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Partner in Empire: Dwarkanath Tagore and the Age of Enterprise in Eastern India
Berkeley 1976. first edition. University of California. Hardcover. Lg.8vo., 276pp., frontis illus., index. VG , no owner marks. Good DJ, some light edge wear on dj.
320 pages, Hardcover
First published January 1, 1976
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December 16, 2023
Dwarkanath Tagore, Pioneer of Private Equity.
Between 1831 and 1846, Dwarkanath Tagore was the greatest entrepreneur in the world, perhaps the Masayoshi Son or Elon Musk of his era, creating some of the greatest firms of his time but also having a few spectacular failures (how would you be a true entrepreneur otherwise?). And in addition, he bankrolled social reforms, helped expand education, and gave generously to charitable causes.
The Tagores were Pirali Brahmins, disdained by their fellow Hindus for having consorted with Muslims in the seventeenth century. They were given the title Thakur by the fishermen of Govindapur, in gratitude for their priestly ministrations. When the British decided to build Fort William, they built it upon the site of the Thakur mansions in Govindapur and Dharamtola, expropriating them in exchange for giving the contract to build the fort to a Tagore. From the start, therefore, the Tagores had particularly close ties to the British, especially after their defeat of Siraj.
Born in 1794 (the year after Cornwallis’s Permanent Settlement, which gave zamindars permanent title to their land, but at an extortionate fixed revenue demand equal to about 90% of the crop value that year), Dwarkanath had about 7 years of English education, but not only acquired a complete mastery of the language (as evident in his impeccably penned letters) but also an expertise in the new legal codes governing land revenue. By the time he was 21, he was dewan of the Salt bureau in the 24 Parganas, and by age 28 had become the Dewan of the Salt Bureau across Bengal (one of the four highest posts available to an Indian). He resigned that post six years later to plunge fully into business.
He grew his zamindari rapidly, becoming the second-largest contributor of land revenue in Bengal. But he was unique in using his lands to build up extensive export industries in silk, sugar, rum and indigo, which soon made him the biggest exporter in British India. He also established the largest newspapers in India, and was the leading patron of the theatre in Calcutta.
Then he pioneered the first truly world class colliery in India, at Raniganj, employing British engineers and technicians, alongside some Indian (including Indo-Portuguese) managers, and Santhal workers. Although Dwarkanath sold his shares after about a decade, the Bengal Coal Company he created remained India’s largest private coal company for nearly 150 years. Then he bought several ship liners (among the largest fleets in the world) to take his coal and indigo to markets around the world, and established the Union Bank, which became the largest bank in British India in short order. His sense of timing in these investments was impeccable, but he was really a private equity player, building up and turning around companies, then selling his shares and moving on to his next venture.
With one of his subordinates, William Prinsep, Dwarkanath then established India’s first tea estates, creating the Assam Company, which still claims him as part of its illustrious pedigree. He and Prinsep had established the Bengal Tea Association, aiming to have an Indian board, albeit with links to a London financing company. After the merger with tbe London entity, Dwarkanath’s share in the Assam Company dwindled to 5%, and after 2 years, the London board gained full control of the company, although Prinsep joined that board once he returned to England.
As to the failures, Dwarkanath’s attempt to manufacture sugar in India (on the Caribbean model) failed, but he switched to making gur and rum instead. Prinsep’s attempts at manufacturing salt were a colossal failure, as was his expensive proposal to build a bridge of boats across the Hooghly. But Dwarkanath did create an extensive network of steam tugboats across Bengal and north India. He sold his shares in the Union Bank in 1845, but the bank became too concentrated in a single industry — indigo — in the 1840s, which brought about its downfall two years after Tagore had sold his shares. Had Tagore still been involved, he would have tided the bank over the temporary difficulty caused by a decline in its asset values (foreclosed indigo factories), but his son and successors were simply incapable of managing matters as only a pioneer could. Dwarkanath himself died in 1846 on a stormy night at St George’s (now Brown) Hotel, London — and one of his English journalistic protégés wrote that the skies themselves had thundered unprecedentedly at the passing of this truly great man.
