¹ The term ‘discriminatory interventionism’ was used by Bhattacharya, S. in ‘Laissez-Faire in India’, Indian Economic and Social History Review, 1965.Google Scholar A classic statement of this view was put forward in Lamb, H., ‘The “State” and Economic Development in India’, in Kuznets, S., Moore, W., and Spengler, J. J. (eds), Economic Growth: Brazil, India, Japan (Durham, North Carolina, 1955).Google Scholar

² Morris, Morris D. portrayed the Indian Government as a benevolent nightwatchman in his major revisionist article, ‘Towards a Re-Interpretation of Nineteenth Century Indian Economic History’, which first appeared in the Journal of Economic History, 1963CrossRefGoogle Scholar. Rider, T. D., in his examination of ‘The Tariff Policy of the Government of India and its Development Strategy 1894–1924’ (Minnesota Ph. D, 1971),Google Scholar concluded that Indian officials were ‘development-orientated’. An earlier study, Sen, S. K., Studies in Industrial Policy and Development of India 1858–1914 (Calcutta, 1964)Google Scholar, argued that the Government's purchasing policy reflected a concern for Indian industrialization. W. J. Macpherson believes that Government policy played a small ‘but direct role in stimulating industrial enterprise’. Macpherson, W. J., ‘Economic Development in India under the British Crown, 1858–1947’, in Youngson, A. J., Economic Development in the Long Run (London, 1972), p. 175.Google Scholar

³ The best exposition of the view that the momentum behind Japanese economic growth in the Meiji era lay in economic sectors not directly influenced by State activity, such as the traditional handicraft industries, is Lockwood, W. W., The Economic Development of Japan (Princeton, 1954).Google Scholar There is now a substantial literature stressing the limitations of Government economic policies in nineteenth-century Russia, even during the period 1892–1903 when Count Witte was Minister of Finance. See, for example, Kahan, A., ‘Government Policy and the Industrialization of Russia’, Journal of Economic History, 1967;CrossRefGoogle ScholarBarkai, D. N., ‘Macro-Economics of Tsarist Russia’, Journal of Economic History, 1973;Google ScholarMcKay, J. P., Pioneers for Profit: Foreign Entrepreneurship and Russian Industrialization 1885–1913 (Chicago, 1970).CrossRefGoogle Scholar Nineteenth-century governments seem to have made their most valuable contribution to economic growth by providing a favourable framework or context in which dynamic elements in their economies could flourish.

⁴ The classic example of this was the use made of the Indian Army in Britain's Imperial interests. The importance of the Indian Army to Britain is emphasized in Tomlinson, B. R., ‘India and the British Empire 1880–1935’, Indian Economic and Social History Review, 1975CrossRefGoogle Scholar.

⁵ Another instance was the railway locomotive manufacturers. See Lehmann, F., ‘Great Britain and the Supply of Railway Locomotives to India: A Case Study of “Economic Imperialism”’, Indian Economic and Social History Review, 1965.Google Scholar It must be emphasized that the ‘blemish’ in the British Government's India policies consisted of susceptibility, rather than subordination, to pressure from British commercial groups. For a rejection of the view that the Secretary of State for India was always ‘at the mercy of economic imperialists’ in railway matters, see Macpherson, W. J., ‘Investment in Indian Railways 1845–1875’, Economic History Review, 1955, pp. 185–6.Google Scholar There is an account of the multifarious reasons behind the Lancashire cotton lobby's strength in the making of Indian tariff policy in the late nineteenth century, and of this lobby's subsequent loss of influence after the First World war, in Clive Dewey, ‘The End of the Imperialism of Free Trade: The Eclipse of the Lancashire Lobby and the Concession of Fiscal Autonomy to India’, in Dewey, Clive and Hopkins, A. G., The Imperial Impact: Studies in the Economic History of Africa and India (London, 1978).Google Scholar The cotton lobby's success stemmed from such varied factors as its temporary strength in the British political system, the widespread conviction of the superiority of free trade, the ability of the Government of India to balance its budgets without resort to high revenue tariffs, and the ascendancy of the Secretary of State over the British authorities in India. Dewey's reminder (p. 50) that pressure groups such as the Lancashire cotton manufacturers ‘were more dependent on the decision-takers than the decision-takers were on them’ provides a valuable corrective to simplistic concepts of the subordination of the Indian authorities to British commercial interests.

