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134 travagant system of subsidizing a commercial Company that had plunged into the quicksand of Indian wars. In 1754, the French Company were on the verge of insolvency; their affairs were under official inquiry; they were demanding large subsidies from the treasury; and it was clear that the public credit would suffer seriously if they were allowed to go into liquidation. Dupleix had laid down the principle, which he was endeavouring to impress upon his government, that no Company could subsist in India which had not a fixed revenue from territory to provide for the cost of establishments. But at that time it was an axiom in France, and even in England, that conquest was incompatible with commerce; the opinion of all French authorities, mercantile and administrative, was unanimous against allowing a trading Company to acquire large territory; and these views had for years been impressed sedulously, though in vain, upon Dupleix.

Whether his principle was right or wrong need not be discussed, for the real point is that it was just then impracticable. The exhaustion of the Company's resources, the embarrassments of French finance, and the weakness of the French navy must have furnished the government with irresistible arguments against persisting in his policy. The true state and inevitable tendency of the contest between the two nations in India has been recognized by M. Marion, in his study of the history of French finance between 1749 and 1754. In defending Machault d'Arnouville, the controller-general of that period, from the imputation of having sacrificed