On November 1, 1858, Queen Victoria's proclamation was read at the Grand Durbar held in Allahabad. The Queen assumed the Government of India with Calcutta as the Royal Capital. The capital indeed was befitting royalty at that time. As a contemporary noted, Calcutta's buildings were "all white, their roofs invariably flat, surrounded by light colonnades, and their fronts relieved by lofty columns supporting deep verandahs. Calcutta's growth was on, too. In spite of the turmoil due to the War of Independence, the University of Calcutta was established in 1857. The new municipal corporation completed the public sewerage system in 1859, and the filtered water distribution network in 1860. The prosperity of Calcutta invited more immigrants, mainly Armenians from Iran, Jews from Afghanistan and Iraq, Chinese and Europeans, besides people from all parts of India. Everybody came because of the excellent law and order situation or to escape persecution. Calcutta, the last word in colonialism, was curiously enough, becoming a citadel of freedom simultaneously.

Calcutta's reputation as a trading center began to wane at about this time. The indigo and saltpeter markets collapsed worldwide. China's anti-opium movement was gaining ground thus choking Calcutta's opium exports. In 1869, the opening of the Suez Canal made Bombay the closest port to Europe and robbing Calcutta of some of its share of the Indo-European trade. The business houses on Clive Street were however, not slow to react. Overnight, companies like Martin Burn, Andrew Yule, Williamson Magor and others moved into a new area of business. Tea had been cultivated in Assam and Darjeeling for a few years now, and had been found to be superior to the varieties from China. Overnight, caskets of tea began to be auctioned on Brabourne Road and began making their way to the teapots of tea lovers around the world. Not much has changed since then. The auctions on Brabourne Road continue to this day at the Tea Board Office, and is indeed a sight every morning. The same companies also diversified into the other development industries, like metal casting and construction, a reputation that has survived to this day. This was the time when Calcutta changed from a trading port to a manufacturing base.

The 1870s was an important decade for Calcutta. The growth of public services was remarkable. Horse-drawn tramcars arrived on the streets of Calcutta in 1873, and a spanking new shopping mall, Stuart Hogg Market, threw open its doors in 1874. Stuart Hogg Market was well stocked with stuff rarely found in Asian markets. The first two hotels in Asia had come up in Calcutta several decades ago. They were the Spence's Hotel, opened in 1830 and now closed, and the Great Eastern Hotel, opened in 1841, now derelict and awaiting restoration. Both hotels now grew up into one of the finest in the world. The political awakening of the region also began at the same time. In 1876, Sir Surendranath Banerjea founded the Indian Association, the first political movement in Asia. The Indian Association House stands to this day at the junction of Bowbazar Street and Central Avenue. In 1877, another Grand Durbar was held, this time in Delhi, the old capital of the erstwhile Mogul Empire. Queen Victoria assumed the title of Empress of India and Calcutta became the Imperial Capital.

Calcutta's growth as a major railway junction continued. The East India Railway ran from Howrah all the way to the outskirts of Delhi in the North. The Bengal Nagpur Railway ran from Howrah to Nagpur in Central India, from where the Great Indian Peninsula Railway continued to Bombay. The East Bengal Railway's line ran from Sealdah, then in the outskirts of Calcutta to the tea gardens of Assam and Northern Bengal. The Grand Trunk Road was built to replace the road built by Sultan Sher Shah Suri of Delhi in the sixteenth century, and now ran from Howrah to Peshawar in the Hindukush mountains. As it had been true for Rome in an earlier age, all roads now led to Calcutta. In 1886, a pontoon bridge was built to link Calcutta and Howrah without disrupting the river traffic. Gaslights had been in Calcutta for a while only to be replaced with electric lighting in 1899. In the 1890s, the largest telecommunications project ever undertaken in the world bridged the two most important cities of the world's greatest power. Siemens laid the first cable between Calcutta and London. Calcutta had arrived as the second City of the British Empire. In 1919, the construction of the Victoria Memorial was completed and soon became the jewel in Calcutta's crown.

Even while Calcutta grew as a city, not all was going well with its administration. While the citizens of Calcutta had not participated in the feudal uprising of 1857, their easier access to the world had fueled ideas of liberty and nationalism. The British ruling class was fully aware of such aspirations, and Lord Curzon, then Viceroy, promoted the idea of a participation of the Bengal Presidency, creating two provinces, each of which would have the local Bengalis as a minority. Such a partition received Royal Assent from King Edward the Seventh on October 16, 1905. Instead of eliminating political dissent, the partition inflamed nationalistic feelings and triggered a wave of terrorism with British officials as targets. The terror culminated in an attack on Writers' Building itself.