⁶ Iyer, G. Subramania, Some Economic Aspects of British Rule in India (Madras, 1903), p. 124;Google ScholarChandra, B., ‘The Re-Interpretation of Nineteenth Century Economic History’, Indian Economic and Social History Review, 1968, p. 64;Google ScholarDasgupta, B., The Oil Industry in India (London, 1971), p. 209.Google Scholar

⁷ Rider, T.D., ‘The Tariff Policy of the Government of India’, p. 143.Google Scholar

⁸ This view is adopted by Edith Penrose in her foreword to Dasgupta's book. Dasgupta, The Oil Industry in India, p. x.Google Scholar

⁹ R. Vernon has noted that the fact that international firms' early investments in less developed countries (LDCs) were in natural resources, the ownership of which frequently lay with the State, forced Governments to have policies towards these firms concerning matters such as terms of entry, conditions of work, etc., often years before such regulations were laid down for domestic enterprises. Vernon, R., ‘The Future of the Multinational Enterprise’, in Kindleberger, C. P., The International Corporation (Cambridge, Mass., 1970), p. 390Google Scholar. Thus the Government of India, and several other British colonial governments, though generally non-interventionist in industry, had to formulate policies towards oil exploration and development in their territories.

¹⁰ Redwood, B., ‘The Oilfields of India’, Journal of the Society of the Chemical Industry, 1890;Google ScholarOldham, R. D., ‘The Petroleum Fields of India: Their Present Condition and Their Probable Future’, Journal of the Society of Arts, 1894;Google ScholarCapito, C. E., ‘The Oil Wells of Assam’, Proceedings of the Institution of Civil Engineers, 1911.Google Scholar

¹¹ For fifty years after 1886 Burma was administratively part of the Indian Empire. It was given full provincial status, with its own governor and executive council, in 1923. The 1935 Government of India Act gave Burma a substantial measure of self-government.

¹² For a brief analysis of the expansion of the world petroleum market in the late nineteenth century, see Jones, G. G., ‘The Oil Fuel Market in Britain 1900–1914: A Lost Cause Revisited’, Business History, 1978.CrossRefGoogle Scholar

¹³ Among the most useful accounts of the development of the Burmese oil industry are Pascoe, E., The Oilfields of Burma (Calcutta, 1912)Google Scholar; Burma Research Society, The Burma Petroleum Industry, (Calcutta, 1946)Google Scholar: Shein, Maung, Burma's Transport and Foreign Trade (Rangoon, 1964), pp. 165–75Google Scholar; Owen, E. W., Trek of the Oil Finders (Tulsa, 1975), pp. 271–3.Google Scholar

¹⁴ Statistics for Indian oil consumption, production and imports are given in Dasgupta, The Oil Industry in India, pp. 40–7.Google Scholar

¹⁵ In 1908/9 petroleum accounted for 6.44 per cent of the Indian customs revenue—the sixth largest item. Rider, T. D., ‘The Tariff Policy of the Government of India’, p. 89.Google Scholar

¹⁶ Dasgupta, The Oil Industry in India, pp. 15–17; Henriques, R., Marcus Samuel, First Viscount Bearsted and Founder of the ‘Shell’ Transport and Trading Company, 1853–1927 (London, 1960)Google Scholar, Chs 3 and 4. The use of tank steamers to carry oil in bulk was considerably more economical than transporting it in tins or barrels, the previous method. Before 1892 the Suez Canal had been closed to tank steamers, partly because of the supposed danger of explosion.

