Get complete information on the mercantile policies of East India Company

Mercantilism generally refers to a set of economic ideas and practices consisting a series of doctrines and policies involving state intervention to promote national prosperity and strength. There were so many ideas and policy. Many mercantilist steps were undertaken in England during the reign of Queen Elizabeth in the latter half of the sixteenth century.

They were continued in the seventeenth century when among other steps a series of Navigation Acts were passed. The first of the Navigation Acts was passed in 1651 under Oliver Cromwell. It required that colonial products to England should be carried in English ships only and its main purpose was to end Dutch predominance in shipping.

Subsequently a series of Navigation Acts were passed with the aim of consolidating colonial trade by securing for British merchants a monopoly of colonial products and reserving colonial markets for British goods. Among the leading supporters and ideologists of mercantilist practices was an Englishman. Thomas Mun, who was a London merchant and also a director of the East India Company. Mun identified wealth with money and advocated reduction in the import of luxury goods and recommended granting of exclusive shipping rights to English ships.

In France a number of mercantilist policies were initiated by the able and ambitious chief minister of the absolutist monarch Louis XIV, Jean Baptiste Colbert between 1661 and 1683. Under him high tariffs were levied on foreign known as ‘Cameralism’ a word derived from Kammer which meant royal treasury. Cameralist practices pursued by the Prussian Kings Frederick William. Frederick the Great were aimed primarily at strengthening the powers of the State by increasing exports and accumulation of bullion.

Mercantilist ideas were very influential between 1600 and 1700 and many of its features survived till the end of the eighteenth century when Adam Smith launched his criticism of mercantilist monopolies in his work, “The Wealth of Nations ‘published in 1776. In the words of Maurice Dobb, the famous Marxist thinker – “The Mercantile System was a system of state regulated exploitation through trade which played a highly important role in the adolescence of capitalist industry. It was essentially the economic policy of an age of primitive accumulation.”

The Mercantilist period was a period of accumulation of capital in Europe which proved to be a vital requirement for the forthcoming Industrial Revolution in the eighteenth and the nineteenth centuries. The main features and ideas of the policy were:

(i) State policies should be directed towards getting the largest share of world trade.

(ii) If a nation is unable to have the precious metal it should get them through trade.

(iii) To buy the precious metal, favourable balance of trade – exceeding value of exports than value of import should be achieved.

(iv) The tariffs should be lowered to encourage imports should be given.

(v) Export promotion steps, especially of manufactured goods like establishing state run workshops and regulating guilds should be taken.

(vi) Due to necessity wars must be waged to acquire colonies that they help the feeder country by providing its market for manufactured goods and supply as raw material.

(vii) Manufacture of certain commodities that may spoil the mother country should be forbidden or discourage.

These were the policies and guidelines England took many mercantilists steps during the reign of Queen Elizabeth under which a series of navigation acts were passed with the aim of consolidating colonial trade by securing for British merchants a monopoly of colonial products and reserving colonial markets for British goods.

In France high tariff on imports by controlled export of bullion, set up many industries in states. Beside that the waged wars against Dutch Republic and expanded colonial domination in West Indies, Canada, India and Africa. In Germany, mercantilism known as ‘Cameralism’ meaning royal treasury were pursued which were aimed primarily at strengthening the powers of state by increasing exports and accumulation of bullion.