political connections, and enjoyed a good
institutionalised by the beginning of the period under study, first in the form
of chief merchants and later in the so-called joint-stock companies or
associations of the indigenous merchants, both of which had origins in the
medieval Indian commercial practices though influenced and inspired by the
European commercial innovations. Both the institutions were an outcome of
the European need to put the whole ordering and delivery process on a firm
and sturdy footing, and their desire to ensure better maintenance of standards
and greater control over the suppliers.
In all the European settlements in India, there evolved an office of chief
merchant, held by one or two of the most prominent merchants of the
settlement. This tendency to deal with one or two strong and powerful
individuals, instead of a large number of diverse merchants, was stronger
with the English than with the Dutch, while the French fell somewhere in
between in this respect.
With regard to the merchant associations, all the available evidence
suggests that they first came into existence in the 1660s in the Dutch
settlements in India with the initiative and support of the Dutch Company.
Later the English and French companies followed suit, and encouraged the
Indian merchants to form such associations in their settlements. These
merchant associations, however, began to decline rapidly as the 18th century
By the very nature of things a certain group of people, known as dalals
(brokers) became indispensable to the trade organisation of India during this
period, though brokerage as an established commercial practice and brokers
as a distinct commercial group existed in India throughout the medieval
period. The brokers acted as a link between the producers, wholesalers,
retailers, and consumers. Besides the primary job of procuring goods at
cheaper rates for their clients, they performed a variety of functions. There
was a hierarchical division among the brokers, each one of them was an
important link in the overall set-up of commercial organisation. As
mentioned earlier, most of the indigenous merchants of India during this
period belonged to the various categories of brokers.