MERCHANTS OF THE RAJ

Also by Stephanie Jones

BUSINESS DOCUMENTS: Their Origins, Sources and Uses in Historical Research (with John Armstrong)

CAREER TURNAROUND: How to Apply Corporate Strategy Techniques to Your Own Career

''THE BIOTECHNOLOGISTS and the Evolution of Biotech Enterprises in the USA and Europe "THE HEADHUNTING BUSINESS

TRADE AND SHIPPING: Lord Inchcape, 1852-1932 *TWO CENTURIES OF OVERSEAS TRADING: The Origins

and Growth of the Inchcape Group *WORKING FOR THE JAPANESE - MYTHS AND

REALITIES: British Perceptions

*Also published by Palgrave Macmillan

Merchants of the Raj British Managing Agency Houses in Calcutta Yesterday and Today

Stephanie Jones

Foreword by the Earl of Inchcape

M

@ Inchcape Family Investments 1992 Softcover reprint of the hardcover 1st edition 1992

All rights reserved. No reproduction, copy or transmission of this publication may be made without written pennission.

No paragraph of this publication may be reproduced, copied or transmitted save with written pennission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the tenns of any licence pennitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE.

Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

First published 1992 by THE MACMILLAN PRESS L TO Houndmills, Basingstoke, Hampshire RG21 2XS and London Companies and representatives throughout the world

A catalogue record for this book is available from the British Library

Copy-edited and typeset by Povey-Edmondson Okehampton and Rochdale, England

ISBN 978-1-349-12540-1 DOI 10.1007/978-1-349-12538-8

ISBN 978-1-349-12538-8 (eBook)

To Calcutta, on its 300th anniversary, and to all my friends there

'Calcutta is full of contrasts, especially between the extreme filth of the city, and the great warmth and style of the people who live there.'-Monica Clough, ]ames Finlay House Magazine, 1990

Contents

List of Plates

Foreword by the Earl of Inchcape

Author's Preface and Acknowledgements

Names of Contributors

Introduction

1. The Historical Background, c.1840-1939

2. War and Nationalism, 1939-47

3. Independence and Partition, 1947-9

4. Reorganisation and Adaptation, c.1950s

5. The Beginnings of Indianisation, c.1960-76

6. Formal Indianisation and After, 1976-91

7. The Future

Conclusions

Appendix I

Appendix II

Appendix III

Appendix IV

Bibliography

Index

Short Biographies of 'Merchants of the Raj'

Selected Chronology, with Indian Political and Economic Background

The Indian Companies Acts and Indian Managing Agencies

Glossary of Words in Common Usage among the British Business Community in Calcutta

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List of Plates

1. Mackinnon Mackenzie office exterior 2. Mackinnon Mackenzie office interior 3. Shipping in the Hooghly 4. Stores, Rivers Steam Navigation Company 5. Andrew Yule head office, Calcutta 6. Mr A. L. Cameron of Andrew Yule, President of the Bengal

Chamber of Commerce soon after Independence, killed in a Hindu/Muslim riot

7. Mr Bhaskar Mitter, first Indian Chairman of Andrew Yule 8. Mr K. S. B. Sanyal, who retired as Chairman of Andrew

Yule in 1991 9. Mr Harnam Wahi of Macneill & Barry and subsequently of

the Assam Company 10. Sir Paul Benthall of Bird & Co. 11. Gradation of jute 12. Jute fibre 13. Wellington Jute Mill entrance 14. Champdany Jute Mill from the manager's bungalow 15. Mr John Weir of Champdany, photographed before

leaving Dundee, late nineteenth century 16. Interior, Glasgow office of James Finlay, c.1907 17. Head Office staff of James Finlay in Glasgow, with tea map

in the background 18. Mr Saroj Mehera of James Finlay 19. Shop in Moscow selling Finlay's tea 20. Shaw Wallace head office, Calcutta 21. Sir Anthony Hayward, last British Chairman of Shaw

Wallace and last British President of the Bengal Chamber 22. Mr S. P. Acharaya, the last Chairman of Shaw Wallace

before the sale to the Chhabrias 23. Gillanders head office, Calcutta 24. Balmer Lawrie head office, Calcutta

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List of Plates ix

25. Sir Owain Jenkins of Balmer Lawrie 26. Sir John Jardine Paterson of Jardine Henderson 27. McLeod House, Calcutta 28. Duncan House, Calcutta 29. Standard Chartered Bank head office, Calcutta 30. The Bengal Chamber of Commerce 31. The board of Goodricke: Mr D. K. Mehra, Mr P. A.

