Europeans in India – Part 7 The Dutch Enter the Fray Section I: Verenigde Oostindische Compagnie (VOC)

Canberra, 20 January 2023

Spain and Portugal, both staunchly Catholic countries, had divided the world between them at the Treaty of Tordesillas in 1494. England and Netherlands, or Holland as it is sometimes known, both protestant countries, refused to agree to this arbitrary decision, defending the principle that ‘the sea was as free as the air’.

The Netherlands and The ‘Dutch’

The Netherlands consists of 12 provinces, of which, the two provinces of Noord- and Zuid- Holland together form the territory known as Holland. However, the term Holland was/is often used to indicate the entire Netherlands. The word ‘Holland’ literally means ‘wood-land’ in Old English and originally was meant to refer to the northern region of the Netherlands, gradually coming to mean the entire country to English-speaking people.

A demonym is a term that is derived from a place that helps describe the people who live there. For example, Indians are people who live in India. However, there are also demonyms that are coined at random, the term Dutch being one. In Old English, the terms thiod or theod, earlier versions of the more modern term Dutch, simply meant ‘people or nation’ (also explains why Germany is Deutschland in German). For some time, the term Dutch was applied to people from both Netherlands and Germany, both of which along with Belgium and Luxembourg, were part of the Holy Roman Empire. The term ‘High Dutch’ referred to people from the mountains of today’s southern Germany and ‘Low Dutch’ referred to people from the flatlands, which is today Netherlands. Within the Holy Roman Empire, the word Netherlands was used to describe the low-lying (nether) region, the term becoming formal when the region became a separate and independent Kingdom of the Netherlands in 1815.

[In this narrative both the terms—Netherlands and Holland—will be used and should be taken to mean the homeland of the Dutch, as we know it today.]   

The Dutch were among the last to enter direct trade with the East, the reason being that they already controlled a large share in the spice trade being undertaken by the Portuguese and therefore, did not have to start trade on their own. In the 16th century, the Dutch commanded the greatest volume of tonnage in trade within Europe. They had also established a sort of rudimentary capitalism by selling parts (today’s shares) of an enterprise to any taker, the first to abandon the time-honoured guild system and move towards common ownership.

Spain and the Dutch were at loggerheads since 1568, fighting each other at every opportunity. However, even after Spain annexed Portugal in 1580, the Dutch continued trade relations with the latter. It was only in 1585, when Spain impounded several Dutch vessels harboured in Lisbon, that the need for direct trade with the East and India was felt and coalesced into a real concept in Holland. Even then, it was another decade before the concept was executed into action.

The first Dutch expedition sailed for the Indian Ocean in 1595. The broad instructions to the captain were to bring back as much spices as the ships could carry; avoid any confrontation with the Portuguese; and establish friendly relations with the ‘natives’. The expedition was not a great commercial success, a fact that was overshadowed by it having established direct contact with the Far-East.

Vagaries of Trade with the Indian Ocean

The trade with the ‘East Indies’ was different to what the Dutch had so far been used to in European waters. The European trade was based on bulk goods of low unit value that was moved over relatively short distances. Further, there was no danger of enemy interference, and the ships could undertake more than one voyage a year. Trade with the East was totally different, even discounting the normal hazards of long voyages. At the other end of the expedition, supply of spices was not always guaranteed, some ships had to wait for months before being able to load even partial cargo in their holds. Additionally, the competition with other traders increased exponentially that in turn increased all costs; prices at the final retail outlets quadrupling in just a few years. The spice trade had become a monopoly of the sellers at all levels and at each step.

After the first voyage returned to Holland, ten companies sent out 14 fleets of which only a few were profitable. Most of them did not break-even at the culmination. Even so, Dutch shipping trade with Asia developed in leaps and bounds in the next few years. Between 1595–1602, the Dutch sent out 65 ships to India, compared to the 46 that the Portuguese were able to in the same timeframe. In less than a decade, the Portuguese were relegated to the second division in a one fell sweep. The Dutch success prompted the English to set up a company on similar lines to the Dutch example.

