Hostname: page-component-78c5997874-ndw9j Total loading time: 0 Render date: 2024-11-09T08:51:14.909Z Has data issue: false hasContentIssue false

The ‘Great Firm’ Theory of the Decline of the Mughal Empire

Published online by Cambridge University Press:  03 June 2009

Karen Leonard
Affiliation:
University of California, Irvine

Extract

Most historians of the Mughal empire currently emphasize economic factors in their attempts to locate and measure the causes of imperial decline in seventeenth- and eighteenth-century India. Recent articles reiterate a standard set of tensions: those between monarch, military and service nobles (mansabdars), landholders (zamindars), and peasants. Existing theories attribute the Mughal decline to the nature of the monarchy, the breakdown of the mansabdari administrative system, and the challenges from newly established regional rulers. One influential analysis points to the increasing burden of taxation and consequent zamindar-peasant rebellions throughout the empire as the fundamental cause of decline. The nobility and the mansabdari system have received most attention, however. Historians have emphasized the strains caused by numerical expansion, inflation of noble ranks, and the ‘aristocratization’ of the mansabdars through conspicuous consumption and hereditary control of positions.

Type
Business and Government in Preindustrial Economies
Copyright
Copyright © Society for the Comparative Study of Society and History 1979

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

A preliminary version of this article was presented at the Seminar on ‘Decline of the Mughals’ at the University of Pennsylvania, May 1974; criticism from the other participants, but even more from Dr. John G. Leonard, has helped improve that version.

1 Peter Hardy has referred to this standard ‘diagram of tensions’ in his commentary upon two of the most recent articles: Hardy, P., ‘Commentary and Critique,’ Journal of Asian Studies, XXXV: 2 (02 1976), 257.CrossRefGoogle Scholar The articles upon which he is commenting are Pearson, M. N., ‘Shivaji and the Decline of the Mughal empire,’ 221–35,Google Scholar and Richards, J. F., ‘The Imperial Crisis in the Deccan,’ 237–56, both in the same issue.Google Scholar

2 Habib, Irfan, The Agrarian System of Mughal India (Bombay, 1963),Google Scholar argues for oppression and revolt. Two often-cited views focusing upon factions among the nobility are Chandra, Satish, Parties and Politics at the Mughal Court, 1707–1740 (Aligarh, 1959),Google Scholar and Ali, M. Athar, The Mughal Nobility Under Aurangzeb (Aligarh, 1966).Google Scholar Two regional perspectives are given by Calkins, Philip, ‘The Formation of a Regionally Oriented Ruling Group in Bengal, 170O-1740,’ Journal of Asian Studies. XXIX: 4 (08 1970),Google Scholar and Leonard, Karen, ‘The Hyderabad Political System and Its Participants,’ Journal of Asian Studies, XX: 3 (05, 1971), 569–82.CrossRefGoogle Scholar

3 See the two articles cited in footnote 1; Pearson argues that military efforts in the south and the defeats inflicted by Shivaji decisively affected the loyalty of the nobles, and Richards argues that policy miscalculations led to artificial jagir shortages and inattention to newly incorporated warrior elites in the south.

4 Useful discussions are by Eisenstadt, S. N., The Political Systems of Empires (New York, 1963),Google Scholar and The Decline of Empires (New Jersey, 1967).Google Scholar

5 The generalization has interesting implications for scholars of cultural and intellectual movements in medieval and early modern India, such as the bhakti movements, the development of vernacular poetry, the shifts of artistic patronage to regional courts, and those political movements led by Shivaji or the Sikh gurus.

6 The analysis draws upon Eisenstadt, , Political Systems, particularly ch. 12.Google Scholar

7 Ibid., and his Decline of Empires, pp. 35;Google Scholar and Udovitch, A. L., ‘Credit as a Means of Investment in Medieval Islamic Trade,’ in Journal of the American Oriental Society, 87:3 (0709, 1967), 6064.CrossRefGoogle Scholar

8 Eisenstadt, S. N., Essays on Comparative Institutions (New York, 1965), 203, suggests this line of reasoning, which is clearly relevant to the Mughal empire.Google Scholar

