The State and Commodity Production in the Magadhan State (500 to 200 B.C.)
From The Culture and Civilization of Ancient India in Historical Outline by D.D. Kosambi, Vikas Publishing House, New Delhi, 1982
The Arthasastra state differed in one other remarkable particular from any other known to antiquity, whether in India or elsewhere: it engaged in commodity production on a large scale. The main income of the state, as we have seen, was from sita lands, which paid a fourth or more of the produce into the state's warehouse; the rashtra taxes, though lower, were also mainly gathered in kind. The grain had to be husked and perhaps milled to flour before it became usable; someone had to press the oilseeds for the edible oil, to card the cotton and spin it into yarn, to grade and process the wool and prepare blankets, to saw and trim down the timber into planks and beams; and so on. The superintendent of crown storehouses had all this done under state supervision, mostly by local labour (both men and women) seasonally engaged when agricultural operations were slack; they were paid a small monthly wage in addition to their food. The full range of operations is described in the Arthasastra, with the normal loss of every kind of material given at each stage of processing, with the average output of efficient labour, the final weight or measurement of the finished product and so on step by step; we might be reading a factory production manual rather than a book on statecraft. With the system of recording, it would have been difficult to cheat. The inefficient state official was fined in proportion to the loss of revenue caused by his negligence, with rewards for the keener officials who showed income above the estimate by finding new sources not in the budget or by new economies and more efficient methods of processing. In addition, the state storehouses were very important in budgeting and each of them had a rain-gauge whose records helped classify the land for revenue estimates.
The final product was sold. A great deal went to other branches of the state service, such as the army; but it was transferred by sale with full accounting. The state paid its soldiers very well, but as much of the pay was to be gathered back as possible during a campaign by salaried state agents disguised as merchants selling their goods in army camps at double prices and returning the difference to the treasury. Every state servant was paid in cash; the scale of salaries, given in fullest detail, makes impressive reading. The highest pay was 48,000 panas per year each for the kings chief priest, high councillor, chief queen, queen mother, crown prince, and commander-in-chief. The lowest was 60 per year for the menial and drudge labour needed on such a large scale in camp and on state works; this was called vishli, and there was an element of press-gang compulsion in it, but it was paid for, whereas the same word under feudalism meant the forced unpaid corvee labour which peasants and artisans had to give in lieu of or in addition to taxes as required by the king or the local baron, ostensibly for the public good. A good deal of this labour was for porterage in bad country, roadmaking, digging irrigation canals or fortification ditches and piling up dykes. The scale of 60 pieces of silver shows the minimum then needed to keep body and soul together for a year under conditions of hard physical labour, with perhaps something left over for dependents. (This amounts to 17.5 grams of silver per month, almost exactly what was paid to the lowest Indian labour by the British East India Company in the early eighteenth century). Carpenters and craftsmen were paid by the state at 120 panas. The heavy-armed soldier of the line after being trained in full got 500, which was the scale also for scribes and accountants in state service (generals, senior superintendents, etc., naturally got much more). The expert miner and the engineer received 1,000 a year. So did the best quality of spy who could disguise himself in many ways; also the spy who normally lived unsuspected as a householder, merchant, or man of religion. Whereas these spies were expected actually to follow the normal pastimes of the classes whose disguise they adopted, there were no extra allowances; hence 1,000 panas per annum may be taken as the decent minimum for a Magadhan grihapati's normal standard and style of living. The lower spies, assassins, bravos, poisoners, the beggar-woman-spy (who had unhindered access to all women's apartments from the palace to normal household), got 500, which was also the scale for the registrar who reported on the village or villages in his charge. Royal messengers were paid on a fixed scale, in proportion to the distance travelled, with double rates for the long-distance couriers. There were regular pensions for those disabled in state service, and for the helpless dependents of servants and officials who died during their term. For long service, special bonuses were given in the form of allowances of rice or food-grain, presents of cloth and the like. Never was anything given away which would permanently curtail state revenues; when short of ready cash, the king might add any gift articles from his storehouses that he liked, but not give away land or whole villages. This is a strange injunction from a brahmin minister like Canakya, seeing the villages given away to yajna priests by Bimbisara and Pasenadi; the latter also granted an occasional village to a prince or army colonel. The Arthasastra expressly warns against such hereditary gifts, which later became the norm under feudalism. The most that any Magadhan state servant might expect was a plot of sita land assigned on much the same terms as to anyone else, unless the candidate had been disabled or superannuated in state service, in which case the rates might be reduced; but the land had to be worked and taxes paid regularly.
It follows that the Magadhan state functioned on a powerful cash economy. Some misunderstanding has been caused by the word pana or karshdpana, which came later to mean a copper coin. The Arthasastra pana was of silver, as seen from the directions given in the book itself, and from numerous archaeological finds of the period. The age shows plenty of hoards of silver coins of the 3.5 gram standard, but none of gold and very few of copper. The demand upon currency must have been enormous, when we recall the size of Candragupta's army, even taking a goodly part of the camp to consist of menials, vishti drudge labourers, and attendants. It must be emphasised that the state controlled all mining in its domains. This is shown by the excellent salary for the miner who directed everything from the prospecting to the refinery. The state monopoly is reflected in Canakya's dictum: 'The treasury is based upon mining, the army upon the treasury; he who has army and treasury may conquer the whole wide earth.' The Greeks would have understood this basic position of heavy industry very well, though the Indians of the Panjab did not, nor did Indian politicians in general till perhaps the present day. There are careful though brief directions in the Arthasastra for reducing and smelting ores, with distinction between various grades.