One of the critical problems faced by the European traders in the East was that the original sellers in Malabar and other places would hold back their goods till the Monsoon winds were about to change and then offer the merchandise at an increased profit margin. The European ships had no choice but to pay the exorbitant rates or risk staying in port for another seasonal change of winds, which would almost nullify their profit margin. The Dutch solved this conundrum by obtaining permission from the local rulers—through inducements, requests and gifts—permission to build a factory with a small permanent staff based in it. This staff would buy and stock spices throughout the year and so were able to load the ships as soon as they arrived.

The second challenge for the Dutch was the internal competition between the many companies that had sprung up in Holland. This was solved to some extent by setting up a ‘United East India Company’: the Verenigde Oostindische Compagnie (VOC), which for the next two centuries became the vehicle for Dutch expansion in Asia. The VOC grew to be the largest commercial enterprise in the 17th and 18th centuries and was a critical factor in the globalisation of trade in that period. The United Company was meant to benefit the entire country, rather than a particular town or small region represented by the earlier smaller companies. The charter that set up the VOC was approved by the King, and by an article in it all other companies from the Dutch Republic were prohibited from trading east of the Cape of Good Hope and west of the Strait of Magellan. The Indo-Pacific was given over to the VOC, which was formally established in 1602.

The Verenigde Oostindische Compagnie (VOC)

The VOC was set up with six chambers, in lieu of the multiple companies that entered the fray initially. The Company was controlled by a council of 17 representatives, called ‘Gentlemen Seventeen’. In the representative council, Amsterdam was the most prominent, authorised to half the takings, Zeeland (Middleburg) a quarter, and the other four chambers each having a sixteenth. Each chamber delegated members to attend the meetings in Amsterdam — ‘Meeting of the Gentlemen Seventeen’ (eight from Amsterdam, four from Zeeland, one each from the four smaller chambers and a seventeenth member nominated by the smaller chambers to ensure that Amsterdam would not have a majority sway).

The VOC permitted its ship’s captains to attack other ships, if necessary, adopting a new policy of ‘trade and war’, essentially extending the war with Spain to the East. This change in policy was meant as an anti-dote to the fact that monopoly of the VOC to trade in the East was applicable only to Dutch companies and did not apply to other European countries or on the extensive local trade. Traders of other nations were in open competition with the VOC, and it became necessary to protect Dutch interests, with the application of force when required.

The VOC made rapid progress in increasing their influence and power in the Indian Ocean region. About 15 years after the fatal union of Spain and Portugal, the Portuguese monopoly in the Indian Ocean region was beginning to end, a progression of events indicating the waning Portuguese power. In 1602, the Dutch took over the Straits of Sunda, the route to Malacca and the spice islands famed for their nutmegs and cloves. In 1603, they enforced the first blockade of Goa. By 1610–12 the Dutch had taken over Java and started building the famous city of Batavia, where Jakarta had stood and stands today. By then the main interest of the Dutch was gradually shifting to the Malay Archipelago, now known as Indonesia. (The term Indonesia was a term coined for the widely spread-out archipelago by Adolf Bastion, a German ethnologist, in the late 19th century.)

Expansion – Factors to be Understood

In the first decades of the 17th century, the VOC was expanding its trading empire while simultaneously increasing their power and influence, especially in the far-east, while also being active in the Indian sub-continent. The burgeoning trade of the Europeans with the Indian Ocean region and its unparalleled expansion must be understood within the ambit of some factors that have not been brought to focus in the normal recounting of events of the 16th and 17th centuries.

One, the relationship between Europe and Asia should not be judged by the modern yardstick and attitudes of superiority displayed by the Europeans in the past century—underpinned by the economic superiority of European nations over the exploited and under-developed Asian countries. Such a disparity and division did not exist when the Europeans first came to directly trade with the Indian Ocean region. The trade took place between nations that were economically equal in status and strength. Second, Europe had not yet undergone the industrial revolution and therefore, there was little or no chance of holding technical/technological superiority in the trading goods that were brought to the market. In fact, it could be considered that the Asian goods were of much better quality than the ones that the Europeans proffered for trade. For example: European textiles were no match for the Indian manufactured ones and could not compete with them in the open market.

