by Lucy Inglis
The British Opium Smugglers
Clive’s efforts in India had not only lined his own pockets, but placed Britain in control of the major opium-growing regions of Patna, Benares, Behar and Malwa. Production also went on in various independent states, and was either for purchase or domestic consumption outside British control.
As in many of the world’s opium-growing regions, poppy agriculture is not a matter of a straightforward exchange with a farmer, and this was also true in India. The caste system and entrenched hierarchies meant that the farmer was at the very bottom of the production line and earning very little, as a series of middlemen – in India’s case, higher-caste landowners – took their profit along the line. In theory, the farmer himself delivered the opium crop to the EIC or ‘government’ agents, but this was rarely the case, and opium farmers ran their own smuggling sidelines, something the company rapidly became used to.
The appetite for opium inside India was high, although not comparable to China’s voracious demand. Opium smoking, and more usually eating, was a common pastime of male workers, who would smoke madakwala in a hookah, or chandu in a nigali, like a rough cigarette with paan. The common sight of smokers at an Indian opium ‘shop’, rather than the Chinese den, is described in an early British trade monograph on northern India. These shops were taxed by the government, although many ran illicit operations on the side, buying their opium direct from the farmers. As in China, Indian opium smoking was a highly social event. ‘Visit the famous madak shop at Pulgaman at about 8 pm and you will see a small square shop . . . On the opposite side of the street you will see a long shed where other smokers are gathered. They sit in a long line with their backs to the wall and their knees drawn up to their chests . . . the whole forming a medley group of harmless irrationality and helpless intoxication’.13
The preparation of both madak and chandu in India was a long and tedious process, involving drying out the latex, powdering it, evaporation and adulteration, but it rendered a product that was more than twice as strong as crude opium, and had the added advantage that what was left in the hookah bowl could be scraped out and made into pills ‘and swallowed by those whose poverty prevents them from smoking the chandoo itself’.14
It is likely that women took opium less conspicuously, and it was also associated in India, as in Persia, with female suicide. John Mandelslo, the German writer who travelled in India, witnessed at Cambay the Hindu tradition of sati, in which the widow immolates herself on the funeral pyre of her husband. Mandelslo, watching from horseback, was particularly touched when the young woman came and threw him one of her bangles, and ‘she came up to the place with so much self-control and cheerfulness [he] was much inclined to believe she had dulled her senses with a dose of opium’. Mandelslo caught the bangle and kept it, ‘in remembrance of so extraordinary an action’.15
In late-eighteenth-century Bengal, opium for the domestic and export markets was prepared in vast government factories at Patna and Benares, overseen by the EIC, where it was carefully inspected, prepared and packaged on an industrial scale. Large balls were formed in iron moulds, and these balls then coated in opium paste and rolled in poppy leaves. This created a hard outer casing that would survive shipment, and a softer latex interior. The balls were then packed into mango-wood chests, forty to a chest, and the chest sealed and weighed to ensure that the contents weighed 116 pounds. Then, they were transferred to the government warehouse in Calcutta, and auctioned off at one of four sales per year. These auctions, although real enough, were part of what was essentially an elaborate ruse, all linking back to the British demand for Chinese tea.
The rising Chinese demand for opium finally meant that the British had a core product to trade against tea. There was one problem: by the late eighteenth century, opium had been banned in China. This prohibition had little effect on the escalating consumption, but it did mean that the EIC had to come up with a way to get opium into Canton without sailing in there under their own flag. The Calcutta auctions were the answer. Sanctioned British merchant ships, and selected others, bought the opium and exported it to Canton, either sailing in brazenly or distributing their shipments to local Chinese merchant ships, often through Macau. The Chinese government, whilst vocal about the evils of opium, was slow to react against the powerful hong merchant faction in Canton, who had no scruples about bringing in such cargo to weigh the British balance of payments for the tea they so desired. Business was, after all, business.
It took less than twenty years for the trade to become a substantial part of the income of the British Empire, and the EIC was swift to ensure it had a monopoly, firmly establishing it between 1773 and 1797. This, however, was not without its problems, for the British Parliament, as much as the revenue was welcomed, had long been suspicious of the actions of EIC agents. The arrival of the nabobs back in London in the 1760s had stirred up a deep distrust of the company amongst London’s political classes, and the government continually attempted to regulate the EIC’s operations through a series of Acts and the appointment of overseers. To no avail. Out in British India, so far from the control of London, there were stupendous and fast fortunes to be made, and those who were making them were an increasingly independent breed whose loyalty was to themselves first, the company second, and Britain somewhere down the line. There was also the fact that the EIC was still in debt from the wars that had brought its agents such fortunes, and from maintaining what was essentially a whole new infrastructure in its Indian holdings. The money had to come from somewhere, and as the tea and opium trade took off in the last thirty years of the eighteenth century, it was obvious where that money would come from.
