LETTER VI.

_Friday, January 22, 1813._

Gracchus is charged, by some of the champions of the East India Company, with error and a want of candour, because he has represented the Directors to have maintained, that opening the import trade from India to the out-ports of the kingdom, involves a question of the last importance to the British Empire in India, and to the British Constitution at home; and those writers affirm, that the Directors do not deduce the danger of those great interests from the question of the out-port trade, but from the question of disturbing the present system of administering the Government of India.

Yet he can discover, neither error nor want of candour in his statement. If those advocates will take the pains to follow the whole argument of the Directors, on the present occasion, throughout, they must be sensible, that his statement cannot be controverted. The Directors, indeed, avoid expressing their proposition in the fair and distinct form in which it is here drawn out; yet such is the proposition in effect. For, if the whole of it be reduced into a form of syllogism, it is no other than this:--

"Whatever shall cause the subversion of the present system of Indian Government, will cause danger to the Empire and Constitution.

"But, pressing the extension of _an import trade from India to the out-ports_, will cause the subversion of the present system of Indian Government.

"Therefore, _pressing the extension of an import trade to the out-ports, will cause danger to the Empire and Constitution_."

If we question the _minor_ proposition, and ask, Why, pressing an import trade for the out-ports, should necessarily cause the subversion of the existing system of Indian Government? the answer of the Directors is already given:--Because they _will not_ continue to carry on that Government, if an import trade from India should be granted to the out-ports. Thus, the original statement is demonstrably established; and all the logic of the City cannot overturn it.

The Directors must permit the words "_will not_;" for, with the record of the East India Company's history before us, it is impossible to say they _cannot_. In proof of this assertion, let us take a review of that history, and let us examine, what evil resulted to the Company, _during the period that the import trade from India_ WAS ACTUALLY _extended to the out-ports of Great Britain_.

When the first, or London East India Company, had incurred the forfeiture of their Charter in 1693, by the non-payment of a stipulated sum of money, their privileges were immediately restored to them, and confirmed by letters patent, granted by King William III. upon this express ground:--"Considering how highly it imports the honour and welfare of this our kingdom, and our subjects thereof, that a trade and traffic to the East Indies should be continued; and being well satisfied that the same may be of great and public advantage; and being also desirous to render the same, as much as in us lies, _more national, general, and extensive, than hitherto it hath been_," &c.

This principle, of promoting a more national, general, and extensive trade to India than had subsisted under the then existing Company's exclusive Charter, gave rise to _a new measure_ in the year 1698, in an Act passed in the 9th and 10th year of the same king, entitled, _An Act for raising a sum not exceeding two millions, &c. and for settling the trade to the East Indies_. The parties subscribing towards that loan, were formed into a Society, called _The General Society of Merchants, &c._; and such of them as chose to unite their subscriptions, and to form a joint-stock, were incorporated under the name of _The English East India Company, &c._ The General Society possessed the privilege of an export and import trade with India, with the power of _bringing their import cargoes from India to the_ OUT-PORTS _of the kingdom_, in the same manner as is proposed by Government at the present day; with this only difference, that the General Society of Merchants were not restricted as to the ports at which they should enter, whereas Government have _now_ proposed, that merchants _should be restricted to such ports as can best afford the means of guarding against the depredations of smuggling_.

The regulations, which were adopted for ships importing from India to the out-ports, are to be found in the Act 9 and 10 William III. c. 44. s. 69. and were as follows:--

"Provided always, and it is here enacted, that no Company, or _particular person or persons_, who shall have a right, in pursuance of this Act, to trade to the East Indies, or other parts within the limits aforesaid, shall be allowed to trade, until _sufficient security_ shall be first given (which the Commissioners of the Customs in England, or any three or more of them for the time being, are hereby authorized and required to take, in the name and to the use of His Majesty, his heirs and successors), that such Company, or _particular persons_, shall cause all the goods, wares, merchandise, and commodities, which shall at any time or times hereafter, during the continuance of this Act, be laden by or for them, or _any of them_, or for their, or any of their accounts, in _any ship_ or ships whatsoever, bound from the said East Indies, or parts within the limits aforesaid, to be brought (without breaking bulk), to _some port of England or Wales_, and _there be unladen and put to land_, &c. And that all goods and merchandises belonging to the Company aforesaid, or _any other traders to the East Indies_, and which shall be _imported into England or Wales_, as aforesaid, pursuant to this Act, shall by them be sold openly and publicly, by inch of candle, _upon their respective accounts_, and not otherwise."

Upon this Act of the 9th and 10th of William III. was built, in the following year, that famous Charter of the Company, upon which they rest the weight of their pretensions; and that very Charter, as is here rendered incontestable by the Act itself, comprehended the principle, _of an Import Trade from India to the_ OUT-PORTS _of the kingdom_.

The form and condition of the security which was to be given by the out-port merchants, will be found in the Act, 6th Anne, c. 3. entitled, "_An Act for better securing the duties on East India goods_." By that Act, the security to be given was fixed "at the rate of 2500l. sterling for every hundred ton their ships or vessels shall be respectively let for;" and the _only_ restriction imposed upon the import trade from India was, that it should be brought "_to some port in Great Britain_."

Thus, then, any man who looks but a little beyond the objects which lie accidentally before his eyes, may see, that the measure now suggested by Government, instead of being a wild and airy speculation, a theoretical innovation, a _new_, untried, and dangerous experiment, on which we have no ground to reason from experience (as it has been ignorantly and falsely asserted), is nothing more than reverting to an _ancient_ principle, involved in the Company's applauded Charter of the 10th of William the Third, and to the practice of our forefathers in the brightest period of our domestic history; a period, in which the British Constitution received its last perfection, and from which the present power and greatness of the British Empire, in the East and in the West, dates its origin.

