The historical role of opium and what it tells us about illicit economies today

Debates on drugs are often extremely parochial and ahistorical, yet our research is showing that historical and comparative perspectives are essential to better understand and engage more effectively with illicit drug economies.

Opium is a commodity that was deeply implicated in the growth and consolidation of empire and the extension of international trade, and a catalyst for the development of European and Asian capitalism. Two books provide different but fascinating insights into the historical role of opium, capturing important themes that are relevant to understanding illicit economies today.

Book one: Opium, Empire and Global Political Economy by Carl Trocki

In his superb book Opium, Empire and Global Political Economy, Trocki (1999) persuasively argues that the ‘super profits’ that came from monopolising the long-distance opium trade were of central importance to the development of European and Asian capitalism.

In the nineteenth century, opium produced in British ruled India was transported to China. This became the world’s largest market, to the extent that by 1900 there were estimated to be 13.5 million opium users in China (see McCoy’s 1971 book The Politics of Heroin in Southeast Asia).

The opium trade prepared the ground for capitalism by creating mass markets. For European merchants, opium created their first major accumulations of capital. And many British merchant houses, banks and insurance companies that had their roots in Asian trade, all had a start in opium.

The opium trade transformed agrarian relations in the eastern Indian state Bihar, the main site of large-scale production for the Chinese market. Even in years of famine, farmers were often made to give up their grain cultivation in favour of producing the drug. To produce a 1.6 kg. ball of raw opium required 387 man-hours, underlining the value of peasant labour in the opium industry in the 18th and early 19th centuries, as emphasised by Trocki:

‘Realising that the Chinese market had become far more elastic than they had previously imagined, the government decided to increase production in order to meet competition from foreign and Malwa opium. And rather than attempt to restrict the supply and maintain the price, they adopted the opposite strategy: producing as much as possible and hoping to drive the competition out of business by running down the price. Despite the usual blandishments about native welfare, increasing blocks of land were brought under opium cultivation, particularly in Bihar state, and more peasants were dragooned into the business of poppy cultivation.’

Trocki 1999

There are many other links between labour, opium and colonial regimes of power. For instance, European colonies all faced the same labour shortage and many turned to the same solution. Europeans facilitated the provision of opium to ethnic Chinese and indigenous Southeast Asians, usually in modest quantities – for example Chinese labourers, many of whom were fleeing internal crises within China at the time, could be induced to work long hours at physically demanding jobs in medically challenging environments for low pay. 

Opium also produced revenue crucial for the functioning and growth of the colonial state and its infrastructure. In Singapore, government-granted monopolies over the retail sale of opium brought in approximately half of the state revenue from the mid nineteenth century to the first decade of the twentieth century.

Whilst the lion’s share of the profits was made by European capitalists, opium also contributed to the emergence of a new Asian capitalist class. In China for example, Trocki points to the catalytic role played by opium in the commercialisation of agriculture and the creation of new sources of capital accumulation and new indigenous owners of capital. Other research also points to the role of local merchants and indigenous entrepreneurs in developing new markets as a response to the opportunities created by European trading.

Therefore, the imperial system in South and Southeast Asia rested on opium.  Colonial labour markets and state budgets would not have functioned without it. Southeast Asian nationalists in the 1920s came to believe that part of their struggle to gain independence was also to end the legal sale of opium. Colonial rule and opium consumption were seen to be entwined, and newly independent states were relatively successful in prohibiting opium during the early years.

Book two: Sea of Poppies by Amitav Ghosh

Amitav Ghosh’s novel Sea of Poppies (2008) provides a very different, but equally arresting set of insights about the opium trade. 

The book’s origins go back to Ghosh’s interest in why Bihar became such an important source of indentured labour in the nineteenth century and what drove this population to take the risk of crossing the ‘black water’ to make a new life elsewhere.  

He made the link between the rise of a monoculture in opium and the creation of indentured labour force, as peasant farmers became indebted first to the East India Company and then to other private companies once the East India companies’ monopoly ended.   

The novel which emerged from this discovery unfolds in north India and the Bay of Bengal in 1838, on the eve of the British attack on the Chinese ports known as the first opium war. He dramatises two great economic themes of the 19th century: the cultivation of opium as a cash crop in Bengal and Bihar for the Chinese market, and the transport of Indian indentured workers to cut sugar canes for the British on islands such as Mauritius, Fiji and Trinidad.

The novel begins in the fertile farms of the Ganges blooming with poppies, and with Deeti, the wife (but soon to be widow) of an addicted husband, who works at the British opium factory at Ghazipur.  The book (the first in Ghosh’s ‘Ibis triologu’) ends with her on an old converted slaving ship, the Ibis, taking indentured labourers to Mauritius.

