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Public Administration in Ancient India c21: Chapter XVIII: Industry and Commerce

Public Administration in Ancient India c21

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English

Chapter XVIII: Industry and Commerce

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AGRICULTURE was in ancient days—as it still is—the most important industry of the people of India. And, naturally, it received encouragement at the hands of the State in a variety of ways. Credit has always been an essential condition of agriculture in India, as in all other agricultural countries, and the practice of granting loans to needy cultivators began from very early times. In the Mahābhārata, Nārada is made to ask Yudhishthira: “Grantest thou with kindness loans unto the tillers, taking only a fourth in excess?”¹

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¹ Sabhā Parva, Sec. V.

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The Agricultural Department of the government served as a sort of information bureau for the cultivators. It was presided over by a Superintendent, whose duty it was to study the conditions of cultivation in the different parts of the country and to introduce improved methods, wherever possible. He collected improved varieties of seeds and distributed them among the agriculturists.¹ He was also expected to possess a knowledge of the science of meteorology so as to be able to make forecasts of weather conditions and of agricultural outlook.² It was under the supervision of this department of the government that uncultivated tracts were brought into cultivation. The Agricultural Department supervised cultivation on State lands and assessed the irrigation rate. It was also responsible for making suitable provision for pasturage.

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¹ Arthaśāstra, Bk. II. ch. 24. In the Mahābhārata, one of Nārada’s questions to Yudhishthira when he enquires into the condition of the kingdom is: “Do not agriculturists in thy kingdom want either seed or food?”

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² Meteorological forecasts used to be made by observing the position and motion of the planets. “Rainfall,” says Chānakya, “is said to be well-distributed, when one-third falls during the first and third months and two-thirds in the second month of the rainy season.” The local distribution of rain was considered normal in different parts of the country when the quantity was as follows: Asmaka (Mahārāshtra),—13½ droṇas; forest tracts,—16; Avantī,—23; more moist parts,—24; and immense quantities on the Bombay coast and in the Himālayan regions. Arthaśāstra, Bk. III. ch. 24.

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Associated with this department was that of dairy-farming. In Kautilya’s time, dairy-farming was undertaken by the State in one of two ways. Either the State farms were directly worked by the government department with the help of herdsmen employed for wages, or they were leased to herdsmen for a share of the produce. Cattle-breeding also engaged the attention of the State.

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Another important activity of the State was that which related to arboriculture. Forests were mostly under government control. The beneficial influence of forests in respect of rainfall and the general economic condition of the country was fully appreciated, and proper steps were taken for the preservation of forests.¹ It was the duty of the forest rangers to see that no damage was done to forests. One reason why forests received such care at the hands of the State was that they yielded considerable incomes to the State in the shape of rents, which were largely augmented by the profits of productive works established in many parts of the forest area.² Proper measures were also taken for the preservation of beasts and birds, and severe penalties were inflicted on persons who were found guilty of violating the game laws.

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¹ Hunters were engaged to guard the forests against robbers and hostile persons. These hunters also sent information to the headquarters regarding the movements of wild tribes by means of carrier pigeons. Vide Arthasāstra. Megasthenes also refers to them when he says: "The same persons have charge also of huntsmen, and are entrusted with the power of rewarding or punishing them according to their deserts. They collect the taxes and superintend the occupations connected with the land, as those of the woodcutters, carpenters, the blacksmiths, and the miners." Fragment XXXIV.

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² The different kinds of things obtained from forests were in Kautilya's time: timber, bamboo, cane, fibrous plants, rope-materials, leaves, flowers, roots, fruits, medicinal herbs, metals, clay, firewood, fodder, and wild animals. Arthasāstra, Bk. II. ch. 17.