Having sufficiently proved and established this _great fact_, let us next inquire, what history reveals to us, of _the consequences_ of that import trade to the out-ports, that can tend, in any degree, to justify, or give support to, the Company, in determining to resort to an alternative which, they acknowledge, will subvert the system of Indian Government (and thereby shake the Constitution at home), rather than _renew the measure_ of a regulated trade to the out-ports.

We have not to deduce these consequences from _abstract hypothesis_, but from _historical testimony_; let us, then, observe what that testimony unfolds. No evil, of any kind whatever, resulted to the incorporated, or Joint Stock Company, from the privilege enjoyed by the out ports. On the contrary, that _Joint Stock Company_, issuing out of the General Society of Merchants (which, as has been above stated, soon became the English East India Company), rose above all their competitors, notwithstanding the power of importing, without limitation, to _any of the ports of the kingdom_; and such was the rapidity of their progress, that they overcame the former, or London Company; they obtained a surrender of all their rights to St. Helena, Bombay, and all their other islands and settlements in India; they at length received that ancient Company into their own body; and finally became the United East India Company of the present day. And so little did the competition and free import of the general merchants tend to obstruct the growth of the United Company, even in the age of its _infancy_; and so "superior were the advantages they derived from trading with a joint-stock (to use the words of one of the Company's most strenuous champions), that at the time of the union of the two Companies, out of the whole loan of two millions, only 7000l. then remained the property of the _separate traders of the General Society_; and this sum also was soon absorbed in the United Company[4]." If then the Company, starting originally with only a joint stock, against a competition in the out-ports of the kingdom, with a power to import to those out-ports, outstripped and overcame all their competitors; what can they seriously apprehend from a renewal of the same experiment, in the present momentum of their power, and when they are able to unite with their joint-stock, the whole of the revenues of their present empire in the East?

But it may be asked, if no better success is likely to attend the commercial speculations of the out-ports, why is so strong an effort made, to admit them to a share in the India trade? The answer is obvious. When Mr. Dundas, in the year 1800, so forcibly expressed his opinion against any such admission, he did not ground that opinion upon a question of _ports_, but of _commercial capital_. He considered the capital of the Company as sufficient for all the advantage which the Public, in the aggregate, could derive from the India Trade; and he maintained, that the aggregate interest of the Public would suffer from any measure, tending "to divert any larger proportion of the commercial capital of the country from a more advantageous and more profitable use." But the circumstances of the world are become materially altered, since the period of 1800. The commercial capital, of which Mr. Dundas then reasoned, is deprived of that advantageous and profitable employment which his argument supposed, and is therefore without application or direction; from whence it has resulted, that the operation of commerce is interrupted, and its activity suspended. The allowing that capital to be partially directed to the markets of India, would therefore, under present circumstances, have the great national advantage, of recovering the activity and spirit of commerce, and of encouraging an extensive public interest which is at present disappointed, if not dormant; and, whenever a more prosperous state of things should return, the capital so engaged for a time, would, from the nature of commerce, unquestionably recall itself, and seek again a more profitable market, if any such should open. In the mean time, the East India Company, adding to their joint-stock all the revenues of India, need hardly know, because they could not _feel_, that they had any competitors in the markets of India. And, as the Executive Government was able to guard the out-ports against smuggling in the period of _the infancy_ of the Company, they might and ought to feel a perfect confidence, that the same authority can guard them equally now, in the present period of _their maturity_.

Thus, since history renders it indisputable, that an import trade from India to the out-ports of the kingdom has been heretofore exercised under Acts of Parliament, and that it may be perfectly compatible with the highest prosperity of the East India Company; since the Executive Government can guard it against smuggling at the present day, as well as in the reigns of King William and Queen Anne; and since a great and urgent national interest reasonably demands it, both from Parliament and the Company; the present moment furnishes a most fit occasion for the Company to consider, Mr. Dundas's solemn call upon "their wisdom, policy, and liberality," made by him to them in the year 1800; and also, his weighty admonition, that "_if any thing can endanger their monopoly, it is_ AN UNNECESSARY ADHERENCE TO POINTS NOT ESSENTIAL TO THEIR EXISTENCE."

It has been called _illiberal_, to question the motives of the Directors, in refusing their consent to an import trade to the out-ports. But, with the facts of history, which have been here produced, staring us and them in the face, it would be impossible not to question those motives. No man can entertain a higher respect for the East India Company, as a body politic and corporate, or contemplate with higher admiration the distinguished career which it has run, than Gracchus; but, at the same time, no one is better persuaded of the operation of _policy_, in a body circumstanced as they are. And it is more especially necessary to watch that policy, and to be free to interpret _political motives_, at the present crisis, because, at the eve of the expiration of the Company's _last_ Charter, in 1793, certain rights were anxiously alleged on their behalf, in a work entitled, "_A Short History of the East India Company_, &c." rights absolutely unmaintainable, and utterly incompatible with the sovereignty of the Empire, and the freedom of the Constitution; and the allegations then made, appear now to assume the form of _a practical assertion_. To those alleged rights, therefore, it will be advisable early to call the attention of Parliament and of the nation.

GRACCHUS.

FOOTNOTE:

[4] A Short History of the East India Company.