Who is Giving the Diwani Right?

The Diwani rights were granted by Shah Alam II, the Mughal Emperor.

Understanding the Grant of Diwani Rights

The grant of Diwani rights marked a significant turning point in the history of British influence in India. It effectively transferred the financial administration of rich territories to the East India Company.

• The Grantor: The Mughal Emperor Shah Alam II was the sovereign authority who formally bestowed these rights. This decision came after his defeat in the pivotal Battle of Buxar in 1764.
• The Recipient: The East India Company was the beneficiary of this grant, gaining control over the revenue collection.
• Key Date and Territory: The Diwani rights of Bengal were granted in the year 1765. This encompassed the regions of Bengal, Bihar, and Orissa, providing the East India Company with a vast new source of revenue.
• Historical Context: The Battle of Buxar, fought in 1764, saw the combined forces of Mir Qasim (the Nawab of Bengal), Shuja-ud-Daula (the Nawab of Awadh), and Emperor Shah Alam II decisively defeated by the British East India Company. This military victory allowed the Company to dictate terms, leading to the Treaty of Allahabad in 1765, which included the grant of the Diwani rights.

This acquisition transformed the East India Company from a trading organization into a formidable political and administrative power in India, providing them with the financial resources necessary for their military expansion and territorial consolidation.

The grant of Diwani rights was instrumental in establishing the economic and political foundations of British colonial rule in India, enabling the East India Company to finance its operations and military with local revenues rather than relying solely on funds from Britain.