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The Secretary to the Court of Directors has informed your Committee that no copy of the answer is to be found in the India House; nor has your Committee been able to discover that any has been transmitted. On this failure, your Committee ordered an application to be made to Mr. Barwell for a copy of his answer to the bill, and any other information with which he might be furnished with regard to that subject.

Mr. Barwell, after reciting the above letter, returned in answer what follows.

"Whether the records of the Supreme Court of Judicature are lodged at the India House I am ignorant, but on those records my answer is certainly to be found. At this distance of time I am sorry I cannot from memory recover the circumstances of this affair; but this I know, that the bill did receive a complete answer, and the people the fullest satisfaction: nor is it necessary for me to remark, that [in?] the state of parties at that time in Bengal, could party have brought forward any particle of that bill supported by any verified fact, the principle that introduced it in the proceedings of the Governor-General and Council would likewise have given the verification of that one circumstance, whatever that might have been. As I generally attend in my place in the House, I shall with pleasure answer any invitation of the gentlemen of the Committee to attend their investigations up stairs with every information and light in my power to give them.

"St. James's Square, 15th April, 1783."

Your Committee considered, that, with regard to the matter charged in the several petitions to the board, no sort of specific answer had been given at the time and place where they were made, and when and where the parties might be examined and confronted. It was considered also, that the bill had been transmitted, with other papers relating to the same matter, to the Court of Directors, with the knowledge and consent of Mr. Barwell,—and that he states that his answer had been filed, and no proceedings had upon it for eighteen months. In that situation it was thought something extraordinary that no care was taken by him to transmit so essential a paper as his answer, and that he had no copy of it in his hands.

Your Committee, in this difficulty, thought themselves obliged to decline any verbal explanation from the person who is defendant in the suit, relative to matters which on the part of the complainant appear upon record, and to leave the whole matter, as it is charged, to the judgment of the House to determine how far it may be worthy of a further inquiry, or how far they may admit such allegations as your Committee could not think themselves justified in receiving. To this effect your Committee ordered a letter to be written Mr. Barwell; from whom they received the following answer.

"Sir,—In consequence of your letter of the 17th, I must request the favor of you to inform the Select Committee that I expect from their justice, on any matter of public record in which I am personally to be brought forward to the notice of the House, that they will at the same time point out to the House what part of such matter has been verified, and what parts have not nor ever were attempted to be verified, though introduced in debate and entered on the records of the Governor-General and Council of Bengal. I am anxious the information should be complete, or the House will not be competent to judge; and if it is complete, it will preclude all explanation as unnecessary.

"I am, Sir,

"Your most obedient humble servant,

"RICHARD BARWELL.

"St. James's Square, 22nd April, 1783.

"P.S. As I am this moment returned from the country, I had it not in my power to be earlier in acknowledging your letter of the 17th."

Your Committee applied to Mr. Barwell to communicate any papers which might tend to the elucidation of matters before them in which he was concerned. This he has declined to do. Your Committee conceive that under the orders of the House they are by no means obliged to make a complete state of all the evidence which may tend to criminate or exculpate every person whose transactions they may find it expedient to report: this, if not specially ordered, has not hitherto been, as they apprehend, the usage of any committee of this House. It is not for your Committee, but for the discretion of the party, to call for, and for the wisdom of the House to institute, such proceedings as may tend finally to condemn or acquit. The Reports of your Committee are no charges, though they may possibly furnish matter for charge; and no representations or observations of theirs can either clear or convict on any proceeding which may hereafter be grounded on the facts which they produce to the House. Their opinions are not of a judicial nature. Your Committee has taken abundant care that every important fact in their Report should be attended with the authority for it, either in the course of their reflections or in the Appendix: to report everything upon every subject before them which is to be found on the records of the Company would be to transcribe, and in the event to print, almost the whole of those voluminous papers. The matter which appears before them is in a summary manner this.

The Dacca merchants begin by complaining that in November, 1773, Mr. Richard Barwell, then Chief of Dacca, had deprived them of their employment and means of subsistence; that he had extorted from them 44,224 Arcot rupees (4,731l.) by the terror of his threats, by long imprisonment, and cruel confinement in the stocks; that afterwards they were confined in a small room near the factory-gate, under a guard of sepoys; that their food was stopped, and they remained starving a whole day; that they were not permitted to take their food till next day at noon, and were again brought back to the same confinement, in which they were continued for six days, and were not set at liberty until they had given Mr. Barwell's banian a certificate for forty thousand rupees; that in July, 1774, when Mr. Barwell had left Dacca, they went to Calcutta to seek justice; that Mr. Barwell confined them in his house at Calcutta, and sent them back under a guard of peons to Dacca; that in December, 1774, on the arrival of the gentlemen from Europe, they returned to Calcutta, and preferred their complaint to the Supreme Court of Judicature.

