Ancient Indian economy

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Indian herbal medicines

Ancient India trade: Indian herbal medicines

Most people in ancient India, as in other parts of Asia and Europe at this time, were farmers. In India, farmers mainly grew wheat and rice, and cotton for cloth. They grew opium for medicine too. On the coast, people produced salt in big evaporation flats, and in Sri Lanka they dove for pearls. Indian traders shipped teak wood to Iran to use in ship-building. Many men and women and children also worked in manufacturing, spinningweaving, and printing cotton cloth, pouring steel into crucibles, boiling off sugar into lumps, and drawing out glass into tiny glass beads.

India always made money from trade, because India is between China and West Asia and Europe. From the Harappan period on, Indian people were selling gold to West Asia, using their carefully made weights to weigh the gold out. Soon Indian traders were selling West Asian glass and wool to people in China, and Chinese things like silk and pottery to people in West Asia.

Traders in India also sold a lot of Indian things to both China and West Asia. Early on it was mainly medicine, but also spices like cinnamon and black pepper, clothing dyes like indigo (named for India) and luxuries like pearls. The trade made India a very rich country. But because the trade mainly went through northern India, the north part of India was usually richer than the south part.

Beads from Arikamedu

Beads from Arikamedu

Sometime around 600 BC, Indian traders began to trade using ships on the ocean, which could carry more stuff more easily and safely than donkeys or camels could on land. This was good for South India, because some of the ships went to ports in the south, or sailed right around the south of India. About the same time, Indian rulers began to mint metal coins.

Also about this time, pearl divers were collecting pearls to sell off the shores of Sri Lanka. By 200 BC, manufacturers had extended the pearl industry to include cheaper stone and glass beads on the south-east coast of India, at Arikamedu, and traded both pearls and beads as far as the Philippines to the east and as far as West Africa to the west.

Steel furnace from Samanalawewa, Sri Lanka

Steel furnace from Samanalawewa, Sri Lanka

This successful shipping trade, and the Sogdian creation of the Silk Road route from Central Asia east to China and west to the Persian Empire, encouraged Indian manufacturers to develop new industries. By around 300 AD, India was making and selling high quality steel along the Silk Road; a hundred years later India was also making and selling paper. In the 600s AD there was a big steel factory with wind-driven bellows in Sri Lanka. About the same time, India began to make and sell tons of lump sugar to China, to the Sogdians, and to the Parthian Empire.

African giraffe in India (Konarak Sun Temple, Odisha, ca. 1250 AD)

African giraffe in India (Konarak Sun Temple, Odisha, ca. 1250 AD)

About 130 BC, the Ptolemies established direct sailing from Egypt and East Africa to India. By 800 AD, Indian manufacturers were also selling a lot of cotton clothsilk, and glass beads to Arab traders and African traders, who sailed with the cloth to East Africa and sold it there, bringing back African ivorygold, and slaves. Very soon, looking for other things to trade for, the traders also began to bring back coffee.

Did you find out what you wanted to know about ancient India trade? Let us know in the comments!

Learn by doing: go to a bead store and make a bracelet or necklace.
More about the Indian economy

Bibliography and further reading about the ancient Indian economy:


Arab Seafaring: In the Indian Ocean in Ancient and Early Medieval Times, by George Hourani and John Carswell (2002). For adults, a time-tested account of trade between India and the Arabian Peninsula.

Eating India: An Odyssey into the Food and Culture of the Land of Spices , by Chitrita Banerji (2007). Not a cookbook, but a discussion of food in India, for grown-ups.

Eyewitness India, by Manini Chatterjee (2002). Written for kids.

Ancient India, by Virginia Schomp (2005). Written for teens. Very good for reports.

More about the Indian economy home

By |2018-04-23T14:47:03+00:00July 20th, 2017|Economy, India|15 Comments
Cite this page: Carr, K.E. Ancient Indian economy. Study Guides, July 20, 2017. Web. December 15, 2018.

About the Author:

Dr. Karen Carr is Associate Professor Emerita, Department of History, Portland State University. She holds a doctorate in Classical Art and Archaeology from the University of Michigan. Follow her on Instagram, Pinterest, or Facebook, or buy her book, Vandals to Visigoths.


  1. Savita May 30, 2018 at 1:38 am - Reply

    You have mentioned that traders began to bring back coffee to India around 800 AD. In India, the story is that a Sufi named Baba Budan first brought coffee beans here in the 15 -16th centuries AD and planted them in Coorg.

    Could you please clarify?

    I enjoyed reading your article.


    • Karen Carr May 30, 2018 at 10:11 am

      That story is about the first people who tried to grow coffee in India – a very different thing from the first traders who brought coffee to India. The story is clear that people were already drinking coffee in India long before that.

  2. fake person May 22, 2018 at 6:09 pm - Reply

    very helpfull

  3. Neel May 12, 2018 at 7:18 am - Reply

    Nice information

    • Karen Carr May 12, 2018 at 10:47 am

      Thank you, Neel! I’m glad we could help.

  4. Bob April 17, 2018 at 6:59 am - Reply

    Thanks this was helpful!

    • Karen Carr April 17, 2018 at 8:29 am

      I’m glad we could help!

  5. Bob February 8, 2018 at 2:38 pm - Reply

    This was useful Thank you!!

  6. ANGEL S February 7, 2018 at 1:37 pm - Reply


  7. Alex February 6, 2018 at 2:50 pm - Reply

    Where did you get the information from?

    • Karen Carr February 6, 2018 at 4:18 pm

      You can find the same info in the books listed at the end of the article.

  8. Alex February 5, 2018 at 2:42 pm - Reply

    Thank you for the information

    • Karen Carr February 5, 2018 at 3:36 pm

      You’re welcome, Alex! Thanks for stopping by.

  9. Jewell Lilac December 11, 2017 at 6:21 pm - Reply

    in the second paragraph there is a grammer issue. it says China and West Asia and Europe. it should say china, west asia, and europe. thank you and have a good day

    • Karen Carr December 11, 2017 at 11:45 pm

      Thank you for commenting, but that’s not really a grammar error, just a stylistic choice. I wanted to make it clear that it’s not a list of things, because India is between China (to the east) and West Asia and Europe (to the west). It’s really between two things, not three.

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