishment of religious and educational institutions.
Cohn argues that in the Benaras region traditional intermediaries found new power
with changing circumstances. According to him intermediaries transited to new
roles, often functioning as ‘hinges’ between the state and local society.

The condition of the peasantry and the artisans in rural and urban centres cannot
be comprehensively clarified due to the lack of enough studies around the same.
But theoretically there was plenty of land available for cultivation which made the
position of the peasant less vulnerable. The threat of migration would have made
the violation of customary and contractual rights of peasants less likely also. In
pockets of agricultural growth like Mysore and in the Deccan under the Marathas,
purposive state action to curb intermediaries must have benefited the less-
privileged peasants.

The artisans, handicraft workers, weavers had their fortune tied to the demand for
goods within the subcontinent itself suggesting their conditions may have been
better before the company than later.

Population, prices, trade and production all showed an upward swing which
broadly indicated a positive trend. The Bengal famine also occured only during the
Company rule, showing the gross mismanagement of the subcontinent’s
resources. Urbanization was also an important indicator of economic prosperity
but here the story was more complicated. As Surat witnessed decline as
international trade were taken over by the company merchants rather than the
locals. They were replaced by newer cities established by the colonists including
Madras, Bombay and Calcutta and the inland cities and capitals of regional
kingdoms: Lucknow, Fyzabad, Benaras, Hyderabad, Srirangapatam and
Bangalore. Trading cities like Mirzapur, Kanpur and Baroda also came into being to
service trade.

Unlike the previous assumptions about the decline of finance due to

decentralisation, there was actually growth in credit due to political fragmentation.
Local rural commercial production found new markets in the provincial kingdoms
and was thus compensated for any disruptions caused by the disintegration of the
Mughal empire. Conspicuous consumption in the regional courts encouraged
production and provided employment to labour outside the traditional agrarian
sphere.

One of the most counter-intuitive and realities of the 18th century is how war
between the provinces and with the Mughal empire boosted the economy rather
than destroying the existing production. Awadh for instance developed a thriving
market for saltpetre, swords and matchlocks. Afghan Rohilla towns were famous
for their bows and arrows and the trademark Rampur daggers. Jhansi was well-
known for its canon foundries. Boot makers and liquor distillers also had a thriving
business and so did grain merchants who had to supply food grains and fodder to
the large armies and seige trains as they moved across provinces. War, like in the
European contexts, brought in massive positive economic and financial gains in
the region.

Irfan Habib had argued that for the full establishment of capitalism, Mughal India
needed the development of indicators like wage labour, commodity production and
mechanization of industry. He argued that in Mughal India there was a growth of
markets and monetization but this in itself was not enough evidence for the
beginnings of capitalism. The payment of revenue in cash also led to the
development of merchant capital but this extractive process did not lead to any
reinvestment in the countryside. Towns that developed alongside were mere
parasites that lived off the countryside. One important indicator of this failure was
the response of elites in Mughal India. Irfan Habib has shown that with enormous
resources at their command they showed little interest in economic and scientific
developments.

The rural sector of the Indian economy remained a source of supply rather than a
market for products, indicating that peasant incomes were not rising – a serious
hindrance to the transformation of the economy. Other inhibiting factors were a
pre-modern system of transport, a tradition of minutely specialized hereditary skills
that were resistant to labour saving technology, and the deeply entrenched
institution of caste. He has argued that the very sophisticated artisanal skills and
existing market networks may have paradoxically inhibited further change as they
were able to cope with growing domestic and international demand. Christopher
Bayly has written that the growing influence of commercial houses did not signal
the emergence of a bourgeoisie. Capital controlled by traders and revenue farmers
was closely tied to land and was not invested in new forms of production.

The East India Company grafted successfully onto the vibrant economic currents
in 18th century India. Two key innovations – military fiscalism and revenue farming
were used by the Company to deeply entrench its rule. In other words the
Company state was no ‘outsider’ but drew on political and economic currents
within India itself. After Clive’s success in Bengal, Burton Stein has pointed out,
Indian rulers paradoxically became attracted to the Company requesting it to
provide military support – the beginnings of the infamous ‘subsidiary system’.

 The Company in its turn used military influence to effectively push its business
interests. Any fears of the Company taking over territory was tempered by the
knowledge that back home in England imperial policies were constantly under
attack in the English Parliament. The Company carefully avoided any use of the
symbols of sovereignty and tacitly acknowledged the ineffectual Mughals as their
overlords. Like Indian rulers, the Company also took to capturing wherever
possible monopolies in royal prerogatives like salt and saltpetre.

The Company’s success was facilitated by the close bonds with Indian merchant
and banking families i.e. with credit and markets which ultimately helped the
Company subvert the indigenous regimes in India. In this view the attempt to
control India’s trade and production ended with the Company’s political control
over India. Merchant and banking families were attracted to the Company because
in its enclaves there was the promise of secure property rights. Indian rulers
desperate for cash were well known to violate such rights and squeeze rich
merchants for their own ends. Thus commercial communities and the new gentry
became the foundation of the British colonial regime.

Conclusion

There is thus a very radical divide between the historians about the 18th century
polity and economics. The Aligarh School attribute the Mughal collapse to the
excessive centralization and disastrous decisions about the agrarian economy.
However further analysis finds this explanation a little too reductionist since the
revolt against the Mughals was not entirely only due to financial woes. The
succeeding states varied in their structures even while they retained their titular
allegiance to the Mughal crown. On the economic front the consolidation of the
intermediary classes – merchants, revenue farmers and gentry. Chris Bayly’s work
has shown the importance of these groups in trade, credit and markets and how
these sustained and lent a new direction to 18th century political economy.

The dynamism of the economic activities cannot be ignored. Political

fragmentation and renovation does not imply an acute economic decline.