The bill in Chancery filed against Richard Barwell, John Shakespeare, and others, contains a minute specification of the various acts of personal cruelty said to be practised by Mr. Barwell's orders, to extort money from these people. Among other acts of a similar nature he is charged with having ordered the appraiser of the Company's cloths, who was an old man, and who asserts that he had faithfully served the Company above sixteen years without the least censure on his conduct, to be severely flogged without reason.

In the manner of confining the delâls, with ten of their servants, it is charged on him, that, "when he first ordered them to be put into the stocks, it was at a time when the weather was exceedingly bad and the rain very heavy, without allowing them the least covering for their heads or any part of their body, or anything to raise them from the wet ground; in which condition they were continued for many hours, until the said Richard Barwell thought proper to remove them into a far worse state, if possible, as if studying to exercise the most cruel acts of barbarity on them, &c.; and that during their imprisonment they were frequently carried to and tortured in the stocks in the middle of the day, when the scorching heat of the sun was insupportable, notwithstanding which they were denied the least covering." These men assert that they had served the Company without blame for thirty years,—a period commencing long before the power of the Company in India.

It was no slight aggravation of this severity, that the objects were not young, nor of the lowest of the people, who might, by the vigor of their constitutions, or by the habits of hardship, be enabled to bear up against treatment so full of rigor. They were aged persons; they were men of a reputable profession.

The account given by these merchants of their first journey to Calcutta, in July, 1774, is circumstantial and remarkable. They say, "that, on their arrival, to their astonishment, they soon learned that the Governor, who had formerly been violently enraged against the said Richard Barwell for different improprieties in his conduct, was now reconciled to him; and that ever since there was a certainty of his Majesty's appointments taking place in India, from being the most inveterate enemies they were now become the most intimate friends; and that this account soon taught them to believe they were not any nearer justice from their journey to Calcutta than they had been before at Dacca."

When this bill of complaint was, in 1776, laid before the Council, to be transmitted to the Court of Directors, Mr. Barwell complained of the introduction of such a paper, and asserted, that he had answered to every particular of it on oath about eighteen months, and that during this long period no attempt had been made to controvert, refute, or even to reply to it.

He did not, however, think it proper to enter his answer on the records along with the bill of whose introduction he complained.

On the declarations made by Mr. Barwell in his minute (September, 1776) your Committee observe, that, considering him only as an individual under prosecution in a court of justice, it might be sufficient for him to exhibit his defence in the court where he was accused; but that, as a member of government, specifically charged before that very government with abusing the powers of his office in a very extraordinary manner, and for purposes (as they allege) highly corrupt and criminal, it appears to your Committee hardly sufficient to say that he had answered elsewhere. The matter was to go before the Court of Directors, to whom the question of his conduct in that situation, a situation of the highest power and trust, was as much at least a question of state as a matter of redress to be solely left to the discretion, capacity, or perseverance of individuals. Mr. Barwell might possibly be generous enough to take no advantage of his eminent situation; but these unfortunate people would rather look to his power than his disposition. In general, a man so circumstanced and so charged (though we do not know this to be the case with Mr. Barwell) might easily contrive by legal advantages to escape. The plaintiffs being at a great distance from the seat of government, and possibly affected by fear or fatigue, or seeing the impossibility of sustaining with the ruins of fortunes never perhaps very opulent a suit against wealth, power, and influence, a compromise might even take place, in which circumstances might make the complainants gladly acquiesce. But the public injury is not in the least repaired by the acquiescence of individuals, as it touched the honor of the very highest parts of government. In the opinion of your Committee some means ought to have been taken to bring the bill to a discussion on the merits; or supposing that such decree could not be obtained by reason of any failure of proceeding on the part of the plaintiffs, that some process official or juridical ought to have been instituted against them which might prove them guilty of slander and defamation in as authentic a manner as they had made their charge, before the Council as well as the Court.

