Empires and nation states tend to be understood as two distinct types of political organization. The former are primarily associated with the premodern world, while the latter have come to be seen as political forms paradigmatic of the modern. While colonialism is a process associated with empires, it is more usually practised by modern nation states in their establishment of overseas empires. These empires are marked by a particular form of political economy—a colonial political economy—which determines the specificity of their political form as distinct from earlier empires. In this article, I examine the Mughal Empire of the premodern period in relation to the subsequent establishment of British colonial rule in India, and discuss the particularities of each in terms of the modes of political economy—moral and colonial—which were characteristic of their administration. In particular, I address the mobilization of the precepts of classical liberalism by the British, as demonstrated in the response of colonial administrators to incidences of dearth and famine, and contrast this with the modes of governance of the preceding Mughal Empire. The differences between them, I suggest, demonstrate that British colonial rule was a structurally distinct, modern type of empire.