Ancient Indian Guilds as Banks and Trusts - Sandeep Balakrishna

 

Banking Activities

GUILDS AND CORPORATIONS IN ANCIENT and medieval India also functioned as local banks that accepted public money and paid interest in the range of nine – twelve percent. Like any bank, they also lent money.

Larger guilds extended their banking services throughout India. Enough evidence exists to show that there was an impressive network of such banking guilds dotting the entire geography of Bharatavarsha. Their organization was coherent, well-linked and above all, they operated on the basis of strict honesty, integrity, fair dealing, and had a fear of incurring paapa. Measured on the parameters of professional competence, organizational efficiency, customer service, and delivery, these banking guilds can hold their own against contemporary banking systems. This was in an era where plain, simple trust and not fraud-detection software was the norm. Like their compatriot commercial guilds, these banking guilds discharged their share of charity and piety as we shall see.

All of these traits are precisely what inspired trust among the public who deposited large sums of money. Likewise, another significant feature of these corporations was the fact that they had a system similar to travelers’ cheques. Then there was another side to it as well. For example, if a traveler ran out of money in a faraway land, he could take a loan from a local guild and repay it to a guild back in his native town or village. That local guild was in turn connected with the guild from which the traveler had taken out the loan.

Village and town administrative bodies—similar to municipal councils—also provided banking services and worked closely with all denominations of commercial guilds. Banking guilds were recognised as an important constituent in the municipal government of ancient cities such as Pataliputra, Mathura, Ujjaini, Vidisha, etc. The town corporation or municipality recognized their duties as trustees of public money. These banking guilds received not only cash deposits but also endowments of property.

Epigraphic Evidence

We will examine how some of these features played out in the real life of the Hindu society throughout our history using hard inscriptional evidence.

A large cache of seals dating to the Gupta Era – roughly the fourth or fifth century CE – was recovered at Basarh (Bihar). A majority of these seals deal with corporations (nigama) of bankers. Others talk about guilds of traders (Sarthavaha) and merchants (Kulika). Interestingly, one seal mentions the name of Dodda, the head of a guild of bankers and traders. Together, they had formed a body resembling the modern Chamber of Commerce.

From here, when we travel down to Lakshmeshwara (Karnataka) two centuries later, we find an inscription dated 725 CE. This talks about the Constitution drawn up for the town of Porigere. Here is what it says: “the taxes of all classes of people shall be paid to the guild of braziers in this town in the month of Kartika.” Clearly, this guild also served as the local bank or treasury.

The Chola period supplies us with a truly spectacular portrait of how village corporations also doubled up as banks and treasuries. The hoard of fourteen inscriptions found in 1893 at the crumbling Vishnu temple makes us go awestruck. Together, they give us a comprehensive picture of the economic facet of village administration in South India. Every activity that generated money was given a dedicated fund. Thus, you had a tank fund, a rice fund, an oil fund, a flower-garden fund, a gold fund and various donor funds. These funds were managed by their respective guilds, which had to make regular deposits with the village assembly at stipulated periods. It is this feature that gave a corporate character to the village assembly (Sabha or Mahasabha). The treasury of the village assembly used the interest from these deposits to fulfill the duties laid down in the village constitution, including performing works of charity.

Guilds as Trusts

GUILDS AND CORPORATIONS were also executors of endowments and wills. Given the high degree of trust that these guilds inspired, people fearlessly made perpetual endowments and entrusted these corporate bodies to execute them. In turn, these bodies did this job flawlessly over five, six, and even ten generations. And they did this not merely as a job entrusted to them but out of a spirit of Dharma—that is, by executing the endowments, some part of that Dharma would also accrue to them. This automatically reveals the fact that these guilds were generational and had preserved institutional memory in a manner that can only be described as genius-level.

We need to remember that both the donor and the guild discharging the endowment regarded it as an act of piety and reverence. This is perhaps the most elevating feature of the corporate and business history of ancient India.

