by Alan Lester<\/p>\n\n\n\n
1833 was a critical year for Britons who had invested in the Empire. Thanks to the work of the Legacies of British Slave Ownership team at UCL, we have got to know more about the thousands of British people from nearly all classes, regions, towns and cities, who owned slaves and were paid compensation for their emancipation after the act abolishing slavery was passed in that year. We know that some 40% of GDP was handed over to slave owners while formerly enslaved people received nothing, and that much of the payout was invested in projects like the building of railways and the establishment of banking and insurance firms at home, and in projects like the colonization of South Australia overseas. But many of those who now know about slave owners don’t necessarily recognise that the simultaneous transformation of the East India Company also safeguarded the interests of Britons invested in empire.<\/p>\n\n\n\n
In 1833, the East India Company\u2019s charter came up for\nrenewal. Its directors had to renegotiate its role in trade and the governance of\nIndia with the British government. Its monopoly on trade with India had already\nbeen opened up by the last charter renewal act in 1813. In 1833, with the\ndoctrine of free trade gaining ground in Britain, it was also stripped of its\nremaining monopoly, on the trade between India and China. In fact even this\nmonopoly was more nominal than real, since the Company had long been encouraging\nprivate merchants to smuggle the opium that it grew in Bengal into China so\nthat it could earn currency with which to buy tea. The element of the 1833\ncharter renewal that was perhaps more significant was the deal struck with the\nCompany\u2019s shareholders in Britain. <\/p>\n\n\n\n
Rather than winding up the East India Company altogether now\nthat it was no longer a viable commercial concern, the British government\ndecided to turn it exclusively into Britain\u2019s proxy government of India. Its\ntrading functions were closed down and, just as British slave owners were being\ncompensated through the Abolition of Slavery Act, the creditors, warehouse\nlabourers and managers of its trading arm were also paid out. What remained,\nthough, was the question of what to do with its shareholders.<\/p>\n\n\n\n
Compensation for slave owners was conceded in 1833 because\neven the most ardent antislavery campaigners recognised that they needed\ncompliance from the powerful West India lobby at home and from planter\ndominated legislative assemblies in the Caribbean if enslaved people were ever\nactually to be set free. Compensation (along with an intended four or six year\nperiod of continued \u2018apprenticeship\u2019 for slaves) was the compromise necessary to\nget the legislation approved. Remarkably, the East India Company\u2019s shareholders\nwere given the guarantee of continued dividends for their stock at pretty much\nthe same time, and for similar reasons. The returns were generous to say the\nleast: annual dividends of 10 \u00bd per cent.As Thomas Babington Macaulay, at\nthat time Secretary of the Board of Control which oversaw the Company on behalf\nof the British government, explained to parliament, this was \u201cprecisely the\nsame dividend which they have been receiving for forty years, and which they\nhave expected to receive permanently\u201d.[1]<\/a> Rather\nthan being derived from the profits of trade, from now on these dividends would\nbe extracted exclusively from the rent paid by the Company\u2019s Indian subjects in\nreturn for the privilege of being governed by it. <\/p>\n\n\n\n The early 1830s was\na time of great transformation. In Britain itself, both the 1832 Reform Act and\nthe increasingly powerful doctrine of free trade were magnifying the political\nforce of commercial and industrial interests. As ever, imperial transformations\nwere closely connected. The abolition of slavery, mainly in the western half of\nthe empire, and the restructuring of the East India Company in the eastern\nhalf, were part of the same broad transformation. Both threatened vested\ninterests among a cross section of British society. Both were handled\nsimultaneously so as to protect those interests at the expense of colonial\nsubjects.
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