HISTORY OF COMMERCE AND

TRADE
Commerce is related to facilitating the sale of goods and services in the
economy, and trade is one of its subsets. Trade is just buying and
selling of goods and services in exchange for cash or cash's worth.

This Photo by Unknown author is licensed under CC BY-SA-NC.

 1. INDIAN subcontinent has himalayas in the
north and bordered by water in the South.
History Of 2. Silk Route helped in establishing commercial
Trade & and political contacts with adjoining foreign
kingdoms and empires of Asia
Commerce 3. With the help of wealth earned through trade ,
the chief kingdoms, important trade centres
and the industrial belt flourished, which in turn
further facilitated the progress of domestic and
international trade in ancient India.
4. Trade and commerce have played a vital role in
making India to envolve as a major actor in the
economic world in ancient times.
 • Metals began to supplement other commodities as money because
of its durability and divisibility.
• Documents such as Hundi and Chitti were in use for carrying out
transactions in which money passed from hand to hand.
• Hundi involved a contract which- (i) warrant the payment of money,
the promise or order which is unconditional (ii) capable of change
Indigenous through transfer by valid negotiation.
Banking • With the development of banking, people began to deposit precious
metals with lending individuals functioning as bankers or Seths.
System • Agriculture and the domestication of animals were important
components of the economic life of ancient people.
• . In addition to this, by resorting to weaving cotton, dyeing fabrics,
making clay pots, utensils, and handicrafts, , cottage
industries, manufacturing, transports (i.e., carts, boats and ships),
etc., they were able to generate surpluses and savings for further
investment.
 Rise of Intermediaries

• Intermediaries provided considerable

financial security to the manufacturers by
assuming responsibility for the risks involved,
especially in foreign trade.
• The institution of Jagat Seths also developed
and exercised great influence during the
Mughal period
• Commercial and Industrial banks s later
evolved to finance trade and commerce and
agricultural banks to provide both short-and
long-term loans to finance agriculturists. This Photo by Unknown author is licensed under CC BY-SA.
TRANSPORT
• Transport by land and water was popular in the ancient
times. Trade was maintained by both land and sea
• Trade routes were structurally wide and suitable for speed
and safety
• Maritime trade was another important branch of global
trade network
• Pepper was particularly valued in the Roman Empire and
was known as ‘Black Gold’. For centuries, it remained the
reason for rivalry and conflict between various empires and
trade powers to dominate the route for this trade.
 Trading Communities Strengthened
• Punjabi and Multani merchants handled business in the
northern region, while the Bhats managed the trade in the
states of Gujarat and Rajasthan. In western India, these groups
were called Mahajan.

• In urban centres, such as Ahmedabad the Mahajan community

collectively represented by their chief called nagarseth.

• Other urban groups such as hakim and vaid (physician), wakil

(Lawyer), pundit or mulla (teachers), painters, musicians,
calligraphers, etc.

This Photo by Unknown author is licensed under CC BY-SA.

 Merchant Corporations

• Guilds, were autonomous corporations formed to protect the interests of the traders
through which merchant community derived power and prestige
• Trade and industry taxes were also a major source of revenue. Traders had to pay octroi
duties that were levied on most of the imported articles at varying rates. They were paid
either in cash or in kind.
• The ferry tax was another source of income generation. It had to be paid for passengers,
goods, cattle and carts.
• The guild merchants also acted as custodians of religious interests. They undertook the
task of building temples and made donations by levying a corporate tax on their
members. The commercial activity, thus, enabled big merchants to gain power in the
society.
Major Trade Centres
 Major Exports and Imports
• Exports consisted of spices, wheat, sugar, indigo, opium,
sesame oil, cotton, parrot, live animals and animal products—
hides, skin, furs, horns, tortoise shells, pearls, sapphires,
quartz, crystal, lapis, lazuli, granites, turquoise and copper etc.
• Imports included horses, animal products, Chinese silk, flax
and linen, wine, gold, silver, tin, copper, lead, rubies, coral,
glass, amber, etc.
 POSITION OF INDIAN SUBCONTINENT IN WORLD
ECONOMY ( 1 AD UP TO 1991)

• Between the 1st and the 7th centuries CE, India is estimated to have the largest
economy of the ancient and medieval world, controlling about onethird and one-
fourth of the world’s wealth
• The British empire began to take roots in India in the mid – 18th century.
• The East India Company used revenues generated by the provinces under its rule for
purchasing Indian raw materials, spices and goods.
• Hence, the continuous inflow of bullion that used to come on account of foreign trade
stopped. This changed the condition of the Indian economy from being an exporter of
processed goods to the exporter of raw materials and buyer of manufactured goods.
 India begins to Reindustrialise
• After Independence, India went for centralised planning;

i. The First Five Year Plan was implemented in 1952. Due importance was given
to the establishment of modern industries, modern technological and scientific
institutes, space and nuclear programmes.
ii. However, the Indian economy could not develop at a rapid pace due to Lack of
capital formation, rise in population, huge expenditure on defence and
inadequate infrastructure were the major reasons.

