Question

Statement 1: The Dutch and the English set up their own East India Companies between 1600 and 1602, and traded goods that were in great demand in Europe, fetching high profits in gold and silver.

Statement 2: Europe started objecting to the activities of the companies even though they were yielding profits.

• A. Both statements are correct and statement 1 is the correct justification of statement 2.
• B. Both statements are correct and statement 2 is the correct justification of statement 1.
• C. Statement 1 is correct but statement 2 is incorrect.
• D. Satement 1 is correct and Statement 2 is also correct.

Answer 1

The correct option is D Satement 1 is correct and Statement 2 is also correct.

The Dutch and the English set up their own East India Companies between 1600 and 1602, and started trading cotton, silk textiles, spices, and steel. These goods were in great demand in Europe. They fetched high profits in gold and silver. These European companies had also established various trading ports in India, Indonesia and Africa.

But, Europe started objecting to the activities of these companies. They were buying commodities in India in exchange for gold and silver. This drained Holland and England of their accumulated wealth. So, there was a great pressure on the Companies to finance their trade in Asia on their own.