Reforms of Warren Hastings

When Warren Hastings assumed the administration of Bengal in 1772, he found it in utter chaos. The financial position of the Company became worse and the difficulties were intensified by famine. Therefore, Warren Hastings realized the immediate need for introducing reforms.

Abolition of the Dual System

The East India Company decided to act as Diwan and to undertake the collection of revenue by its own agents. Hence, the Dual System introduced by Robert Clive was abolished. As a measure to improve the finances of the Company, Warren Hastings reduced the Nawab’s allowance of 32 lakhs of rupees to half that amount. He also stopped the annual payment of 26 lakhs given to the Mughal Emperor.

Revenue Reforms

After the abolition of the Dual System, the responsibility of collecting the revenue fell on the shoulders of the Company. For that purpose, a Board of Revenue was established at Calcutta to supervise the collection of revenue. English Collectors were appointed in each district.

The treasury was removed from Murshidabad to Calcutta and an Accountant General was appointed. Calcutta thus became the capital of Bengal in 1772 and shortly after of British India.

The Board of Revenue farmed out the lands by auction for a period of five years instead of one year in order to find out their real value. The zamindars were given priority in the auction. However, certain good measures were taken to safeguard the interests of the peasants. Arbitrary cesses and unreasonable fines were abolished. Besides, restrictions were imposed on the enhancement of rent. Yet, the system was a failure. Many zamindars defaulted and the arrears of revenue accumulated.

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