Foreign Trade

India was at the centre of the trading activities in respect of both Euro-Asian as well as
intra-Asian trade in the 15th and 16th centuries. India carried trade through three important
zones-
1. Arabian sea zone or western zone, connecting important sea routes and ports of Persian
Gulf in Mediterranean sea, Iran and Arabic countries to the Red Sea forming borders
with African countries such as Egypt and Djibouti.
2. From the Gulf of Aden, between the Indian Ocean and Yemen to the African Coast.
3. Bay of Bengal Zone, connecting the South China sea through Strait of Malacca.

India played a central role in this structure of Asian trade. Items exports- included agricultural
goods, both food items such as rice, sugar and oil as well as raw materials such as cotton and
indigo. The real strength of the subcontinent, however, lay in the provision of large quantities of
manufactured goods, the most important amongst which was textiles of various kinds. While
these included high value varieties such as the legendary Dhaka muslins and the Gujarat silk
embroideries, the really important component for the Asian market was the coarse cotton
varieties manufactured primarily on the Coromandel coast and in Gujarat. There was a
large-scale demand for these varieties both in the eastern markets of Indonesia, Malaya,
Thailand and Burma as well as in the markets of the Red Sea, the Persian Gulf and East Africa.
The imports included- In the first category were items such as fine spices like cloves, nutmeg
and mace from Indonesia, and horses and rosewater from west Asia. The second category
included rubies and other precious stones from Burma, as well as metals - both precious and
non-precious. By far the most important non-precious metal imported was tin from Malaya.
Precious metals, mainly silver, were imported overwhelmingly from west Asia. It was for this
reason that, from the sixteenth century onward, the port of Mocha was repeatedly referred to as
the 'treasure-chest' of the Mughal empire.

Irfan Habib in his work ‘The Cambridge Economic History of India’ and Om Prakash in
‘European Commercial Enterprise in Pre-colonial India’ focused on the alteration in the position
of India in Asian trade with the advent of Portuguese. sIn the western sector, the European
merchants' involvement in the trade in Asian goods began only after the goods had reached the
southern coast of the Mediterranean, to which these merchants regularly traveled to buy them.
This pattern of trade between Asia and Europe, which had been in operation for centuries,
underwent a structural modification following the discovery by the Portuguese at the end of the
fifteenth century of the all-water route to the East Indies via the Cape of Good Hope. Since it
was the Portuguese who had discovered the Cape route, they promptly monopolized it and
even asked the Pope to legitimize the arrangement.
The Portuguese claim to an armed domination of the maritime trade of the Indian Ocean found
an even more striking expression in the instructions issued to Pedro Alvares Cabral, the
commander of the fleet which sailed for India in 1500. Cabral was instructed to inform the King
of Calicut of the ancient enmity which existed between Christians and Muslims, which imposed
on every Catholic king the obligation to wage war on these enemies of the holy faith. The 'Moor'
merchants who resided in and traded with Calicut could not clearly be exempted from that duty
and the king must know that if the Portuguese encountered their ships at sea, they would take
possession of them, ' of their merchandise and property and also of the Moors who are in the
ships'.
During the first two decades of the sixteenth century, there was a rapid transition from the stage
when the Portuguese planned only individual attacks on Muslim shipping trading between the
Red Sea and the western coast of India to one in which a carefully formulated policy was aimed
systematically at a comprehensive control of the spice trade.
The Portuguese onslaught towards a realization of this goal began with the bombardment of
Calicut(Kerala) in 1502 when it became clear that its king, the Zamorin, was not prepared to
cooperate in expelling the Muslim traders from his port. Calicut's natural enemy and rival on the
Malabar Coast. The first Portuguese fort on Indian soil was constructed in Cochin during 1503.
In 1509 Francisco de Almeida destroyed Diu. But it was not until the capture of the island of
Goa from the Sultan of Bijapur in 1510 under the governorship of Alfonso de Albuquerque that
the foundation of the future Portuguese maritime empire in the Indies was truly laid.The
foundation of Goa as the chief administrative seat was rapidly followed by the capture of
Malacca (1511), which controlled the sea-route to the Far East and which was an important
commercial emporium in its own right. With the conquest of Ormuz in the Persian Gulf (1515),
the Portuguese plan was virtually complete. To be sure, over the coming years a number of
other fortified settlements and trading stations were added to the list such as Hugli and
Chittagong in Bengal, Macau on the estuary of the Pearl river in China, and Colombo in Ceylon.
Thus the Portuguese established a maritime empire named Estado da India. In keeping with the
traditional composition of the Asian imports into Europe, the principal item sought by the
Portuguese Crown in Asia was spices — overwhelmingly pepper. The overwhelming bulk of
their pepper procurement was done in the Malabar region (and later Kanara as well) on the
southwest coast of India. This made India their principal theater of operation throughout the
century and a half of their trading history between Europe and Asia. The procurement of pepper
in India was organized by the Estado while the sales in Europe were through contract sales
based until the middle of the century at Antwerp and thereafter at Lisbon.Throughout the
sixteenth and the first half of the seventeenth century, an overwhelming proportion of the pepper
imported into Lisbon was procured on the southwest coast of India. On the southwest coast of
India, the procurement of pepper was begun at Calicut on the Malabar coast, where the
Portuguese had first arrived.
The exports to Asia- The cargoes sent out from Portugal to Asia to facilitate the procurement of
pepper and other return goods included precious metals (West African gold and, from 1570
onward, primarily rials coined from American silver), non-precious metals such as copper, lead,
tin, quicksilver and mercury, and other goods such as coral and alum, wines and olive oil, and
fine textiles such as scarlets, damasks, taffetas and silks