¹⁷ Henriques, Marcus Samuel, p. 324.Google Scholar Most general writers on Indian economic history do not appear to have considered the petroleum tariff as having a significant protective effect. Bagchi argues that no import duty ‘intentionally or unintentionally’ protected an Indian industry before the First World War. Bagchi, A. K., Private Investment in India 1900–1939 (Cambridge, 1972), p. 47.CrossRefGoogle Scholar

¹⁸ India Office Library (IOL), Finance Department, Government of India to Chief Secretary, Government of Burma, 9 November 1910 in No. 74 of 1911, Government of India Finance Department, L/E/7/696, No. R&S 945/1911.

¹⁹ Rider, ‘The Tariff Policy of the Government of India’, Ch. 3.

²⁰ Oldham, R. D., ‘The Petroleum Fields of India’, Jour. Soc. Arts, 1894, p. 155.Google Scholar Oldham argued that the Government's motive was to secure a supply of oil for the State-owned North Western Railway.

²¹ IOL, minute 19 February 1894 on Oldham's paper, L/E/7/322, No. R&S 268/94.

²² IOL, A. Godley to Lord George Hamilton, 10 December 1901, L/E/7/441, No. R&S 3436/00.

²³ IOL, Secretary to Government of Burma to Secretary to Government of India, Finance Department, in No. 74 of 1911, Government of India, Finance Department, 23 March 1911, L/E/7/696, No. R&S 945/1911.

²⁴ IOL, Memorial of the Burmah Oil Company to Lord Curzon, 12 April 1904, L/E/7/543, No. R&S 43.

²⁵ IOL, Burmah Oil Memorandum, 11 September 1911, L/E/7/696, No. R&S 2762/11.

²⁶ Ibid., minute 9 November 1911.

²⁷ IOL, Revenue Secretary of Government of Burma to Secretary to the Government of India, 7 September 1899, L/E/7/414, No. R&S 3183/1899.

²⁸ Hidy, R. W. and Hidy, M. E., History of Standard Oil Company (New Jersey): Pioneering in Big Business 1882–1911 (New York, 1955), pp. 499–501.Google Scholar

²⁹ Parliamentary Question by Bonar Law, 3 July 1902, Parliamentary Debates, 4th Series, Vol. CX, 1902, 10th Session, pp. 680–1.

³⁰ Reed, P. M., ‘Standard Oil in Indonesia 1898–1928’, Business History Review, 1958, pp. 313–14.Google Scholar

³¹ IOL, Government of India to Secretary of State, 23 October 1902, L/E/7/414, No. R&S 3141/1902.

³² For the growing criticism in the United States of Standard Oil, and the company's final dissolution by the Supreme Court in 1911, see Hidy, R. W., and Hidy, M. E., Pioneering in Big Business, pp. 639–718;Google ScholarNash, G. D., United States Oil Policy (Pittsburgh, 1968), pp. 11–15.Google Scholar

³³ Ida Tarbell's work was eventually published as a book in the United States in 1904. It was published in Britain a year later. Tarbell, Ida, The History of the Standard Oil Company (2 vols, London, 1905).Google Scholar

³⁴ IOL, Government of India to Secretary of State, 23 October 1902, L/E/7/414, No. R&S 3141/1902. The governments of several other countries in this period adopted similar policies towards Standard Oil, and for similar reasons, as the Government of India. Thus the Tsarist government in the 1890s, though eager to attract foreign capital, was extremely concerned to prevent Standard Oil's penetration of the Russian oil industry.

³⁵ Adelman, M. A., ‘The World Oil Outlook,’ in Clawson, M. (ed.), Natural Resources and International Development (Baltimore, 1964), pp. 38–9.Google Scholar

³⁶ Mikesell, R. F., Foreign Investment in the Petroleum and Mineral Industries (Baltimore, 1971), p. 457.Google Scholar

³⁷ Jones, G. G., ‘The Oil Companies and the British Government’ (Cambridge Ph.D. 1977), Ch. 1.Google Scholar

³⁸ Director of Contracts to Burmah Oil, 24 July 1903, ADM(iralty papers, Public Record Office), ADM 116/3807, No. CP 9919/1903.

³⁹ Minute by A. J. Durston, Engineer-in-Chief, 29 October 1902, ADM 1/7676, No. 25546/02.

⁴⁰ IOL, E. G. Pretyman to Secretary of State, 13 June 1904, L/E/7/498, No. R&S 1402/1904.

