Trade and Commerce in Ancient India

During ancient times Hindus were the masters of the seaborne trade of Europe, Asia and Africa. Till about the beginning of the 18th century almost every nation on earth obtained to a large extent its supplies of fine cotton and silk fabric, spices, indigo, sugar, drugs, precious stones and many curious works of art from India in exchange of gold and silver. This traditional prosperity of India began to vanish only at the dawn of the Industrial Revolution in the west.

In industrial production ancient India was far ahead in comparison with other countries of those times. According to Prof. Weber the skill of the Indians in the production of delicate woven fabrics, in the mixing of colours, the working of metals and precious stones, the preparation of essences and in all manner of technical art, has from early times enjoyed a world-wide celebrity. For instance surgical instruments of great delicacy and accuracy were manufactured in India and it was from Indians that the art of tempering steel was learnt by other people. Factors favouring India to emerge as the number one country in trade, commerce and manufacturing activities were-

  • The Hindu mercantile community was very enterprising and known for their entrepreneurship, trustworthiness and resilience.
  • Indian goods were known for its excellence. The skilled artisans of India manufactured varieties of goods which people in other parts of the world could not find elsewhere.
  • In the art of building ocean going huge ships ancient Hindus were far ahead of others. With the knowledge of sea routes, monsoon winds and other navigational aspects they were able to sail to distant corners of the earth with their goods.
  • Fairs were an important means for commercial activities and were held in every part of the country. Huge number of people assembled at these fairs for the purpose of exchanging merchandise as well as discussing religious and national topic.
  • The peace and prosperity that prevailed in the country gave a great impetus to inter-provincial and inter-state trade.


To facilitate trade and commerce royal roads were constructed all over the country from east to west and from north to south. These roads were provided with mile stones and planted with trees. The river Ganga and its tributary were used for carrying goods. During the Mauryan times the Great Royal Highway more than 1600 kilometers in length connected the capital Patliputra with Taxila and the North-West Frontier. Another long road of great commercial importance ran through Kasi and Ujjain and linked the capital with the great sea-ports of Western India. Yet another road linked the capital with the port of Tamralipti. It was through this principal port in Bengal that India carried extensive trade with China, Ceylon, Java and Sumatra. Some of the important towns of trade were Arikamedu, Kaveripattanam, Madurai, Cranganore, Nagapattanam, Mahabalipuram, Calicut, Cochin, Mangalore, Tamralipti, Pataliputra, Vidisha, Ujjaini, Kausambi, Mathura, Taxila, Aihole, Paithan, Surat, Lothal, Sopara, Broach, Kalyan, etc.

Currency in Vogue

During the early period (Vedic age) the currency in circulation was a gold coin called Nishka. Its weight was 32 ratis, i.e. one third of a tola. Later we have reference to another gold coin, Suvarna equal to 80 ratis. There was also a silver Purana of 32 ratis. Karshapana mentioned by Panini was the name of a coin which was minted in gold, silver and copper and weighed 80 ratis. During the Mauryan period we come across punch marked coins. These coins were small pieces of flat silver and copper which were punched with symbols. The superintendent of the mint was known as Laksanadhyaksha and an officer known as Rupadarsaka used to check the coins so minted for purity and weight. In South India we come across gold coins like Varaha circulated during the Badami Chalukyan period, Kasu circulated during the Chola rule and Pagoda of the Vijayanagar period. The weights of the coins were based on the system laid down in Manu Samhita and its unit was the rati or gunja berry weighing approximately 1.83 grains or .118 grams.

Trade during the Vedic times

The Rig-Veda contains several references to sea voyages undertaken for commercial and other purposes. God Varuna is credited with the knowledge of sea routes followed by ships. Later when urban culture flourished in cities like Harappa and Mohenjodaro, India had established trade and commercial relations with Sumer, Egypt and Crete. Lothal in Gujarat was one of the biggest port towns of that period with a huge dockyard constructed out of brick. In the Old Testaments, we have reference to trade between India and Syrian coast dating back to 1400 B.C. According to the chronicles of the Jews, during the reign of King Solomon (c.800.B.C.), a navy equipped by Hiram, King of Tyre, undertook a triennial voyage to the eastern countries and brought back with it gold, silver, ivory, apes, peacocks, Almug trees, jewels and precious stones. Ophir was the port at which they loaded these goods in the ships and this Ophir have been identified with the port Abhir or Sopara on the western coast of India by scholars.

