Q. Consider the following statements about ‘the Charter Act of 1813’:

  1. It ended the trade monopoly of the East India Company in India except for trade in tea and trade with China.
  2. It asserted the sovereignty of the British Crown over the Indian territories held by the Company.
  3. The revenues of India were now controlled by the British Parliament.

Which of the statements given above are correct?

  • 1 and 2 only
  • 2 and 3 only
  • 1 and 3 only
  • 1, 2 and 3

Answer: (a) 1 and 2 only

Charter Act of 1813:
  • The Charter Act of 1813 renewed the Company’s lease for another 20 years but introduced key changes reflecting the shifting political and economic dynamics of the period.
  • Causes/Reasons behind Charter Act of 1813:
    • The expiry of privileges granted under the 1793 Act.
    • Growing demands by free-trade enthusiasts in Britain, especially after the Napoleonic Continental System disrupted European trade.
    • Ideological pressures from reformist groups and evangelicals in Britain.
    • The Company faced financial strains due to wars and trade setbacks.
    • Expansion of the Company’s territories despite directives to avoid conquest.
  • Salient Features of Charter Act of 1813:
    • The Company’s monopoly over trade with India was abolished, but it retained monopoly over the tea trade and trade with China.
    • The Company’s privileges were renewed, but the Crown asserted sovereignty over Indian territories.
    • The Board of Control’s powers were expanded significantly.
    • A provision was made to spend ₹1,00,000 annually on the promotion of education in India.
    • Allowed missionaries to preach Christianity in India.
    • Defined British territories: The Councils of Madras, Bombay, and Calcutta were required to submit their regulations to the British Parliament and for the first time, the British territories’ constitutional position in India was clearly defined.
    • Separate Accounts and Expanded Supervision: Separate accounts were required for commercial transactions and territorial revenues. The Board of Control’s powers of supervision and direction were expanded significantly.
Charter Act of 1813
Pitt’s India Act 1784:
  • It established an authority in England to supervise the company’s affairs. This is known as the Board of Control which has 6 members.
  • The revenues of India were controlled by the British parliament through Pitts India Act 1784.
  • The Governor-General in the council has more powers over Bombay and Madras Governors in matters related to the War, Revenue and Diplomacy.
  • In India, the strength of the executive council was reduced from four to three.
Pitts India Act