MY LORD,

No. LXVIII.

The Earl of Elgin to the Earl of Mornington.

Constantinople, Feb. 20th, 1800.

[Received at Fort William, May 10th, 1800.]

Although Sir Sidney Smith will, no doubt, have sent to your Lordship the earliest accounts of the capitulation which the French have signed for the evacuation of Egypt, yet I lose no time in forwarding the intelligence from hence, and enclosing an abstract of the terms agreed upon.

I most sincerely congratulate your Lordship upon this additional security to our East India possessions. The period of your administration has surely been the most brilliant, and has procured more essential benefits to those interests than any Government ever was so fortunate as to obtain. No one takes a warmer share than I do in whatever must contribute so greatly to your satisfaction and reputation.

There are at this moment eight mails from England missing. It would appear that the Elbe is frozen; and the roads on this side of Vienna are almost impassable. I can, therefore, offer you no news from hence.

We have merely common report from France: nor do we know of any act worthy to be cited of the new Government at Paris.

I wish I could give your Lordship any hopes that the Court of Russia shewed more disposition than of late for continuing a continental war against France. I have not heard from Lord Minto since he went to Prague last month, for the purpose of an interview with Marshal Suwarrow. At first it was said that their conferences had ended as we might wish; but my accounts from Russia state the determination of the Emperor to be, to recal his troops.

By advice from London, it is expected there that Russia continues hearty with us; and the same language is held to the Porte. But if it does not act on the Continent, I am not sanguine as to the benefit we are to derive from its efforts.

Meanwhile the Court of Vienna continues its preparations

for another campaign. At present we do not hear any surmise of Buonaparte's having proposed fresh terms of peace to Austria.

I have the honour to be,

with great truth and regard, my Lord,

your Lordship's most obedient, humble Servant,

ELGIN.

No. LXIX.

The Earl of Mornington to the Right Honourable Henry Dundas.

MY DEAR SIR,

Fort William, March 5th, 1800.

Although most of the points touched in your several despatches have already been anticipated, either by my letters to you, by the communications which I trust you have received through Mr. Wellesley, or by my despatches to the Secret Committee and the Court of Directors, I propose in this letter to reply regularly to such of your communications as have not already been directly answered by me.

HYDERABAD.-I received with the greatest satisfaction your approbation of the treaty of Hyderabad.* Subsequent events have abundantly confirmed the justice of the expectations, which you formed upon the first view of that treaty. It was indeed the source of all our recent successes in India; and even if it has in any degree aggravated the characteristic jealousy of the Mahrattas, it has furnished ample compensation in establishing an impregnable barrier against their power. The system on which the treaty of Hyderabad was founded, would certainly be most effectually completed by the conclusion of a similar engagement at Poonah, and I am resolved never to lose sight of that most desirable object.

The various instances in which the jealousy of the Mahratta State has lately been disclosed, are rather to be attributed to the peculiar character of that nation, and to the singular disposition of the present Peishwa, than to any formed aversion to a nearer connection with the British power.

The influence of Scindia has also contributed to frustrate my proposed measures, because their necessary effect must have been to restore the Peishwa to a certain degree of credit

* See Vol. I. Appendix.

VOL. II.

and power; and to reduce Scindia in the same proportion. I have no reason to believe that Scindia would be averse to a separate connection with us, but not perceiving any possible advantage which could arise from such a connection under all the circumstances of the present moment, I have taken no steps to cultivate it, while I have avoided any manifestation of an unfriendly disposition.

The distractions of the Mahratta empire must continue to increase, until they shall be checked by foreign interference. No power in India excepting the British now possesses sufficient strength to interpose with effect in these dissentions; and I shall not be surprised if ultimately the subsidiary force, which I am so anxious to establish at Poonah, should be required with equal anxiety by the Mahratta State, as the only means of restoring order, and of saving the whole of that country from plunder and desolation.

