Commercial enterprise led the Dutch to undertake voyages to the East. Cornelis de Houtman was the first Dutchman to reach Sumatra and Bantam in 1596. In 1602, the States General of the Netherlands amalgamated many trading companies into the East India Company of the Netherlands. This company was also empowered to carry on war, to conclude treaties, to take possession of territory and to erect fortresses
After their arrival in India, the Dutch founded their first factory in Masulipatnam (in Andhra) in 1605. They went on to establish trading centres in different parts of India and thus became a threat to the Portuguese. They captured Nagapatam near Madras (Chennai) from the Portuguese and made it their main stronghold in South India.
The Dutch established factories on the Coromandel coast, in Gujarat, Uttar Pradesh, Bengal and Bihar. In 1609, they opened a factory in Pulicat, north of Madras. Their other principal factories in India were at Surat (1616), Bimlipatam (1641), Karaikal (1645), Chinsura (1653), Baranagar, Kasimbazar (near Murshidabad), Balasore, Patna, Nagapatam (1658) and Cochin (1663). Participating in the redistributive
or carrying trade, they took to the islands of the Far East various articles and merchandise from India. They carrie indigo manufactured in the Yamuna valley and Central India, textiles and silk from Bengal, Gujarat and the Coromandel, saltpetre from Bihar and opium and rice from the Ganga valley.
The English were also at this time rising to prominence in the Eastern trade, and this posed a serious challenge to the commercial interests of the Dutch. Commercial rivalry soon turned into bloody warfare.
The climax of the enmity between the Dutch and the English in the East was reached at Amboyna (a place in present-day Indonesia, which the Dutch had captured from the Portuguese in 1605) where they massacred ten Englishmen and nine Japanese in 1623.
This incident further intensified the rivalry between the two European companies. After prolonged warfare, both the parties came to a compromise in 1667 by which the British agreed to withdraw all their claims on Indonesia, and the Dutch retired from India to concentrate on their more profitable trade in Indonesia. They monopolised the trade in black pepper and spices. The most important Indian commodities the Dutch traded in were silk, cotton, indigo, rice and opium.
Decline of the Dutch in India
The Dutch got drawn into the trade of the Malay Archipelago. Further, in the third Anglo-Dutch War (1672-74),
The Dutch rivalry with the English, during the seventeenth century, was more bitter than that of the Portuguese. The policy of the Dutch in the East was influenced by two motives: one was to take revenge on Catholic Spain, the foe of their independence, and her ally Portugal, and the other was to colonise and establish settlements in the East Indies with a view to monopolising commerce in that region. They gained their first object by the gradual decline of Portuguese influence. The realisation of their second object brought them into bitter competition with the English.
—R.C. Majumdar, H.C. Raychaudhuri and K. Datta
in An Advanced History of India
communications between Surat and the new English settlement of Bombay got cut due to which three homebound English ships were captured in the Bay of Bengal by the Dutch forces. The retaliation by the English resulted in the defeat of the Dutch, in the battle of Hooghly (November 1759), which dealt a crushing blow to Dutch ambitions in India.
The Dutch were not much interested in empire building in India; their concerns were trade. In any case, their main commercial interest lay in the Spice Islands of Indonesia from where they earned a huge profit through business.