Question

How did the Bengal Economy Fall Into Deep Crisis?

Answer 1

The Company becomes the Diwan
1) The Mughal emperor appointed the East India Company as the Diwan of Bengal on 12 August, 1765.
2) The Company became the chief financial administrator of the territory under its control.

Revenue for the Company
1) After becoming the Diwan, the Company aimed at increasing revenue as much as possible and buying silk cloth and fine cotton as cheaply as possible.
 2) In 5 years, the value of goods bought by the Company in Bengal doubled.  
3) Now, the cost of goods purchased for export was paid from the revenue collected in Bengal.
4) Bengal started facing deep economic crisis and artisans started deserting the villages.
5) Peasants were unable to pay their dues, production declined and agricultural cultivation collapsed.
6) In 1770, one-third of the population of Bengal was wiped out due to a terrible famine.

Answer 2

Me back :)
Well See, The company (East India Company) had become the Diwan, but it still saw itself primarily as a trader, It wanted a large revenue Income but was unwilling to set up any regular system of  assessum and collection.

-> The effort was to increase the revenue as much as it could and buy fine cotton and silk cloth as cheaply as possible, Within, five years the value of goods bought by the company in Bengal Doubled, As you know.

-> Before 1865, The company had purchased goods in India Importing gold and silver from Britian. Now the revenue collected in Bengal could finance the purchase of goods for export..
Well, I thought you understood it, Any problems? Let me Know :)