Conclusion

When we study trade and commerce in the 16th and 17th centuries, we see a
kind of relationship between cities and towns and trade at that time. Some towns
initially developed as centers of administration but later became centers of trade and
commerce. The Imperial Court, the army, the number of nobles and the administrative
staff attracted a large number of merchants and artisans. Once more developed as a
center of commerce and industry, it became a trade center rather than an
administrative centre. Agra and Shahjahanabad can be seen as such examples.
Similarly there were some towns and cities which were initially centers of trade and
industry and later became administrative centres. Patna grew in this form. Patna was
initially a large commercial center that controlled trade in Bengal and northern India
and later became the capital of Bihar as its administrative efficiency increased.
In the 17th century, some centers in Gujarat and Bengal were known for their
manufactured goods. When European companies came to India, the demand for
Indian goods such as cotton cloth, raw silk and silk cloth increased in European
markets. The result was that it acted as a factor that led to the development of the area
of Surat into a cotton fabric manufacturing centre and the region of Dacca and Hughli
into a cotton and silk fabric manufacturing centre.
An important point in the economic structure of the 17th century was the rate
of exchange which influenced the market system of the time. In the absence of a
prescribed rate, different rates of exchange prevailed in different markets. This
provided highly inconvenient and costly to the manufacturers, traders and consumers.
Transactions could be settled till the rate of exchange was decided by the money
changers as the prices of gold and silver were subject to market fluctuations. The non-
existence of a central money market led to the domination of indigenous bankers who
charged interest not according to any banking principle but according to their own
whims and choice. Such supremacy was further supplemented by the passive attitude
of the state specially during the Mughal times.
At the same time, another defect in the economic structure of India is visible at
that time, the absence of a fully developed bill market. At this time there were only a

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few big cities where some big domestic bankers used to provide rediscounting
facility. There are only a few places in Mughal India from where this facility was
available like Lahore, Ahmedabad, Agra, Surat etc.
Economically, the condition of India at that time was not such that savings
could be made for any kind of investment here. The level of income and economic
condition were not such as to create a reasonable opportunity for saving. Only a few
Umrahs, Jagirdars and Mansabdars were such a class that was prosperous but most of
the population could not rise above the normal standard of living. Whatever people
could save in prosperous times of good harvest was either buried underground or
spent on ornaments or precious metals.
For the development of the industries of that time, it was necessary that they
should be helped by the ruling classes by providing financial assistance. But this was
not done by them. Also, no economic policy was made by them. The rulers were not
very concerned about the economic development of the country. They were as much
interested in industry and trade as it could supply the royal demand for quality goods
and boost up profits by trading on private account.
Since Islam was the religion of the rulers of this time, its effect was also
visible on the economic activities of the country. The policy of escheat may be
regarded as the implementation of the Islamic law as it prevented income from the
accumulated wealth of the deceased. This income was more or less akin to interest
which is completely prohibited by Islam. The irreligiosity of interest discouraged
saving and investment and encouraged irrational expenditure on non-productive
account. If savings were invested in the right place, then its effect would definitely be
visible in economic development.
Finance plays an important role in the production of a commodity. Finance
affects the manufacture, direction and nature of goods. In the 17th century, finance
was used for only those crafts and works that would encourage local or foreign trade.
We find very few examples in which industrial activities have been free from trading
impacts and influences. The result was that industrial organizations were governed by
the needs of trade and commerce rather than the principle of production. The reason
for this is also clearly visible. Since finance was supplied by bankers, sarrafs, the
moneylenders or western merchants and all of them were run by their business

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interests, it was not possible to develop an industry which was free from trade and
commerce during this period. In this way, during this period the field of industry was
subordinated to trade and commerce.
The workers had no freedom at all. They were merely puppets in the hands of
the state officials or the private merchants. The working conditions inculcated in them
a sense of pessimism towards their profession. They were not very enthusiastic about
the performance of work or the execution of their duties because they were not
expected to manifest any efficiency of extraordinary nature. Under such
circumstances it was not only difficult but impossible for workmen to keep up the
efficiency. It is creditable that in the mindset of such distracting forces the artisan
continued to maintain the tempo of work without substantially impairing his
efficiency to work. Even in such poor conditions when they were oppressed by the
state employees as well as exploited by the traders, the workers were producing
excellent goods. In the 16th and 17th centuries, the working class did excellent work
even in such difficult circumstances, due to which the balance of trade remained in
favor here. It was their sweat and toil which brought the flow of gold and silver from
other countries of the world. In spite of such valiant contribution to the prosperity and
artistic excellence of this country the guardians of the political and economic
institutions could give them even the bare necessaries of life.
The prosperity in production and the stability in the market led to the
expansion of demand in the national and international market. The internal markets
were packed with buyers and sellers who were dealing in the goods and commodities
from different parts of country. The mobility of goods and services was guaranteed by
the lasting peace established by the Mughal rulers. The goods soon found their way to
the western world. Almost all the western countries started dealing in Indian goods.
This resulted in the concurrent effects. Whereas the trade increased the industry, the
industry in turn strengthened the forces of trade of commerce.
The study of economic activities of 16th and 17th century shows that during
this period the Mughal rulers did not develop any commercial policy so that trade and
commerce could be promoted. The rulers of this period did not make any rules to
maintain their trade relations with different countries. The merchant class was
completely free that they could trade with any country or any person and there was no