⁴¹ Jones, ‘The Oil Companies and the British Government’, pp. 108–10.

⁴² IOL, Admiralty to Colonial Office, 20 July 1904, L/E/7/498, No. R&S 1914/1904.

⁴³ Admiralty memorandum, 17 March, 1904, ADM 116/3807, No. CP 4310/1904.

⁴⁴ IOL, Admiralty to India Office, 25 January 1905, L/E/7/498, No. R&S 2879. The Admiralty's contract with Burmah Oil was eventually signed in November 1905. The Company agreed to erect plant capable of producing up to 80,000 tons of fuel oil per annum within two years, and to have a reserve stock of 20,000 tons ready within three years, and in time of war to hold their entire production of fuel oil at the disposal of the Admiralty. Although the Company was to supply the Admiralty with 100,000 tons during time of emergency, the Admiralty was under no obligation to purchase oil if it did not wish.

⁴⁵ In the summer of 1902 Shell Transport and Trading Company, the Royal Dutch Petroleum Company of Holland, and the French Rothschilds agreed to co-ordinate their petroleum marketing interests in the East. In 1903 this arrangement was formalized in the Asiatic Petroleum Company.

⁴⁶ Robert Henriques argues that Shell Transport became seriously interested in securing an oil concession in Burma early in 1902. Henriques, Marcus Samuel, p. 390. However, no application was made to the Government of India until 1904. Moreover, there is no documentary evidence that any interest was shown in the Burma oilfields until the summer of 1903, when the Asiatic ordered a report to be made on the Burma oilfields with a view to acquiring territory or establishing a refinery for crude oil purchased from native producers. Asiatic Petroleum Company, Minutes of Committee Meetings, 20 July 1903, SHELL (archives).

⁴⁷ IOL, Government of Burma to Government of India, 5 September, 1904, L/E/7/543, No. R&S 43.

⁴⁸ For the use of the ‘monopolist menace’ tactic by the smaller British oil companies, see Jones, G. G., ‘The British Government and the Oil Companies 1912–1924: The Search for an Oil Policy’, Historical Journal, 1977, pp. 651–2.Google Scholar

⁴⁹ IOL, Charles Greenway to Secretary of Government of India, 29 July 1903, L/E/7/543, No. R&S 43.

⁵⁰ Ibid., Charles Greenway to Government of India, 4 July 1904.

⁵¹ The official concerned was E. G. Pretyman, Parliamentary and Financial Secretary. Report of Company Government meeting, 5 August 1904, ADM 116/3807, No. A.G. 011.

⁵² IOL, minute on Burmah Oil Memorial, 3 January 1905, L/E/7/528, No. R&S 43.

⁵³ IOL, India Office to Viceroy, 3 March 1905, L/E/7/543, No. R&S 43/1905.

⁵⁴ IOL, Secretary of State to Viceroy, 10 March 1905, L/E/7/498, No. R&S 335/1905.

⁵⁵ There is a copy of the agreement between Burmah Oil and the Asiatic in IOL, L/E/7/543, No. R&S 2751/1905. The main outlines are given in Gerretson, F. C., History of the Royal Dutch (Leiden, 1958), pp. 211–13.Google Scholar

⁵⁶ Telegram from Viceroy, 23 October 1905, L/E/7/543, No. 2751/1905.

⁵⁷ For China, see Pugach, N. H., ‘Standard Oil and Petroleum Development in Early Republican China’, Business History Review, 1971. For EgyptGoogle Scholar, see Jones, ‘The Oil Companies and the British Government’, pp. 128–30.