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Mining was an industry to which great attention was paid in ancient days. The mines supplied a large part of the wealth of India, and were the chief attractions to foreign merchants. Mining was not confined merely to surface diggings, but followed the lodes of metalliferous ores to considerable depths. It was the duty of the mining department to exploit the resources of existing mines in the most economical manner, and to carry on exploring operations which might lead to the discovery of new mines. The principal kinds of ores obtained from mines were gold, silver, copper, lead, tin, and trapu.¹ Gold was also obtained from rivers. “Gold,” says Curtius, “is carried down by several rivers, whose loitering waters glide with slow and gentle currents.” ² Curtius refers to precious stones and pearls, and remarks: “Nor has anything contributed more to the opulence of the natives, especially since they spread the community of evil to foreign nations.” Pliny, in the latter part of his 37th book, treats of the various kinds of precious stones found in India, and his ninth book is full of details about pearls. In his 15th book, Strabo states that India produced precious stones, carbuncles, and pearls of various kinds. In Ptolemy’s Geography and in the Periplus of the Erythraean Sea, mention is made of the diamond, beryl, onyx, cornelian, hyacinth, and sapphire as precious stones obtained in India. The Arthaśāstra and the Yuktikalpataru give full and detailed descriptions of the various kinds of gems found in India.³

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¹ Arthaśāstra, Bk. II. ch. 12.

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² McCrindle, Ancient India.

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³ Arthaśāstra, Bk. VII. ch. 12. The Sukranīti also describes in detail the various kinds of gems and precious stones. VI. 2, 40, etc.

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Mines were, as a rule, leased to private persons for a certain proportion of the output or for a fixed rent. But such mines as could be worked with small capital and properly managed by a government department were worked direct by the State.¹ Chāṇakya complains that the older teachers paid too much attention to the mines which yielded valuable minerals, to the neglect of the inferior metals, and says that, in his opinion, the latter are quite as important as the former.²

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¹ Arthaśāstra, Bk. II. ch. 12.

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² Arthaśāstra, Bk. VII. ch. 12.

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Associated with mining, but under a separate head, was the department of metallurgy. The treatment and manufacture of metals was centralised and conducted under the supervision of the State. There was a special officer, under the Superintendent, whose duty it was to control the manufacture of articles of jewellery by goldsmiths. Another officer was in charge of the manufacture of the inferior metals.

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The working of the mines, as Mr. Hewitt points out, “required practical mechanical skill as well as the scientific aptitude and perseverance necessary to discover the proper method of treating the ores so as to extract the precious metals.”³ In fact, in metallurgical skill the ancient Hindus attained to a very high state of efficiency. Ample evidence of this is to be found in ancient works of industrial art. With reference to the iron pillar near the Kutb Mīnār of Delhi, which is 24 feet in height and which was perhaps erected in the fifth century A.D., Fergusson says:

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³ Journal of the Royal Asiatic Society, Vol. 18.

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“It opens our eyes to an unsuspected state of affairs to find the Hindus at that age forging a bar of iron larger than any that have been forged even in Europe to a very late date, and not frequently even now.”¹

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¹ Fergusson, Eastern Architecture.

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The manufacture of salt and the brewing of liquors² were industries under the direct control of the State. Both of them were government monopolies. There were many other industrial pursuits which, although undertaken by private enterprise, were supervised by the State. Of these, weaving was perhaps the most important. The State encouraged, by offering rewards, spinning and the associated industries, as well as the weaving of the better kinds of cotton cloths, and the manufacture of woollen and silken garments.³ That there was a great demand for such clothes in early times is proved by the testimony of the Greek writers.⁴ In comparatively modern times, Hiuen Tsiang says: “Their garments are made of kausheya and of cotton. Kausheya is the product of the wild silk-worm. They have garments also of Kshauma which is a sort of hemp; garments also made of kambala which is woven from fine goat-hair; garments also made from karala.”¹ The important reason for controlling the weaving industry seems to have been the necessity for giving employment to widows and partially disabled persons.

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² According to Chāṇakya, it was the duty of the Superintendent of Liquors to prevent such excessive drinking as might lead to the commission of crimes. The intimate relation between alcohol and crime was thus not unknown in ancient times.

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³ Arthaśāstra, Bk. II. ch. 23.