From 1st century A.D. commodities greatly in demand in Roman world from India were spices and perfumes, precious stones such beryl and silks, muslins and cotton. All these commodities were paid for in gold and silver by the Roman traders. Pliny in 77 A.D. lamented the wasteful expenditure on perfumes and personal ornaments which drained the Roman Empire, hundred million Sesterce a year. From Rome came gold, wine and perhaps Roman soldiers and women whose services were needed in the courts of South Indian kings. Indian items were sold 100 times their original price. After the accession of Augustus four embassies from India visited him. Roman coins of Augustus and Tiberius era are found in the Hazara district of Punjab and Coimbatore and Madura district of Tamilnadu. To guide ships to ports lighthouses were built. One such light house existed at the mouth of river Kaveri, built either of brick and mortar or a big Palmyra trunk carrying on the top of it a huge oil lamp.

During the Mauryan age

During the Mauryan reign manufacturing activity was abuzz and Greek writers refer to the manufacture of chariots, wagons, arms and agricultural implements and building of ships. Strabo mentions richly embroidered dresses in gold duly adorned with precious stones and also flowered robes made of fine muslin. The fact that one committee of the municipal board of Patliputra was entrusted with the supervision of manufactured articles in the metropolis indicates the existence of good manufacturing industries in the Mauryan period.

There were considerable number of foreign residents in Patliputra and they were in all probability were traders. Sweet fine wines, pigments, glass-vessels, costly vessels of silver, singing boys and beautiful maidens for the harem and choicest ointment were some of the articles imported in India while India exported fine silks, muslin, spices, perfumes, medicinal herbs, indigo, sandalwood, pearls, ivory, iron, steel, etc.

Gupta and later period

While the Mauryans carried on their trade mainly with the east through the Kalinga ports, the Guptas not only increased their eastern trade effectively but opened up the western sea-borne trade and this led to unprecedented economic prosperity. In Bengal, Tamralipti was the principal port, while in Tamilnadu, Kaveripattanam and Tondai were the principal ports. In the Malbar coast Kottayam and Muziris (modern Crangnore) were the main ports through which brisk trade was carried with the Eastern Archipelago and China. The acquisition of the maritime province of Saurashtra by Chandragupta II opened up the western trade and the wealth of the Roman Empire began to pour in India through the ports of western coast like Broach, Sopara, Cambay and Kalyan. The Arabs used to visit the west coast to purchase goods like teak, drugs, perfumes, shoes, black salt, spices, indigo, textiles, muslin, etc., and Indian commodities were very popular in Arabian countries. Many of these Arabs settled in the west coast and the Hindu rulers allowed them to practice their religion and even proselytize. Ships from China, Sindh and the Persian Gulf used to anchor at Broach and merchandise from every country was found there and was sent from there to other countries.

In the 15th century Calicut became one of the busiest ports in the west coast and merchants from South Africa, Abyssinia, and Arabia brought their merchandise to this port for distribution in India. Many ships from Pegu and Malacca on their way to Red Sea halted at Calicut and carried Indian goods for distribution to various directions. The Arabs who till then had monopolized India’s overseas trade had to make way for the Portuguese. Some of the items exported were cloths, rice, iron, saltpeter, sugar and spices while pearls, copper, coral, mercury, vermilion, elephants and horses were imported.

The Trading Class

The traditional trading class in India was the Vaisyas. Later we find this profession being followed by Parsis, Banias and Marwaris in Bombay Presidency, the Lingayaths in Karnataka region, Chettis and Komatis in the Madras Presidency, Khatris in Punjab and Marwaris in Bengal and Assam. The Vaisya community was the richest being of the business class and was represented in district councils. This class contributed much to the cultural progress of the country. Some of them excavated caves and build temples while others were well versed in folklore and astrology.

