BRITISH EAST INDIA COMPANY proved to be its biggest rival. Formed in 1600, the Company immediately received permission from Queen Elizabeth to be the only British company to trade with South Asia.
At first, the Company made good money. Soon, however, the Company realized it had little of value to trade for Indian goods. The only wealth Britain had that South Asia wanted was precious metal, but Britain imposed restrictions on just how much gold and silver a company could export. For a brief while, the Company fell on hard times.
In the mid-17th century, though, the British government granted powers to the Company that are usually reserved only for independent countries. First, the Company gained the right to mint its own money. Second, it was granted political authority over all British citizens working in South Asian factories. Effectively, the Company was a government for those citizens. Finally, the Company actually had permission to wage war against any non-Christians in South Asia if it saw fit to do so.
The Company made use of all these privileges and soon began to bring massive amounts of wealth into the British Empire. In fact, at its peak, the Company conducted fully one half of all the trade in the world! No other company in history has matched the Company in this regard. The Company effectively governed 200 million dependents and held many times more lands than the British monarch, its sovereign.
The British and the Portuguese were not the only Europeans interested in India. The French had extensive holdings there as well, and the two most important thrones in southern India were held by French puppet governors. Although Britain and France were officially at peace, they competed bitterly for holdings in South Asia.