As far as the Indian maritime merchant was concerned, the Portuguese intrusion into the
western Indian Ocean at the end of the fifteenth century initially created a situation of utter
chaos. As far as the Indian maritime merchant was concerned, the Portuguese intrusion into the
western Indian Ocean at the end of the fifteenth century initially created a situation of utter
chaos. The Portuguese attempt at monopolizing the spice trade called for a total exclusion of
Asian shipping from the Persian Gulf and the Red Sea. This involved frequent raids on ships
departing from Calicut with pepper for the Red Sea.
But this phase was a rather short-lived one and the financial compulsions of the Estado da India
soon made it opt for taxing Asian shipping in the area rather than trying to smother it. This was
done by requiring all Asian ships to ask for and to carry a Cartaz. In the event of
non-compliance, the vessel ran the risk of being seized by the Portuguese cruisers. The
document authorized the vessel concerned to embark upon a specified trip and prohibited it
from carrying goods monopolized by the Portuguese. The ports of call were specified and
generally included a visit to a Portuguese controlled port to pay duties on its cargo before
proceeding to its destination. The fee charged for the grant of a cartaz was quite small: the
principal pecuniary advantage derived by the Portuguese was the duties collected. The
Portuguese were able to enforce such an arbitrary and high-handed requirement essentially
because of the near absence of effective naval capability on the part of the Indian and most
other Asian states at this time.
In order to ensure that the Indian vessels carrying the cartazes were not able to evade calling at
the Portuguese-controlled ports and paying duties there, as well as to obviate the risk of
Malabari pirate attacks on these vessels, the Portuguese introduced on the west coast of India
the so-called qafila or caravan system in the second half of the sixteenth century. Under this
system, Asian vessels operating between specified points were encouraged to sail in a group
escorted by a Portuguese fleet. The practice was reasonably well established by the 1570s: in
1596, sailing in a qafila was made obligatory.

