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He acted for many years as secretary to the committee of public instruction, and superintended the studies of the Sanskrit College in Calcutta. He was one of the staunchest opponents of the proposal that English should be made the sole medium of instruction in native schools, and became for a time the object of bitter attacks.
In 1832 Oxford University selected Dr. Wilson to be the first occupant of the newly founded Boden chair of Sanskrit: he had placed a column length advertisement in The Times on 6 March 1832 p 3, giving a list of his achievements and intended activities, along with testimonials, including one from a rival candidate, as to his suitability for the post. In 1836 he was appointed librarian to the East India Company. He also taught at the East India Company College. On 10 April 1834 he was elected as a Fellow of the Royal Society of London.
Wilson became deeply interested in the ancient language and literature of India, and was the first person to translate the Rigveda into English. In 1813 he published the Sanskrit text with a free translation in English rhymed verse of Kalidasa's lyrical poem, the Meghaduuta, or Cloud-Messenger.
He prepared the first Sanskrit-English Dictionary (1819) from materials compiled by native scholars, supplemented by his own researches. This work was only superseded by the Sanskritwörterbuch (1853-1876) of Rudolf Roth and Otto von Böhtlingk, who expressed their obligations to Wilson in the preface to their great work.
In 1827 Wilson published Select Specimens of the Theatre of the Hindus, which contained a very full survey of the Indian drama, translations of six complete plays and short accounts of twenty-three others.
His Mackenzie Collection (1828) is a descriptive catalogue of the extensive collection of Oriental, especially South Indian, manuscripts and antiquities made by Colonel Colin Mackenzie, then deposited partly in the India Office, London (now part of the Oriental and India Office Collections of the British Library) and partly at Madras (Chennai).
He also wrote a Historical Sketch of the First Burmese War, with Documents, Political and Geographical (1827),
a Review of the External Commerce of Bengal from 1813 to 1828 (1830),
a translation of Vishnu Purana (1840), and
a History of British India from 1805 to 1835, (1844-1848) in continuation of James Mill's 1818 The History of British India.