In 1911, King George the Fifth at his Coronation Durbar in Delhi announced that the partition of Bengal had been rescinded. However, the same announcement also included the transfer of the Imperial Capital to a city to be built near Delhi. The reason cited was that Delhi was the traditional seat of all emperors that had ruled India, and should be the same for the House of Windsor, too, but the actual reason was that the British no longer considered it safe to maintain political power in Calcutta. The Independence Movement nevertheless, gained ground in Bengal and soon spread all over India. Calcutta's leaders, however, belonged to two classes. One that advocated home rule on the lines of Australia and Canada and the other that believed in terrorism to drive the British from India. Both groups refused to be drawn along communal lines. By the 1930s, other leaders from northern and central India, who stressed on communal values and non-cooperation, had marginalized both groups.

The Independence Movement not withstanding, Calcutta's economic growth continued. The outbreak of the First World War had little impact on Calcutta, in spite of the German cruiser Emden rampaging the Bay of Bengal and blocking tea exports. Calcutta, about 50 miles upstream was beyond the reach of Emden's guns and Calcutta was spared the shelling that Madras and Penang had to undergo. At about this time, Indian entrepreneurs broke into the monopoly of the British and hundreds of jute and cotton mills appeared on both sides of the Ganges. This was also the time when a large community from the Marwar region in Western India arrived and began to take over the businesses of traditional Bengali business families. The best known such family, the Birlas, established a jute mill in 1918, and began manufacturing Morris motor cars in 1942 at their Hindusthan Motor Works.

The Golden Thirties was indeed the golden age of Calcutta. The city knew no shortages. The streets glowed in its electric lights. Trams and motor buses plied the streets and motor cars were beginning to outnumber horse-drawn coaches. Theater, cinema and fine dining defined Calcutta's social life. Great Eastern, Spence's and the newer Grand and Continental were the finest hotels in the continent. The shops of New Market and stores like the Army & Navy and Whiteway, Laidlaw & Co. did brisk business, and Peletti's, Firpo and Maxim's served the finest in French and Italian foods on their tables. Trains linked Calcutta to all over the Indian Empire and ships of all nations called at its docks. Even the nascent air travel industry could not ignore Calcutta. Imperial Airways' service linked Calcutta to London, while Calcutta was an important stop on the Paris to Saigon and Amsterdam to Batavia services. The euphoria over Asia's first Nobel Laureate had just been replaced by one for a Calcutta University professor becoming the second, even as another scientist was helping the greatest scientist of the twentieth century, Albert Einstein, unfurl the secrets of science, sitting in its laboratory. Calcutta's hospitals and medical colleges were producing vaccines for deadly tropical diseases. Indeed the din of success rendered the occasional explosion of terrorist bombs and the sounds of demonstration, out of hearing. Chinese chefs and craftsmen arrived in Calcutta at about this time to escape Japanese invasion or communist persecution. Calcutta welcomed everybody, to her own advantage.

The 1940s brought gloom to Calcutta as with the rest of the world. As trade collapsed and all energies were channeled into the war effort, Calcutta watched as the Japanese army overran nation after helpless nation until it stood at the Eastern borders of India. For the first time since Clive and Watson restored the Union Jack on Fort William, Calcutta was under direct threat of invasion. The invasion came this time from the air. Calcutta's dockyards and several residential areas were bombed, though the damage was very little. Fear, however, set in and several citizens began to depart the city, even while refugees from Burma and other areas actually overrun by the Japanese began arriving by the millions on the streets of Calcutta. And as if its woes were no less, the parallel agitation for a Moslem homeland in India began to gain ground. Fueled by the British policy of divide and rule, India burned both under the impact of the Independence Movement and communal riots. Nowhere, were they more severe than in Calcutta, in spite of its great tradition in secularism. Calcutta's contribution to the war effort is tremendous though very often forgotten. In 1943, Bengal chose to take upon itself the greatest man-made famine ever, in order to feed the besieged Allied forces in China. For months the starving masses of humankind watched as supplies were flown over the Himalayas. The famine resulting from the biggest airlift in history until then left millions dead.

The Second World War ended with little doubts that the British would leave. The biggest issue left however was that of the imminent partition of India into Hindu and Moslem states. As the issue of partition was being debated in London and New Delhi, the Great Calcutta Killings of August 1946 commenced. The fight between the Indian National Congress and the Muslim League claimed thousands of lives. The Indian Empire was partitioned on August 14, 1947 creating the two states of India and Pakistan.

Calcutta's glory as the second city of the British Empire ended with the lowering of the Union Jack from the mast atop Fort William on August 15, 1947. The departure of her creators deprived Calcutta of her special status, and partisan treatment by the succeeding rulers and the apathy of her own people led to her rapid decline. However, true to her spirit, she continues to live and prosper even amongst her seeming dereliction.