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Dhaka became the seat of Naib Nazim (Deputy Governor) and continued to remain the headquarters of the Mughal army and navy in eastern Bengal. Nevertheless, the increase in the industrial actions of the European traders kept the city alive, though without any additional enlargement. After the acquisition of the Diwani in 1765 by the East India Company the decline of the city set in. By 1828 the city was reduced to a mere district headquarters, though retaining its position as a provincial Court of Circuit and Enchantment. The decline of the cotton textile trade within the late 18th and early nineteenth century hastened the process of decline, and by 1840 this decline reached its nadir. Most of the previous Mughal city had both been deserted or had fallen victim to the encroaching jungles.

• Becoming the hub of the nation’s industrial, commercial, cultural, academic and political actions.
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• Increasing air and water pollution emanating from visitors congestion and industrial waste is affecting public health and the quality of life in the city.
• The fort (on the location of current central jail) and Chandnighat, on the river financial institution straight to the south of the fort which are the two areas referred to in the Baharaistan to have grown in his time.
• Dhaka is dealing with serious environmental threats from pollution brought on by the town’s rapid growth, congestion and industrial actions.

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City developments have sparked a widespread construction growth, inflicting new high-rise buildings and skyscrapers to alter the town panorama. Growth has been particularly robust in the finance, banking, manufacturing, telecommunications, and services sectors, whereas tourism, motels, and restaurants continue as necessary elements of the Dhaka economy. The city passed to the management of the British East India Firm in 1765 after the Battle of Plassey.