Debasing Indigenous Statehood: Sovereign Monies, Markets and Imperial Power in the Indian Subcontinent, c. 1893–1905

Dense overlapping networks of multiple currencies were a feature of subcontinental commerce and statehood until the twentieth century. Twenty-seven subcontinental states in addition to the Raj issued their own currencies in 1893. Underpinned by a common basis in silver and an extensive market for their bills, they financed trade and circulated in one another’s territories, including British India. By 1905 most currencies had ceased and this sovereign prerogative belonged mainly to the Raj. The suppression of indigenous currency networks by a colonial monetary system presaged a dramatic reconfiguration of native sovereignty and imperial paramountcy. Triggered by silver’s demonetization in British India in 1893, these transformations unfolded amid gold’s elevation as the universal standard and the growth in London’s financial influence. They were cemented by the famines of 1896–1902, which crippled the native states’ finances and accentuated the conflict they faced between famine relief and currency stability. Markets magnified this conflict into a test of sovereign capacity that few states managed to withstand. The consequent redistribution of sovereign capacity between states and markets, and between states according to their ability to control the markets, helped to dematerialize, rearticulate and extend the reach of British power. This subcontinental story of money, markets and indigenous statehood is hence a British imperial story with resonances beyond the empire and its own time.