222 ADMINISTRATIVE ORGANIZATION

approaching session, there ensued a long bargaining discussion between the government and the Company, which produced a law binding the Company for a term of years to pay 400,000 annually to the Crown, " in respect of the territorial acquisition and revenue lately obtained by them in the East Indies." From a subse- quent inquiry in 1773, it appeared that the Company's annual expenses had increased since the year 1765 from 700,000 to the enormous sum of 1,700,000. It also appeared that from 1765 the British government had received by the net customs duties, the indemnity upon tea, and the yearly payment of 400,000, little less than two millions annually from the Company; so that the British nation took heavy blackmail upon the Com- pany's gains, however they may have been gotten. This yearly payment represented, in fact, the tribute or royalty levied by the state upon the great territorial revenues recently acquired by Clive's victories. But with the possession of these revenues had come a change in the Company's commercial system, for in 1767 began the practice of making what were called investments, that is, of employing a large portion of the surplus public revenue collected from the province in buying goods, raw produce and manufactures, for ex- portation to Europe. It followed, as Burke said, that whereas in other countries revenue arises out of com- merce, in Bengal the whole foreign maritime trade, of which the Company had a monopoly, was fed by the revenue. The consequence of this steady drain upon the production of the country soon began to be felt.