⁵⁸ IOL, S. Pearson and Son to India Office, 16 January 1914, L/PS/10/358, No. P 4554/1913. Pearson's had built up a large petroleum production and distribution business in Mexico in the 1900s. An outline of the firm's work in Mexico is given in Middlemas, K., The Master Builders (London, 1963), pp. 209–30.Google Scholar

⁵⁹ ‘The Burma Oil Company’, an India Office official wrote to the Petroleum Department in September 1939, ‘seem to admit with a good deal of candour that they are in this Indian exploration business largely or mainly for the purpose of keeping other people out’. W. D. Croft to F. C. Starling, 25 September 1939, POWE (Ministry of Power papers, Public Record Office) 33/456. The questions whether the retardation in the development of the Indian oil industry was inevitable, or whether it was detrimental to Indian interests, are complicated ones. The Petroleum Department pointed out to the India Office that the 1930s were a period of surplus in the world petroleum industry. F. C. Starling to W. D. Croft, 14 October 1939, POWE 33/456. A large new source of crude petroleum in India would have raised acute marketing problems for Burmah Oil and its associate the Anglo-Persian Oil Company, with its own large production in Persia. However, it is conceivable that one of the Anglo-Persian/Burmah Oil group's commercial rivals may have found the development of a supply of petroleum in India an attractive and commercially viable proposition. A comparison could perhaps be made with events in the Persian Gulf in the Inter-War years. As with Burmah Oil in India, Anglo-Persian in the Persian Gulf in the 1920s displayed little interest in developing a rival source of oil to their Persian fields, and were mainly interested in oil concessions in order to exclude their rivals. As in India, British officials were aware of this fact. ‘We know’, a Colonial Office official wote in June 1924, ‘that [Anglo Persian] don't particularly want these concessions provided no-one else gets them’. Minute by Mr Clawson, 20 June 1924, C[olonial] O[ffice papers, Public Record Office] 727/9, No. Co 29139. An awareness of the Anglo-Persian's ‘pre-emptive’ designs was a considerable factor in influencing Persian Gulf rulers, who though British-protected retained considerable freedom of manoeuvre, against giving Anglo-Persian exclusive concessions in their territories. This was certainly the case in Kuwait. See Chisholm, A. H. T., The First Kuwait Oil Concession Agreement: A Record of the Negotiations 1911–1934 (London, 1975), pp. 7–9.Google Scholar The Sheikh had been committed since 1913 to granting an oil concession only to persons approved by the British Government, but United States diplomatic pressure on Britain forced the relaxation of the British ‘nationality clause’, and in 1934 a concession was awarded to the Kuwait Oil Company, which was jointly owned by Anglo-Persian and the Gulf Oil Corporation of the United States. Substantial exploration work was undertaken in the following five years, though developments were halted by the Second World War. Oil exploration proceeded at an even more rapid pace in Bahrein in the 1930s, where the Standard Oil of California secured an exclusive concession. Its marketing problems were solved by an alliance with another American company, the Texas Company, which possessed an established Eastern marketing organization. ‘Caltex’ subsequently marketed Bahrein oil in the Middle East, Far East and India.

⁶⁰ The damage that had been done to some American oilfields by competitive drilling was a commonplace at that time. Burmah Oil's concern stemmed partly from the company's pessimistic assessment of its own long-term future. While yields from its own wells steadily declined, substantial capital outlay on exploring new areas before 1914 produced no important discoveries.

⁶¹ IOL, note by Sir H. Barnes, 21 June 1911, L/E/7/696, No. R&S 945/1911. Barnes was the official who had originally refused access to the Burma Oilfields to Shell. A Government report in 1908 found the oil companies, including Burmah Oil, guilty of wasteful exploitation of the oilfields. IOL, Report of a Committee appointed to investigate the Condition of the Twinza Reserves, 1908, L/E/7/608, No. R&S 1023/1909. Following this report, a Warden of the Oilfields was appointed.

⁶² Report of the Indian Tariff Board Regarding the Grant of Protection to the Oil Industry (Calcutta, 1928), p. 43.Google Scholar

⁶³ Waley Cohen to Bataafsche Petroleum Maatschappij, 4 December 1914, SHELL.

⁶⁴ Prices in the Indian market were calculated by the oil companies on the basis of the ‘U.S. parity price system’. This meant that prices were fixed for both crude and oil products as if they had come from the U.S. Gulf, even if they had in fact come from Burma or Persia. India would almost certainly have received its oil at a lower price if this system had not been in operation. See Dasgupta, , The Oil Industry in India, pp. 81–9.Google Scholar The rigid price structure in India only broke down during the brief price wars waged between the large companies.