9 For an introductory discussion of ‘Elites,’ see Keller's, Suzanne article in the International Encyclopedia of the Social Sciences, Vol. 5 (New York, 1968), p. 28.Google Scholar

10 This is Michael Pearson's view, particularly in his unpublished dissertation, ‘Commerce and Compulsion: Gujarati Merchants and the Portuguese System in Western India, 1500–1600,’ University of Michigan, 1971. He has modified his view of their role in politics to some extent in his article, Political Participation in Mughal India,’ Indian Economic and Social History Review IX:2 (0406 1972), 113–31.Google Scholar

11 See Habib's, Irfan three articles: ‘Banking in Mughal India,’ Contributions to Indian Economic History, 1 (Calcutta, 1960), 120;Google ScholarPotentialities of Capitalistic Development in the Economy of Mughal India,’ Journal of Economic History, XXIX (03 1969), 3278;Google Scholar and Usury in Medieval India,’ Comparative Studies in Society and History, VI: 4 (07 1964), 393423.Google Scholar Also, Smith, W. C., ‘The Mughal Empire and the Middle Class-A Hypothesis,’ Islamic Culture, XVIII: 4 (10 1944), 349–63.Google Scholar

12 For examples of such treatments, see Pearson, , ‘Political Participation,’ op. cit., p. 119–23;Google ScholarGadgil, D. R.Origins of the Modern Indian Business Class (New York, 1959), especially pp. 2328,Google Scholar and the same author's tentative conclusion that ‘mahajans’ in Poona were socio-religious organizations for immigrants, Immigrant Traders in Poona in the 18th Century,’ Artha Vijnana I (03 1959), 16;Google Scholar and Gillion, K. L., Ahmedabad (Berkeley, 1968), pp. 1624.Google Scholar

13 Timberg, T. A., ‘A Study of a “Great” Marwari Firm: 1860–1914,’ Indian Economic and Social History Review VIII: 3 (0709 1971), 267–68.Google ScholarGadgil, , in Origins, speaks of firms based on kinship units: p. 34. Neither defines the unit further.Google Scholar

14 Jain, L. C., Indigenous Banking in India (London, 1929),Google Scholar makes this distinction on p. 3. He also gives the best explanation of the hundi system which was extremely complex.

15 Krishnan, V., Indigenous Banking in South India (Bombay, 1959), p. 9.Google Scholar In a twentieth-century survey, he found that 80 percent of moneylenders dealt with agriculturalists, while only 3 percent of the bankers did so.

16 Habib, , ‘Banking,’ pp. 38.Google Scholar

17 Gadgil, , Origins, pp. 3234.Google ScholarNaqvi, Hameeda Khatoon, Urban Centres and Industries in Upper India, 1556–1603 (New York, 1968), gives specific instances: pp. 6263, 127–28, 286.Google Scholar

18 Little, J. H., ‘The House of Jagatseth,’ in Bengal Past & Present XX (0106, 1920), 111200, and XXII (Jan-June, 1921), 1–119, is a fascinating history of this firm. The material used here comes from XX, 112–32.Google ScholarGupta, Brijen K., Sirajuddatlah and the East India Company, 1756–1757 (Leiden, 1962), also documents this firm's closeness to the Mughals, especially pp. 3031 and 9697.Google Scholar

19 Krishnan, , Indigenous Banking, p. 3.Google Scholar

20 Timberg, , ‘A “Great” Marwari Firm,’ in the footnotes, pp. 272–74.Google Scholar

21 For the Nawab of Arcot, Bavany Doss Nanasa Soucar and Dave Boocunji Cashee Dass Soukar were the largest creditors in 1805: Jain, , Indigenous Banking, p. 21. For Hyderabad, there were the ‘Panch Bhai’ bankers, which in the early nineteenth century certainly included Seth Kishen Das (now a famous jewelry firm), Makhdum Seth, Mahanand Ram Puran Mai, probably Surat Ram Govind Ram, and perhaps Palmer and Company.Google Scholar

22 Writers on later systems of finance and banking often referred to this prior function of indigenous banking firms, for example, Datta, P., ‘Rise of the Calcutta Money Market in Relation to Public Borrowing and Public Credit (1772–1833),’ Calcutta Review 46 (02 1933). 171203,Google Scholar and Das, N., ‘The Old Agency Houses of Calcutta,’ Calcutta Review 46 (03, 1933), 317–26. But these and other authors completely fail to deal with the historical transition which the indigenous bankers have undergone, even at a descriptive level.Google Scholar