A busy examining hall in the opium factory at Patna, India. Lithograph after W. S. Sherwill, c. 1850.
Photo courtesy of Wellcome Images.

As Ghosh writes, the official version of history glosses over the time when Britain was the ‘world’s biggest drugs pusher.’ One of the most arresting scenes in the book is his description of Deeti’s visit to the great Sudder opium factory at Ghazipur.

Deeti rushes in terror through every single shed of the factory in search of her dying husband. Poppy flowers, sap and trash are processed before Deeti’s terrified village eyes. She is affronted by the smell, ‘hot and fetid, like that of a closed kitchen.’ The smell was not of spices and oil, but of liquid opium mixed with the ‘dull stench of sweat’ and then the sight of ‘dark legless torsos,’ who turn out to be ‘bare-bodied men, sunk waist-deep in tanks of opium, tramping round and round … as slow as ants in honey, trampling, treading.’  The men, coloured dark as pitch, are urged on by white overseers ‘armed with fearsome instruments.’

What these books capture that are relevant to the contemporary dynamics of drug economies

In very different ways, these two books capture a number of the themes that we wish to explore in our research. Although the context and time period are different, the historical insights captured by these books are relevant to the contemporary dynamics of the drugs economies in fragile and conflict-affected states.  Both Trocki’s and Ghosh’s accounts highlight:

The interrelationship between, and inseparability of, violence and opium trade and production.

This includes structural violence (such as exploitative labour relations, the ‘slow violence’ of drug addiction, poverty induced migration) and direct physical violence (from the coercion of factory workers to the conduct of imperial wars).

Yet notwithstanding (and perhaps even because of) this violence, opium economies played a transformational role, both on peripheral rural economies (the creation of indentured labour, the commercialisation of agriculture, increased differentiation of the peasantry) as well as the metropolitan centres (growth of powerful of trading houses, tax base for colonial administration). 

Therefore, although extremely violent and bound up with exploitative relationships, the opium economy had – often unexpectedly – long term developmental effects. 

The transnational, or in fact global, dimensions of the drug economy.

This includes movement of people and commodities across huge distances.  European empires created the mercantile routes along which drugs (and other intoxicants) flowed. Sites of opium production, distribution and consumption spanned continents and empires.

Both of these books provide a ‘subaltern’ perspective – they seek to understand the opium economy from the perspectives of those living in the peripheries of empire, whilst at the same time not losing sight of the wider structures of power and sets of interests that drove this economy.

The transition to more licit forms of wealth creation enabled by wealth generated through opium.

Finally, what we might call processes of ‘graduation’ in which empires, countries, groups of people and individuals who had accumulated vast wealth as a result of the production and trade in opium, graduated into more ‘respectable’ forms of wealth creation (as with the American robber barons).

For example, historians have argued that money from the Chinese opium trade founded much of the modern US. Many of the antislavery schemes, hospitals, universities and railways that gave shape to nineteenth century America would not have been possible were it not for the drugs profits made in China.

Furthermore, counter narcotics policies and anti-opium discourses were and are frequently deployed to consolidate and legitimise earlier gains and unequal power relations. For example, some have argued that the US focus on controlling drug supply that still dominates today was in part born of a desire to undermine British power in Asia. Also, images of opium addicts as indolent, languid, feminised men, and opium dens as places of iniquity, created new justifications for a ‘civilising mission.’

Literature review on illegal drugs in Latin America

This document summarises the academic research on illegal drugs in Latin America published in 2018.

The literature falls into one of three categories: (1) production, (2) commercialisation, and (3) consumption of illegal drugs.

This brief is currently only available to download in Spanish language: Revisión de literatura sobre drogas ilegales en la región.

States, markets and violence in drug-affected borderlands

Drugs & (dis)order experts share insights from their fieldwork in the drug-affected borderlands of Afghanistan, Colombia and Myanmar at the SOAS Development Studies Seminar series.

Speakers include: Professor Jonathan Goodhand, Dr Jasmine Bhatia, Dr Patrick Meehan (SOAS, University of London) and Dr Francisco Gutiérrez Sanín  (Universidad Nacional de Colombia).

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Colombia´s anti-drugs policies: evidence versus ideology

This article was first published on Latin American Bureau on 19 October 2019. Read original article with images and graphics.

By 30 July this year, 99,097 families (around 500,000 individuals) had signed up to the voluntary crop substitution programme and 94 per cent of these families had complied with the condition to eradicate their coca crops voluntarily. A total of 37,629 hectares have been eradicated under this programme (also according to UNODC).

The crop substitution programme is aimed at small-scale coca producers. These are families living in areas often controlled by the extinct FARC-EP and with little or no presence of state institutions and very poor or a complete absence of public services.