⁶⁵ Jones, , ‘The Oil Companies and the British Government’, pp. 138–41.Google Scholar Burmah Oil subsequently provided both personnel and technical assistance for the Persian company. Most of the geologists employed by Anglo-Persian before the First World War, men such as E. H. Cunningham Craig, Basil F. Macrorie and S. Lister James, were on hire from, or had close links with, Burmah Oil. The plans for Anglo-Persian's first refinery were made by personnel seconded by Burmah Oil. Again, much of the preliminary analysis of Persian oil after 1908 was undertaken in London at the works of the New Oil Refining Process Ltd, a subsidiary of Burmah Oil.

⁶⁶ Ibid., pp. 175–9.

⁶⁷ Lord Hardinge to Sir Valentine Chirol, 16 July 1913, Hardinge MSS, Cambridge University Library, 93/52.

⁶⁸ Ibid., memorandum of 28 April 1913, enclosed in Sir Guy Fleetwood Wilson to Lord Hardinge, 29 April 1913, 57/152.

⁶⁹ Jones, , ‘The Oil Companies and the British Government’, pp. 287–9.Google Scholar

⁷⁰ IOL, Government of India to Under Secretary of State for India, 27 June 1929, L/E/9/756, No. 4906/1929.

⁷¹ IOL, India Office memorandum, 24 September 1943, L/E/9/756, No. E&O 252/1939.

⁷² Ibid., Government of India to Under Secretary of State for India, 27 June 1929, No. 4906/1929.

⁷³ Ibid., Telegram from Viceroy, Department of Industry and Labour, to Secretary of State for India, 21 October 1929, No. R&S 7779/1929.

⁷⁴ The President of the Indian Industrial Conference in 1907, Mr Vithaldas Thackessey, argued that it would be in India's interest if its oil and other minerals were left unexploited until ‘the gradual regeneration of the country, which must come about under British rule, enables her own industrialists to raise them and get the profits of the industries.’ IOL, Proceedings of Indian Industrial Conference, December 1907, L/E/7/545, No. R&S 247/1907.

⁷⁵ The role of the oil companies in supplying oil to Britain during the First World War is examined in Jones, , ‘The British Government and the Oil Companies 1912–1924’, Historical Journal, 1977.CrossRefGoogle Scholar

⁷⁶ It has been widely argued that this stagnation was a general feature of the whole range of the Government of India's industrial and commercial policies after the First World War. Hence Morris D. Morris's argument that Government framework investment before 1914 made a useful contribution to Indian economic development, but the economic policy stagnated after 1918, and that this was partially responsible for the probable slowdown in the growth of total output in India. Morris, M. D., ‘Towards a Re-Interpretation of Nineteenth Century Indian Economic History’, Journal of Economic History, 1963, pp. 615–16.Google Scholar A. K. Bagchi has observed a ‘paralysis of will’ among British officials in their economic decision-making in the Inter-War years. Bagchi, Private Investment in India 1900–39, p. 47. However, for more detailed discussions of the Government of India's economic policies, at least in the early 1920s, see the last two chapters of Rider, T. D., ‘The Tariff Policy of the Government of India’, and Dewey, C., ‘The Government of India's New Industrial Policy, 1905–1925: Formation and Failure’, in Dewey, C. J. and Chaudhuri, K. N. (eds.), Economy and Society: Studies in Indian Economic and Social History (New Delhi, 1977).Google Scholar

⁷⁷ For developments in the Indian oil industry after 1947, see Dasgupta, The Oil Industry in India; Kidron, M., Foreign Investments in India (London, 1965), pp. 166–75, 191–6Google Scholar; Tanzier, M., The Political Economy of International Oil and the Underdeveloped Countries (Boston, 1969), pp. 163–257.Google Scholar

⁷⁸ This would appear also to be the implication of Clive Dewey's research. Dewey, Clive, ‘The End of the Imperialism of Free Trade’, in Dewey and Hopkins, The Imperial Impact, esp. pp. 50–6.Google Scholar