One app for all your study abroad needs
The Diwani Rights are a way to legally collect revenue. The British East India Company was allowed by the Diwani Rights to utilise Bengal’s substantial revenue resources. Moreover, the Company could employ the revenue for financing its trade and other expenses, as well as for enhancing its military power.In this blog, we will read more about these rights and learn everything about them.
Who gave the Diwani Rights to the British?
On the 16th of August 1765, the Treaty of Allahabad was signed between Robert Clive of the British East India Company and Mughal Emperor, Shah Alam II. This contract was signed after the Battle of Buxar on the 22nd of October 1764. I’tisam-ud-Din, a Bengali scribe and diplomat to the Mughal Empire, handwrote the Treaty.
Also Read – From Trade to Territory – The Company Establishes Power
In addition, the Treaty signified the British political and constitutional involvement in India. According to the terms of the Treaty, Shah Alam II gave the British East India Company these rights, thus allowing the British to collect taxes at the behest of the Emperor from the eastern provinces of Bihar, Orissa and Bengal. Furthermore, these rights allowed the Company to directly collect revenue from the residents of Bihar, Orissa and Bengal. In exchange for the Diwani Rights, the Company had to pay an annual sum of 26 lakh rupees while guaranteeing that Shah Alam II retained control over the districts of Allahabad and Kora. Thus, the sum had to support the maintenance of the Emperor’s court in Allahabad.
How did the Diwani Rights Benefit the Company?
These are the following ways these rights were beneficial to the East India Company:
- Revenue Collection: The primary benefit was the authority to collect taxes on behalf of the Mughal Emperor from the eastern provinces of Bihar, Orissa and Bengal. This gave the East India Company direct access to the immense substantial revenue resources of these regions.
- Financial Control: Moreover, with the Rights, the East India Company acquired financial authority over a very significant part of India. Thus, allowing the British to handle and administer resources further enhancing their economic influence in the region.
- Trade and Expenses: The revenue accumulated via the Diwani Rights could be used by the British East India Company to finance their trade activities and cover other expenses. This financial autonomy contributed to the Company’s economic growth.
- Military Strength: In addition to economic benefits, the revenue generated from the Diwani Rights could be utilised to strengthen the military power of the British East India Company. This was necessary for maintaining continuous control and stability in the regions under their power.
- Political Influence: Furthermore, controlling the financial affairs of Bihar, Orissa and Bengal gave the British East India Company significant political leverage. Thus, allowing them to exercise power in the local governance and additionally solidify their standing in the Indian political scenario.
Relevant Blogs
| Warren Hastings | Battle of Plassey |
| Babur | Mughal Emperor Jahangir |
| Humayun | Shah Jahan |
| Battle of Panipat | 50 Interesting History Facts |
| Alauddin Khilji | History of Indian Art |
FAQs
Diwani means the lawful right to administer and collect revenue from a particular state. The Diwani Rights were given to the British East India Company by the Mughal Emperor.
The Diwani Rights allowed the Company to directly collect land revenue from the residents of Bihar, Orissa and Bengal. In exchange for the Diwani Rights, the East India Company had to pay an annual sum of 26 lakh rupees to the Emperor.
The British got Diwani Rights after the Battle of Buxar in 1764. In 1765, the Treaty of Allahabad was signed between Robert Clive of the East India Company and Mughal Emperor, Shah Alam II.
We hope you liked our blog. If you want to read more articles like this you can visit our general knowledge page on Indian History!