23 Habib, , ‘Usury,’ pp. 408–09.Google Scholar

24 Habib, , ‘Banking,’ p. 6,Google Scholar and ‘Usury,’ p. 409.Google Scholar

25 Habib, , ‘Usury,’ pp. 414–15.Google Scholar

26 Habib, , ‘Banking,’ pp. 1011.Google Scholar

27 Gadgil, , Origins, p. 34.Google Scholar

28 Habib falls into this category most of the time. See his article ‘Potentialities of Capitalistic Development,’ p. 69,Google Scholar where he sees the karkhanahs as engaged in the ‘production of luxury articles. … This naturally set limits to their economic significance,’ and similar remarks on pp. 5760.Google Scholar

29 Significantly, Gadgil remarks that by 1750 such karkhanas had diminished in importance: Origins, pp. 3435.Google Scholar

30 Gadgil, , Origins, pp. 35.Google Scholar

31 Ibid, 35; Habib, , ‘Banking,’ p. 4.Google Scholar

32 In Hyderabad, a leading early banking firm is now noted as the leading jewelry firm, a business in which it had always engaged as well: Kishen Das, now Vithal Das. See also Ahmad, Qeyamuddin, ‘An Historial Account of the Banaras Mint in the Later Mughal Period, 1732–1776,’ in Numismatic Society of India, 23 (1961), 198215,Google Scholar where ‘precious stones’ pass through the mint: pp. 209.Google Scholar

33 Habib, , ‘Usury,’ p. 398.Google Scholar

34 Little, , ‘House of Jagatseth,’ XX, 133,Google Scholar citing Hunter's, Statistical Account, IX, 256.Google Scholar

35 Jain, , Indigenous Banking, pp. 1819, citing Bengal District Records of the eighteenth century.Google Scholar

36 Shah, A. M., ‘Political Systems in 18th Century Gujarat,’ Enquiry, 1:1 (Spring, 1964), 8395, 92.Google Scholar

37 See specific instances in the following articles by Cohn, Bernard S.: ‘The Initial British Impact on India, A Case Study of the Benares Region,’ Journal of Asian Studies, XIX: 4 (08, 1960), 422–23;Google Scholar ‘Recruitment of Elites in British India,’ in Plotnicov, L. and Tuden, A., eds., Essays in Comparative Social Stratification (Pittsburgh, 1970), 128–29:Google Scholar‘Structural Change in Indian Rural Society, 1596–1885,’ in Frykenberg, R., ed., Land Control & Social Structure in Indian History (Wisconsin, 1969), 8081;Google Scholar and Political Systems in Eighteenth Century India: The Banares Region,’ Journal of the American Oriental Society, 82:3 (0709 1962), 319.Google Scholar

38 See Sundaram, L., ‘Revenue Administration of the Northern Circars,’ Journal of the Andhra Historical Research Society, XIV (1943-1944), 2258, and XV (1944–45), 1118, for details. The reference to Hyderabad firms: XV, 12.Google Scholar

39 Krishnan, , Indigenous Banking, pp. 1920, notes that this was still done in the twentieth century; despite the failure to date its origin, it indicates the complex possibilities the revenue system offered for intermediary profits.Google Scholar

40 Even for this commission method, an initial large nazr or payment seems to have been necessary.

41 Pearson argues that the impact upon the nobility was crucial: ‘Shivaji and the Decline,’ op. cit.

42 Pearson, , ‘Shivaji and the Decline,’ pp. 227–28,Google Scholar and his ‘Political Participation,’ op cit., 118–19.Google Scholar

43 Ibid., particularly the latter article, pp. 124, 129–30. See also Chandra, Satish, ‘Commercial Activities of the Mughal Emperors During the Seventeenth Century,’ in Bengal Past & Present, 78:146 (0712 1959), 9297,Google Scholar where he argues that the jagir crisis may have induced nobles to turn to commerce, and his Some Aspects of the Growth of A Money Economy in India during the Seventeenth Century,’ Indian Economic and Social History Review, 111:4(12, 1966), 321–36.Google Scholar