By the late 1760s, the company was increasingly using opium to fund the British tea habit, which meant that more high-quality land, formerly used to grow valuable indigo and sugar, was given over to opium poppies between November and March. Less and less land was available for basic food crops. The company was also taxing the land under its control, and the prices were rising, leaving people unable to buy in the food they needed in times of shortage. This had a disastrous effect when in 1768 and 1769 there were poor grain harvests. Coupled with the tax-induced poverty, people began to starve. The company, under the control of Warren Hastings, the first British governor general of India, continued to collect taxes, sometimes using violent means. Hastings later recorded that by his estimate one third of the population had died, thought today to be in excess of 10 million people. The EIC was not responsible for the Great Bengal Famine of 1770, but the actions of its agents and overseers no doubt exacerbated what was already a catastrophic situation.
Just three years later, Britain and the EIC had established their dominance over the opium trade, and it did so with aggression. After the famine, a bandit culture arose in the now sparsely populated rural areas, which the company had to quell to prevent opium simply leaking away in the night. And the Bengal bandits were not the only smugglers, as privateers continued to purchase low-grade opium from Malwa and run it to China through Bombay. The company became increasingly indignant about this practice, as the Malwa producers, whose opium had traditionally gone to the Indonesian market, were now in direct competition with the company. The Portuguese enclave on the southern Indian west coast were taking more and more trade away, and Lord Wellesley, governor general of India by 1804, called for its ‘complete annihilation’.16
In China, Britain and the EIC had tried to take the diplomatic route in 1793 by sending George Macartney, 1st Earl Macartney (1737–1806), to Beijing as the British envoy to China, to negotiate the establishment of a permanent British embassy there, as well as other numerous trading concessions, such as an island for British use off the south China coast. The Qianlong Emperor met with the delegation, and accepted the gifts given to the court with polite neutrality, later saying that they were things only fit to amuse a child. The delegation were sent from pillar to post, and told exactly when they would leave the court, having achieved none of their objectives. The M
acartney mission was a failure, markedly because the Chinese court and emperor, secure in Beijing, had no interest in making concessions to foreign barbarians, while Macartney and his delegation had severely underestimated the social and cultural differences between the two nations. With hindsight, the mission was a real and unfortunate lost opportunity to establish meaningful ties between China and Britain, but at the time, it only seemed more like a complete humiliation for Macartney himself, who had been sent across the seas on a goose chase somewhat arrogantly termed British diplomacy.
By now there was another player in the game, one that would be a continual thorn in the British side: America. Opportunistic and resourceful, one American merchant ship arrived in the East Indies in the 1790s having sailed there using only a Mercator projection and a school atlas. After 1800, these American merchants were playing a significant role in trafficking opium throughout the South China Sea. Coming out of Baltimore and Philadelphia, these ships went not to India but to Smyrna (now Izmir) on the Aegean coast, often putting in at Batavia before they finished up in China. In opium, American merchants had found something that seemingly had an endless demand. Cash poor, they had to involve themselves in constant rounds of commodities such as sealskin, sandalwood and ginseng to generate the money they needed to keep buying, but sending Turkish opium to China was different, and much simpler. By the early nineteenth century, Perkins & Co. was established in Smyrna to facilitate the trade, and had the strongest ties with Boston. By 1807, the Select Committee of the EIC in Canton was becoming increasingly irritated by the American presence. By the War of 1812, Americans were determined to press their rights to trade across the oceans, and the number of American ships in the South China Sea increased significantly. The EIC was not amused, but there was little it could do, as the Americans operated as sole traders and were too piecemeal to prosecute. This changed with the Emily incident in the autumn of 1821.
The American ship Emily had arrived in Canton in May 1821 to sell a Turkish opium cargo. She lay at anchor near Whampoa for four months, selling carefully and slowly to maintain the price for their premium product. On 23 September, a seaman argued with a local woman in a boat, and then hurled a jar at her. It struck her in the head and, falling overboard, she drowned. The British consul resident in Canton attempted to persuade the captain to bribe the grieving family, but he refused. The Chinese authorities demanded the seaman be presented for trial. Captain Cowpland again refused, and rallied a committee of American merchants to negotiate with the Chinese. Suddenly, the American faction in Canton were not so piecemeal as they had been. A trial held aboard the Emily resulted in deadlock, so the Chinese blockaded all American trade. Stuck in Canton with goods to sell, the Americans gave up the seaman. He was retried and strangled. A man from Canton mysteriously appeared with a ledger totting up what the Emily and other ships had managed to sell, and Emily was ordered from Canton without further ado.
The British watched all this with alarm. In 1784, the Lady Hughes affair had similarly affected the British contingent, when a gunner had fired an honorary salute and accidentally killed a Chinese boatman in a small vessel beneath the gunport. After the gunner was arrested by Chinese authorities and strangled on a murder charge, the British in Canton had applied the Principle of Extraterritoriality, meaning they were a foreign enclave immune from local laws, much to the chagrin of the Chinese. The British were determined to maintain this principle, and from then on there was an increasing accord between the British and Americans in the face of the Chinese authorities in Canton. This, of course, did nothing for American–Chinese relations, but the Emily incident was a turning point in the organization of the Western communities of Canton, and one that had far-reaching consequences for China and, ultimately, Hong Kong.