In my conversations with many of these farmers, they told me that cultivating coca has provided a means to escape poverty and has allowed them to feed and ensure education for their children. In fact, a survey carried out by the National University, one of Christian Aid´s partners in Colombia, has shown that just like middle class families, coca farmers invest most of their disposable income in their children´s education.

However, the coca farmers also assured me that they want to find a way out of this economy. One of the reasons they give is that being involved in the production of coca involves contact with armed groups and therefore security risks.

This high level of motivation explains why so many signed up for the programme and why only 0.5 per cent of the eradicated area has reverted to coca cultivation. In the context of 30 years of failed anti-drugs policies in Colombia, this is an unusually high success rate. By comparison, 35 per cent of the coca areas exposed to aerial fumigation return to coca cultivation, according to DeJusticia. The same source reveals that with regard to cost, voluntary crop substitution programmes are also more attractive because they are far cheaper. The cost of aerial fumigation is more than double – around £16,700 pounds sterling per hectare, as against £9,300 for crop substitution.

This begs the question why the government would want to sacrifice a highly effective and relatively cheap public programme with one that is far less effective and costlier.

One reason could be that, for ideological reasons, it somehow thinks it is wrong to support former cultivators of coca through subsidies and alternative livelihood development projects. Basically, the voluntary crop substitution programme consists in a cash subsidy given straight after the eradication, so that the families can survive while developing alternative income sources, plus technical assistance and materials for short-term projects, for example a kitchen garden or pigs, and long term agricultural projects, for example cocoa or coffee plantations.

To date the government has largely failed to implement this programme, with only 24 per cent of the families receiving all the cash subsidy due and not a single family receiving everything that was promised, according to Pedro Arenas from the International Drug Policy Consortium.

The ‘war on drugs’

Of course, the government is under strong pressure from the US, which continues to believe in the effectiveness of the war on drugs. Colombia is a key political and ideological ally of the US in Latin-America and is heavily dependent on the Trump administration for continued security support, development aid, and preferential trade treatment. And there is no better way to demonstrate alignment with US anti-narcotics policies than aerial fumigation.

The US, through the White House’s Office of National Drug Control Policy, conducts a thorough assessment each year of the counter-narcotics policies of each country. This assessment, carried out by the State Department and embassy staff, the DEA and CIA, is a requirement under US law before aid and any form of can be disbursed. In March each year, the US president certifies to Congress which countries are eligible to receive aid support, based on this assessment.

The difficulty for the Duque Government is that since 2012 the area under coca cultivation has increased from around 48,000 hectares to 208,000 in 2018, a huge increase. The reasons for this are disputed, with some arguing that the prospect of benefiting from a generous voluntary crop substitution programme was an incentive to increase cultivation.

However, Arnobi Zapata, the spokesperson for COCCAM, a farmers’ association promoting voluntary crop substitution supported by Christian Aid, says that ‘the increase occurred because the FARC-EP used to impose limits as to how many hectares each family was allowed to produce but that the new criminal groups, that took over control after the FARC-EP left, on the contrary oblige farmers to increase production.’

Moreover, disputes over territory and the illegal drug economy have led to an increase in the killing of farmers involved in the voluntary crop substitution programmes. 58 leaders of COCCAM, have been killed since the programme started in 2017. Jose Yimer Cartagena was killed in early 2017 after he had denounced increased presence of paramilitaries in Cordoba, Northern Colombia, following demobilisation of the FARC. When the supposed assassins forced Jose Yimer into a white 4-wheel drive and then drove him away, they said to people watching “he should not have made those denouncements”.

While I do not believe there is a silver bullet that will once and for all solve the problem of drug production, evidence seems to indicate that fully implementing the voluntary crop substitution programme, in the spirit of the Peace Agreement, would lead to a significant reduction in the number of hectares growing coca, which is the indicator that both the Colombian and US Government seem most concerned about. In addition, I believe it would simultaneously lead to a reduction in violence and poverty rates in those areas, which are other indicators against which the success or failure of anti-drugs policies should be measured.

Christian Aid believes that a new approach to transforming illicit drug crop economies is needed in order to support sustainable transitions that achieve the targets and ambition of the SDGs, read more in the recent paper as part of the Drugs & (dis)order project, Peace, illicit drugs and the SDGs – A development gap.

Data management guidance

The nature of Drugs & (dis)order’s research poses many data management challenges, such as dealing with sensitive and illicit activities that may put interviewees and researchers at risk, or the need to build a collaborative data infrastructure for cross-partner research.

This guidance is for anyone in the project who handles research data – such as data collection transcription, translation, storage, transfer or analysis. While it has been designed for the Drugs & (dis)order project, it may also be a useful reference for other projects and researchers.

This is a working document, written to address issues arising from the project, and will continue to develop over time. Read more about how we’re building capacities in a complex research project.