The Pattern of Trade in 17th Century Mughal India Ankita Pawar IPM2014059 Samyak Ponangi IPM2014061

21 April 1525

21 April 1526

Nov 1564 under Akbar

Trade view (1564)

1574 under Akbar

Trade View (1574)

Mughal Emperors and Trade Babur began establishing infrastructure required for trade, roads and caravansaries Akbar continued this work. Rahdars to protect Khyber pass, low custom duty, strategic conquests along trade routes Unique revenue system, uniform coinage, Persian influence in court led to more trade Jahangir maintained alliances with Safavids and Central Asian Khanates Aurangzeb astute follower of Sharia, Islamic banking (Risk sharing not Risk Transfer)

Introduction Three historiographical perspectives: Global, World & Maritime Steensgaard: Dutch and English companies- internalise transaction costs Douglas North-How did this happen? Unlike caravan merchants, they benefited from economic buffers (Issues) Revisionists-Arguments and Issues So why did the Central Asian trade persist? Limited nature of trade diversion (comparative advantage) and potential for trade creation Horses and Textiles

Customs Union Model -Customs Union Model- lowering of tariffs -Movement towards free trade- increase in welfare -Jacob Viner's- Trade Creation and Trade Diversion -Assumptions: Pure Competition, Factor Mobility within the country/ region Zero transportation costs Non-member country -Central Asia - Home country- Mughal India -export to partner country -Jahangir-liberalising and not protecting trade- port duty and personal travel tax abolished -Aurangzeb- abolished tax on profits and various transit and income taxes

Textiles: Trade Creation -Issues of technical learning and capacity( Indian weaver-17th Century) -Types of textiles: Plain, Dyed and loom-patterned calicoes Printed and painted calicoes Silk Fabrics -Trade creation- textile industry-highly specialised -Extent of Demand- Limited substitutability -Possibility of changes in supply -Shiting Production Centres- 1630-Famine and its effects -Spare- Capacity Utilisation

Horse Trade and Trade-Diversion -Explaining the persistence of Indo-Central Asian Trade using the trade diversion hypothesis -Heckscher-Ohlin Framework- comparative advantage Central Asian advantage- horse breeding Opportunity cost -relative factor endowments- land suitable for horse-breeding Horses as assets and markers of rank Mansabdari system-(Akbar)- rank / position- Horses signified rank to which one belonged -Horses as objects of beauty Horses- central place in Ceremony and entertainment - Hour and half - two hours daily presentation ceremonies

Conclusion -Trade persistence- limited substitutability b/w Indo- european and Indo-Central Asian trade -Customs Union Model- European Companies-zero tariffs -Insufficient trade diversion and trade creation -Prevalent Heckscher-Ohlin Model -Implications: absence of a sub-continental vantage point -Introducing concepts of trade creation and trade diversion in the trading history

Assignment Questions: How and why trade flourished despite the impediments? -Stable centre and a uniform provincial government- age of relative peace and security, trade and commerce flourished. The production of handicrafts increased in order to keep up with the demand for them in foreign countries. They were unmatched for their beauty and skill and were popular in the European countries. The emerging foreign trade led to the development of market places not only in the towns but also in the villages. Well-maintained roads linking various parts of the country facilitated domestic trade.

THANK YOU. Questions?