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⁴ Of the dress of Indians in olden times Curtius says: “They cover their persons down to the feet with fine muslin, are shod with sandals, and coil round their heads cloths of linen. They hang precious stones as pendants from their ears, and persons of high social rank or of great wealth deck their wrists and upper arm with bracelets of gold.” Arrian quotes a passage from Nearchos and says that the Indians “wear an undergarment of cotton which reaches below the knee half way down and also an upper garment. They wear shoes made of white leather.” Ancient India (McCrindle).

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¹ Buddhist Records, Bk. II.

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The State also regulated the production of goods by bringing under its control the guilds of producers. There were many such guilds, and according to Prof. Rhys Davids, in the early Buddhist times they included the following:

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(1) Workers in metal who made iron implements, including those of husbandry and war, but they also did finer work, and gold and silver work of great delicacy and beauty; (2) workers in stone, who did rough as well as fine work, e.g. crystal bowl, or stone coffer; (3) weavers, who not only made ordinary clothes, but manufactured muslins and costly and dainty fabrics; (4) ivory-workers, who made articles for ordinary use and also costly ornaments; (5) jewellers, who made beautiful ornaments of various kinds; (6) leather workers; (7) potters; (8) dyers; (9) fishermen; (10) butchers; (11) hunters and trappers; (12) cooks and confectioners; (13) garland makers and flower sellers; (14) sailors; (15) rush-workers and basket-makers; and (16) painters.²

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² Rhys Davids, Buddhist India, pp. 90-95.

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These guilds (śreṇi, pūga) were very useful institutions in olden times, and it was through them that the King summoned the people on important occasions. They settled disputes between members by arbitration, and maintained high standards in production. Their business was conducted in assembly, and their Presidents (Nāyakas, or Mukhyas)¹ occupied high positions in society.

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¹ Inscriptions from Belgaum (1204 A.D), ed. by L. D. Barnett.

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Even more important than the Industry Department was the Commerce Department of the State. The country owed its prosperity largely to trade and commerce; and as these produced large revenues to the State, they received tender care at the hands of the government officials. The chief business of the Superintendent of Commerce was to facilitate the growth of the internal trade as well as of the foreign commerce of the country. And with that view his first duty was to secure the safety and convenience of the mercantile traffic. As different parts of the country produced different sorts of goods, there was an active internal trade, and merchants conveyed their goods either up and down the rivers or right across the country in carts travelling in caravans.² Chānakya discusses the comparative merits and defects of land and water routes. According to older writers, the water routes were regarded as better, being less expensive and troublesome, and consequently productive of larger profits. But Chānakya points out several difficulties of communication by water, namely, that it is liable to obstruction; it is not available in all seasons, and it is more liable to dangers and less easy to defend.¹ Trade routes (baṇik-patha) are divided by Chānakya under four heads, namely, those going north towards the Himālayas; those going south beyond the Vindhya mountains; those going west; and those going east. The northern and the southern routes were both regarded as very important, for the principal products of the north were elephants, horses, fragrant substances, ivory, wool, skins, silver, and gold, while in the south conches, diamonds, gems, pearls, and gold and other metals could be obtained in abundance.² The Buddhist books give us a more detailed description of the trade routes. From these we know that an important route went from Srāvastī to Pratishthāna, the principal stopping places being Māhismatī, Ujjayinī, Vidisā, Kosambī, and Sāketa. Another road ran from the north to the south-east from Srāvastī to Rājagriha, and the stopping places were Setavya, Kapilavastu, Kusinagara, Pāvā, Hastigrāma, Bhāndagrāma, Vaisālī, Pātaliputra, and Nālanda. This road probably went on to Gayā and there met another road from the coast of the Bay of Bengal.¹ The Greek writers speak of a road which went from Pushkalāvatī (Pesketaotis) near Attock through Takshasilā, Bukephala, and crossing the Hyphasis to Pātaliputra. Another road went from Pushkalāvatī to Indraprastha (near modern Delhi) and then to Ujjayinī. These and many other roads connected different parts of the country with one another and with the seaports. The Indian caravans were perhaps met at border-stations by western caravans bound for Persia, Tyre, and Egypt. The northern route crossed the Himālayas and went to Tibet and China.