What implications did the Portuguese trade and policies have for the coastal and the high-seas
trade carried on by the Indian merchants? To begin with Gujarat, one finds that, after an initial
resistance, the response of the local merchants was one of acquiescence in the Portuguese
system. By the middle of the sixteenth century, all Gujarati ships leaving the ports of the Gulf of
Cambay were obliged to call at Portuguese-controlled Diu and pay duties there. This involved
an additional fiscal burden of around 5 percent of the value of the goods carried. The sixteenth
century also witnessed a certain amount of reorientation of the Gujarati merchants' trade, with
the share of the Red Sea sector in the total trade perhaps going up substantially. The Kanara
coast- From about 1510 on, the Portuguese are known to have attacked the shipping from
Bhatkal, particularly that bound for the Red Sea. But between 1518 and 1530, this port figured
in the network of Portuguese Crown shipping, and annual voyages were organized to Ormuz
with pepper and other goods such as iron, rice, sugar and ginger. In theory, the Indian
merchants were not allowed to export pepper or import horses into Bhatkal which could be sold
only at Goa, but the restrictions do not seem to have always been observed. The sailings to the
Red Sea and South Arabia often seem to have been carried out even without a cartaz. From
about 1530 onward, the amount of pepper exported from Bhatkal to the Red Sea went up
considerably.
In the west, Indian trade flowed along the two established maritime channels, one through the
red sea, Cairo and Alexandria and the other through Persian Gulf up through Basra and
Baghdad. The north of the red sea was controlled by the Mamluk Sultans of Egypt. The
advances into Iraq were resumed under Suleiman the Magnificent and Baghdad was wrested
from the Safavids in 1534. Basra at the head of the Gulf was left with an autonomous Arab chief
for a time but was taken in 1547. The Ottoman empire thus touched the Indian Ocean in the
Persian Gulf and controlled the entry to the Red Sea. During the end of the 16th century, the
struggle in the Persian Gulf remained between the Ottomans and Portuguese. It were the
Portuguese who dominated the entrance to the gulf by controlling the ports of Hormuz and
Muscat.
Thus the 16th c is important for historians to understand the changing relationship between the
‘old’ and the ‘new’ routes linking Europe and Asia, i.e., the trade from India and beyond to the
Red Sea and the Persian Gulf on one hand and the Cape of Good Hope on the other.
The early years of the seventeenth century mark a sharp discontinuity in the volume and the
value of the seaborne trade between Asia and Europe. This was the direct outcome of the
successful challenge by the Dutch and the English of the Portuguese monopoly of this trade.

