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Bihar under Company rule: Buxar to the Permanent Settlement

The Battle of Buxar in 1764 made the East India Company the effective ruler of Bihar. What followed — the Diwani, the famine of 1770, the Permanent Settlement, indigo and opium — reshaped the province's economy and society for a century and a half. A clear guide to colonial Bihar before 1857.

29 Sept 2026 4 min read

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In this guide
  1. Mir Qasim and Munger
  2. The Battle of Buxar and the Treaty of Allahabad
  3. Dual government and the famine of 1770
  4. The Permanent Settlement (1793)
  5. Indigo and opium
  6. Culture: Patna Kalam
  7. Education and institutions
  8. Bihar within the Bengal Presidency
  9. Practice

On 22–23 October 1764, on the plains near Buxar on the Ganga, a Company army under Major Hector Munro defeated the combined forces of three rulers: Mir Qasim (the deposed Nawab of Bengal), Shuja-ud-Daula (the Nawab of Awadh) and the Mughal emperor Shah Alam II. If Plassey (1757) gave the Company a foothold, Buxar made it the master of eastern India. And it was fought in Bihar.

Mir Qasim and Munger

  • After Plassey, the Company installed Mir Jafar and then Mir Qasim as Nawabs of Bengal (which then included Bihar and Orissa).
  • Mir Qasim tried to assert independence: he moved his capital from Murshidabad to Munger (Monghyr) in Bihar, reorganised his army and finances, and abolished inland duties for all traders — removing the unfair advantage enjoyed by Company servants who misused trade permits (dastaks).
  • Conflict with the Company followed, leading to his defeat and flight — and to Buxar.

The Battle of Buxar and the Treaty of Allahabad

EventDetails
Battle of Buxar1764; Company (Hector Munro) defeated Mir Qasim, Shuja-ud-Daula and Shah Alam II
Treaty of Allahabad1765, negotiated by Robert Clive; Shah Alam II granted the Company the Diwani (right to collect revenue) of Bengal, Bihar and Orissa; Awadh restored to Shuja-ud-Daula on payment of an indemnity

Dual government and the famine of 1770

  • From 1765 to 1772, under the dual government, the Company collected revenue while the Nawab's officials remained responsible for administration — power without responsibility.
  • The great Bengal famine of 1770 devastated Bengal and Bihar, killing a very large share of the population (commonly estimated at about a third in the worst-affected areas). Revenue collection continued harshly even during the famine.

Golghar

  • After the famine, the Company built the Golghar in Patna (completed in 1786, designed by Captain John Garstin) — a huge beehive-shaped granary to store grain against future famines.
  • It was never filled to capacity, but it remains one of Patna's best-known landmarks.

The Permanent Settlement (1793)

Introduced by Lord Cornwallis in Bengal, Bihar and Orissa:

  • Zamindars were recognised as owners of land.
  • The land revenue they paid to the Company was fixed permanently.
  • Zamindars who failed to pay on time lost their estates (the sunset law).

Effects in Bihar

EffectExplanation
Powerful zamindarsLarge estates such as Darbhanga, Bettiah, Hathwa and Tekari
Rack-rentingZamindars raised rents on cultivators, who had no protection initially
Insecurity for tenantsEvictions and illegal cesses (abwabs)
Stagnant agricultureLittle incentive for investment in land improvement
Long-term legacyUnequal landholding and agrarian tension that shaped Bihar's politics into the twentieth century — see our guide on land reforms

Indigo and opium

Indigo

  • European planters grew indigo (for blue dye) in north Bihar, especially Champaran, Tirhut and Saran.
  • The tinkathia system forced cultivators to grow indigo on 3/20 of their land, often at a loss.
  • Discontent culminated in the Champaran Satyagraha (1917) — see our dedicated guide.

Opium

  • The Company held a monopoly on opium, grown under contract by cultivators in Bihar and processed at the Patna opium factory (at Gulzarbagh).
  • Opium was exported to China — the trade that led to the Opium Wars.
  • Cultivators were often paid poorly and advanced loans that tied them to the crop.

Culture: Patna Kalam

  • Patna Kalam (the Patna school of painting) developed in the late eighteenth and nineteenth centuries, when painters who had worked at Mughal and regional courts moved to Patna.
  • It blended Mughal techniques with European influences and depicted everyday life — craftsmen, vendors, festivals — often for European patrons.
  • It is one of the few Indian painting schools focused on ordinary people.

Education and institutions

  • Patna College was established in 1863.
  • Khuda Bakhsh Oriental Library, Patna — opened to the public in 1891, with a remarkable collection of Arabic and Persian manuscripts; now an institution of national importance.

Bihar within the Bengal Presidency

Until 1912, Bihar was part of the Bengal Presidency, governed from Calcutta. Many in Bihar felt their interests were neglected, which led to the movement for a separate province — see our guide on the formation of Bihar.

Practice

Prelims-style:

  1. Who commanded the Company's forces at Buxar?
  2. What did the Treaty of Allahabad grant the Company?
  3. Why and when was the Golghar built?
  4. What was the tinkathia system?
  5. Where was the Company's opium factory in Patna?

Mains-style:

  • "The Battle of Buxar was more decisive than Plassey." Discuss.
  • Examine the impact of the Permanent Settlement on Bihar's agrarian society.

A note on dates and numbers. Exam patterns, vacancies and schedules change from year to year. Always confirm the current details in the latest notification on the Bihar Public Service Commission website .

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