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² From the Jātaka stories we learn that caravans of five hundred bullock waggons were used by merchants for transporting goods between Benares and Pātaliputra and the sea-coast.

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¹ Arthasāstra, Bk. VII. ch. 2.

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² Ibid.

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¹ Vide Rhys Davids, Buddhist India, p. 104.

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The main waterways were the Indus and its tributaries in the Punjab, the Jumna and Ganges with their tributaries and branches in Middle India, and the Brahmaputra in the east. The rivers of the Deccan and South India were also useful to some extent as waterways. Besides these natural water routes, the navigation canals probably afforded some facilities of communication in certain parts of the country.

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The government, however, did not confine their attention to inland navigation, for we know that merchants sailed along the coasts, and even made ocean voyages to Persia, Arabia, Egypt, Burma, the islands of the Indian and Pacific oceans, and China. Foreign commerce perhaps began before the advent of the Āryans in India. It is believed that a large maritime trade was carried on between India and the Accadian-Semitic Empire of Assyria. Many centuries later, Solomon (in the tenth century B.C.) and his ally Hiram used to send every three years ships of Tarshish to India, and these ships used to take back Indian produce. In the Rig-Veda, there are several references to sea-voyages undertaken by men “eager for gain.”¹ The Baudhāyana Dharma-sūtra also mentions maritime navigation (samudra-samyāna) and taxes levied on maritime commerce (samudra-śulka).² At the time of Alexander’s invasion, Indians were expert sailors, and it was Indian pilots who guided Alexander’s vessels.³ The author of the Periplus says: “Native fishermen appointed by Government are stationed with well-manned long boats called trappaga and kotumba at the entrance of the river whence they go out as far as Surastrene to meet ships, and pilot them to Barygaza. At the head of the gulf, the pilot immediately on taking charge of a ship, with the help of his own boat’s crew, shifts her clear of the shoals, and tows her from one fixed station to another.”⁴

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¹ Rig-Veda, I. 48, 3, and I. 116, 5. Cf. Atharva-Veda, V. 19, 8, where the ruin of a kingdom in which Brāhmanas are oppressed is compared to the sinking of a ship which is leaking.

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² I, 1, 20; II. 1, 41; I. 10, 13.

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³ Arrian (McCrindle), p. 163.

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⁴ Periplus of the Erythraean Sea.

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For the safety and convenience of sea-going vessels, harbours were constructed by the governments at suitable places. The seaports on the coast of the Arabian Sea attained to positions of considerable importance and renown. Bharukachha (Sans. Bhr̥igu-kshetra, Gr. Barygaza, modern Broach) was the greatest seat of commerce in Western India. Three other important ports were Patala and Barbarikon, near the mouth of the Indus, and Surashtra (modern Surat) at the mouth of the Tapti. Ujjayanī is mentioned in the Periplus as an inland port. From this town were "brought down to Barygaza every commodity for the supply of the country and for export to our own (i.e. Greek) markets onyx-stones, porcelain, fine muslins, mallow-coloured muslins, and no small quantity of ordinary cottons."¹ The two great seats of commerce in the interior of the Deccan (Dakshināpatha)² were Pratishthāna (Paithāna) and Tagara-pura (Tangara, identified with Tair, now a small village). The seaports on the Malabar coast were Nelkunda and Mouziris (Murjari). The latter was a city "at the height of prosperity, frequented by ships from Ariake and Greek ships from Egypt." The coast of the Bay of Bengal, on account of the usual roughness of the sea, did not offer much facility for the construction of harbours and the growth of seaports, but there were two towns of considerable importance on this coast, namely, Mansala (Masalia, modern Masalipatam) in the Madras Presidency and Gange near the mouth of the Ganges.¹ At the time of Fa Hian’s visit,² Tāmraliptī ³ in Bengal was a very important seaport, and had an extensive traffic with South India and Ceylon. The prosperity of Tāmraliptī was great in Hiuen Tsiang’s time. “Wonderful articles of value,” says the Chinese traveller, “and gems are collected here in abundance, and, therefore, the people of the country are in general very rich.” ⁴

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¹ Periplus of the Erythraean Sea, p. 122.