Merchant and Artisan Guilds

Merchants and traders were organized into guilds and were called Nigamas, Sresthi-Vanijas and Sarthavahas by Kalidasa. Katyayana and Narada (law giver) refers to guilds like gana, pasanda, puga, vrata, sreni and nigama. Panini defines Sreni as an assembly of persons following a common craft or trade. Sreni was the general term used for both merchant and artisan guilds and the specific term for a merchant guild was Nigama. Those who controlled the financing of trade on individual as well as partnership basis were known as Sresthin. Manu and predecessors depict guilds as part and parcel of a wider body called Samuha or Varga which functioned according to its established rules. According to Yajnavalka, the business of the group was managed by elected advisers. The group was entrusted with judicial duties also in addition to their executive work. According to Katyayana there were four grades of partnership for sharing the profit of the guild and they were Sikshaka (apprentice), Abhijna (advanced student), Kusala (expert) and Acharya (teacher). Guilds were autonomous bodies having their own rules, regulations and bye-laws, which were usually accepted and respected by the state. Many of these guilds were immensely prosperous. For instance the ivory workers of Vidisa in the 1st century A.D. were in a position to offer one of the four monumental porticoes of the great stupa at Sanchi. The Mandasor inscription reveals that the guild of silk weavers at Dasapura built a Sun temple in the city in A.D. 436. In course of time the temple fell into ruins and was repaired by the same guild in 472 A.D.

Salient features of Merchant Guilds

Merchant guilds arose as a front to resist depredation by highway robbers on merchants who used to traverse long distance with their goods through insecure roads. Over a period of time these guilds extended their activities and acted as banks; giving loans to fellow members and interest to the public who used to deposit money with them and also involved in philanthropist activities. Considering their growing importance the State invested powers of making laws for themselves (guild members) and its leader to represent his class in the royal court.

Every guild possessed a special seal (namamudra) made of bronze, copper, ivory or stone and possessed a banner and ceremonial flywhisks which were carried in procession during festivals. These were sometimes conferred on them by royal charters. Guild masters were nominated either by hereditary succession or by election and were known as Jyesthaka (elder), Sresthin (best) and Mahattama (most important). He took part in popular assemblies convened by the king and also in regional councils and was assisted by a secretary (Kayastha).

The guild master acted as a magistrate to arbitrate a case or expel refractory or disloyal member. He was also the head of the militia which every guild maintained to assure its own security. During wartime the militias of all guilds were incorporated into the royal army.

At Basarh the ancient Vaisali which was a seat of provincial government under the Guptas, 274 sealing were found of a joint guild of bankers, traders and transport merchants having its membership spread over a large number of towns and cities in north India. This guild had a great reputation and status; for it often entered into transactions jointly with the office of the heir apparent of the great Gupta Empire.

Salient features of Artisan Guilds

On the basis of various epigraphical sources and the Jatakas a comprehensive list of 24 occupations in which guild organization existed has been given. There are references about the guilds of weavers, braziers, oil-millers, bamboo-workers, druggists, potters, corn-dealers and of artisans fabricating hydraulic engines. These guilds were self-governing corporations. These guilds brought members of the same profession or craft together, regulated their business on mutual goodwill and served as banks giving loans and receiving deposits on interest. The rate of interest varied from two to twelve percent per annum. These guilds regulated productions, fixed prices and wages and prevented unhealthy competitions. They also trained apprentices.