By the determination of Mr. Hurst, and the resolutions of the Board of Trade, it is much to be apprehended that the native mercantile interest must be exceedingly reduced. The above-mentioned resolutions of the Board of Trade, if executed in their rigor, must almost inevitably accomplish its ruin. The subsequent transactions are covered with an obscurity which your Committee have not been able to dispel. All which they can collect, but that by no means distinctly, is, that, as those who trade for the Company in the articles of investment may also trade for themselves in the same articles, the old opportunities of confounding the capacities must remain, and all the oppressions by which this confusion has been attended. The Company's investments, as the General Letter from Bengal of the 20th of November, 1775, par. 28, states the matter, "are never at a stand; advances are made and goods are received all the year round." Balances, the grand instrument of oppression, naturally accumulate on poor manufacturers who are intrusted with money. Where there is not a vigorous rivalship, not only tolerated, but encouraged, it is impossible ever to redeem the manufacturers from the servitude induced by those unpaid balances.

No such rivalship does exist: the policy practised and avowed is directly against it. The reason assigned in the Board of Trade's letter of the 28th of November, 1778, for its making their advances early in the season is, to prevent the foreign merchants and private traders interfering with the purchase of their (the Company's) assortments. "They also refer to the means taken to prevent this interference in their letter of 26th January, 1779." It is impossible that the small part of the trade should not fall into the hands of those who, with the name and authority of the governing persons, have such extensive contracts in their hands. It appears in evidence that natives can hardly trade to the best advantage, (your Committee doubt whether they can trade to any advantage at all,) if not joined with or countenanced by British subjects. The Directors were in 1775 so strongly impressed with this notion, and conceived the native merchants to have been even then reduced to so low a state, that, notwithstanding the Company's earnest desire of giving them a preference, they "doubt whether there are at this time in Bengal native merchants possessed of property adequate to such undertaking, or of credit and responsibility sufficient to make it safe and prudent to trust them with such sums as might be necessary to enable them to fulfil their engagements with the Company."

The effect which so long continued a monopoly, followed by a preëmption, and then by partial preferences supported by power, must necessarily have in weakening the mercantile capital, and disabling the merchants from all undertakings of magnitude, is but too visible. However, a witness of understanding and credit does not believe the capitals of the natives to be yet so reduced as to disable them from partaking in the trade, if they were otherwise able to put themselves on an equal footing with Europeans.

The difficulties at the outset will, however, be considerable. For the long continuance of abuse has in some measure conformed the whole trade of the country to its false principle. To make a sudden change, therefore, might destroy the few advantages which attend any trade, without securing those which must flow from one established upon sound mercantile principles, whenever such a trade can be established. The fact is, that the forcible direction which the trade of India has had towards Europe, to the neglect, or rather to the total abandoning, of the Asiatic, has of itself tended to carry even the internal business from the native merchant. The revival of trade in the native hands is of absolute necessity; but your Committee is of opinion that it will rather be the effect of a regular progressive course of endeavors for that purpose than of any one regulation, however wisely conceived.

After this examination into the condition of the trade and traders in the principal articles provided for the investment to Europe, your Committee proceeded to take into consideration those articles the produce of which, after sale in Bengal, is to form a part of the fund for the purchase of other articles of investment, or to make a part of it in kind. These are, 1st, Opium,—2ndly, Saltpetre,—and, 3rdly, Salt. These are all monopolized.

OPIUM

The first of the internal authorized monopolies is that of opium. This drug, extracted from a species of the poppy, is of extensive consumption in most of the Eastern markets. The best is produced in the province of Bahar: in Bengal it is of an inferior sort, though of late it has been improved. This monopoly is to be traced to the very origin of our influence in Bengal. It is stated to have begun at Patna so early as the year 1761, but it received no considerable degree of strength or consistence until the year 1765, when the acquisition of the Duanné opened a wide field for all projects of this nature. It was then adopted and owned as a resource for persons in office,—was managed chiefly by the civil servants of the Patna factory, and for their own benefit. The policy was justified on the usual principles on which monopolies are supported, and on some peculiar to the commodity, to the nature of the trade, and to the state of the country: the security against adulteration; the prevention of the excessive home consumption of a pernicious drug; the stopping an excessive competition, which by an over-proportioned supply would at length destroy the market abroad; the inability of the cultivator to proceed in an expensive and precarious culture without a large advance of capital; and, lastly, the incapacity of private merchants to supply that capital on the feeble security of wretched farmers.

These were the principal topics on which the monopoly was supported. The last topic leads to a serious consideration on the state of the country; for, in pushing it, the gentlemen argued, that, in case such private merchants should advance the necessary capital, the lower cultivators "would get money in abundance." Admitting this fact, it seems to be a part of the policy of this monopoly to prevent the cultivator from obtaining the natural fruits of his labor. Dealing with a private merchant, he could not get money in abundance, unless his commodity could produce an abundant profit. Further reasons, relative to the peace and good order of the province, were assigned for thus preventing the course of trade from the equitable distribution of the advantages of the produce, in which the first, the poorest, and the most laborious producer ought to have his first share. The cultivators, they add, would squander part of the money, and not be able to complete their engagements to the full; lawsuits, and even battles, would ensue between the factors, contending for a deficient produce; and the farmers would discourage the culture of an object which brought so much disturbance into their districts. This competition, the operation of which they endeavor to prevent, is the natural corrective of the abuse, and the best remedy which could be applied to the disorder, even supposing its probable existence.