• As a result, India relied heavily on borrowings from foreign sources and finally,
agreed to economic liberalisation in 1991.
Presentation
BY
 M P
A O
M J S
A O I
T
J R T
R I
O
A O
R I B
D N
T M I
E H
R T P B
I I
A R O L
& S N
N A R I
T O
S D T W
C O G
P E S O
O R R
O R
M Y A
R C & L
M P
D
T E H
E
N E Y
R E
T X C
C
R P O
E
E O N
S R O
T M
S Y

1
 COMMERCE: Refers to all those
activities which are concerned with the
T
R transfer of goods and services from the
A
D
producers to the consumers. It embraces
E all those activities which are necessary
& for maintaining a free flow of goods and
C services.
O
M
M
E TRADE: Refers to buying and
R
C selling of goods and services with
E
the objective of earning profit.

2
 INDIGENOUS BANKING SYSTEM
Metals came to be used as money as the economic life of the
people progressed as they are durable and divisible. This
accelerated economic activities. Documents such as Hundi
H and Chitti were in use for carrying out transactions in which
I
S money passed from hand to hand. Hundi involved a contract
T
O
which:
R (i) warrants the payment of
Y
money, the promise or order
which is unconditional.
(ii) capable of change
through transfer by valid
negotiation.
3
 With the development of banking,
people began to deposit precious
metals with lending individuals
functioning as bankers or
H Seths. Money became an instrument
I
S for supplying the manufacturers with
T
O
a means of producing more goods.
R
Y Agriculture and the domestication of animals were main part
of the economic life of ancient people. Also, weaving cotton,
dyeing fabrics, making clay pots, utensils, and handicrafts,
sculpting, cottage industries, masonry, manufacturing,
transports (i.e., carts, boats and ships), etc., helped in
generating surpluses and savings for further investment.
4
 RISE OF INTERMEDIARIES
Intermediaries provided considerable
financial security to the manufacturers
by assuming responsibility for the risks
H involved, especially in foreign trade.
I
S During the Mughal period and the days
T
O of the East India Company, the institution of
R
Y
Jagat Seths also developed and
exercised great influence.
Commercial and Industrial banks
later evolved to finance trade and
commerce and agricultural banks to
provide both short-and long-term
loans to finance agriculturists. 5
 TRANSPORT by land and water was popular
in the ancient times that helped in maintaining
trade. Trade routes were structurally wide and
suitable for speed and safety. Malabar Coast
T
R
has a long history of international maritime
A trade going back to the era of the Roman
N
S Empire.
P
O
R
T
An alternate route to India for spices that led
to the discovery of America by Christopher
Columbus in the closing years of 15th century
and also brought Vasco da Gama to the
shores of Malabar in 1498. 6
 TRADING COMMUNITIES STRENGTHENED

In different parts of the country, different communities

dominated trade:
→ Punjabi and Multani merchants handled business in the
T
R
A
N
northern region.
S → The Bhats managed the trade in the states of Gujarat and
P
O Rajasthan.
R
T Other urban groups included professional classes, such as
hakim and vaid (physician), wakil (Lawyer), pundit or mulla
(teachers), painters, musicians, calligraphers, etc.

7
 MERCHANT CORPORATION

Guilds were autonomous corporations formed to protect

T
the interests of the traders through which merchant
R community also derived power and prestige. Traders had
A
N to pay octroi duties that were levied on most of the
S
P
imported articles at varying rates. Customs duties varied
O according to the commodities and from province to
R
T province. The ferry tax was another source of income
generation which had to be paid for passengers, goods,
cattle and carts. The guild chief dealt directly with the king
or tax collectors and settled the market toll on behalf of its
fellow merchants at a fixed sum of money.
 MAJOR TRADE CENTRES
M
A
leading trade centres in ancient 3.

J
O
India were :→ 2.
R
1. Pataliputra 8. Surat 4.
6.
T 2. Peshawar 9. Broach 7.
R
A 3. Taxila 10. Madura 1. 14.
D
E 4. Indraprastha 11. Kaveripatta 5.
13.
8.
C
5. Ujjain 12. Kanchi 9.
E 6. Mathura 13. Tamralipti
N
T 7. Varanasi 14. Mithila
R
E 12.
S 11.
10.