Trade and Commerce in South India

From the earliest times, the products of Tamilnadu appear to have attracted the merchants of distant lands. The names Kapim and Tukim as found in the Hebrew Bible for apes and peacocks are the same as those still used in Tamil, i.e. Kavi and Thokai. The Greek names for rice (oryza), ginger (zingiber) and cinnamon (karpion) are almost identical with their Tamil names airis, inchiver and karuva all which clearly indicate that Greek merchants conveyed these articles and their names to Europe from Tamilnadu. The western merchants who visited the Tamil land were known as Yavanas. In ancient Tamil poems the name Yavana appears to have been applied exclusively to the Greek and Romans. The Yavanas alluded to by these poets were undoubtedly the Egyptian Greeks because as stated in Periplus it was the Greek merchants from Egypt who brought wine, brass, lead, glass, etc. for sale to Muziris and Vaikkarai and purchased from these ports pepper, betel, ivory, pearls and fine muslin. The Greeks sailed from Egypt in the month of July and arrived at Muziri in about 40 days. They stayed on the Malabar Coast for about three months and commenced their return journey from Muziri in December or January. As the Indian seas were infested by pirates, the Greek merchants brought with them cohorts of archers on board their ships. Egypt being at this period subject to Rome, the archers who accompanied the Greek merchants must have been Roman soldiers. The Pandyan kings sent embassies to Rome and had employed Roman soldiers as guards. There was a colony of Yavana merchants at Kaveripattanam. That Roman gold poured largely into Tamil country at this period is attested by the numerous Roman coins dating from the reign of Augustus to that of Zeno (B.C. 27 to A.D. 491) which have been found buried in different parts of Tamilnadu.

The Cholas who came to power in 10th century A.D. gave tremendous impetus to foreign trade. The merchant guilds like Manigramam, Nanadesis and Ainnurruvar participated in the sea-borne trade which extended up to the Persian Gulf in the west and Indonesia and China in the east. The Chola rulers sent trading missions to China. Indian products like cotton fabrics, spices, drugs, jewels, ivory, rhinoceros horn, precious stones and aromatic products were in great demand in China and its import caused considerable drainage of Chinese currency. During the rule of Vijayanagar the ports on the east and west coast were humming with trade. Spices, iron ore, coconuts, areca, jiggery, diamonds, limestone, rice and textiles were exported on a large scale. Horses from Persia, armaments from Europe and other goods like copper, coral, mercury and saltpetre were imported. Marco Polo remarks that the greater part of revenue of the kingdoms in India is employed in obtaining horses from foreign countries and every vessel visiting the Deccan and Gujarat ports invariably carried horses in addition to other cargo. The Italian traveller Nicolo Conti says that the south Indian merchants are very rich, so much so that some will carry on their business in 40 of their own ships, each of which is valued at 15,000 gold pieces.

As mentioned above guilds played an important role in the economic activities of a state. During the Chalukyan period the Ayyavole guild with its headquarters at Aihole (Karnataka) visited different countries with valuable articles in their bags. They collectively made grants for charitable purposes. During the Rashtrakuta period the banks of these guilds were so stable that it inspired the highest amount of public confidence. For deposits, the bank used to pay an annual interest of 17%. During the Vijayanagar period the members of the guilds called Vira Banajigas were more organized and influential than in the previous centuries. The senior merchant was called Vadda Vyavahari and another was known as Pattanasvami. The office of Pattanasvami was in some way connected with the weekly fair which was established by the joint effort of the people. The guilds used to confer on some of the highest government officials the title ‘Prithvisetty’ (Mayor of the earth). The leaders of the guild seem to have exercised some powerful control at the royal court.

Through ages India occupied a unique position in the commercial world as the main supplier of the world’s luxuries. Hence she throughout had the balance of trade clearly in her favour, a balance which could only be settled by the export of precious metals (gold) from European and other countries which purchased her goods. Thus India has been for many centuries the final depository of a large portion of the metallic wealth of the world. India obtained gold not as did Europe from America in the 16th century by conquest or rapine, but by the more natural and peaceful method of commerce; by the exchange of such of her production which were highly prized by the nations of West-Asia, Egypt and Europe and which they could not have obtained from other places except India. (Radhakumud Mookerji- Indian Shipping, Longmans Green & Co, 1912, pp: 83, 84.)

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  • Aditya  On May 5, 2015 at 4:25 pm

    Very helpful.Nice work done.
    I’ll give a 9/10.
    A map would have made it perfect,

  • Ravi gautam  On November 2, 2016 at 9:20 am

    it will be usefull to senior students

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