At the close of October 1698, the Court of Directors in London dispatched urgent instructions to their agents in Bengal. They had learned that three staples – doreas, mulmulls and cossaes – fetched prices in Banaras fully forty per cent lower than in Calcutta. The news came via the Zamindar’s broker at Patna and was confirmed by Messrs Bowridge, who had personal experience of local markets. The Directors saw an opportunity to undercut local “engrossers” – Muttradas, Golollchund, Mannickchund and Nehallchund – whose inflated rates threatened Company profit margins.
Their remedy was bold. They proposed sending an experienced Armenian merchant to Banaras at once, armed with two or three thousand pounds’ worth of Company funds. He was to buy up silk and cotton goods there – especially gold- and silver-embroidered stuffs – and ship them to Calcutta. The directors were clear: such a venture might provoke local middlemen, but a successful run could “bring the engrossers … to more reasonable rates” back in Calcutta .
Key to the plan was selection of a reliable Armenian factor. The Directors mentioned Coja Surhaud by name, but permitted any “honest Armenian” capable of handling a ₨ 2,000 investment. He would work on commission alone. His task would be to invest Company rupees in Banāras silks and bullion-threaded textiles. Then he would transport them to Calcutta, where they could be auctioned or retailed at substantial profit. It was a textbook example of arbitrage – exploiting regional price differences to fatten the Company’s coffers.
Yet the Directors also exhibited caution. They insisted that the Armenian factor be expressly barred from forwarding the goods until he had received orders to do so. He was warned against altering the bullion in any embroidered silks destined for England. Above all, he was to pay all duties and charges that the Company itself would incur upon landing at Calcutta’s customs house. Any deviation, they implied, would amount to a breach of trust.
What emerges from this episode is a striking glimpse of Calcutta’s mercantile world in 1698. Calcutta (then often spelled “Culcutta”) was already a major entrepôt. Yet even here, prices could be higher than at other pilgrimage-center markets upriver. Company officials in London relied upon networks of local brokers and Armenian intermediaries to keep costs down. They recognized that Armenians possessed unique advantages: mastery of trade routes, willingness to front Company credit, and the ability to negotiate permissible customs exemptions under informal contracts.
Moreover, the instructions reveal the Company’s keen anxiety over local monopoly menaces. Muttradas and his associates were presented as price-fixers, hoarding fabric to force higher rates in Calcutta. The Company regarded such indigenous merchants as both a challenge and a resource. In Calcutta, Company agents sometimes competed with them for goods and credit. In Banāras, they could exploit competition to their own benefit – provided they sent the right agent.
This underscores the critical role of Armenians in early Calcutta commerce. Their linguistic skills, credit standing, and trans-regional networks made them the go-betweens of choice for the Company’s riskier commercial gambits. Though nominally “strangers”, they were indispensable. Their involvement in this price-hunting mission illustrates how, from the late seventeenth century, Calcutta’s trading dynamics blended European capital, Company policy and Armenian commercial expertise.
Source
Baladouni, V., & Makepeace, M. (Eds.). (1998). Armenian merchants of the seventeenth and early eighteenth centuries: English East India Company sources (Vol. 85). American Philosophical Society.
Arup K. Chatterjee 