Charter Act of 1813


The company was granted to stay and rule in India for another extended period. Based on the revision of the previous Act established a strict licensing system for the British merchants to practice trade in India. British merchants suffered during the boycott of their products in France and they started to demand the expansion of trade in the Asia-specific regions.

Background of The Act

The primary objective of the Act was to extend the control of the company in Britishoccupied India for 20 years duration. The Crown’s jurisdiction over the British colonial culture in India was declared with the application of the Act. This Act made some greater significance in India based on the structure that was followed for a ruling or administrative guidelines.

Aspects of Charter Act of 1813

One of the most essential conditions of the Charter Act of 1813 was the condition of a sum of rupees one lakh per year for the revival. This Act was made an introduction to the Supreme court juridical system to supervise the trade practice of the company. Additionally, this Act allowed the courts in India to take cases of British subjects.

The aim was to make improvisation of literature and encouragement of India's learned natives, and it made the introduction and promotion of scientific knowledge among the residents of British Indian domains. This was considered the first stage toward the identification of the concept of the state education responsibility. This expression was, without a suspicion, one of the numerous effective moves done by the government of Britain in relation to India by promoting western education.

Key Provisions of The Act

The followings are the key provisions of the Act in India due to the applied revision of the Act published in 1973 −

  • The company got the licence to trade in India and rule over the next 20 years.

  • It granted local governments the capability to tax those who were beneath the jurisdiction of the Supreme Court, and it positioned the company's dividend by 10.5%.

  • This Act ended the monopoly of the EIC in the foreign business market; however, EIC maintained its monopoly in transactions with China for the tea trade.

  • The Act allowed the missionaries the privilege to enter India and immerse in religious practice.

  • The Act allowed the EIC to practice the Christian culture over the Indians.

  • This Act permitted the missionaries to assign a Bishop in British Occupied India with the pre-decided headquarters in Calcutta.

  • British merchants are allowed to practice trade in India under the strict circumstance of a licence issued by the Government of Britain.

Features of The Act

The Government of Britain felt the requirement of the new Act as the British merchant faced losses in the matter of international trade due to the boycott of the goods from the merchants of Europe in France. The Government of Britain realised the requirements of the new Act that will end the monopoly of the EIC in international trading from India. Additionally, the Act added different factors that made sure about the building of better connections with the residents of India.

Significance of The Act

The followings are the significance of the Act in India −

  • The act had the impulse of regulating revenues and profits from the commercial trades done by the EIC in India.

  • The debt of the EIC was decreased and the amount for the dividend was fixed at the rate of 10.5% annually.

  • The Act also empowered local authorities to impose taxes on the matter of jurisdiction of the Supreme Court.

  • The refined tax system on the EIC was proposed by the application of the Act in 1813.

Consequences of The Act

The revision of the Act of 1793 and passed in 1813 did not include any changes to the political functions of the EIC and there were no changes regarding the authority given to the Governors in the past (Malik, 2019). This Act was more focused on trade practice rather than looking over the political system.

The Charter Act of 1813 had the bare minimum significance over the Indian political changes as the Act was introduced due to the pressure created on international trading due to the boycott of the goods imported by the British traders in the international market.


The Charter Act 1813 delivered allowance for the introduction of the western education system in India to educate the citizens. One of the greatest features of this Act is, that it retained the jurisdiction of Crowns over the EIC in India in the ruling period. This Act also aimed to regulate the revenue generated by the EIC from trading activities. This Act sought financial aid with the impulse to support the regeneration of Indian literature.


Q.1. When and Why the Act was employed in India?

Ans. The Charter Act of 1813 was employed by the Parliament of Britain with the impulse of ending the monopoly of the EIC in international trading and allowing British Merchant to trade in India under strict licence. The Act was demanded to be employed in 1813 as the French market was not importing the goods sold by the British market.

Q.2. What was the aim of the Charter Act 1813?

Ans. The primary trade of the Act was to ensure that there was no monopoly of EIC in the trade so the British manufacturers could sells their product also. The aim of the Act was corresponding to ensure extending the ruling period of 20 years in the British Occupied Territory of India.

Q.3. What were the significances of the Act?

Ans. The Act that was employed by the Parliament of Britain was about to ensure that British merchants could practice trade against the strict licensing policy of the Britain government. This Act managed to deliver the first constitutional position of the British territories in India. However, there was no other political significance to this Act.

Updated on: 21-Dec-2022


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