Third, even though the European ships mounted cannons on them, an innovation that had not yet spread to the Asian continent, the advantage they brought about in maritime warfare was short-lived. The nations of the Indian Ocean very quickly developed tactics to counter this advantage. However, the European ships maintained an edge in operations conducted on the high seas—they were tougher since they had to withstand the hardships of a long voyage out form Europe. Fourth, and stemming from the third, the Europeans were restricted to maritime operations for the first century of their trade with the Indian Ocean region. They could not move inland, where the firepower was matched between their soldiers and those of the local rulers. Another reason for their inability to move inland was that western medicine had not developed enough to cure the illnesses that were encountered in a tropical climate. In fact, losses through disease was heavy and at least equal to casualties in military actions.

These four main factors, underplayed in most recounting of the events of the time, had direct influence in the conduct of trade by the Europeans in the Indian sub-continent. The narrative of the trade in the initial two centuries from the arrival of Vasco da Gama in Calicut must always be put forward and analysed with these four as the foundational stimuli that held sway and manipulated the development of relationships as well as the impetus for enmities.

Desultory Dutch Actions – Brief Narration

When the Dutch arrived off the west coast of Peninsular India, the Portuguese were thoroughly hated by the local people. Therefore, they were welcomed as a counter to the Portuguese and found it easy to enter into treaties and agreements with the local chiefs and rulers. However, the Dutch restricted their activities to supporting local rulers only when the circumstances suited them and only when it was possible to steer clear of domestic politics. In 1604, the VOC sent a fleet of 13 ships to the west coast of India. The commander of the expedition met with the Zamorin and finalised a treaty to trade and join forces to drive the Portuguese out of Malabar.

The Portuguese were far too strong and entrenched at that time to be easily dislodged—they continued to dominate the Malabar trade for a few more decades. The Dutch opted to set up trading posts in other parts of the Indian Ocean region, initially in the Coromandel coast, Ceylon and Surat before moving purposefully to the Far-East; the main objective being to establish their presence in sufficient strength before confronting the Portuguese. From 1638 onwards they started to take over Portuguese establishments in Ceylon and by 1658, there were no Portuguese bases on that island.

In 1641, the Dutch captured Malacca and in 1652 they took possession of the Cape of Good Hope itself. By this time the Dutch Republic was at the height of its powers and prosperity. Although reluctant to support territorial expansion, the VOC was forced to support the creation of a settlement at the Cape. The Dutch maritime power of the time was such that the inhabitants in the Cape settlement felt safe, even from the English against whom the Dutch were to fight three wars in the second half of the 17th century.

The Dutch built a large fleet of heavily armed and extremely manoeuvrable ships—at that time the fleet was numerically superior to the combined strength of the Portuguese, Spanish and English fleets. They kept snipping at the Portuguese, usurping their trade and taking over their posts as opportunities to do so arose. When the Dutch believed that the Portuguese had been sufficiently weakened, they decided to attack the Malabar coast. (More detailed accounts of the Dutch activities in the Malabar coast, Gujarat, the Coromandel and Bengal are given in the next two chapters) The Dutch subsequently attacked Goa twice, but without much success. Then they resorted to blockade, severely curtailing Portuguese ability to trade freely. By this time the Malabar trade was dominated by the Dutch. The volume of VOC trade from the Far-East added to their Malabar trade, pushed the Portuguese to the fringes, they were now a bit-player in the larger scheme of Indo-European trade. Goa was not the centre of trade and became unimportant, its ‘golden years’ were finally over.    

