Indigo cultivation was started by the French in St Dominique in the Caribbean islands. Similarly, the Portuguese began indigo cultivation in Brazil, the British in Jamaica and the Spanish in Venezuela. Indigo plantations were also started in many parts of North America.

By the end of the eighteenth century, industrialization began in Britain and cotton production expanded manifold. This created an enormous demand for cloth dyes. The existing supplies of indigo from the West Indies and America collapsed due to various reasons. The indigo production in the world fell by half between 1783 and 1789. This meant that there was increasing demand for Indian indigo.

The Company looked for ways to expand the area under indigo cultivation in India. From the last decades of the eighteenth century, indigo cultivation in Bengal rapidly expanded. Only about 30% of indigo imported to Britain in 1788 was from India. This figure went up to 95% by 1810.

Commercial agents and officials of the Company began investing in indigo production to increase their profit. Many Company officials even left their jobs to look after their indigo business. Many people from Scotland and England came to India and became planters; to grab the opportunity. The Company and banks were giving loans for indigo cultivation at that time.