On the macro canvas, the intrinsic and inseparable elements of Hindu business history include spirituality, godliness, devotion and Dharma. We have a wealth of records that show how corporations themselves made generous endowments of an astonishing variety: for lighting lamps in temples in perpetuity, for upkeep of temples, for Annadaanam, for celebrating festivals, for providing food and other services to Sanyasins, Buddhist monks, for facilitating Tirthayatras…

I will cite just one hoary example.

A Shaka Prince ruling somewhere in the Sindh region in 120 CE made a perpetual endowment of 3000 Karshapanas for the benefit of Buddhist monks engaged in penance in the caves of Nasik. He entrusted the execution of this endowment to some guilds based in Govardhana! As they say in Hindi, Kahan Sindh? Kahan Govardhan, aur Kahan Nasik? Where is Sindh? Where is Govardhan, and where is Nasik? Remember, we’re talking of the India of 120 CE, or 1900 years ago.

Closing Notes

And now we’ve arrived at the final stage of this series. We will close with where we began. With Sri Dharampal’s passionate and sustained appeals for decolonising the Hindu psyche and thereby the Hindu society and civilisation.

A tragic, fatal and ongoing consequence of British or European colonialism was the creation of a deliberate myth that European discoveries and inventions and innovations in science and technology alone had all the power and all the secret keys to unlock the mysteries of the universe. Its companion-myth was that European political systems, social organization, institutional frameworks, and intellectual traditions were the sole repositories of all wisdom in the realm of human civilization.

Quite obviously, these myths could only be sustained on the brute strength of their military dominance and superiority. It was precisely this that made them confidently declare that everything in India’s past was primitive and fit only to be discarded. We must admit that they have phenomenally succeeded in instilling this myth among our own people from the lineage that began in the latter half of the nineteenth century. The 1857 war of independence was the last resistance whose foundational inspiration was wholly organic and homegrown.

One major, if not central component of this myth is directly if not entirely related to the Indian corporate and business life till then. It must be remembered that the British first arrived in India only to trade, i.e., in their essential position, they were supplicants before a vastly superior economic power spread across one of the largest geographies of the world. But absolute political dominance made them spin exactly the opposite story. Thus, inveterate racists like James Mill deliberately invented the fiction that our guilds and corporations were closed entities working in isolation, were fossilized and resisted change, progress and innovation.

The opposite is actually true and we can consider just one tiny bit of evidence that proves this reality. As we have seen throughout this series, our guilds and corporations enjoyed an extraordinary degree of autonomy and received royal protection as well. It was precisely this factor that made India the economic powerhouse of the world for several centuries irrespective of the rise and fall of empires and dynasties.

The fact that Indian products commanded extraordinary premium in international markets for such a prolonged duration is one common sense proof of our innovation, progress and other terms whose definitions are not yet settled.

We have the example of Sri Krishnadevaraya who had set up an entire Ministry of Perfumes, and the Shreshtis in his domain prolifically imported aromatic raw materials and copious barrels of exquisite perfumes from Persia, Portugal, etc.

Finally, on the basis of my limited studies in this subject, I can say with some confidence that a study of corporate and business life in ancient India is also an invitation to an ennobling penance. The names and accomplishments of some eminent businessmen have been preserved in royal edicts, epigraphs and grant records. These are the stories we must unearth, popularise and prescribe them as reading material for our children. If they reveal anything, it is this: that our business class was distinguished not just for their financial acumen; they made tons of money, yes, but they went far beyond this ken. In peacetime, they contributed to society and nurtured culture. In times of crisis, they stood with their chest thrust forward. When they were profoundly moved, they donated all they had and renounced the world in quest of higher callings.

The history of corporate and business life of Bharatavarsha is no less exalted than its spiritual history, which is but natural.

Think about it.