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restriction on them. They were given freedom to trade to the extent that their interests
did not conflict with the business interests of the ruling class. At that time the
Emperors, Empresses and their relatives used to do business at private level to
increase their income. Although they charged customs and transit duties for revenues,
there was no attempt to direct the channels of trade in respect either of market or
commodities. As well as they did not even try to develop a strong navy to resist the
wrongdoings being done by the foreign traders.
We find that in the time of Mughals, when the European Governments were
encouraging Mercantilism to bring about economic transition, the Mughals were
satisfied with securing anything. With this neglect, when the Europeans became
powerful enough, the Mughals had no alternative than to be friendly with the
Portuguese and other Europeans in Asiatic waters. They, at times, granted preferences
and concessions to them over the local traders in the shape of exemption from custom
and transit duties.
It is also surprising that the government in Mughal times did not do anything
to stop the illegal activities of the custom officers or to regulate the custom and heavy
transit dues. Though foreigners were benefitted because they were exempted from
such duties, the local traders suffered on account of such high duties. This assigned a
superior position to foreign merchants which proved detrimental to local merchants
and traders. Such attitude of the state in medieval times encouraged the activities of
the foreign traders; the foreign traders, by making use of the faults and follies of the
rulers, first acquired the trading supremacy and afterwards the sovereignty of the
country. With this Indian merchants had to work without the protection of any
Mughal fleet against the attacks on their shipping in the Asiatic waters infested by
European pirates. Accordingly there was no alternative to local merchants than to
surrender to the trade supremacy of the European merchants. Had the State
formulated a definite policy, the history of country would have been different.
The influence of foreign traders coming to India is visible in exports. This
change is visible in the 17th century, especially after the entry of the East India
Company into India. In the 17th century, raw silk, saltpeter and indigo became the
main export commodities, and traditional agricultural products lost their importance.
The new markets in England and Holland had a great demand for cotton fabrics.

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Normally we do not see any change in imports. Along with this, the influence of
western traders is also visible in industrial activities. Due to foreign demand, there
was a new life in the languishing industries. Now all the production was being done
for the purpose of meeting the foreign demand.
The important effect on the industrial set up was that the actual producers
become puppets in the hands of the merchants who advanced them money. Though
the system of advances was common in the Mughal times also right from the very
beginning but they were enjoying a comparatively greater independence as
manufacturers of finished products. The emergence of the western merchants
established a virtual supremacy of trade and commerce over the industry and
enterprise. With the passage of the foreign trade into the hands of the foreign traders,
India’s production was geared to the demand of the foreign traders. They began to
advance money to the artisans in order to procure supplies for export purposes. We
find, therefore, that the production of calicoes, chintzes, silk fabrics, indigo, saltpetre
etc. increased considerably in consequence of this consideration.
The pattern of money market unlike the industrial set up continued to be
unaffected. The indigenous money-lender became more and more powerful
consequent to the dependence of the western merchants. It was not possible to finance
their trade and commerce from money of the West. These indigenous bankers
financed the trade and commerce of the western merchants till the establishment of
the company’s rule. Gradually relations with each other became thick. The evil effect
of such alliance is seen in 1757 when Jagat Seth in conspiration with Clive overthrew
Sirajuddaulah.
The foreign trade changed many hands. In the beginning, it was taken over by
the Arabs, the Turks and the Muslim from Hindus, from whom it was taken over by
the Portuguese. The Portuguese lost it to the Dutch and the English. The Indian
maritime activities in the Gujrat, Coromandel, the Persian Gulf and Red Sea-routes
were finished entirely by the coming in of the English and the Dutch. The advent of
the Europeans brought about the addition of the new markets, the decay of the Indian
maritime activity and the increasing power to middlemen, merchants and money-
lenders.

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 The village and the urban handicrafts constituted as two wings of medieval
industrial economy. They were equipped fully to satisfy the demands of the people- a
majority of whom lived in village and of the upper classes consisting of the mercantile
community in the cities and the towns. Though agriculture was the principal
occupation of the villagers but the entire rural economy was by and large dependent
upon the services of the craftsmen. Every village was the home of a number of arts
and crafts. They utilized, invariably, the local products as raw material. Much of their
product was paid for not in cash but by means of a customary payment in kind. The
self-sufficient village had few wants and they were all met from within the villages.
The agricultural surplus went to the king and nobility in the form of land revenue.
This left little to the villagers to purchase goods of the urban industry. The scarce
purchasing power together with the difficulty of movement of goods from the centres
of production to the places of consumption in the villages could not exercise an
encouraging influence on the general growth of industry and trade. On the other hand
the demand of the local and foreign merchants and the local urban population was met
out of the goods produced by the artisans who worked either independently for
themselves or whole-sale merchants. These artisans, therefore, supplied goods for
export and for local consumption purpose. They produced cotton and silk textiles,
mining, mineral and metal goods, leather goods and footwear etc.

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