Hindostan was a prosperous part of Indiana in the 19th century. So why did it die suddenly?

The heartland of the United States is full of improbable place-names, thought up by 19th-century pioneers trying to attract migrants from the crowded cities of the east. The state of Indiana is no exception. Here towns like Wheatland and Santa Claus promise bountiful crops and holiday joy. But perhaps its most unusual, most suggestive name is that of the ghost town of Hindostan.

Founded in 1816, the town of Hindostan sprang into prosperity, becoming a centre of transport and industry. By the standards of what was then a sparsely-populated frontier of white settlement, on land only just conquered by the United States government, Hindostan, with more than a thousand inhabitants at its height in the late 1820s, was a town of considerable size and importance. It seemed to live up to the hopes of its founder Caleb Fellowes, who had intended the name Hindostan to bring good fortune – and to pay tribute to the source of his own fortune in India.

Fellowes was one of hundreds of Americans who became successful traders in India at the hinge of the eighteenth and nineteenth centuries. Like nearly all of these merchants, he came from the state of Massachusetts, then the centre of American enterprise, where for decades businessmen had dreamed of trading with the subcontinent. Before the American Revolution (1775-1783), fashionable shoppers in Boston purchased ever-growing quantities of Indian textiles, which allowed provincial colonial subjects to imagine themselves as sophisticated cosmopolitans.

But the British colonial government prevented its American and Asian subjects from trading directly with each other. This forced Americans to purchase Indian goods from the East India Company, which they greatly resented. Simmering grievances about Indian commerce contributed to the outbreak of the American Revolution in 1775. Indeed, the right to trade with India was one of the most prized concessions that the United States wrested from Britain in 1783, when the new nation achieved independence. Dozens of American merchant vessels soon plied India’s coasts.

Fellowes joined this booming commerce by unusual means. In 1792, all of 21 years old, he took service on a ship bound for China, but disappeared under mysterious circumstances somewhere in the Indian Ocean. He was said to have been thrown overboard by his shipmates, presumably after a quarrel. He resurfaced by some means – in Calcutta – where he began trading under an assumed name.

The East India Company, in theory, opposed the intrusion of American newcomers like Fellowes. Its corrupt officials, however, soon found ways to benefit from their presence. Since the Company forbade its agents from carrying out business on their own behalf, they realised that American merchants could act as frontmen for their illicit deals. Other Americans, however, avoided the British as much as they could, working instead with Indian merchants.

According to rumours that hounded him in later life, Fellowes pursued neither of these strategies. Rather than finding capital and counsel for his business affairs from British or Indian traders, Fellowes, it was said, married a wealthy native widow, using her fortune to start his career. If this was true, he never confirmed it, and indeed said hardly a word about the nature of his activities in India. Whatever the activities were, they made him a wealthy man.

In 1811, after decades of living under false identities, Fellowes suddenly reappeared, and in no modest fashion. He had apparently been acting for some time as a business agent in India for the Chief Justice of the Massachusetts Supreme Court. The magistrate, pulling strings in Congress, arranged for a special act of legislation to help Fellowes move his money and goods from Calcutta to Boston. Fellowes arrived in the United States the following year, to the shock of family members who had long believed him dead. Incredibly, while he had cut off contact with his own relatives, Fellowes had maintained connections to powerful political and business forces back in the US.

The good timing of Fellowes’ departure from Calcutta is no less incredible than his cynical approach to family ties. The years between the end of the American Revolution (1783) and the beginning of the War of 1812 were, as historian Michael Verney describes it, the “golden age of the American Indian Trade”. Exploiting the United States’ status as a neutral party in the Wars of the French Revolution (1792-1815), Americans traded Indian textiles throughout the world, enriching themselves in the process. Merchants from the Boston area were particularly successful, with America’s first millionaire, Elias Hasket Derby, profiting greatly from his country’s new opportunities in India. When the US and Britain went to war in 1812, however, America’s India trade collapsed. Fellowes slipped out of India at the last possible moment, with his fortune intact.

After returning to the US in 1812, Fellowes sought out new business opportunities on the frontier. He joined a group of investors to found a settlement in Indiana. As the group’s wealthiest member, he won the right to name it. His choice of Hindostan seemed to mark the new town with the same aura of success that followed Fellowes himself. But at the height of its growth, as the town surpassed 1,000 inhabitants and became the seat of Martin County, it was struck with a mysterious illness. Hundreds of townspeople died, and the rest fled. The deserted town reverted to forest. Ghost stories, and tales of buried treasure, are still told of Hindostan today. Rumour holds that an official hid the town’s gold underground before succumbing to the plague.

Perhaps it was a fitting end to Hindostan. For nearly two decades, its founder had lived in India like a nameless phantom. Dead to his family back home, working shadowy dealings through false names, he amassed an untraceable fortune. India had made Fellowes a rich man. But his wealth, by whatever fair or foul means it was acquired, could not make Hindostan prosper.