These were years when the boundaries of British rule were extended while its impact was intensified. New territory was acquired, both in India and outside it, while the activities of government advanced beyond the maintenance of order and the collection of revenue to economic and social policies that accorded with European ideas of utility and morality. Exaggerated fears of a revival of French power in Asia were at first associated with this territorial expansion, and the desire for a strong ally against a resurgent France was the main reason why the British allowed the Dutch to return to South-East Asia after the Napoleonic Wars. But the major concern of the English East India Company was now the establishment of its authority as the paramount power in India. Mughal supremacy had been little more than nominal after the death of Aurangzib, the last of the great emperors, in 1707, and the Maratha confederacy lacked the unity of direction and the centralised administrative system necessary for dominance over the sub-continent. Widespread disorder and devastation in central India, spreading to the borders of British territory, indicated the need for some paramount authority. Indian considerations thus brought the English Company to grips with the Marathas. Apart from arousing occasional suspicions of Russian designs, European politics were henceforth of diminishing importance in the shaping of its external policies.

European ideas, on the other hand, were of increasing importance in the development of internal policy. True, the defects that had arisen in the administrative institutions established by Lord Cornwallis in Bengal suggested that he had paid too little attention to Indian ideas and circumstances, and the reforms that were in train elsewhere made more use of local experience by modifying the rigidity of his separation of powers, by giving more responsibility to native officials, and by settling the land revenue with villages and with individual cultivators instead of with great landholders.