Assess the strengths and weaknesses of the Dutch and English East india Companies as "colonial powers" - What advantages did they have over colonial bureaucracies? What factors led to their replacement by colonial states?

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Assess the strengths and weaknesses of the Dutch and English East india Companies as “colonial powers”. What advantages did they have over colonial bureaucracies? What factors led to their replacement by colonial states?

The Dutch and English East Companies were formed in the early 1600s with the common aim of eliminating competition at home and to break the Portuguese monopoly in Asia. They eventually grew in power so much so that they were regarded as ‘colonial powers’, their presence strongly felt throughout the Asian nations. The following essay shall discuss the strengths and weaknesses of the Companies, and how these gave them the edge over the colonial bureaucracies that later replaced them. The factors, which led to their downfall, shall also be analysed.

Both the Dutch and English East India Companies were granted authority by their respective governments to venture and explore Asia. The field was left open to them as the governments lacked the resources to undertake colonization. Given military power by the European governments, they were ‘empowered to make war or treaties’ which allowed them to earn profits through trade and gain territories through establishments of ports. In a sense they were separate entities from their government, having much freedom in the making of decisions yet at the same time under the protection of their governments, such as military backing. Intervention was limited since the Companies were, after all, founded with private capital and thus private companies.

Economically, both companies enjoyed monopoly of trade. The Dutch East India Company (VOC), for instance, had a strong unbreakable monopoly over the spice trade and was very well established in Java by the time the English arrived. Rivals that came along the way were often frustrated and eliminated without much effort. The monopolies brought the Companies enormous profits.

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In addition, the development of shipping equipment and later the industrial Revolution back in Europe gave the Companies technological advantage over their European and Asian counterparts, enabling them to maintain monopoly and control territory. The rise of Dutch power was initially due to their superiority in naval warfare over the Portuguese, whereas later in the case of the English East India Company (EIC), their unchallenged naval power gave them predominance in Asia. Military organization and technology developed back home also gave the Company ‘unforeseen advantages in its confrontations with the Indian states’. Their ability to protect the Indians from banditry ...

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