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Meanwhile Warren Hastings had to deal with a more formidable enemy than the Mahratta confederacy. The reckless conduct of the Madras government had roused the hostility both of Hyder Ali of Mysore and of the nizam of the First Mysore War. Deccan, the two strongest Mussulman powers in India, who attempted to draw the Mahrattas into an alliance against the British. The diplomacy of Hastings won over the nizam and the Mahratta raja of Nagpur, but the army of Hyder Ali fell like a thunderbolt upon the British possessions in the Carnatic. A strong detachment under Colonel Baillie was cut to pieces at Perambakam, and the Mysore cavalry ravaged the country unchecked up to the walls of Madras. For the second time the Bengal army, stimulated by the energy of Hastings, saved the honour of the British name. Sir Eyre Coote, the victor of Wandiwash, was sent by sea to relieve Madras with all the men and money available, while Colonel Pearse marched south overland to overawe the raja of Berar and the nizam. The war was hotly contested, for Sir Eyre Coote was now an old man, and the Mysore army was well-disciplined and equipped, and also skilfully handled by Hyder and his son Tippoo. Hyder died in 1782, and peace was finally concluded with Tippoo in 1784, on the basis of a mutual restitution of all conquests.

It was Warren Hastings’s merit to organize the empire which Clive founded. He was governor or governor-general for thirteen years, a longer period than any of his successors. During that time the British lost the American colonies, Permanent settlement of Bengal. but in India their reputation steadily rose to its highest pitch. Within a year Hastings was succeeded by Lord Cornwallis, the first English nobleman of rank who undertook the office of governor-general. His rule lasted from 1786 to 1793, and is celebrated for two events—the introduction of the permanent settlement into Bengal and the second Mysore war. If the foundations of the system of civil administration were laid by Hastings, the superstructure was erected by Cornwallis. It was he who first entrusted criminal jurisdiction to Europeans, and established the Nizamat Sadr Adalat, or appellate court of criminal judicature, at Calcutta; and it was he who separated the functions of collector and judge. The system thus organized in Bengal was afterwards extended to Madras and Bombay, when those presidencies also acquired territorial sovereignty. But the achievement most familiarly associated with the name of Cornwallis is the permanent settlement of the land revenue of Bengal. Up to this time the revenue had been collected pretty much according to the old Mogul system. Zamindars, or government farmers, whose office always tended to become hereditary, were recognized as having a right of some sort to collect the revenue from the actual cultivators. But no principle of assessment existed, and the amount actually realized varied greatly from year to year. Hastings had the reputation of bearing hard upon the zamindars, and was absorbed in other critical affairs of state or of war. On the whole he seems to have looked to experience, as acquired from a succession of quinquennial settlements, to furnish the standard rate of the future. Francis, on the other hand, Hastings’s great rival, deserves the credit of being among the first to advocate a limitation of the state demand in perpetuity. The same view recommended itself to the authorities at home, partly because it would place their finances on a more stable basis, partly because it seemed to identify the zamindar with the more familiar landlord. Accordingly, Cornwallis took out with him in 1787 instructions to introduce a permanent settlement. The process of assessment began in 1789 and terminated in 1791. No attempt was made to measure the fields or calculate the out-turn, as had been done by Akbar, and is now done when occasion requires in the British provinces; but the amount payable was fixed by reference to what had been paid in the past. At first the settlement was called decennial, but in 1793 it was declared permanent for ever. The total assessment amounted to sikka Rs.26,800,989, or about 2¾ millions sterling. Though Lord Cornwallis carried the scheme into execution, all praise or blame, so far as details are concerned, must belong to Sir John Shore, afterwards Lord Teignmouth, whose knowledge of the country was unsurpassed by that of any civilian of his time. Shore would have proceeded more cautiously than Cornwallis’s preconceived idea of a proprietary body and the court of directors’ haste after fixity permitted.

The second Mysore War of 1790-92 is noteworthy on two accounts: Lord Cornwallis, the governor-general, led the British army in person, with a pomp and lavishness of supplies that recalled the campaigns of Aurangzeb; Second Mysore War. and the two great native powers, the nizam of the Deccan and the Mahratta confederacy, co-operated as allies of the British. In the result, Tippoo Sultan submitted when Lord Cornwallis had commenced to beleaguer his capital. He agreed to yield one-half of his dominions to be divided among the allies, and to pay three millions sterling towards the cost of the war. Those conditions he fulfilled, but ever afterwards he burned to be revenged upon his conquerors.

The period of Sir John Shore’s rule as governor-general, from 1793 to 1798, was uneventful. In 1798 Lord Mornington, better known as the marquis Wellesley, arrived in India, already inspired with imperial projects that were Wellesley. destined to change the map of the country. Mornington was the friend and favourite of Pitt, from whom he is thought to have derived the comprehensiveness of his political vision and his antipathy to the French name. From the first he laid down as his guiding principle that the British must be the one paramount power in the peninsula, and that the native princes could only retain the insignia of sovereignty by surrendering the substance of independence. The subsequent political history of India has been but the gradual development of this policy, which received its finishing touch when Queen Victoria was proclaimed empress of India in 1877.

To frustrate the possibility of a French invasion of India, led by Napoleon in person, was the governing idea of Wellesley’s foreign policy; for France at this time, and for many years later, filled the place afterwards occupied by The French Menace. Russia in the imagination of British statesmen. Nor was the possibility so remote as might now be thought. French regiments guarded and overawed the nizam of Hyderabad. The soldiers of Sindhia, the military head of the Mahratta confederacy, were disciplined and led by French adventurers. Tippoo Sultan carried on a secret correspondence with the French directorate, and allowed a tree of liberty to be planted in his dominions. The islands of Mauritius and Bourbon afforded a convenient half-way house both for French intrigue and for the assembling of a hostile expedition. Above all, Napoleon Buonaparte was then in Egypt, dreaming of the conquests of Alexander; and no man knew in what direction he might turn his hitherto unconquered legions. Wellesley first addressed himself to the nizam, where his policy prevailed without serious opposition. The French battalions at Hyderabad were disbanded and the nizam bound himself by treaty not to take any European into his service without the consent of the British government—a clause since inserted in every engagement entered into with native powers. Next, the whole weight of Wellesley’s resources was turned against Tippoo, whom Cornwallis had defeated but not subdued. His intrigues with the French were laid bare, and he was given an opportunity of adhering to the new subsidiary system. On his refusal war was declared, and Wellesley came down in state to Madras to organize the expedition in person and watch over the course of events. One British army marched into Mysore from Madras, accompanied by a contingent from the nizam. Another advanced from the western coast. Tippoo, after offering but a feeble resistance in the field, retired into Seringapatam, and, when his capital was stormed, died fighting bravely in the breach (1799). Since the battle of Plassey no event so greatly impressed the native imagination as the capture of Seringapatam, which won for General Harris a peerage and for Wellesley an Irish marquisate. In dealing with the territories of Tippoo, Wellesley acted with moderation. The central portion, forming the old state of Mysore, was restored to an infant representative of the Hindu rajas, whom Hyder Ali