Diwani of Bengal

Also called: Diwani rights · Topic: Europeans in India and the Rise of Company Rule · NCERT: Class 8, Ch 4 "The Colonial Era in India"; Class 12, Ch 1 "Colonialism and the Countryside"

Meaning

The Diwani of Bengal was the right to collect land revenue in Bengal, Bihar and Orissa, along with the civil justice tied to it. The Mughal emperor Shah Alam II gave this right to the English East India Company in 1765, through the Treaty of Allahabad, after the Company won the Battle of Buxar (1764).

It matters because it was the moment the Company became the legal tax-collector of India's richest province. From then on, Indian revenue paid for the Company's trade, its army and its further conquests.

Explanation

Background — from Plassey to Buxar

• The word diwani comes from diwan, the Mughal officer in charge of a province's finances. He collected revenue and settled civil (money and property) cases.
• The road began at Plassey.
• On 23 June 1757, Robert Clive defeated Siraj-ud-daulah at Palashi with the help of the traitor Mir Jafar [2].

• Mir Jafar was installed as Nawab [2]. The Company now made and unmade Nawabs, but it still had no legal right to Bengal's taxes.

• Puppet Nawabs did not stay puppets.

• Mir Jafar was replaced by Mir Qasim in 1760. Mir Qasim tried to act on his own and objected to the Company's misuse of duty-free trade.

• War broke out, and Mir Qasim was driven out of Bengal.

• Battle of Buxar, 1764.

• Three powers joined against the Company: Mir Qasim, Shuja-ud-daula (Nawab of Awadh) and the Mughal emperor Shah Alam II.
• The Company's army under Hector Munro defeated all three together.
• Plassey was won through betrayal. Buxar was a real military victory over the Mughal emperor himself.

The grant — Treaty of Allahabad, 1765

• Robert Clive, who had come back to Bengal in 1765, made the settlement.
• What the Company got:
• The Diwani of Bengal, Bihar and Orissa. In practice, "Orissa" here meant only a small part of the present state.

• Legal standing as the Mughal emperor's own revenue officer for the province.

• What Shah Alam II got:

• A fixed yearly payment (tribute) of about ₹26 lakh.

• The districts of Kara and Allahabad, taken from Awadh.

• Awadh was not annexed. Shuja-ud-daula got his state back but had to pay a war indemnity. Awadh became a buffer state (a friendly state that stood between the Company's lands and its enemies).

How it worked — the Dual System (1765–1772)

• The Mughal system split a province's government into two parts:
• Diwani: revenue and civil justice.

• Nizamat: police, criminal justice and defence.

• After 1765 the two parts sat with different hands.

• The Company held the Diwani, so it took the money.

• The Nawab kept the Nizamat in name. But his deputy was chosen by the Company, and the Company's army held the real force.

• This arrangement is called the Dual System or Dual Government.

• The Company had power without responsibility.

• The Nawab had responsibility without power.

• At first the Company did not collect the revenue itself. It worked through Indian officials, who were pushed to collect as much as possible.

• Warren Hastings ended the Dual System in 1772. The Company then took direct charge of revenue collection.

Results

• Trade paid for by Indian taxes.
• Before 1765 the Company had to bring gold and silver from Britain to buy Indian goods.

• After 1765, Bengal's own revenue paid for cotton and silk textiles bought for export. It also paid for Company troops and for building Fort William in Calcutta.

• Pressure on peasants and the famine of 1770.

• The Company wanted as much revenue as possible. Collection was harsh, while farming and crafts declined.

• In 1770 a terrible famine struck Bengal. About one-third of its population died (NCERT puts the toll at about ten million).

• Company servants grew rich. Many went home with huge private fortunes. In Britain they were mocked as "nabobs" (an English version of "nawab").

• Search for steady revenue. The Company's need for a fixed, reliable income from the Diwani lands led, step by step, to the Permanent Settlement (1793). Under it, zamindars (landholders who collected revenue from peasants) paid a fixed amount to the Company for ever.
• A legal mask for power. The Company ruled as the emperor's "servant" (diwan). This gave its rule a legitimacy that conquest alone could not.