From the middle of the 17th century onwards, for the Dutch, the Malabar trade and their bases in India gradually became of secondary importance—their main bases and focus were rivetted in Java and other trading ports in the Far-East. Further, the anticipated profit from the Malabar trade did not eventuate, which made the Dutch move away from the western coastal trading enterprises. The Zamorin, the new ally of the Dutch, wanted to reinstate the primacy of his port at Calicut, which had suffered a decline in trade by the concerted Portuguese actions in favour of Cochin. However, the Dutch following the policy of non-interference in local politics, ignored his demands. The Zamorin them started to trade with the English and other independent merchants to the detriment of Dutch trade. The Dutch were at a disadvantage since they did not have the wherewithal to impose a monopoly on the trade—gradually their share in the overall trade started to wane.    

In the late 17th and early 18th centuries, the Dutch trade in Asia was multifarious and the VOC managed to maintain a substantial participation in Asian commerce. It would be misleading to assume that the overall Dutch activities were in decline, especially since the two other competing nations, England and France, were expanding their activities rapidly in the same period. Their expansion was not at the expense of the Dutch trade in terms of reduction in volume; even though the competition was fierce, the Dutch managed to hold on to their share in the trade. Therefore, it is clear that the expansion of trade by the foreigners was achieved at the cost of Indian enterprises in trade and shipping and did not affect the fortunes of the VOC. However, by the late 1600s and the turn of the century, two general trends were noticeable. One, there was a discernible change in the control of the Indian markets in favour of the English and the French; and two, in the Coromandel coast, the English expanded their activities at the cost of the Dutch, who had been dominant in that region for some decades. The native rulers had started to prefer trading with the English rather than the Dutch.

Dutch Society in India

Holland was a protestant country, but the Dutch were tolerant of Catholics, especially women who were taken as wives or mistresses. Like in the case of the Portuguese, very few Dutch women came out to India and the local Indian women were reluctant to enter into alliances with the Dutch men. As a result, majority of the Dutch men took Indo-Portuguese women as wives—permitting them to retain their Catholic faith, maintain Portuguese as the first language and also bring up the offspring as Catholics. It is recorded that the Dutch who stayed semi-permanently in Malabar were mostly from the lower strata of Dutch society, poor, ignorant and debauched in many ways and that the VOC did not support marriages or unions with local women. From these reports it is clear that the unlike the Portuguese, the Dutch were not a proselytizing people, keeping religion apart from their trading activities.

Dutch life in India was governed by strict protocol with orders and laws that covered the precedence—of how each strata of society was permitted to dress and behave, which was strictly enforced. Laws even laid down the value of the jewellery that a person from a certain stratum could wear, strictly according to protocol. The Dutch treated non-Dutch people with condescension and contempt. However, the contempt and disdain at the extreme was reserved for the local Indian population. By early 18th century there was a pervasive feeling, bordering on ‘sacred belief’, among the Europeans in India that they were ‘superior’ to the local population. The Dutch Calvinists were the most extreme in propagating this false impression and attempting to perpetuate it, referring to Indians as ‘black dogs’, while they themselves were declared ‘Elect of the Gods’. The concerted attempt at declaring Indians to be less than the Europeans, was mainly based on their darker skin colour, not having knowledge of a European language, and above all adhering to an ancient religion that the Europeans found baffling in its philosophical complexity and extreme simplicity of its worshiping rituals. As mentioned in a previous chapter, the extreme arrogance of ignorance.  

Slavery. Slavery, although not unknown in Indian shores, became a sanctioned endemic with the arrival of the Dutch on Indian shores, especially in the Coromandel coast.

Slavery in the South-West Coast

Records confirm that slavery was not new to the shores of Malabar and Travancore, where it had existed for time immemorial. The slaves had no rights, and the owner held the power of life and death over the slave, who were of both genders. They were considered ‘untouchable’ and ‘unapproachable’ and not permitted to come within a radius of 64 feet of Nairs and 90 feet of Brahmins. [How the exact distance was measured remains an enigma.]

The Dutch took slaves from impoverished local households and Pulicat, north of Madras; the Dutch fort there becoming the hub of slave export. Records show that at least 500 slaves from the eastern shores were exported every year to the Dutch establishments in the Far-East for decades.

A more detailed analysis of Dutch endeavours in the different regions of the Indian sub-continent and their eventual decline is provided in the following two chapters.

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