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1 The growth of the opium trade (1650-1773)

The Qing dynasty of China entered into a long decay beginning in the 1700's, beset by increasingly aggressive foreign powers that clamoured for two-way trade with China. Europeans bought porcelain, silk, spices and tea from China, but could sell little in return. The drain on silver in Europe helped strain finances already squeezed by European wide wars.

Opium itself had been manufactured in China beginning in the 15th century and was mixed with tobacco, in a process invented by the Spanish, but dominated by the Dutch by the 18th century. The imperial government prohibited the smoking of opium in 1729.

However, the British began manufacturing opium in India in quantity starting in the mid-18th century, learning the art from the Mughal state, which had traded in opium in the land trade since at least the reign of Akbar (1556-1605), and began an illegal trade of opium for gold in southern China. In 1764, when the British conquered Bengal, they began to see the potential profit in opium, which up until this point had been primarily out of Netherlands-controlled Jakarta. Profits approached 400%, and poppies grew almost anywhere.

British exports of opium skyrocketed, from an estimated 15 tons in 1720, to 75 tons in 1773, shipped in over two thousand "chests" of opium, each containing 140 pounds of opium.

2 The East India Company (1773-1833)

In 1773 the Governor-General of Bengal was granted a monopoly on the sale of opium, and abolished the old opium syndicate at Patna. For the next 50 years, opium would be a key to the British East India Company in its hold on India. Since importation of opium was illegal (the Chinese could, after all, manufacture enough for medicinal purposes themselves), the British would sell tea in Canton on credit, carrying no opium, but would instead sell off the right to smuggle the opium in at auction in Calcutta. In 1797, the company would end local Bengal purchasing agents, and would require direct sale of opium to the company by farmers.

In 1799 the Chinese Empire reaffirmed its ban on opium imports, and in 1810 the following decree was issued:

Opium has a very violent effect. When an addict smokes it, it rapidly makes him extremely excited and capable of doing anything he pleases. But before long, it kills him. Opium is a poison, undermining our good customs and morality. Its use is prohibited by law. Now the commoner, Yang, dares to bring it into the Forbidden City [i.e., Peking]. Indeed, he flouts the law! He should be turned over to the Board of Punishment, and should be tried and severely sentenced.

However, recently the purchases and eaters of opium have become numerous. Deceitful merchants buy and sell it to gain profit. The customs house at the Ch'ung-wen Gate was originally set up to supervise the collection of imports (it had no responsibility with regard to opium smuggling). If we confine our search for opium to the seaports, we fear the search will not be sufficiently thorough. We should also order the general commandant of the police and police- censors at the five gates to prohibit opium and to search for it at all gates. If they capture any violators, they should immediately punish them and should destroy the opium at once. As to Kwangtung and Fukien, the provinces from which opium comes, we order their viceroys, governors, and superintendents of the maritime customs to conduct a thorough search for opium, and cut off its supply. They should in no wise consider this order a dead letter and allow opium to be smuggled out!

(Lo-shu Fu, A Documentary Chronicle of Sino-Western relations, Vol. 1 (1966), page 380)

But to no avail, the addictive properties of the drug, the misery of the population in China, and the vast need for silver of the British Government (see gold standard) combined to press opium trade higher. In the 1820's opium trade averaged 900 tons per year from Bengal to China.