Time, place and evidence

• Period: the 1760s, in the later Mughal era. This was when Mughal emperors held the title but regional Nawabs and the Company held real power.
• Region: the Bengal suba (province), covering Bengal, Bihar and part of Orissa. Murshidabad was its capital [3], and Calcutta was the Company's base.
• Key places: Plassey (1757) [2], Buxar (1764), Allahabad (treaty, 1765).
• Key people:
• Shah Alam II: the Mughal emperor who made the grant.
• Robert Clive: the Company's leader at Plassey and in the 1765 settlement.
• Mir Jafar and Mir Qasim: Nawabs of Bengal set up by the Company.
• Shuja-ud-daula: Nawab of Awadh, defeated at Buxar.
• Hector Munro: the Company's commander at Buxar.

• Warren Hastings: ended the Dual System in 1772.

• How we know:

• The text of the Treaty of Allahabad and the imperial farman (royal order) granting the Diwani.
• The East India Company's own records and revenue reports.
• Later British inquiries into the Company's affairs in Bengal.
• NCERT draws on these in Class 8, Ch 4 and Class 12, "Colonialism and the Countryside".

Don't confuse with

• Battle of Plassey (1757): Plassey made Mir Jafar Nawab [2] but gave no legal revenue right. The Diwani came only after Buxar, in 1765.
• Nizamat: this was the police and criminal justice side of government, and it stayed with the Nawab under the Dual System. The Diwani was the revenue side, which went to the Company.
• Farman of 1717 (Farrukhsiyar): this was a Mughal grant of duty-free trade to the Company. It was a trade privilege. The Diwani of 1765 was a revenue and administrative right.
• Subsidiary Alliance: this was a later system (Wellesley, 1798–1805 [4]) in which Indian rulers paid for British troops. The Diwani was a direct grant of tax-collecting rights by the Mughal emperor.

Prelims Hooks

• The Diwani of Bengal, Bihar and Orissa was granted in 1765 by Shah Alam II to the East India Company through the Treaty of Allahabad.
• Chronological order: Plassey (1757) → Buxar (1764) → Diwani/Treaty of Allahabad (1765) → end of the Dual System (1772) → Permanent Settlement (1793).
• Buxar was fought against Mir Qasim, Shuja-ud-daula and Shah Alam II. The Company's commander was Hector Munro.
• Under the treaty, the emperor got about ₹26 lakh a year plus Kara and Allahabad.
• Dual System (1765–1772): Diwani went to the Company, while the Nizamat stayed with the Nawab. Warren Hastings ended it.
• Trap: the Diwani was gained by Clive after Buxar, not at Plassey. It covered Bengal, Bihar and Orissa, not Awadh.

Mains Points

• From trader to ruler. The Diwani completed the change that Plassey began, when the Company became a military and political power [2]. Plassey gave it control of the Nawab. The Diwani gave it the legal right to tax. Indian revenue now paid for the Company's trade, army and wars. This is the basic logic of the "drain of wealth".
• Power without responsibility. The Dual System split real power from accountability. The Company pushed collection as high as it could, while the Nawab was blamed for misrule. Peasants paid the price, most terribly in the Bengal famine of 1770. This is a strong example for GS-I questions on how colonial revenue policy hurt Indian society.
• Continuity and change. The Company ruled through a Mughal title (diwan) and kept the Nawab as a figurehead. It used old Indian institutions as a cover for new colonial aims. Its search for a steady income from the Diwani lands led directly to the Permanent Settlement (1793) and to later land revenue experiments.

Related concepts

• Divide and rule
• Dastak
• Black Hole of Calcutta
• Siraj-ud-daulah
• Robert Clive
• Battle of Plassey
• Mir Jafar
• Mir Qasim
• Battle of Buxar 1764
• Treaty of Allahabad 1765

Read more

• Instruments of conquest: divide and rule, Plassey, subsidiary alliance, Doctrine of Lapse