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² The other inland ports mentioned in the Periplus are Naoura (Onore) and Tundis (Tundi).

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¹ Periplus, p. 132.

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² We also read of ‘Thīna’ as an important port in Burma.

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³ It was from this port that Fa Hian sailed for Ceylon. The vessel in which he went carried 200 men, and astern of this great ship was a smaller one.

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⁴ Beal, Buddhist Records. I-Tsing also mentions it as a flourishing port.

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The principal exports from India were: topazes, sapphires, silk, fine linen, muslin, silk thread, indigo, coloured cloths, cotton, rice, oil, cattle, clarified butter, and soapstone. Besides these, Pliny speaks of the large quantities of gold and silver which were taken from the mines on the other side of Mons Capitolia (Mount Ābū), and he estimates the capital expended every year in the purchase of Indian goods at fifty million sesterces (a sum equal to about £500,000) and says that twenty ships passed yearly out of the Red Sea to India.⁵ The chief imports were Italian, Laodicean and Arabian wines, brass, tin, cloths of various kinds, slaves, cloves, honey, coarse glass, red sulphuret of antimony, and gold and silver coins.¹ From China, India imported certain kinds of woollen and silk fabrics.²

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⁵ Pliny, Hist. Nat. VI. 23.

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¹ Periplus of the Erythraean Sea.

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² Arthaśāstra, Bk. II. ch. 11.

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As large numbers of boats were required for the transportation of goods, the construction of vessels became a very important industry, and this was undertaken either by, or under the auspices of, the State.³ Ships and boats (nau) are mentioned in the Rig-Veda and the Atharva-Veda. The ships with which Alexander was supplied on his return from India numbered eighty thirty-oared galleys, but the whole fleet did not fall much short of two thousand. The author of the Periplus says: "The ships which frequent these parts are of a large size, on account of the great amount and bulkiness of the pepper and betel of which their lading consists."⁴ Chānakya speaks of various sorts of boats, and Bhoja in the Yukti-kalpataru, mentions twenty-four different kinds.

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³ Vide Arthaśāstra, Bk. II. ch. 16.

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⁴ Periplus of the Erythraean Sea, p. 136.

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The Commerce Department of the State, besides keeping the means of communication open and safe, and collecting the trade dues, performed other important duties. It encouraged the importation of foreign merchandise by a remission of taxes in proper cases, and it not only protected the foreign merchants but secured to them certain special privileges.⁵ Megasthenes says: "Among the Indians, officers are appointed even for foreigners, whose duty is to see that no foreigner is wronged.”¹ The Superintendent of this department facilitated the exportation of goods not required for home consumption. He acquainted himself with the values of goods in different countries, and encouraged the production of such goods as might be profitably exchanged for foreign goods. He also furnished the merchants with information relating to such matters as conveyance charges, expenses on the road to any foreign country, the dangers of the journey, the history of towns, and the trade customs of different places.² Sometimes, merchants formed combinations amongst themselves for the purpose of raising prices to an excessive extent.³ In such cases, it was the duty of the Superintendent to fix the prices of commodities. According to Chānakya, prices were to be fixed after determining the amount of capital outlay and the total cost of production, including such charges as the payment of tolls, road-dues and other taxes, the cost of labour, and the expenses of conveyance. When the prices were fixed by the government, a profit of five per cent. on local goods and of ten per cent. on imported commodities was allowed.¹ In case of an over-supply of goods, it was the duty of the Superintendent to control the production until the stock was exhausted. Balances, weights and measures were manufactured and sold by government, and any person using false weights, measures or balances was severely punished. The State also took steps for preventing the adulteration of goods, especially of food articles.²

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⁵ Arthaśāstra, Bk. II. ch. 16.

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¹ Fragment I. Megasthenes adds : “Should any of them lose his health, they send physicians to attend him, and take care of him otherwise, and if he dies, they bury him, and deliver over such property as he leaves to his relatives. The Judges also decide cases in which foreigners are concerned with the greatest care, and come down sharply on those who take unfair advantage of them.”

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² Ibid.

