CAPF AC 2022 Q77: Modern History – British Administration & Economic Policies
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (a) 1 only
Explanation
Agency Houses
How to think: agency houses were private British trading firms in India.
They grew up in the late eighteenth century, when Company servants needed someone to manage and send home their private savings.
Later they turned into managing agencies that ran many companies at once.
| Statement | Verdict | Reason |
|---|---|---|
| 1. Important commercial formations in late 18th and 19th century India | Correct | They financed indigo, shipping, banking and the trade with China |
| 2. Managing agencies remained confined to Calcutta | Wrong | They also worked in Bombay and Madras |
Examples: Carr, Tagore and Company (with Dwarkanath Tagore), Andrew Yule, Jardine Skinner and Shaw Wallace in Calcutta.
In Bombay, Indian business families ran managing agencies for the cotton mills.
A turning point: many great agency houses of Calcutta collapsed in 1830-33.
The managing agency system was finally abolished in 1970.
Answer: (a) 1 only.
Why each option is right or wrong
- (a) CORRECT. Only statement 1 is true; agency houses were key commercial bodies.
- (b) Incorrect. Statement 2 is false; managing agencies also operated in Bombay and Madras.
- (c) Incorrect. Statement 2 is false, so both cannot be right.
- (d) Incorrect. Statement 1 is true.
Key point
Agency houses: private European firms from the 1780s; financed indigo, opium and shipping; many failed in 1830-33. Managing agency system: one firm managed many joint-stock companies in Calcutta, Bombay and Madras; abolished in 1970.
Remember
Agency houses: Calcutta, Bombay and Madras, not Calcutta alone.
Common mistakes
- Accepting the word confined, which makes statement 2 too narrow.
- Mixing up agency houses with the East India Company itself.
- Thinking only Europeans ran managing agencies; Indian firms did so in Bombay.
Exam tip
Educated guess: statements with limiting words such as confined to, only or never are usually false. British trade ran through all three presidency towns.
Sources
- Tirthankar Roy, The Economic History of India 1857-1947 — Large-scale industry and managing agencies
- Bipan Chandra, History of Modern India — The Economic Impact of British Rule