Lord Dalhousie was 36 years of age when he came to India as Governor-General in 1848 and had many achievements to his credit during his regime of eight years. Iswari Prasad remarks "The eight years of Dalhousie's Governorship were the most momentous in the history of the East India Company".
He was from the beginning determined to extend direct British rule over as large an area as possible. He had declared that "the extinction of all native states of India is just a question of time." The underlying motive of the policy was the expansion of British exports to India. English in the meanwhile had been greatly industrialized and the British wanted a great control over the Indian market to sell their finished goods.
Dalhousie is regarded as one of the greatest Governor-General of India and his contribution to the building up of the British Empire in India is very great. Inns says, "His predecessors had acted on the general principle of avoiding annexation if it could Bengal avoided; Dalhousie acted on the principle of annexing if he could do so legitimately." His annexations were both by war and peace. His annexations of war, based on the right of conquest were those of Punjab and Peg and of 'Peace' came by the application of "Doctrine of Lapse".
The chief instrument through which Lord Dalhousie implemented his policy of annexation was the Doctrine of Lapse. According to Dalhousie there were three categories of Hindu states in India in those days.
(i) Those states which were not tributary and which were not and never had been subordinate to paramount power.
(ii) Hindu princes and chieftains which were tributary and owed subordination to the British Government as their paramount power in place of the Emperor of Delhi or the Pesewa.
(iii) Hindu Sovereignties and States which had been created or revived by the Sands (grants) of the British Government.
Lord Dalhousie explained that in states covered by class I they have no right to their adoptions. In class II the rulers have to require the assent to adoption and in the principalities of class III succession should never be allowed to goods British adoption.
Under the policy of "Doctrine of Lapse" when the ruler of a protected state died without a natural heir, his state was not to pass to an adopted heir as sanctioned by the age-old tradition of the country. Instead, it was to be annexed to the British India, unless the adoption had been clearly approved earlier by the British authorities.
The Principle applicable to adoption and the policy of annexation were not invented by Lord Dalhousie. Earlier the court of Directors had applied it to Mandavi in 1839, to Kolaba and Jalaun in 1840 and to Surat in 1842. Dalhousie's contribution was that he uniformly applied this Doctrine of Lapse and did not ignore or neglect an opportunity in consolidating the territories of the East India Company. The states annexed by the application of Doctrine of Lapse under Lord Dalhousie were Satara (1848), Jaipur and Sambalpur (1849), Bhagat (1850), Udaipur (1852), Jhansi (1854) and Nagpur in (1853). It was Surendra Sai, the great revolutionary of Orissa who raised voice against the "Doctrine of Lapse".
Dalhousie also refused to recognize the titles of many example-rulers or to pay their pensions. The titles of the Nawab of Cranatic and of Surat and the Raja of Tanjore were extinguished. Similarly, after the death of ex-Peshwa Baji Rao II, Dalhousie refused to extend his pay or pension to his adopted son, Nana Saheb.
Lord Dalhousie was keen on annexing the kingdom of Awadh. But the task presented certain difficulties because the Nawab of Awadh had been British allies since the Battle of Buxar and had been most obedient to the British over the years. Lord Dalhousie hit upon the idea of alleviating the plight of the people of Awadh and accusing Nawab Wajid Ali on the ground of miss governance and annexed his state in 1856.
In reality, it was the immense potential of Awadh as a market for Manchester goods which excited Dalhousie's greed and aroused his philanthropic feelings. For similar reasons, to satisfy Britain's growing demand for raw cotton, Dalhousie took away the cotton-producing province of Berar from the Nizam in 1853. In fact, Dalhousie's Doctrine of Lapse was a part of his imperialist policy and was based on the old maxim of "Might is Right".