Leggatt, Mr S. K. Bhasin, Calcutta 32. Weighing the tea, Koomber tea garden, Cachar 33. Mr B. M. Khaitan of Macneill & Magor at the Races,

Calcutta 34. Mr Gillem Sandys Lumsdaine and Mr J. L. Rikhye of

Macneill & Magor 35. Babus of Macneill & Magor office 36. Packaging Macneill & Magor tea 37. J. Thomas tea auction room 38. Vinod Parek, first Indian Chairman of J. Thomas, later to

join James Warren 39. Dipak Roy, who retired from J. Thomas in 1988 40. Hunting by elephant I 41. Hunting by elephant II 42. The Bengal Club 43. The Victoria Memorial, Calcutta 44. Tea on the lawn, Calcutta 45. Bungalow tennis before 1930 46. Memsahib in Darjeeling carried by Nepalese bearers 47. Darjeeling Light Railway

Note: Photographs in the author's collection of modem-day Calcutta were taken on 31 August 1991 by Mr Biresh Paul of Goodricke Group Ltd, Calcutta. Photographs of pictures in the Bengal Chamber of Commerce, J. Thomas & Co. Pvt Ltd, the Bengal Club and Macneill & Magor were taken on 23 August 1991 by Mr Vivek Das, Calcutta. Photographs from the archives of James Finlay plc in Glasgow were loaned with the kind assistance of Mrs Monica Clough. The photograph of the author seen on the jacket was taken by Mr Biresh Paul of Goodricke Group Ltd, Calcutta

Foreword by the Earl of Inchcape

This book is a logical continuation of Dr Jones's related studies, Two Centuries of Overseas Trading- about the Inchcape Group­and Trade and Shipping, the biography of my grandfather. As a result of the publication of these books and the appearance of a new history of the P&O, I have had numerous requests from Mackinnon's men and their families that there should be a history of Mackinnon Mackenzie & Company, as distinct from the P&O and the British India Steam Navigation Co. (BI). I have never been able to agree to the publication of a separate history of Mackinnon Mackenzie because of its too close historical connections with the P &0 and the B.I., and for different reasons Macneill & Barry could not really warrant a separate book either.

However, as the Mackinnon's 'correspondents' contributing to this book - Dick Adams, James Anson, Mohi Das and Ruthven Monteath - point out, while Mackinnon's arguably was the largest and most powerful of the managing agencies in Calcutta, at the same time it is equally arguable that because of its dependence on the BI managing agency and the P&O Eastern Shipping Agencies, Mackinnon's was in many ways not as important as the other large managing agencies. This, sadly, was shown by its early demise when the P&O and BI agencies were withdrawn for political and economic reasons.

So, for this reason, in my view, Mackinnon's did not warrant a separate book and accordingly, I proposed that Dr Jones- in the light of her previous books, Two Centuries of Overseas Trading and Trade and Shipping - should write a new book to make a symposium of the histories of the famous managing agency houses in Calcutta, including histories of Mackinnon's and Macneill & Barry - a study of 'The Merchants of the Raj'.

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Foreword by the Earl of Inchcape XI

Dr Jones has chosen to present the histories of these companies through recording the personal experiences of those at the time, both British and Indian. This has produced not only a fascinating collection of the various firms' histories, but also provided remarkable glimpses into the political and economic changeover in India after Partition, which I hope will be of great interest not only to the Burra Sahibs of the past, but to present Indian and Pakistani businessmen, their successors today and in the future.

As it was agreed with the author and the publishers that this book would be confined to Calcutta and East India, so unfortu­nately it has not been feasible to include those other famous businesses elsewhere in India, such as Wallace Brothers and Bombay Burmah, Finlay's (outside Calcutta), Binny's and Parry's in Madras, and BIC. in Cawnpore; but perhaps these companies can be covered at a later date. There is still a great wealth of history of the British commercial experience in India still to be explored.

Addington Manor, june 1991 INCH CAPE

Author's Preface and Acknowledgements

When I originally discussed with Lord Inchcape the writing of a major study of the leading Calcutta managing agency houses, I had no idea of the enormity and complexity of the task which I had agreed to undertake. At first, from London, I began preparing an academic study based on secondary sources; most of these seemed to be highly critical of the managing agency system, and dry and uninteresting in style. Then I attempted a quantitative approach, but discovered that only the accounts of managed companies were available; the managing agencies were largely partnership firms before they incorporated, then mostly to become rupee companies. On attempting to further my academic and quantitative approaches in Calcutta itself, I found even more hurdles, in the form of the piecemeal survival of documentary material, because of lack of space, interest, and -primarily - climactic conditions.