Nowhere is it implied that the state would make die tools and utensils and ornaments in use; a great deal of the metal was sold by the state to the trader, to artisans' guilds, goldsmiths, and individual manufacturers. Even silver coins could be made by a person provided the pieces were taken to the mint, where the alloy and weight would be checked and the proper punch-marks stamped on if the pieces were up to standard; after which the coin would be legal tender. Counterfeiting involved drastic punishment. It is known that cloth, pots, baskets, etc., were mostly made and traded privately.
What were the relations between the private commodity producer and the state ?
The trader, and merchant could purchase whatever was available from the state, or from any other source. Every peasant was free to sell his surplus, if any, to any purchaser or to barter it against any article of use. The royal storehouses in each janapada had to keep a permanent stock not only of grain and foodstuffs but of rope, timber, tools and the like against emergencies. Famine, fires, flood, or an unusually lean year due to epidemic or the like would find public relief given from these stores. An inscribed copper plate found near Savatthi and a similar though damaged limestone slab from Bogra prove not only that the storehouses actually existed but that such instructions for storage and relief were given. Except for this reserve stock, anything else could be sold. The merchant's troubles began after the purchase. There was the rigid rule: 'No trade goods to be sold (by the private merchant) in their place of origin.' This implies that the purchased material had to be processed in some way, and generally to be transported to a distant place. The trader had to add value by manufacture, or by transport; the latter was most important in keeping the circulation of goods and money at a satisfactory level. There were periodic checks on all weights and measures (with a license fee) with the inspection of all wares and stocks. The caravaneer had to pass from janapada to janapada through forests infested with savages against whom the caravan might protect itself by carrying arms. As soon as the frontier of the next janapada was reached, the arms might have to be deposited in the state armoury, unless there were special reasons for which a permit might be issued against the proper fee. No private individual was allowed to go armed within the janapada limits without such a permit; even regular soldiers not on active guard duty could not bring their arms into a city. The caravans had to pay tolls and customs duties upon entering and leaving the janapada. Smuggling and false declarations of value were not only dangerous but very difficult, because at least one merchant in the caravan would be a spy in the well-paid secret service, and would know of every transaction of the caravan. Often the information would be sent ahead so that the captain of frontier guards could tell the merchants exactly what goods their caravan had brought, without waiting for the formal customs declaration. The goods imported had to be sold at an appointed public market-place at prices that allowed a good profit but no more. Unsold goods might even be put up by the local officials for sale at prices they believed to be fair, based upon their very accurate information; the merchantunlike his modern counterpart could not withhold any essential goods in the hope of a better bargain somewhere else, as for under-cover sales at higher prices.
Perhaps the most serious of the restrictions on the manufacturing trader was the limit to his supply of skilled labour. The artisan was free and generally organised in powerful guilds. No sudra living as a free man could be sold into servitude; the Greeks could not recognise any form of slavery in India, just as the Indians thought that there was only the distinction of Arya and Dasa castes on the frontier and in Greek lands. Penal slaves have been mentioned before, and there was a whole purchased class of house slaves, entertainers, and the like. But none of them could be asked to perform any degrading or filthy service; any such compulsion resulted in immediate freedom, as did any attempt at rape, or cruelty. Children of slave and free were free, not subject to sale. Any property held by the slave could not be taken by the master; the labour of any slave would count at its statutory value towards purchasing his or her freedom. The paid workers were protected by a very fair contract law, which bound them as well as those who had contracted for their services. Add to that the endless forest where anyone who had the nerve could find refuge. There it was always possible to live by food-gathering and for people on good terms with the savages to clear a patch for cultivation, untroubled by state or taxes till the janapada expanded to that limit. Though the merchant's interests were amply protected in those cases where they did not conflict with those of the crown, the general attitude of the law was that the trader was a natural rogue who would become a public enemy unless carefully watched, controlled, and penalised from time to time. No view more strikingly different from the Buddhist attitude can be imagined.
The cash appraisal of everything is reflected in the table of fines; the list occupies nine and a half columns in the index to a standard translation of the Arthasastra, and covers many transgressions that would have been treated as sins or bad manners. Even the brahmin priest was legally bound, just like any other contracting party, by his agreement to perform a ritual. The ascetic who had not the wherewithal to pay a fine for a minor transgression was assessed in terms of prayers for the king. Prostitution was neither a crime nor a sin, but a state enterprise under its own minister; the regulations for public women are as complete as for merchandise or services of less peculiar quality. When they had earned certain amount, they could retire and become respectable, for the profession was not so dishonoured as it became later; but the debt to the state must be paid. The superannuated courtesan could in turn become a superintending Madam herself in state service. Wines, too, had a separate ministry that looked after the liquor from manufacture to sale. All gambling houses were also run by the state under a particular superintendent. The penetration of cash economy into every corner of civic life can hardly be better shown than by these features. Only it must be remembered that by far the greater number of people lived in the deaf sita villages, where every precaution was taken to keep them hard at work on the soil. The prostitute, wine shop and gambling house were amenities for the cities and towns, not for the countryside in general. When we say that the Magadhan state and its society reduced everything to its money equivalent, the statement applies primarily to urban life, to the caravan trader, and the state official; not to the lowly peasant deported for settlement on crown land.