The factors which were responsible for opening and development of European trade in India during the 16th and 17th centuries are as follows:
The landing of Vasco da Gama at Calicut in 1498 led to opening of new phase in the commercial history.
The finding of direct sea route to India led to booming up of European trade with India which increased in volume later on. Several factors were responsible for opening and development of European trade in India during the sixteenth and the seventeenth centuries.
The most important factor in this regard was that the European economy was growing rapidly at that time due to the expansion of land under cultivation on account of the drainage of marshes and cutting of forests, the introduction of an improved plough and a more scientific rotation of crops which also led to increase in supply of meat. The growth was reflected in the rise of towns, an increase of trade, both internal and external.
Moreover, since the Roman times, there had been a steady demand for oriental goods in Europe. These included spices and drag from India, silk from China. With the economic revival, this demand increased, especially the needed to make meat palatable since due to shortage of fodder much of the cattle had to be slaughtered during the winter and the meat salted up.
Discovery of the all new sea route to India by the Europeans also contributed. Pepper and spices were brought to Europe overland and partly by sea from India and South-East Asia. With rise of the power of the Ottoman Turks from the early part of the fifteenth century, all these areas came under the control of the Turks.
The Turks were not opposed to the trade, but the virtual monopoly over the pepper established by them was bound to act against the Europeans. The expansion of Turkish power towards Europe made the
Europeans uneasy and forced them to look at alternative trade routes to India. The lead in this was taken up by Portugal and Spain who commissioned voyages. Once Vasco-da Gama found the new route the European trade with India expanded and went on expanding.
Critical role in the expansion of trade was played also by certain path breaking inventions, notably rhe mariner’s compass and the astrolabe for navigation by day. Neither of them were European invention. The mariner’s compass was known to the Chinese several centuries earlier, but was not widely met. The astrolabe was however widely used by the Arabs, Indians and others. Nor were the European ships superior in construction to the ships used in Asian waters at that time.
What made the critical difference however the new spirit of daring and enterprise displayed by the Europeans. This spirit has been traced back to the revival of trade and commerce from the thirteenth century onwards, leading to the intense rivalry among European states. As important was the intellectual stirring called the Renaissance?
The Renaissance signified above all a spirit of independent investigation rather than baring oneself either on the revealed world or on the wisdom enshrined in the Church. These developments led to rapid assimilation, dispersal and improvement of other inventions such as the gun powder, printing, telescope etc. Developments in the metallurgy led to production of better quality guns.
Besides, the prospects of huge profits offered by trade with Asia in general and India in particular acted as further motivators in expansion of trade. Thus Vasco da Gama returned after his first voyage with profits sixty times and value of goods he brought.
Equally important in this context was the intense competition among various European powers to capture the trade of various Asian countries.
Further, European traders trading through their monopolistic East India Companies were ended by the favourable and encouraging attitude towards them displayed by the Indian rulers. Thus, the ruler Zamorin of Calicut favourably received Vasco-da Gama when he reached Calicut on his first voyage to India.
Moreover, the important ruling dynasties such as Bijapur and the Vijayanagar Kingdom also accorded favours on the Portuguese. Similarly, the Mughal Emperors accorded great honours and granted several concessions to the European companies.
Equally important factor for expansion of European trade with India was the environment of political stability provided with the establishment of the Mughal Empire in India in between the sixteenth and the eighteenth centuries. Further, the Mughal Emperors provided better law and order conditions and also showed favourable attitude towards commerce.
Moreover the Mughal rulers favourably treated the Indian merchants and at time saved those from the exaction of their nobles through European travelers like Bernier have noted this otherwise in their travelogue.
Lastly, India during this period had well- developed trading network both inside the country and outside. There were several rich merchant families owning ships and transporting merchandise. Moreover, the Commercial practices as Hindi system, the monetary system and the banking system too were all well developed. Many ports like Surat were in flourishing state.
India, besides, also produced some goods of special interest to Europeans. This included Indigo produced at Bay Ana near Agra and in Bihar and saltpeter produced near Sarkhej in Gujarat. The expansion of European trade however was not so beneficial for India in the long run. As the centralized rule of the Mughals weakened, the European companies made no secret of their desire for political subjugation of India and before long, India passed under the shackles of British colonialism.