comprised not only India proper, but also the countries on the east side of the Bay of Bengal, the Straits of Malacca, Java, Siam, and all the Spice Islands further eastward in the Java and Chinese seas, such as the Celebes and the Moluccas. With China and Japan also a very active commercial intercourse had been established by the English Company, something under 100 per cent. being reckoned a reasonable rate of profit on sales.
In the first half of the seventeenth century the traffic with the Spice Islands was by far the most important and profitable; and from this branch of the general East India trade the Dutch were determined to exclude us; for indeed upon this commerce the prosperity of their state and people largely depended. They did, in fact, so thwart and embarrass the operations of the English Company in the waters of Eastern Asia, beyond the Malacca Straits, that the English gradually withdrew from many of their stations in that region, and shifted their trade more and more, as time went on, toward the coasts of India and the countries adjacent. From this tendency of the English to concentrate their business upon the ports and factories of the Indian mainland, and to cultivate relations with the Moghul Empire, we may deduce some ulterior consequences of much importance in regard to the course and character of their subsequent expansion.
In this manner began the contest for valuable markets that gave so strong an impulse, at this period, to the system of chartered companies; for the early