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³ Chānakya says : “The more greedy among the merchants often oppress the people by forming combines and making profits of cent. per cent. (paṇe paṇaśatam).” The Nitivākyāmṛita says : “Merchants left to themselves charge high prices for their goods, and, therefore, the King should regulate prices.” Ch. VIII.

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¹ Arthaśāstra, Bk. IV. ch. 2.

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² Arthaśāstra, Bk. IV. ch. 2.

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Transactions were carried on, and values estimated, in terms of coins of various substances and denominations. Gold coins were perhaps rarely used, silver and copper coins forming the bulk of the medium of exchange.³ The silver karsha and the copper karshāpaṇa were the coins mostly used.⁴ Originally, it seems, the coins were guaranteed as to weight and fineness by punch marks which were tokens of merchants, or of guilds, or of the bullion-makers; but later on, coins were struck chiefly by royal authority. In Chānakya’s time, gold and silver coins were issued in abundance from the royal mints.⁵

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³ Many of the Smriti works mention gold coins.

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⁴ The silver coins were paṇa, ½-paṇa, ¼-paṇa, and ⅛-paṇa, in Chānakya’s time. Arthaśāstra, Bk. II. ch. 12.

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⁵ Some of the Smriti works refer to the Karshāpaṇa as a silver coin, while others regard it as a copper coin. The Sukranīti refers to silver Karshas. In Prof. Rhys Davids’ opinion, the Kahāpaṇa was a copper coin in early

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There was also a considerable use of instruments of credit, and promissory notes were not unknown.¹ We are not exactly aware what banking facilities there were in the country, but we know that loans were frequently given.² Gautama, one of the early law-givers, mentions the practice of lending money at interest (kusīda).³ Brihaspati mentions six different kinds of interest, viz. Kāyika (bodily), Kālika (periodical), Chakra-vṛddhi (compound interest), Kārita (stipulated interest), Śikhāvṛddhi (hair-increase), and bhogalābha (interest by enjoyment).⁴ This lending of money at interest was permitted only to Vaisyas. Usury, however, was strongly condemned. Bodhāyana quotes the following verse in condemnation of usury: "Weighed in the scales the crime of killing a learned Brāhmana against (the crime) of usury; the slayer of the Brāhmana remained at the top, the usurer (vārdhushi) sank downwards."⁵ Almost all the law-books, therefore, insist on a limitation of the rate of interest. According to Gautama and Vasistha the legal rate of interest is 1¼ per cent. per month, or 15 per cent.

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¹ Arthasāstra, Bk. II. chs. 12-14.

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² Prof. Rhys Davids says: "The great merchants in the few large towns gave letters of credit on one another." Buddhist India, p. 101.

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³ Gautama, X. 6.

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⁴ Brihaspati, XI. 55.

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⁵ Bodhāyana, I. 5, 10, 23. This verse is also quoted by Vasistha, II. 42.

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Buddhist times. He says: "Though the Kahāpana would be worth, at the present value of copper, only five-sixths of a penny, its purchasing power then was about equal to the purchasing power of a shilling now." Buddhist India, p. 101.

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per annum. Manu and Chānakya also regard this as the proper rate. Where, however, no security was given, or in cases where no periodical interest was taken, or the loan was returned in kind, higher rates of interest might be demanded. According to some law-givers, the interest demanded from the members of the higher castes was to be less than from those of the lower. On this point Vasishtha quotes the following verse: "Two in the hundred, three, four and five, as has been declared in the Smriti, he may take as interest by the month according to the order of the castes."¹ Some of the law-books also lay it down that interest should cease after a time, and that no debtor should ever be compelled to pay more than double the amount of capital in case of gold and three times in the case of grain.² The fact that usury was strongly condemned must have made the lending of money at interest rather unusual, and it was perhaps this circumstance which prompted Megasthenes to say: "The Indians neither put out money at usury, nor know how to borrow. It is contrary to established usage for an Indian either to do or to suffer a wrong, and therefore, they neither make contracts nor require securities."³

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¹ Vasishtha, II. 48.

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² Vasishtha, II. 44.

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³ Megasthenes, Fragment XXVII.

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