44 Pearson, , ‘Political Participation,’ op. cit., pp. 122–27;Google ScholarGillion, , Ahmedabad, 1718, 21.Google Scholar

45 Pearson, , both articles cited above, and particularly ‘Political Participation,’ p. 128, for emigration.Google Scholar

46 Gadgil, , ‘Immigrant Traders in Poona,’ op. cit., p. 16.Google Scholar

47 Habib, , ‘Usury,’ pp. 408–09.Google Scholar

48 Chandra, Satish, ‘Early Relations of Farrukh Siyar and the Saiyid Brothers,’ Medieval India Quarterly 2:1 & 2 (1957) 142, for Husain Ali Khan's action (the governor of Bihar).Google Scholar

49 Satish Chandra, in his articles cited in footnote 43, suggests that Mughal commercial activities were increasing in the seventeenth century and persisted right through the eighteenth century; I suspect that their activities were characteristic earlier as well, and that his evidence supports the line of argument here for interdependence.

50 For example, Arasaratnam, S., ‘Aspects of the Role and Activities of South Indian Merchants c 1650–1750,’ in Proceedings of the First International Conference Seminar of Tamil Studies(University of Malaya,1968), vol. I, pp. 582–96.Google Scholar He prefaces his material on merchants dealing with Europeans after 1650 with these sentences (p. 582): ‘After the decline of the great medieval collective enterprises, the mercantile tradition seems to have lived on among certain families with commercial roots in the past. When the European traders … came to southern India they … soon established firm relations with them.’ See also, Chandhuri, Susil, Trade and Commercial Organization in Bengal, 1650–1720: With Special Reference to the English East India Company (Calcutta, 1975).Google Scholar

51 Gokhale, B. G. starts his ‘Ahmadabad in the XVIIth Century’ with the statement, ‘The history of India in the seventeenth century is characterized by the emergence of various regions as distinct economic units,’ Journal of Economic and Social History of the Orient, XII:2 (04, 1969), 187;CrossRefGoogle Scholarsee also Rau, B. Ramachandra, ‘Some Specific Services of the Indigenous Bankers of Bombay,’ in Indian Historical Records Commission, Vol. 12 (1929), 5459.Google Scholar

52 See footnote 46; also Gode, P. K., ‘Keshavbhat Karve, a Poona Banker of the Peshwa Period and His Relations with the Peshwa and Damaji Gaikwad,’ in Journal of the University of Bombay Vol. 6 (07, 1937), 8791.Google Scholar

53 Saletore, B. A., ‘A Forgotten Gujarati Brahman Banker,’ Indian Historical Records Commission XXX (1954), 155–60.Google Scholar

54 See Philip Calkin's article (cited in footnote 2) and his unpublished paper, ‘The Role of Murshidabad as a Regional and Sub-regional Center in Bengal,’ which suggests that the city's importance derived more from its commercial orientation towards European factories even in the seventeenth century than from its administrative orientation to the Mughals (8–14).

55 For the Hyderabad firms, Sundaram, , ‘Revenue Administration,’ p. 12;Google Scholar for the Marwari firm, Timberg, , ‘A “Great” Marwari Firm,’ 264–65, 283.Google Scholar

56 This has been stated by Jain, , Indigenous Bankers, p. 17,Google Scholar and Gadgil, , Origins, p. 32,Google Scholar where he notes that de Bussy in the Deccan and Karnatak obtained a loan from ‘a great banker.’ Instances of Kanara Saraswat merchants who allied themselves with the British are given in Kudra, V. N., History of the Dakshinatya Saraswats (Madras, 1972), 117–18.Google Scholar

57 Fischer, Karl, ‘The Beginning of Dutch Trade with Gujarat,’ unpublished paper, pp. 1618.Google Scholar

58 Saletore, , ‘A Forgotten Gujarati Brahman Banker,’ p. 155,Google Scholar citing early East India Company records which he lists in his footnote; see also Habib's charts in ‘Usury,’ pp. 402–03,Google Scholar and Naqvi, H. Q., Urban Centres and Industries, pp. 6364.Google Scholar

