Your Committee find that the late Lord Clive constantly asserted that the salt trade in Bengal had been a monopoly time immemorial,—­that it ever was and ever must be a monopoly,—­and that Coja Wazid, and other merchants long before him, had given to the Nabob and his ministers two hundred thousand pounds per annum for the exclusive privilege.  The Directors, in their letter of the 24th December, 1776, paragraph 76, say, “that it has ever been in a great measure an exclusive trade.”

The Secret Committee report,[8] that under the government of the Nabobs the duty on salt made in Bengal was two and an half per cent paid by Mussulmen, and five per cent paid by Gentoos.  On the accession of Mir Cassim, in 1760, the claim of the Company’s servants to trade in salt duty-free was first avowed.  Mr. Vansittart made an agreement with him by which the duties should be fixed at nine per cent.  The Council annulled the agreement, and reduced the duty to two and an half per cent.  On this Mir Cassim ordered that no customs or duties whatsoever should be collected for the future.  But a majority of the Council (22nd March, 1763) resolved, that the making the exemption general was a breach of the Company’s privileges, and that the Nabob should be positively required to recall it, and collect duties as before from the country merchants, and all other persons who had not the protection of the Company’s dustuck.  The Directors, as the evident reason of the thing and as their duty required, disapproved highly of these transactions, and ordered (8th February, 1764) a final and effectual stop to be put to the inland trade in salt, and several other articles of commerce.  But other politics and other interests prevailed, so that in the May following a General Court resolved, that it should be recommended to the Court of Directors to reconsider the preceding orders; in consequence of which the Directors ordered the Governor and Council to form a plan, in concert with the Nabob, for regulating the inland trade.

On these last orders Lord Clive’s plan was formed, in 1765, for engrossing the sole purchase of salt, and dividing the profits among the Company’s senior servants.  The Directors, who had hitherto reluctantly given way to a monopoly under any ideas or for any purposes, disapproved of this plan, and on the 17th May, 1766, ordered it to be abolished; but they substituted no other in its room.[9] In this manner things continued until November, 1767, when the Directors repeated their orders for excluding all persons whatever, excepting the natives only, from being concerned in the inland trade in salt; and they declared that (vide par. 90) “such trade is hereby abolished and put a final end to.”  In the same letter (par. 92) they ordered that the salt trade should be laid open to the natives in general, subject to such a duty as might produce one hundred and twenty thousand pounds a year.  This policy was adopted by the legislature.  In the act of 1773 it was expressly provided, that it should not be lawful for any of his Majesty’s subjects to engage, intermeddle, or be any way concerned, directly or indirectly, in the inland trade in salt, except on the India Company’s account.