My task suddenly became much simpler when I actually met the 'Merchants of the Raj' themselves, in person, in both the UK and in Calcutta: I realised that their insight and perspective were fundamentally more interesting, real and original than anything I found in the archives. During innumerable trips around the English, Scottish and Welsh countryside, and in four visits to Calcutta (and not only in the Cold Weather) I had the privilege of meeting both old and young (84 to 35) 'Merchants of the Raj' and their successors. Together, these contributors have provided what I feel is a unique view of the commercial transition from the Raj to Independence. They share the common experience of carrying on business in a city which, although no longer the second city of the British Empire, has a totally unique but largely inexplicable charm. Calcutta has certainly influenced my outlook and way of thinking more so than any place I have ever visited.

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Author's Preface and Acknowledgements xiii

The one-time presence and continued trappings of the managing agency system are an essential part of its attractions still.

I am conscious that my book reflects a very subjective choice of interviewees, and very many others could and should have been approached. Since its completion, I have already become aware of at least half a dozen more whom I wish I had included. Also, the contributors are largely Burra Sahibs, and this over­looks the equally important role of the many who never became 'No.1', not to mention the armies of Babus and subordinate staff.

All the seventy contributors equally deserve thanks, but in particular I wish to acknowledge the continued help and interest of Lord Inchcape, himself an archetypal 'Merchant of the Raj', in the context of both Mackinnon's and Macneil's. Second, I would like to thank Mr Hugh Waters for his wise comments and advice on the text, both at early and later stages. Third, I would also like to mention the valuable background insight provided by Sir Michael Parsons and Mr Charles Will even though they do not appear as direct contributors. Fourth, I must also express my appreciation to those who have looked after me during my visits to Calcutta, especially Mohan and Nalini Puri, Roger and Pam Wright, Vijay and Shamlu Dudeja, and last but by no means least, Satti Bhasin and his team at Goodricke, especially D. K. Mehra, Ajay Jain and Biresh Paul. I am also most grateful for the help and advice of Goodricke' s Legal Consultant, Mr R. K. Tiwari.

For more than half of the 300 years of the city of Calcutta, the 'Merchants of the Raj' played a very significant - yet generally overlooked - part. I hope this book helps to add another dimension to its rich tapestry, and to the wider canvas of the British experience in India.

STEPHANIE ]ONES

Names of Contributors

Gillanders Arbuthnot William Tully, Henry Stamper, G. D. Kothari, S. N. Singhania

Jardine Henderson Sir John Jardine Paterson, Sir John Brown, S. G. Mehta

Mackinnon Mackenzie/P&O Lord Inchcape, Dick Adams, James Anson, R. B. Monteath, Mohi Das

Andrew Yule Lord CaHo, Sir Alec Ogilvie, Bob Wright, Bhaskar MiHer, Narindar Saroop, K. S. B. Sanyal

Turner Morrison Bernard Greer

Macneill & Barry I Assam Company Lord Inchcape, Newman Baldock, Anthony McCaw, Harnam Wahi

James Finlay Sir Colin Campbell, Monica Clough, Saroj Mehera, R.N. Deogun

Bird's Sir Paul Benthall, Pran Prashad, David Gilani

Shaw Wallace Sir Anthony Hayward, Yash Vohra, K.Srinivasan

Macleod Guy Routledge, Pearson Surita, B. P. Bajoria

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Names of Contributors XV

Balmer Lawrie Sir Owain Jenkins, V. K. Chaudhuri, N. N. Atal

James Warren/Warren Tea W. Kenneth Warren, P. B. Datta, Vinod Parekh, Arabinda Ray, Vinay Goenka

Octavius Steel Hugh Galloway, Yash Vohra, D.P. Goenka

Duncan/Goodricke Jack Vemede, Peter Pepperell, P. K. Gupta, Satti Bhasin

Williamson Mag or /Macneill & Mag or Michael Rome, Gillem Sandys-Lumsdaine, B. M. Khaitan

The Bankers Roger Wright, Sir Peter Graham

The Solicitors Hugh Waters, B.P.Ray

The Accountants Sir John Brown

The Tea Brokers Guy Routledge, Peter Banyard, Vinod Parekh, Dipak Roy, Vijay Dudeja

The Bengal Chamber of Commerce Walter Paris, Sir Paul Benthall, Sir John Brown

The Mem-Sahibs Monica Clough, Preeti Roy