Stabilization and development
THE DIAMOND TRADE
The lesson learned from the failure of the short-lived attempt at monopolization of the diamond trade was not lost upon the Directors of the East India Company and they showed great consistency in framing the new liberal policy. Merchants of precious stones were allowed once more to trade with India, and during the next five years the Council passed a number of further measures calculated to facilitate the private diamond trade and encourage its growth.
The resolution of 1682 described the purpose of rules as 'the encouragement of the adventurers [i.e. shareholders] and all other merchants both English and others'. 1 The rules permitted the merchants to export and import silver, gold, diamonds and other kinds of precious stones, as well as other goods in which the Company was not particularly interested. It is true that the duties imposed were rather high and discriminated against part, at least, of the Jewish merchants; Englishmen had to pay 4 per cent on the value of diamonds etc., and aliens 8 per cent. 2 But only a fortnight after these duties had been fixed the Court decided to lower the rates to 3 per cent and 6 per cent respectively, to abolish the distinction between Englishmen and aliens, and to reintroduce the old one between stockholders and merchants who had no stake in the Company. 3 A duty of 2 per cent was imposed on the export of silver and gold for the purchase of diamonds. It may well be that the former rules constituted an attempt to make things easier for Christian competitors of the Jewish diamond merchants, and that pressure was brought to bear upon the Company in order to prevent it from carrying out this policy. The fact that the Court decided to change the rules reflects its sincere intention to encourage the private trade in diamonds.
In 1683 the Court decided to impose strict limitations on private trade with India, because of the alleged harm which it was causing to the Company's trade. It was, however, explicitly