Upon whatever reasons or pretences the monopoly of opium was supported, the real motive appears to be the profit of those who were in hopes to be concerned in it. As these profits promised to be very considerable, at length it engaged the attention of the Company; and after many discussions, and various plans of application, it was at length taken for their benefit, and the produce of the sale ordered to be employed in the purchase of goods for their investment.

In the year 1773 it had been taken out of the hands of the Council of Patna, and leased to two of the natives,—but for a year only. The contractors were to supply a certain quantity of opium at a given price. Half the value was to be paid to those contractors in advance, and the other half on the delivery.

The proceedings on this contract demonstrated the futility of all the principles on which the monopoly was founded. The Council, as a part of their plan, were obliged, by heavy duties, and by a limitation of the right of emption of foreign opium to the contractors for the home produce, to check the influx of that commodity from the territories of the Nabob of Oude and the Rajah of Benares. In these countries no monopoly existed; and yet there the commodity was of such a quality and so abundant as to bear the duty, and even with the duty in some degree to rival the monopolist even in his own market. There was no complaint in those countries of want of advances to cultivators, or of lawsuits and tumults among the factors; nor was there any appearance of the multitude of other evils which had been so much dreaded from the vivacity of competition.

On the other hand, several of the precautions inserted in this contract, and repeated in all the subsequent, strongly indicated the evils against which it is extremely difficult, if not impossible, to guard a monopoly of this nature and in that country. For in the first contract entered into with the two natives it was strictly forbidden to compel the tenants to the cultivation of this drug. Indeed, very shocking rumors had gone abroad, and they were aggravated by an opinion universally prevalent, that, even in the season immediately following that dreadful famine which swept off one third of the inhabitants of Bengal, several of the poorer farmers were compelled to plough up the fields they had sown with grain in order to plant them with poppies for the benefit of the engrossers of opium. This opinion grew into a strong presumption, when it was seen that in the next year the produce of opium (contrary to what might be naturally expected in a year following such a dearth) was nearly doubled. It is true, that, when the quantity of land necessary for the production of the largest quantity of opium is considered, it is not just to attribute that famine to these practices, nor to any that were or could be used; yet, where such practices did prevail, they must have been very oppressive to individuals, extremely insulting to the feelings of the people, and must tend to bring great and deserved discredit on the British government. The English are a people who appear in India as a conquering nation; all dealing with them is therefore, more or less, a dealing with power. It is such when they trade on a private account; and it is much more so in any authorized monopoly, where the hand of government, which ought never to appear but to protect, is felt as the instrument in every act of oppression. Abuses must exist in a trade and a revenue so constituted, and there is no effectual cure for them but to entirely cut off their cause.

Things continued in this train, until the great revolution in the Company's government was wrought by the Regulating Act of the thirteenth of the king. In 1775 the new Council-General appointed by the act took this troublesome business again into consideration. General Clavering, Colonel Monson, and Mr. Francis expressed such strong doubts of the propriety of this and of all other monopolies, that the Directors, in their letter of the year following, left the Council at liberty to throw the trade open, under a duty, if they should find it practicable. But General Clavering, who most severely censured monopoly in general, thought that this monopoly ought to be retained,—but for a reason which shows his opinion of the wretched state of the country: for he supposed it impossible, with the power and influence which must attend British subjects in all their transactions, that monopoly could be avoided; and he preferred an avowed monopoly, which brought benefit to government, to a virtual engrossing, attended with profit only to individuals. But in this opinion he did not seem to be joined by Mr. Francis, who thought the suppression of this and of all monopolies to be practicable, and strongly recommended their abolition in a plan sent to the Court of Directors the year following.⁶

The Council, however, submitting to the opinion of this necessity, endeavored to render that dubious engagement as beneficial as possible to the Company. They began by putting up the contract to the highest bidder. The proposals were to be sealed. When the seals came to be opened, a very extraordinary scene appeared. Every step in this business develops more and more the effect of this junction of public monopoly and private influence. Four English and eight natives were candidates for the contract; three of the English far overbid the eight natives. They who consider that the natives, from their superior dexterity, from their knowledge of the country and of business, and from their extreme industry, vigilance, and parsimony, are generally an over-match for Europeans, and indeed are, and must ultimately be, employed by them in all transactions whatsoever, will find it very extraordinary that they did not by the best offers secure this dealing to themselves. It can be attributed to this cause, and this only,—that they were conscious, that, without power and influence to subdue the cultivators of the land to their own purposes, they never could afford to engage on the lowest possible terms. Those whose power entered into the calculation of their profits could offer, as they did offer, terms without comparison better; and therefore one of the English bidders, without partiality, secured the preference.

