The subsidiary alliance system was used by Wellesley to bring Indian states within the orbit of British political power .The system served the double purpose of asserting British supremacy in India and at the same time of saving India from the menace of Napoleon .The system played a very important part in the expansion of the company’s dominions and many new territories were added to the company’s possession .
Evolution of the system

Wellesley did not invent the susbsidiary system .The system existed long before him and was of an evolutionary growth .Dupleix was perhaps the first who had lent European troops to Indian princes at the expense of the latter .The English also adopted this system .ever since the Governorship Clive the system had been applied with more or less insight by almost every governor and governor General of India . Wellesley’s special contribution was that he greatly developed and elaborated the system and applied it in the case of almost every India state.
The earliest subsidiary treaty negotiated by the company was with the Nawab of Oudh in 1765 by which the company undertook to defend the frontier of Oudh on the condition of the Nawab defraying the expenses of the such defence .A British Residents was also stationed at Luckhnow .the first time company insisted that the subsidiary state should have no foreign relations was in the treaty with Nawab of Carnatic concluded by Cornwallis in February 1787. Later Sir John Shore in treaty with the Nawab of Oudh ( Jan 1798 ) insisted that the Nawab was not to hold communication or admit into his service other European nationals .The demand for surrender of territory in commutation of cash money was the next logical step .usually the monetary demands of the company for upkeep of the subsidiary force were so heavy that The Indian states ,whose revenue shrank or expanded according to Monsoon ,were not in a position to meet those and usually fell in arrears .Wellesley therefore made it a general rule to negotiate for the surrender of “ territory in full sovereighnty” for upkeep the subsidiary force.

A typical subsidiary treaty was negotiated on the following terms and conditions:

• The Indian state was to surrender its external relations to the care of the company and was to make no wars .it was to conduct negotiations with other states through the company;
• A bigger state was to maintain an army within its territories commanded by British officers for the preservation of public peace and the ruler was to cede territory in full sovereignty for the upkeep of that force ; a smaller state was required to pay tribute in cash to the company;
• The state was to accept a British Resident at its head- quarter;
• The state was not to employ Europeans in the service without the consultation of the company ;
• The company was not to interfere in the internal affairs of the state ;
• The company was to protect the Indian state against foreign enemies of ‘every sort of kind’.

Advantages to the company

• The subsidiary system was the Trojan –horse –tactics in empire building .it disarmed the Indian states and threw British protectorate over them.the Governor General was present by proxy in every Indian state that accepted the subsidiary alliance .thus it deprived the Indian princes of the means of prosecuting any measure of forming any confederacy against British .
• It enabled the company to maintain a large standing army at the expense of Indian prnices.according to the Wellesley himself , “ by the establishment of our subsidiary forces at the Hyderabad ,and Poona ,with Gaikwar , Daulat Rao Sindhia and the Rana of Gohud ,an efficient army of 22000 men is stationed within the territories or on the frontier of foreign states , and is paid by foreign subsidies .that army is constantly Maintained in a state of perfect equipment ,and is prepared for active service in any direction at the shortest notice...........without any considerable increase to the permanent military expenses of the Government of India .”
• The stationing of the company’s troops in the capitals of the Indian princes gave the English the control of the strategic and key positions in India without arousing the Jealousy of other European nations.
• The subsidiary system helped the company to effectively counteract any possible French moves in India .The company required the subsidiary ally to dismiss all Frenchmen from his service.
• The officers commanding of the subsidiary force were very well paid .the British residents wielded considerable influence in the affairs of the Indian states.this placed great patronage into the hands of company’s authorities in India .
• The Company acquired territories in full sovereignty from Indian states and expanded her dominions in India
• So we can say that on one hand Subsidiary alliance helped company to reduce the threat of Napoleon and on the other hand company could maintain a large army on the expenses of Indian states.

DISADVANTAGES TO INDIAN STATES

• An Indian state by accepting disarmament and surrendering foreign relations accepted a subordinate position and virtually lost her independence.Sir Thomas Munro remarked that “ a state purchased security by the sacrifice of independence, of national character & of whatever renders a people respectable.”
• The British residents interfered into the day to day administration of the states to the extent that the normal functioning of administration was renderd impossible.
• The subsidiary system supported every weak and oppressive ruler and deprived the people of any possible remedy against misrule.
• A state which accepted the subsidiary alliance courted bankruptcy. The subsidy demanded by the company -usually one third of the annual revenue of the state—was so heavy that the state fell in arrears. The ruler taxed the people heavily and impoverished the country. Even when the territory was demanded in commutation of subsidy the company’s demand was put very high.

CONCLUSION

Karl Marx very aptly summed up the effects of the subsidiary alliance system :”As to the native states ,they virtually ceased to exist from the moment they became subsidiary to or protected by the Company.If you divide the revenue of a country between two governments, you are sure to cripple the resources of one or the administration of both...the conditions under which they are allowed to retain their apparent independence are at the same time,the conditions of permanent decay, and of an utter inability of improvement.” Even Munro wrote,”that the simple and direct mode of conquest from without is more creditable both to our armies and to our national character than that of dismemberment from within by the aid of subsidiary force.”