Courtesy: https://www.dharmadispatch.in/history/ancient-indian-guilds-as-banks-and-trusts-the-final-episode

Introducing a Miniature Village Republic in the Sevuna Empire - Sandeep Balakrishna

 Preface

IN LETTER DATED SOMETIME IN 1830, CHARLES METCALFE wrote this about Indian villages:

I admire the structure of the village communities… The village communities are little republics, having nearly everything that they want within themselves, and almost independent of any foreign relations. They seem to last where nothing else lasts. Dynasty after dynasty tumbles down. Revolution succeeds to revolution…but the village communities remain the same… This union of the village communities, each one forming a separate little state in itself, has… contributed more  than any other cause to the preservation of the people of India, through all the revolutions and changes which they have suffered and is in a high degree conducive to their happiness and to the enjoyment of a great portion of freedom and independence. I wish, therefore, that the village constitutions to is never be disturbed, and I dread everything that has a tendency to break them up.

But Metcalfe was merely echoing our ancient Dharmasastra writers like Gautama and Bodhayana. 

Rishi Gautama, revered as a Gōtra-pravartaka, composed his Dharmasutra roughly between 600 - 400 BCE. 

Rishi Bodhayana, also venerated as a Gōtra-pravartaka, postdated Gautama and composed his Dharmasutra.      

Both of their Dharmasutras define a village in a simple declarative sentence: a village is where righteous men throng. The simplicity conceals its profundity and in a way, also gives us the essence of what is known as Sutra literature. Sutras or aphorisms couch extraordinary truths in their nourishing breasts. Which is why such a vast body of work interpreting Sutras eventually arose in the Sanatana tradition.

And then Bodhayana delineates the specifics: "a righteous man shall seek to dwell in a village where fuel, water, fodder, sacred fuel, kusa grass, and garlands are plentiful. Access to all this must be easy, and many rich people should dwell in such a village. It ought to abound in industrious people, and where Aryas (virtuous, cultured, honest and honourable men) must form the majority. It should have a strong defence against robbers and other disturbers of peace.” 

But both Gautama and Bodhayana mention that their tenets were based on the authority of the “ancients.” Which only means that this conception of a village predated even them.

At any rate, it is clear that this theory and practice of a village had endured nearly intact for several millennia, leading Metcalfe to make his remark in 1830. It is unlikely that Metcalfe had studied our visionary Dharmasastra sages. He was simply describing what he had witnessed: the unbroken continuity of that village system still in operation.  

The evolution and flowering of the Sanatana civilisation inevitably ushered in complexity and change in the village system. However, the raw but profound simplicity at the core of the village setup that our Dharmasastra Rishis had conceived, largely remained intact. The external devices and methods of its functional administration underwent modifications in response to changing times. In fact, we can pick up this theme and reconstruct the political and social history of Bharatavarsha from its civilisational dawn. We get a hint of this element in Metcalfe’s observation that “this union of the village communities, each one forming a separate little state in itself, has… contributed more than any other cause to the preservation of the people of India, through all the revolutions and changes which they have suffered.” 

The “revolutions” that Metcalfe mentions were mostly sudden and substantial upheavals caused by alien Muslim invasions and exploitative European pirates disguised as traders. Pre-Islamic “revolutions” in India were typically battles of territorial conquest or reconquest by Hindu kings. These battles neither disturbed the Hindu cultural continuity nor harmed the existing social harmony. Likewise, unless faced with extreme conditions — for example, the mass migrations of Hindus from their ancestral villages etc., forced by Islamic depredations — the village system remained unspoilt despite these disruptions. 

This feature is precisely what we observe in the administrative histories of all notable and obscure Hindu empires sprawled over nearly two millennia. As such, barring minor differences, the administrative history of one Hindu empire drawn at random almost mirrors that of another. For example, the 28 administrative departments mentioned in the annals of the Sena Empire (Bengal) are directly derived from the Arthasastra. Roughly around the same period, we notice a similar administrative setup in the Sevuna (Yadava) Empire ruling from Devagiri. 