The contract to this first bidder, Mr. Griffiths, was prolonged from year to year; and as during that time frequent complaints were made by him to the Council Board, on the principle that the years answered very differently, and that the business of one year ran into the other, reasons or excuses were furnished for giving the next contract to Mr. Mackenzie for three years. This third contract was not put up to auction, as the second had been, and as this ought to have been. The terms were, indeed, something better for the Company; and the engagement was subject to qualifications, which, though they did not remove the objection to the breach of the Company's orders, prevented the hands of the Directors from being tied up. A proviso was inserted in the contract, that it should not be anyways binding, if the Company by orders from home should alter the existing practice with regard to such dealing.

Whilst these things were going on, the evils which this monopoly was in show and pretence formed to prevent still existed, and those which were naturally to be expected from a monopoly existed too. Complaints were made of the bad quality of the opium; trials were made, and on those trials the opium was found faulty. An office of inspection at Calcutta, to ascertain its goodness, was established, and directions given to the Provincial Councils at the places of growth to certify the quantity and quality of the commodity transmitted to the Presidency.

In 1776, notwithstanding an engagement in the contract strictly prohibiting all compulsory culture of the poppy, information was given to a member of the Council-General, that fields green with rice had been forcibly ploughed up to make way for that plant,—and that this was done in the presence of several English gentlemen, who beheld the spectacle with a just and natural indignation. The board, struck with this representation, ordered the Council of Patna to make an inquiry into the fact; but your Committee can find no return whatsoever to this order. The complaints were not solely on the part of the cultivators against the contractor. The contractor for opium made loud complaints against the inferior collectors of the landed revenue, stating their undue and vexatious exactions from the cultivators of opium,—their throwing these unfortunate people into prison upon frivolous pretences, by which the tenants were ruined, and the contractor's advances lost. He stated, that, if the contractor should interfere in favor of the cultivator, then a deficiency would be caused to appear in the landed revenues, and that deficiency would be charged on his interposition; he desired, therefore, that the cultivators of opium should be taken out of the general system of the landed revenue, and put under "his protection." Here the effect naturally to be expected from the clashing of inconsistent revenues appeared in its full light, as well as the state of the unfortunate peasants of Bengal between such rival protectors, where the ploughman, flying from the tax-gatherer, is obliged to take refuge under the wings of the monopolist. No dispute arises amongst the English subjects which does not divulge the misery of the natives; when the former are in harmony, all is well with the latter.

This monopoly continuing and gathering strength through a succession of contractors, and being probably a most lucrative dealing, it grew to be every day a greater object of competition. The Council of Patna endeavored to recover the contract, or at least the agency, by the most inviting terms; and in this eager state of mutual complaint and competition between private men and public bodies things continued until the arrival in Bengal of Mr. Stephen Sulivan, son of Mr. Sulivan, Chairman of the East India Company, which soon put an end to all strife and emulation.

To form a clear judgment on the decisive step taken at this period, it is proper to keep in view the opinion of the Court of Directors concerning monopolies, against which they had uniformly declared in the most precise terms. They never submitted to them, but as to a present necessity; it was therefore not necessary for them to express any particular approbation of a clause in Mr. Mackenzie's contract which was made in favor of their own liberty. Every motive led them to preserve it. On the security of that clause they could alone have suffered to pass over in silence (for they never approved) the grant of the contract which contained it for three years. It must also be remembered that they had from the beginning positively directed that the contract should be put up to public auction; and this not having been done in Mr. Mackenzie's case, they severely reprimanded the Governor-General and Council in their letter of the 23rd December, 1778.

The Court of Directors were perfectly right in showing themselves tenacious of this regulation,—not so much to secure the best practicable revenue from their monopoly whilst it existed, but for a much more essential reason, that is, from the corrective which this method administered to that monopoly itself: it prevented the British contractor from becoming doubly terrible to the natives, when they should see that his contract was in effect a grant, and therefore indicated particular favor and private influence with the ruling members of an absolute government.