Initially during sixteenth and seventeenth centuries the settlement of European companies in India resulted into interaction between people associated with different socio-economic, political, cultural and religious paradigm.
Therefore it was but natural that settlement of Europeans in India influenced the socio-economic and religious life of the people falling under the area of their influence.
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For instance we find that the general understanding about different cultures became more apparent and it evolved due to interaction between the people from different countries. India also witnessed advent of new art, architecture and culture during the period.
During the early period of settlement of European companies in India and establishment of trade links between India and Europe proved highly beneficial for India.
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As a result of these contacts European markets were thrown open to Indian goods. India made huge profits through export of Indian goods to Europe.
Wealth began to flow from Europe to India which greatly contributed to the prosperity of the country. However, in later period the nature of the European companies in India witnessed change and their sphere of influence increased.
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In fact they started to influence the balance of power in the sub-continent. In order to benefit from the eastern trade most of the companies involved themselves in activities that were not ethical and moral by any standard.
They drove wedge amongst the native rulers and did not shy away in prodding, provoking and instigating them to fight amongst themselves.
Moreover the loyalty of the European companies was towards their interest and it fluctuated and changed according to their interest.
It would not be an exaggeration to say that European companies added to the level of hatred and feud amongst the Indian elements.
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They had an added advantage of disciplined and well organized modern army equipped with advanced weaponry.
In fact they used their military strength in India to acquire political concessions and powers during the period.
This had immense impact on the military system of India. The Indian rulers adopted the new system and employed many Europeans in their army.
By the last quarter of the 18th century the English had vanquished all others and established themselves as the dominant power in India.
Once the British had consolidated their power, commercial exploitation of the natural resources and native labour became ruthless.
The period of economic exploitation adversely affected Indian culture and social life. The prevalent Mughal administrative, legal, revenue and military structures were dismantled and a long period of unhappiness, poverty and exploitation began.
In fact it leads to drain of wealth from India to England and added to poverty and overall backwardness of India.