Question

Critically analyse the reasons that led to fierce battles between the European trading companies in India?

Answer 1

Instructions: Explain the following points:

• The demand of Indian resources
• The reduction of profit in trade
• The urge to secure market

Solution:
Indian resources like silk, cotton or spices were in great demand in European countries. All European trading companies that came to India were interested in buying the same resources.

This competition to trade in Indian resources led to the increase in price of goods, thus the sales went down. This led to a reduction in the profit of the trading companies.

To make their trade profitable, the European traders had only one choice, and that was to eliminate the rival traders and capture the market.

All these factors led to a series of fierce battles between the European trading companies.