At this time, estimates of the American share of the Canton opium trade are around 10 per cent of the whole, with Britain dominating the market with anywhere between 60 per cent and 80 per cent. The rest was made up of privateering vessels from all over the world. Trade was flourishing, with Chinese demand continually increasing through the nineteenth century, despite yet another call for total prohibition from the emperor and the Qing government in 1799. In 1810, the edict had been reaffirmed, with the emperor declaring, ‘Opium has a harm. Opium is a poison, undermining our good customs and morality . . . However, recently the purchasers, eaters, and consumers of opium have become numerous. Deceitful merchants buy and sell it to gain profit.’17 Beijing was too far from Canton for it to have any effect on the reality of trading there, and whilst relationships between the Chinese merchants and the Western traders were civil at the best of times and often strained, the rising revenue smoothed out many of the conflicts. This was aided by the British and Americans adopting the system of trading out of Lintin Island, located on the eastern side of the delta near Hong Kong island. Owing to the complicated system of bribes, backhanders and the struggle to get paid, Lintin soon seemed like the perfect solution for the Western merchants.
Western ships would stop at Lintin and place their opium into an innocent-looking storeship there, before proceeding upriver with their legal cargoes. Chinese merchants and smugglers would then buy opium tokens at Whampoa or Canton, before sliding down to Lintin to retrieve their goods. The merchants kept their noses clean, removed the need to bribe Chinese officials, and the Chinese traders got the opium. The Americans and the British had taken their business offshore.
The Opium Giants
‘As respects Opium I must take all the blame’18
The spirit of free trade that pervaded in Canton was rapidly attracting respectable merchants from all over the world who wished to take advantage of the profits to be had there. William Jardine and James Matheson were both from Scotland.
Jardine, born in 1784, graduated from Edinburgh University with a degree in medicine and became a ship’s surgeon on an East Indiaman. The Scottish contingent serving aboard East India Company ships was a large one: between 1777 and 1813, 28 per cent of all commanders of East Indiamen were Scots.19 Soon, Jardine was supplementing his income by bringing back opium from India. In 1819 he set up on his own, determined to trade in opium, and by 1822 had arrived in Canton.
Matheson, born in 1796, was sent as a teenager to Calcutta to work in his uncle’s trading company, Mackintosh & Co. After an argument with his uncle when he forgot to deliver a letter to a departing ship, he left for Canton, hoping to improve his fortunes. In Canton, Matheson became a free agent specializing in goods from India, including opium and cotton. Bright, organized and cheerful, he was invited to join one of the principal five Trading Agencies of Canton, Yrissari & Co. He inherited the business on the death of the senior partner, leaving him in a fortunate position. Winding up the business, he was free to go into partnership with the Jardine family in 1827. They operated under the name of Magniac & Co., dealing in India goods, but predominantly opium. William Jardine used his influence, and extraterritoriality, to become the Danish consul, meaning that he was exempt from the EIC’s rules.
The company Jardine Matheson was soon prominent in the Canton opium trade. In 1831, it built the opium clipper the Sylph, which made the run to Macao in seventeen days and seventeen hours, heralding a new age in competitive shipping times for the drug. It also meant she was relatively safe from piracy, owing to her speed and nimbleness on the water. Clippers were primarily coasting vessels, shallow and relatively small. Their capacity was optimized by carrying a small amount of imported goods along with a large central cargo of opium, which was then to be traded up and down the China coast, thus avoiding what the British viewed as the extortionate fees to be paid in Canton.
By this time, the firm was making tremendous profits. Goods of all kinds were starting to be traded between Canton and Britain, not just tea and opium, but trade in Canton remained precarious, something William Jardine complained about constantly. ‘We are in a sad, stupid state,’ he said in 1832, regarding the lack of protection afforded to merchants by the British government, al
though he did acknowledge the role of the Select Committee of the EIC as the only positive power for protecting the goods and rights of the trading houses in the face of shifting Chinese regulations.20 Then, in 1833, the British Parliament passed the Government of India Act and divested the EIC of all its trading rights and monopolies, rendering it a purely administrative body, active in India. Once the opium giant, the East India Company’s trading days had come to an end.
This change, however, had not come about because of the competition in Canton, but because of the Industrial Revolution back in Britain. The new industrial towns in the Midlands were turning out cheap cotton goods that had found a ready market in India, and the manufacturers were keen to open up new markets. Tenacious and political, they had lobbied Parliament continuously, and finally the British government caved in. By 1834, the EIC was gone from Whampoa Anchorage and Canton was an open market. In the same year, Jardine Matheson sent the first private shipments of tea to Britain, and rapidly established a successful business sending the finest Chinese teas back across the world, whilst simultaneously shipping opium and cheap British goods back to Canton.