8
 MAJOR TRADE CENTRES
M
A Pataliputra: Known as Patna today was
J
O
a commercial town and also a major
R centre for export of stones.
T
R
A
D Peshawar: It was an important exporting
E centre for wool and for the import of
C horses.
E
N
T
Taxila: It served as a major centre on the
R important land route between India and
E
S Central Asia. The famous Taxila University
flourished here.
9
 Indraprastha: It was the commercial
M junction on the royal road where most
A
J routes leading to the east, west, south
O
R and north converged.
T
R
A Ujjain: Agate, carnelian, muslin and mallow
D
E cloth were exported from Ujjain to different
C centres.
E
N
T
R Mathura: Many routes from South
E
S
India touched Mathura and
Broach.
10
M
Varanasi:It grew as a major centre
A of textile industry and became
J
O famous for beautiful gold silk cloth
R
and sandalwood workmanship.
T
R
A
D Surat: Textiles of Surat were famous
E
for their gold borders (zari).
C
E
N
T
R
E
Broach: It was situated on the
S banks of river Narmada and was
linked with all important marts by
roadways. 11
M
Madura: It attracted foreign
A merchants, particularly Romans,
J
O for carrying out overseas trade.
R

T Kaveripatta: It was the centre of

R
A
trade for perfumes, cosmetics,
D scents, silk, wool, cotton, corals,
E
pearls, gold and precious stones;
C
E
and also for ship building.
N
T
Kanchi: Known as Kanchipuram today
R where Chinese used to come in foreign
E
S ships to purchase pearls, glass and rare
stones and in return they sold gold and
silk. 12
 Tamralipti: It was one of the greatest ports connected both by
M
A
sea and land with the West and the Far East. It was linked by
J road to Banaras and Taxila.
O
R

T
R
A
D
E

C
E
N
T
R
E Mithila: It established trading
S colonies in South China, especially
in Yunnan.
13
M
A MAJOR IMPORTS
J
O 1. Horses, 13. Glass
R 2. Animal 14. Amber
I Products
M
P 3. Chinese Silk
O
R
4. Flax and Linen
T 5. Wine
S
6. Gold
& 7. Silver
E 8. Tin
X
P 9. Copper
O
R
10.Lead
T 11.Rubies
S
12.Coral
14
M
A MAJOR EXPORTS
J
O 1. Spices 12. Crystal
R 2. Wheat and sugar 13. Lapis
I 3. Indigo 14. Lazuli
M
P 4. Opium 15. Granites
O
R
5. Sesame oil 16. Turquoise and Copper
T 6. Cotton
S
7. Parrot
& 8. Live animals and animal
E products—hides, skin, furs,
X
P horns, tortoise shells
O
R
9. Pearls
T 10.Sapphires
S
11.Quartz 15
P
O
POSITION OF INDIAN SUBCONTINENT IN
S
I WORLD ECONOMY (1 AD UP TO 1991)
T
I
O
Between the 1st and the 7th centuries CE, India is
N estimated to have the largest economy of the ancient and
I
N
medieval world, controlling about one-third and one-fourth
W
of the world’s wealth. The 18th century India was far behind
O
R
Western Europe in technology, innovation and ideas. In the
L
D mid-18th century, the British empire began to take roots in
E India and used revenues generated by the provinces under
C
O its rule for purchasing Indian raw materials, spices and
N
O goods. Hence, the continuous inflow of bullion that used to
M
Y come on account of foreign trade stopped.
16
P
O
S
INDIA BEGINS TO REINDUSTRIALIZE
I
T After Independence, India went for centralised planning. In
I
O 1952, the First Five Year Plan was implemented and
N
importance was given to the establishment of modern
I
N industries, modern technological and scientific institutes, space
W
and nuclear programmes. However, the Indian economy could
O
R
not develop at a rapid pace due to lack of capital formation, rise
L
D
in population, huge expenditure on defence and
E
inadequate infrastructure. Thus, India relied heavily on
C
O
borrowings from foreign sources and finally, agreed to
N
O
economic liberalisation in 1991. Today, Indian economy is one
M of the fastest growing economies in the world today and a
Y
preferred FDI destination. 17
 BIBLIOGRAPHY
https://www.studyrankers.com/2018/07/notes-of-ch-1-business-
trade-and-commerce-class11th-business-studies.html
B
I
B
L
https://ncert.nic.in/textbook.php?kebs1=1-11
I
O
G
https://www.slideshare.net/search/slideshow?searchfrom=hea
R
A
der&q=History+of+trade+and+business+class+11&ud=any&ft=
P
H
all&lang=**&sort=
Y
https://www.google.co.in/search?q=notes+of+business+studies
+class+11+chapter+1&client=safari&hl=en

( Photos belong to their respective owners)

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