How did the assumption of Diwani benefit the East India Company?

After the Battle of Buxar, in 1765 Mir Jafar died. Robert Clive decided to become the Nawabs themselves rather than depending on Puppet rulers. The company was appointed as the Diwan of the provinces of Bengal by the Mughal Emperor in 1765. The assumption of Diwani benefitted the East India Company in various ways-

• It gave them the authority to use the vast revenue resources of Bengal which the company founded difficult to use.

• The trade was increased in the early 18th century but the company has to buy gold and silver which they imported from Britain. The reason behind this was there were no goods to sell by Britain to India.

• After the battle of Plassey and the assumption of Diwani, the import of gold from Britain was slowed down. This is because revenue acquired from India was used to meet the company’s expenses.

• The revenue acquired was also used to purchase cotton and silk textiles in India, to maintain the company’s army, to build Company fort and offices at Calcutta.