The late 1940s marked the origin of what the journalist and political philosopher Walter Lippmann called, in 1947, the Cold War, denoting the emerging confrontation between the United States and the Soviet Union. The term remained in use as a shorthand description of Soviet-American relations and an explanation of most of American foreign policy until 1989 or 1990. World War II ended in the summer of 1945, and the Korean War began in the summer of 1950. The United States and the Soviet Union spent much of the intervening five years defining their postwar relationship. Each nation pursued its vision of world order, exploring the possibilities of cooperation in achieving its goals, and testing the limits of the other's tolerance in pursuit of unshared goals. Each exploited the extraordinary opportunity to extend its influence in the vacuum created by the defeat of Germany and Japan and the decline of British power.

Military entrepreneurs farmed revenue, engaged in local agricultural trade, and tried to build up holdings of zamindari land in the countryside. From the early eighteenth century the Company had emerged preeminent on India's external routes. In the case of Bengal, Indian mercantile capitalists allied with revenue entrepreneurs and disenchanted soldiers to encourage the expansionist ambition of Company servants. The operation of the new British courts which came into being after 1772, and the greater access to landed income afforded by the early colonial regime, offered them a secure base. The accommodation between British power and indigenous capital a relationship in which Indians were rapidly becoming subordinate was forcefully illustrated in the coastal cities. Indian merchants also took part in the rituals of the European city burgesses, filling several offices in the Madras Corporation which had been founded in 1688. In Surat, the English Company increased its control over its European and Indian rivals after 1730.