The Sevuna Empire is as good an exemplar as any to expound on the awesome Hindu village administrative system. Its selection has the additional advantage of tracing back the origins of some of the contemporary names and terminology and functions that have survived in our own age.  

But before that, we’ll take a brief sojourn into the undateable cradle of the Hindu village administrative setup.  

IN GENERAL, the Grāma or village was always recognised as a unit of administration. We have already noted the definition of a typical village, given by Gautama and Bodhayana. 

Kautilya defines a village as one constituting 100 - 500 families. Each village has well-defined boundaries and affords common defence against threats, internal or external. If required, the State could establish more villages in sites suited for the purpose. Housing sites of various measurements were to be allotted to all classes of people according to social status and the number of members in the family. 

Overall, some features of the village administrative system in ancient India are common although the terminology varies. This is typically how it looked: 

• Grāma: The smallest unit, i.e., the individual village. 

• Saṅgrahaṇa: A group of ten villages.

• Kharvāṭikā:  A group of two hundred villages.

• Drōṇamukha: A group of four hundred villages  

• Sthānīya: A group of eight hundred villages.

• Gulma: A unit of thousand villages subdivided in three specific groups: (1) two hundred (3) three hundred (4) five hundred.  

• Dēśa: A group of thousand villages. The familiar meaning of Dēśa as “country” came much later.  

Each Grāma had to conform to definite measurements, roughly about two square miles. It’s physical layout too, had to adhere to a strict plan of streets and roads, and each street and road was named according to function. 

• Padya: Footpath. Width = Three cubits. 

• Vīthi: market street. The Kannada word Bīdi is derived from this. Width = Five cubits.

• Mārga: road, transit road, vista, avenue, etc. Width = Ten cubits

• Rājamārga: literally, “road on which the king or royal family travels.” Also means a highway, trunk road, road on which carriages and carts travel. Width = Fifteen to thirty cubits.

An inseparable element of this village system was the ubiquitous Śāla or resthouse, a term that is familiar to us today with its prefix: Dharma-Śāla. These were built between Grāmas for the primary purpose of providing protection to travellers during the night. Helmed by an official known as the Śālādhipa, he played a double role of a quasi police and a manager. 

Which brings us to a partial list of officials who kept the village administrative setup well-oiled. 

• Gōpa, grāmabhōjaka, grāmāṇi: The village headman in charge of all functions in the village including maintaining account books. 

• śālādhipati: The village police chief. 

• The officials in charge of Saṅgrahaṇas, Kharvāṭikās, and Drōṇamukhas respectively. 

• Sthānika: In charge of eight hundred villages, i.e., one Sthānīya. 

• Samāhartā: The imperial official to whom the Sthānika reported. His office  can be roughly equated with the contemporary Finance ministry. The  Samāhartā directly appointed the Sthānika.  

This system clearly exhibits a strict administrative hierarchy which was scrupulously followed. Violation of this hierarchy at any level would invite swift punishment.

***

A measure of the incessant continuity of this system is available in the introductory essay of D.V.G’s classic volume, Maisūrina divānarugaḷu (The Divans of Mysore), where he shows with hard data and lived experience how even the British did not overtly disturb this administrative system. He says that for all practical purposes, the villagers regarded the Amaldar (roughly, the Sthanika) as synonymous with Government. Likewise, in his brilliant Tabbaliyu Neenaade Magane, Dr. S.L. Bhyrappa gives a vivid account of how this system operated in practice and how it impacted the real life of the villagers.    

***

The foregoing birds’ eye view of the village administrative setup in ancient India should serve as a reasonable primer for exploring some details of its practical functioning in the Sevuna Empire, which Ala-ud-din Khalji extinguished in the beginning of the 14th century. The details are quite eye-opening to say the least.

Courtesy: https://www.dharmadispatch.in/history/introducing-a-miniature-village-republic-in-the-sevuna-empire