However as per Ashin Das Gupta and M.N. Pearson in - India and the Indian Ocean in the
Sixteenth Century did not agree with Om Prakash and argued that the trade network in 16th c
did not alter with the advent of Portuguese.
Despite the fact that the Muslim merchants were expelled in 1502-03 by Portuguese from
Calicut, the trade from Arabian zone and Bay of Bengal zone was dominated by Gujarati Hindu
merchants with dominance over the port of Malacca; red sea and Persian Gulf.
Several important trade routes were still under Indian control.
1. From Aden to Malacca- sea route passed through Gujarat and Malabar, crossing Red
sea to go to Aden. Items of export from India - cotton, indigo from Gujrat, spices from Sri
Lanka and Malabar.
Imports- from Europe came -woolens, silk and bullion.
2. From East Arica, also dominated by Gujratis, exported cotton textiles, beads and spices
in return brought slaves, ebony, ivory and gold.
3. The Hadramawt and the Persian Gulf via Hormuz. Exports from India- cotton, indigo,
spices and foodstuff. Imports - horses, pearls, Persian silk and carpets.
4. Bay of Bengal. Exports - textiles, rice, indigo,spices,opium and foodstuff. No imports
5. Coromandel Coast- Exports- Cotton textiles and yarn.
6. Sri Lanka- Exports- precious stones, cinnamon, black pepper.
7. Pegu. Exports- cotton textiles and foodstuff. Import- Precious stones and metals.
According to Ashin Das Gupta, M.N.Pearson and Sushil Chaudhry, the exports from India
included sugar, indigo, tobacco, cotton and opium but the major item of export was food grains
and textiles. The principle grain surplus region was Bengal and ports such as Hughli and
Balasore handled the exports of large quantities of rice to South-East Asia and Ceylon. The
Kanara rice was exported from the west coast to the Persian gulf and the red sea.
Of India's exports to the markets of Indian Ocean 3 points are levels were important-
Firstly as to India's major export which was textiles throughout the 16th century the mass of it
was of coarse kind. In Indonesia as well as the Red sea it was the commoner people who were
the overwhelming majority of India's consumers.
The Indian textile exported to various Asian markets was of coarse cotton type variety that had
a huge market in south east asia as well as in the middle East. Indian silk and fine cotton had a
limited market due to a heavy price tag. This shows that the Portuguese did not dominate the
trade in the Indian ocean but according to the whole length the arrival of Portuguese brought in
a new age of trade in the Asian region.
Secondly India exported common foods like rice, pulses, wheat and oil for which there was a
considerable demand. Bengal, Odisha and the Kanara coast to the north of Malabar were the
major grain surplus areas. Large quantities of rice and other grains were exported from
Hooghly to South East Asia and Ceylon.
Thirdly, the pattern of Indian exports like most of the other things were items like sugar and raw
silk exported from Bengal and from Malabar pepper. As far as cotton and silk were concerned
Gujarat and Bengal mutually exchanged their products. Indigo and opium were exported from
Bengal.
The imports into the Indian Ocean consisted of goods such as tin, horses, coffee, rose water,
ivory etc. But the most important item was precious metal silver and other varieties of coins. The
coins came from the Red sea and the Persian gulf where they found their way from Europe via
the Levant. Europe in turn received the supply from the Spanish possessions in the new world.
The domination of the total import bill by the precious metals made the foreign trade sector of
crucial importance to the mughal Indian economy.
The regular supply of these metals was important to keep the currency system of the Mughal
Empire intact. For this reason the goods imported by the Europeans into Surat during the early
17th century were subjected to a custom duty of 3.5%.
Gomboon, was another principle port in the Persian Gulf dominated by the Indian ships. The
trading community at Gomboon comprised the Persian traders, Arabs and Armenians and
through these merchants Indian imports were distributed over a fairly wide area in the Persian
and the Ottoman empires.
In India Surat was the most important port from which salling took place to the gulf.
Other important ports were Dabhol, Malabar coast including Rajapur and Maulipatnam on the
Coromandel coast.
The Exports from Surat were mainly textiles, Indigo, tobacco, cotton, rice, Ginger and sugar.;
From Dabhol- textiles, pepper, gumlak, dry ginger and from Bengal sugar, textiles and cotton;
while the ships sailing from Masulipatnam carried mainly Coromandel textiles, Bengal sugar,
rice and cinnamon; the items brought from Persian gulf included rose water, dates, dyes and
horses along with silver and other metal coins.
In the Red Sea the main port was Mocha followed by the port of Jeddah and others. Gujarat
port dominated the Red sea trade. The principle items of export from Gujarat was textiles of
various kinds including those procured on Coromandel coast. The Malabar coast exported
mainly pepper, cardamom and textiles. The commodities imported from the Red sea included
horses, dyes, ivory, opium and coffee.

Like Gujarat Bengal was another important trading region in Mughal India and had extensive
coastal and overseas trade. But as compared to Gujarat here the Bullion trade was relatively
less in volume as it only had marginal access to the Persian gulf and almost none to the Red
sea. The import Trade into Bengal was commodity based to a much greater extent then it was in
the case of regions such as Gujarat.
Bengal became important only after the entry of European East India companies. At the same
time in Bengal the merchant community consisted of ordinary merchants as well as large
numbers of Mughal state officials who took part as they had large amounts of liquid capital and
foreign trade was a profitable channel of investment.
On the whole the trade in the Indian Ocean remained. firmly in the hands of Indian shipping
merchants with only an occasional flutter in the 16th century. Most of the ships that operated
from Surat were named after the Mughal emperor Shah Jahan and princess Bahib Begum. In
16 century Gujarat and Bengal important ports or regions for Mughal overseas trade for textile
production and exchange of commodities Gujarat was a prominent trade route between Delhi
and Agra and was a centre of banking community
Therefore we can conclude that in the 16th century Indian shipping was dominated by the
Gujarati merchants who controlled the sea routes between Cambay and Malacca in the East. In
the West Indian merchant ships traded with Red sea and Persian gulf ports.