THE IDEA of an East India Company with exclusive trading rights between England and the east really emerged in the last years of the sixteenth century, at a time when England faced formidable opposition from powers like Spain and Holland, who were leaders in developing commerce with both Asia and the Americas. The defeat of the Spanish Armada in 1588 was still recent in the memory and, in spite of historians' depiction of her reign as a ‘Golden Age’, in truth Queen Elizabeth I and her Court remained deeply concerned by England's vulnerability to threats from the continent. Across Europe, the ideas on political economy which came to be known as mercantilism were ascendant, and were promoted in England by such eminent scholars as Richard Hakluyt. In essence, this school of thought postulated that the wealth of the world was finite and incapable of much expansion by human endeavour, and that nations which wished to strengthen themselves against rivals needed to amass for themselves a greater share of those scarce resources. In essence this meant the acquisition of colonies in the recently discovered ‘New World’ and the monopolisation of trade in commodities such as gold, silver, spices and other precious goods.

The England of Queen Elizabeth I was a beleaguered Protestant state, confronted by powerful Catholic enemies, notably Spain and Portugal, which already enjoyed a substantial lead in the quest for mercantilist and imperial dominance. In the wings, the Dutch were also a rising world power to be reckoned with, and English efforts to challenge rivals through state-backed piracy, or the pursuit of alternative land or sea routes to the east, had met with little success.