59 Pearson, , ‘Political Participation,’ pp. 125–27.Google Scholar This is also clear in Gupta, Ashin Das, ‘The Merchants of Surat, c. 1700–50,’ in Leach, Edmund and Mukherjee, S.N., eds., Elites in South Asia (Cambridge, 1970), pp. 201–22.Google Scholar

60 Saletore, , ‘A Forgotten Gujarati Brahman Banker,’ pp. 158–60.Google Scholar

61 Little, , ‘The House of Jagatseth,’ (Vol. XX), 115–16, for the 1652 loan, and 126–29, 136–45 for the Mitra Sen firm.Google Scholar

62 Gadgil, , Origins, p. 32,Google Scholar Little's article, continued in Vol. XXII, and Gupta, , Sirajuddallah and the East India Company, p. 132,Google Scholar both document the Hindu bankers’ new alliance with the East India Company in Bengal by 1760. Panikkar, M., in Asia and Western Dominance (New York, 1953), carelessly generalizes that the powerful Indian merchant class worked with European traders because of its ‘inherited hatred of Muslim rule’ (p. 99).Google Scholar

63 Little, , ‘The House of Jagatseth,’ Vol. XXII, 97103.Google Scholar

64 Jain, , Indigenous Banking, pp. 1920,Google Scholar citing the Governor General's letter to the Collector of Rangpur, in Vol. I. p. 33 of the Bengal District Records.

65 Sundaram, , ‘Revenue Administration,’ Vol. XV, 1014.Google Scholar

66 Ibid., p. 33, citing Macartney.

67 Ibid., pp. 34 and 15.

68 Ibid., pp. 77–78.

69 Jain, , Indigenous Banking, pp. 2022.Google Scholar

70 This was Charles Metcalfe, in a letter to the Governor General, September, 1821: Thompson, E. J., Life of Lord Metcalfe (London, 1937), pp. 210–11.Google Scholar

71 Jain, , Indigenous Banking, pp. 2325,Google Scholar makes this comparison. The best coverage of this transition period from the point of view of the Company is by Rau, B. Ramachandra, ‘Organized Banking in the Days of John Company,’ in Bengal Past and Present Vol. 37 (0106 1929), 145–57, and Vol. 38 (July-Dec. 1929), 6080.Google Scholar

72 Both Panikkar, (Asia and Western Dominance, p. 99)Google Scholar and Gupta, (Sirajuddallah and the East India Company, p. 32)Google Scholar compare the Indian mercantile class to ‘Shangahi compradors,’ but they do not investigate this comparison further. For China, see the following: Balazs, E., ‘The Birth of Capitalism in China,’ in Eisenstadt, , (ed.) Decline of Empires, p. 109;Google ScholarYang, Lien-sheng, Money and Credit in China, A Short History (Cambridge, 1952);CrossRefGoogle Scholar‘Economic Aspects of Public Works in Imperial China,’ in Excursions in Sinology (Cambridge, 1969);Google Scholar and Government Control of Urban Merchants in Traditional China,’ in the Tsing Hua Journal of Chinese Studies, new series (2nd) 8, 08 1970, 186206.Google ScholarSee also Elvin, Mark, The Pattern of the Chinese Past (London, 1973), particularly pp. 155, 161–62, 215–25, and 285–97.Google Scholar

73 For example, Lehmann, F., ‘Shah Ayat Allah “Jauhri” and his Shahr Ashob,’ in Abdul Karim Sahitya-Visarad Commemoration Volume (Dacca, 1972), and other writing on the eighteenth-century cultural laments.Google Scholar

74 Timberg discusses the problem of sources in ‘A “Great” Marwari Firm.’ In an unpublished paper, ‘Speculative Gains and Primitive Accumulation’ which deals only with the nineteenth and twentieth centuries, Timberg's problem is the theoretical one of entrepreneurial values; he had no problems with sources. Morris D. Morris, in a recent unpublished paper, ‘South Asian Entrepreneurship and the Rashomon Effect,’ also deals with the nineteenth and twentieth centuries and emphasizes the significance of indigenous banking and entrepreneurial activities and how little we still know about them (paper presented at a Conference on Colonial Port Cities in Berkeley, June 1976).