Mr. Colebrooke has now resided several months at Nagpoor, and I have every reason to believe, that the Rajah of Berar will prove well inclined to support whatever plan the British Government may ultimately adopt with regard to the affairs of the Mahratta empire.

With respect to the views of Zemaun Shah, the papers found in the palace at Seringapatam have completely justified your opinion of Tippoo's disposition to obtain the assistance of that Prince; and of Zemaun Shah's inclination to afford it.

For some time to come, I trust that Zemaun Shah will be too much occupied at home, to admit of turning his arms against Hindostan ; and I am inclined to think that the encouragement of divisions in his own government, and of hostility between the contiguous State of Persia and his dominions, is the system of defence against Zemaun Shah on which it is most safe to rely under the present circumstances of affairs in India.

The profligacy of Scindia's character, the distracted state of his councils and armies, and the distress or rather ruin of his finances preclude the hope of effecting a secure or useful alliance with him.

The establishment of a subsidiary force at Poonah, would compel Scindia to return to his own dominions; and in that event, it might not be difficult to convince him that his best security would consist in imitating the example of the Nizam

and of the Peishwa; and in placing himself under the immediate protection of the British power.

With respect to the general system of policy to be adopted by us in India in consequence of the conquest of Mysore, I shallre view all the important considerations connected with that extensive question in a separate despatch, addressed by some future opportunity, either to you or to the Secret Committee.

I conclude, that the power of the French in Egypt is either already extirpated, or that you will continue the war until that indispensable object shall be completely effected. Notwithstanding the present proud and commanding predominance of the British power in India, we cannot expect an uninterrupted continuance of tranquillity while France shall be permitted to maintain a powerful establishment in Egypt. Since I wrote the preceding paragraph, I have received despatches from Lord Elgin, dated the 22nd December, 1799, by which it appears that Kleber remains in Egypt with 15,000 men, and that Buonaparte is at the head of a new Government in France. Lord Elgin proposes a powerful diversion from India, through the Red Sea, for the purpose of accelerating the evacuation of Egypt by the French, but after a full discussion of this subject with General Stuart, I am satisfied that it would be an useless waste of treasure and blood to attempt such an expedition on a large scale, unless the whole plan of co-operation from the Mediteranean had been previously concerted.* Desultory operations against any places retained by the French on the shores of the Red Sea may be advantageous, they would neither be perilous, nor expensive.

You are already apprized of my entire coincidence in your opinion, respecting the importance of Goa; and I trust that you will be enabled to give full effect to the measures which I have adopted for the purpose of rendering that possession an additional source of strength to the British Empire in India. I also consider the possession of Diu to be a most desirable object, particularly with a view to the coercion of the Piratical States on the north western coast of the peninsula of India.

This was the suggestion of the Governor-General to Mr. Dundas on the 16th of May, 1799. See Vol. I. p. 587.-[ED.]

FINANCES. Notwithstanding the large import of bullion during the present season, the expences of the war, and the considerable amount of the 12 per cent securities, coming in course of payment within the current and succeeding year of account, have compelled me to continue the system of adding to the debt in India, in order to secure a considerable commercial investment for the ensuing season. I have however, the satisfaction to assure you, that every symptom has concurred to confirm my opinion, that the debt in India is likely to become more manageable in every succeeding year. The loans which I have opened at this Presidency during the current year, have been made at a rate of interest much more favourable than any which has been raised since the year 1796, as will appear by the terms of the loans of this year. Although the second loan on the same terms is actually open, the state of the public securities is now—

The distress for specie has gradually vanished, and private credit has proportionably been improved; and I have been enabled to send home with valuable cargoes every regular ship belonging to the Company in India, while on the other hand, I have employed the whole tonnage which the Port of Calcutta could furnish since the month of December, to carry to the Port of London, nearly the whole of the goods of individuals, which had been tendered for exportation previous to that month, over and above the 3,000 tons which the Company is bound by law to furnish.

The finances of the Government of Madras have improved in a still greater proportion than those of Bengal. At that