Between 1831 and 1846, Dwarkanath Tagore was the greatest entrepreneur in the world, perhaps the Masayoshi Son or Elon Musk of his era, creating some of the greatest firms of his time but also having a few spectacular failures (how would you be a true entrepreneur otherwise?). And in addition, he bankrolled social reforms, helped expand education, and gave generously to charitable causes.
The Tagores were Pirali Brahmins, disdained by their fellow Hindus for having consorted with Muslims in the seventeenth century. They were given the title Thakur by the fishermen of Govindapur, in gratitude for their priestly ministrations. When the British decided to build Fort William, they built it upon the site of the Thakur mansions in Govindapur and Dharamtola, expropriating them in exchange for giving the contract to build the fort to a Tagore. From the start, therefore, the Tagores had particularly close ties to the British, especially after their defeat of Siraj.
Born in 1794 (the year after Cornwallis’s Permanent Settlement, which gave zamindars permanent title to their land, but at an extortionate fixed revenue demand equal to about 90% of the crop value that year), Dwarkanath had about 7 years of English education, but not only acquired a complete mastery of the language (as evident in his impeccably penned letters) but also an expertise in the new legal codes governing land revenue. By the time he was 21, he was dewan of the Salt bureau in the 24 Parganas, and by age 28 had become the Dewan of the Salt Bureau across Bengal (one of the four highest posts available to an Indian). He resigned that post six years later to plunge fully into business.
He grew his zamindari rapidly, becoming the second-largest contributor of land revenue in Bengal. But he was unique in using his lands to build up extensive export industries in silk, sugar, rum and indigo, which soon made him the biggest exporter in British India. He also established the largest newspapers in India, and was the leading patron of the theatre in Calcutta.
Then he pioneered the first truly world class colliery in India, at Raniganj, employing British engineers and technicians, alongside some Indian (including Indo-Portuguese) managers, and Santhal workers. Although Dwarkanath sold his shares after about a decade, the Bengal Coal Company he created remained India’s largest private coal company for nearly 150 years. Then he bought several ship liners (among the largest fleets in the world) to take his coal and indigo to markets around the world, and established the Union Bank, which became the largest bank in British India in short order. His sense of timing in these investments was impeccable, but he was really a private equity player, building up and turning around companies, then selling his shares and moving on to his next venture.
With one of his subordinates, William Prinsep, Dwarkanath then established India’s first tea estates, creating the Assam Company, which still claims him as part of its illustrious pedigree. He and Prinsep had established the Bengal Tea Association, aiming to have an Indian board, albeit with links to a London financing company. After the merger with tbe London entity, Dwarkanath’s share in the Assam Company dwindled to 5%, and after 2 years, the London board gained full control of the company, although Prinsep joined that board once he returned to England.
As to the failures, Dwarkanath’s attempt to manufacture sugar in India (on the Caribbean model) failed, but he switched to making gur and rum instead. Prinsep’s attempts at manufacturing salt were a colossal failure, as was his expensive proposal to build a bridge of boats across the Hooghly. But Dwarkanath did create an extensive network of steam tugboats across Bengal and north India. He sold his shares in the Union Bank in 1845, but the bank became too concentrated in a single industry — indigo — in the 1840s, which brought about its downfall two years after Tagore had sold his shares. Had Tagore still been involved, he would have tided the bank over the temporary difficulty caused by a decline in its asset values (foreclosed indigo factories), but his son and successors were simply incapable of managing matters as only a pioneer could. Dwarkanath himself died in 1846 on a stormy night at St George’s (now Brown) Hotel, London — and one of his English journalistic protégés wrote that the skies themselves had thundered unprecedentedly at the passing of this truly great man.
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