Economy and people's lives

Detail

Money: the rupaya and the dam

• The Mughals ran a simple two-metal coin system: a silver rupaya and a copper dam.
• This was a change from the Delhi Sultanate. Sultanate rulers had issued coins in several metals and many denominations (values), which made trade confusing.
• The silver coin was not a Mughal invention. Sher Shah Suri (ruled 1540–45) issued a silver coin called the Rupiya, weighing 178 grains. It is the direct ancestor of today's rupee. [2]
• Sher Shah's large silver coin carried the profession of the faith and the names of the four caliphs, and the Mughals who came after him copied this coin type. [3]
• Why one steady coin mattered:
• A trader in Bengal and a trader in Gujarat could use the same coin.
• Land revenue could be demanded in cash, not only in grain.

• Prices across regions became easier to compare.

• Museum holding: a Silver Rupee of Sher Shah Suri is listed among artefacts on the national culture portal. [4]

Agriculture — the backbone of the economy

• Farming was the mainstay. Most people were peasants, and most state money came from land.
• The Mughal state usually took one-fifth (1/5) of the produce as land revenue. Some sultans of the era had pushed the demand as high as one-half.
• Zabt — the Mughal system of measuring land and fixing revenue (mainly in north India). Land was measured in bighas, crops were sorted by type, and prices were estimated. A fixed cash rate was then charged. [5]

• Dahsala ("ten-year") — Akbar's revenue minister Todar Mal surveyed crop yields, prices and cultivated area over ten years and used the ten-year average to fix the demand. [6]

  Note: Britannica describes the zabt cash demand as roughly one-third of average produce [5], while NCERT states the typical extraction as one-fifth. Keep the NCERT figure (one-fifth) for the exam; the difference is because rates varied by region, crop and period.

• Irrigation grew, most importantly through the Persian wheel — a wheel with pots on a chain, turned by bullocks, that lifts water from a well into the fields all day. More water meant more land could be farmed and more crops per year.

What the fields produced

• Food crops: rice, wheat, barley, pulses, sugarcane, spices.
• Non-food (cash) crops: cotton, silk, wool, dyes, timber, jute.
• Cotton was the key link. It fed a huge textile industry, which in turn fed exports. Farm → loom → ship.
• Output was not the same everywhere. It changed by region and by period — good in well-watered plains, poor in dry tracts.

Famine and the peasant's risk

• The peasantry suffered several severe famines in this era.
• There was no fixed relief system. Help depended on the benevolence (kindness) of the ruler of the day.
• So a peasant faced two risks at once: a bad monsoon, and a revenue demand that did not fall when the harvest did.

Crafts, shipbuilding and ports

• Craft goods made in India: textiles, weapons, utensils, ornaments, jewellery.
• Shipbuilding developed considerably. India built its own ships, it did not only load foreign ones.
• Export ports: Calicut, Mangalore, Surat, Masulipatnam, Hooghly.
• Surat became the emporium (great market) of India, exporting cloth and gold; its two big industries were textile manufacture and shipbuilding. [7]
• The English East India Company set up a factory (trading post) at Surat between 1612 and 1615 to buy calicoes, chintzes, silk embroidery and indigo. [8]
• Sir Thomas Roe's embassy to the Mughal court (1615–18) won the English the right to trade and open factories. [8]
• Masulipatnam prospered in the 17th and early 18th centuries as a trading port and cotton textile centre; the English traveller John Fryer wrote about the very high quality of its dyed and painted fabrics. [9]
• The Indian Ocean worked as one long trade network, carrying Indian cloth as far as Southeast Asia, Central and East Asia, and East Africa. [10]

The trade balance

• India imported much less than it exported. This is the single most important trade fact of the period.
• Imports: silk, horses, metals, luxury goods.
• Because exports were larger, silver and gold flowed into India to pay for its cloth.
• Arab, Persian and Central Asian merchants settled in Indian ports and became part of the coastal towns.

Indigenous financial institutions

• Hundi
• A written instruction to pay money, like an early cheque or bill of exchange.
• It worked across political borders — a trader could deposit money in one kingdom and draw it in another.

• It was a precursor of banking, and it was run without the ruling classes — merchants, not kings, guaranteed it.

• Marwari trader networks

• Trading families with their own credit-and-trust systems running parallel to the state.

• Reputation, not royal courts, enforced repayment.

• Temples as economic ecosystems — a temple was far more than a place of worship:

• It held markets around it.
• It held dana (donations) in trust and reinvested it.
• It built and maintained irrigation infrastructure (tanks, channels).
• It ran dharmashalas (free rest houses for travellers).
• It gave credit to merchants and funded maritime (sea) trade.

Stress in the late 1600s

• The peasant's squeeze — three cuts from one harvest:
• The state's revenue demand.
• Payments to intermediaries (the middlemen who collected revenue).

• What was left was a small share — often not enough to survive on.

• Result: peasants lost their land and fell into bonded labour (working to pay off a debt they could never clear).

• Craftspeople and labourers also worked in harsh conditions.

Abundance, but unequally shared

• Arab and European travellers still called India "a land of abundance".
• But the wealth sat with a narrow group: rulers, courtiers, high officials and merchants.
• Frequent warfare forced people to move away from their homes — population displacement was common.
• Despite all this, people of different faiths by and large lived peacefully side by side, because they were economically interdependent — the weaver needed the trader, the trader needed the farmer, and none of them matched by religion.

Prelims Hooks

• Mughal coinage = silver rupaya + copper dam (two metals), unlike the Sultanate's many metals and denominations.
• Sher Shah Suri (1540–45) issued the silver Rupiya of 178 grains — ancestor of the modern rupee. [2]
• Sher Shah's silver coin carried the profession of faith + names of the four caliphs; Mughals imitated the type. [3]
• Typical Mughal land revenue = one-fifth of produce (some sultans of the era took up to one-half).
• Zabt = measurement-based cash revenue system; land measured in bighas. [5]
• Dahsala = ten-year average of yields and prices, prepared under Todar Mal, Akbar's revenue minister. [6]
• Persian wheel = the irrigation device that raised farm output.
• Five export ports to remember: Calicut, Mangalore, Surat, Masulipatnam, Hooghly.
• English EIC factory at Surat, 1612–15; Sir Thomas Roe's embassy, 1615–18, won trading rights. [8]
• Hundi = written payment order valid across political borders; run by merchants, not rulers.

Mains Points

• Commercialisation without industrialisation. Cotton, silk and indigo were grown for distant markets, ports like Surat and Masulipatnam were world-class [7][9], and India ran an export surplus that pulled in bullion — yet the surplus was captured by the state, nobles and merchants, not reinvested in production. Useful for GS-I questions on why a rich 17th-century economy did not become an industrial one.
• The state was not the whole economy. The hundi, Marwari credit networks and temple ecosystems moved money, gave credit and funded sea trade independently of the ruling classes. This is a strong counter to the idea that Indian economic life was purely state-driven, and it explains why trade survived political breakdown.
• Revenue policy as the link between administration and agrarian crisis. Zabt and dahsala [5][6] gave the state a predictable cash demand, but a demand fixed in cash does not fall when the harvest fails. Combined with intermediary exactions, this drove late-1600s land loss and bonded labour — the standard explanation for agrarian unrest under Aurangzeb.
• Economic interdependence as the base of coexistence. Farmer, weaver, banker and shipper needed each other and did not sort by faith. Everyday economic life, not state policy alone, explains the largely peaceful coexistence NCERT notes — a useful nuance against reading the period only through court politics.