<P> Early in 1608 Alexander Sharpeigh was appointed captain of the company's Ascension, and general or commander of the fourth voyage . Thereafter two ships, Ascension and Union (captained by Richard Rowles) sailed from Woolwich on 14 March 1607--08 . </P> <P> Initially, the company struggled in the spice trade because of the competition from the already well - established Dutch East India Company . The company opened a factory in Bantam on the first voyage, and imports of pepper from Java were an important part of the company's trade for twenty years . The factory in Bantam was closed in 1683 . During this time ships belonging to the company arriving in India docked at Surat, which was established as a trade transit point in 1608 . </P> <P> In the next two years, the company established its first factory in south India in the town of Machilipatnam on the Coromandel Coast of the Bay of Bengal . The high profits reported by the company after landing in India initially prompted King James I to grant subsidiary licences to other trading companies in England . But in 1609 he renewed the charter given to the company for an indefinite period, including a clause that specified that the charter would cease to be in force if the trade turned unprofitable for three consecutive years . </P> <P> English traders frequently engaged in hostilities with their Dutch and Portuguese counterparts in the Indian Ocean . The company achieved a major victory over the Portuguese in the Battle of Swally in 1612, at Suvali in Surat . The company decided to explore the feasibility of gaining a territorial foothold in mainland India, with official sanction from both Britain and the Mughal Empire, and requested that the Crown launch a diplomatic mission . </P>

Where did the east india company set up its first factory in india