The Bengal Famine, Indian Mutiny & Indian Economy

History: KS3, topic 14.1.6

The Bengal Famine, Indian Mutiny and Indian Economy

The Bengal Famine lasted from 1769 to 1773. The Indian Mutiny took place nearly a century later in 1857.

Between the years 1769 and 1773, there was a famine in Bengal and roughly 15% of the local population died.
The East India Company had increased taxes from 10-15% to 50%, meaning that the local population had lower food and financial reserves in years with bad harvests.
Then as more of the population died, the tax rose again to make up for the lost taxpayers.
The East India Company's share price peaked at £269 in 1769 and it is possible that it increased taxes in an attempt to support its share price.

By 1857, the EIC's increasingly expansionist and locally insensitive policies met with nationalist agitation in the Indian Mutiny.
The local people resented taxation by the British, as well as their efforts to Westernise Indian society.
85 sepoys (Indian soldiers employed by the EIC) refused to use bullet cartridges covered in grease (rumoured to be coated in pork & beef fat) as this violated their Hindu & Muslim beliefs. The sepoys were imprisoned, leading to a rebellion to free them. The rebels then appointed Badahur Shah, the Emperor of Hindustan as their leader.
The EIC lost control of 1/6 of India and the mutiny took a year to suppress.
Once Britain regained control in 1858, the East India Company was dissolved and control of India handed over to the British government.

Edelstein (2004) highlights that Britain gained economically from its rule over India.
All Indian railway construction was tendered to British businesses.
India had a colonial tariff with Britain of 0%, relative to 20% with the USA in 1870. This biased all business towards British manufacturers.
The East India Company's benefit was to private individuals, rather than other British businesses or the British taxpayer. The only people to benefit were the shareholders who owned the shares in the East India Company and received their dividend payments.