In 1795 he served with Vice-Admiral Viscount Keith and Major-General Alured Clarke in occupying the Cape Colony from the Dutch Republic where he became governor of the new possession, and remained in that posting until 1797, for which he received the Order of the Bath. In the same year Craig sailed to Madras, and saw combat in the Bengal region of India for which he was again promoted to lieutenant-general in January 1801. Craig returned to England to serve for three years as the commander of the Eastern District.