India’s history has always been inseparable from trade. From the Harappan docks of Lothal to the modern ports of Mumbai and Mundra, commerce has been the lifeblood of Indian civilization. For thousands of years, India connected continents — through land and sea — serving as both a marketplace and a meeting point for ideas, innovation, and influence. Today, as India aspires to become a Viksit Bharat by 2047 and sets its sights on $1 trillion in exports by FY2026, the echoes of its ancient trade legacy offer more than nostalgia — they offer a roadmap.
The journey from ancient barter routes to digital corridors tells a story not just of economic evolution but of adaptability — the ability to thrive despite changing geopolitical tides, tariffs, and global realignments.
The Ancient Seas That Shaped a Civilization
Trade in India dates back more than 4,000 years. Archaeological finds from Mesopotamia bear the unmistakable imprint of the Indus Valley — carnelian beads, ivory combs, and cotton textiles exported from Indian ports like Lothal and Dholavira (c. 2500 BCE). These maritime connections were supported by early knowledge of monsoons — the same winds that later powered the spice and silk routes.
By the early Common Era, India was the center of global trade. Under the Maurya and Gupta empires (300 BCE – 550 CE), Indian merchants traded extensively with Rome, Persia, and China. Roman records note that India’s exports — spices, silk, gems, and textiles — caused a “drain of gold and silver” from Rome, revealing both demand and pricing power.
During this period, trade governance evolved rapidly. Ancient India had a sophisticated system of tariffs, port duties, and tolls, as mentioned in the Arthashastra. Taxes were imposed on imports and exports — typically around one-tenth (≈10 %) of the value — with variations depending on the nature of goods and route. Mauryan records describe Sulkadhyaksha (customs officials) who managed toll stations and inspected caravans. Coastal ports like Tamralipti and Barygaza collected maritime tariffs, while inland trade was taxed through road checkpoints (Sthaniya).
However, these taxes were not protectionist — they were pragmatic. They ensured quality, standardized weights and measures, and funded public goods like roads, rest-houses, and lighthouses. Trade was seen as an engine of prosperity, not a threat to domestic industry. This open, regulation-with-trust model allowed India to flourish even amid political upheavals and foreign incursions.
By the medieval period, India had become the world’s largest economy, contributing about 30-33 % of global GDP, according to historical estimates. Its trade ecosystem — an intricate blend of state regulation and merchant autonomy — ensured stability despite shifting rulers and empires.
Trade in the Age of Globalization and Tariffs
Fast forward to the modern era, and the spirit of trade remains unchanged, though the form has transformed entirely. Post-independence, India initially adopted a protectionist stance — the “Licence Raj” era limited imports and exports through high tariffs and strict quotas. By the late 1980s, import duties often exceeded 100 percent, isolating India from global markets.
The 1991 economic reforms changed everything. Tariffs were slashed, the rupee was devalued, and markets opened to global competition. India joined the World Trade Organization (WTO) in 1995, binding itself to transparent trade practices. Over time, average tariff rates fell from over 80 % in 1991 to below ~15 % today. The focus shifted from self-protection to self-assertion — from insulating domestic industry to integrating it into global value chains.
Despite global protectionism and tariff wars, India’s trade has continued to expand. In FY 2024-25, exports reached a record $824.9 billion, including $437.4 billion in merchandise and $387.5 billion in services. Key drivers included electronics exports ($38.6 billion, +32 %), pharmaceuticals ($30.5 billion, +9.4 %), and engineering goods ($116.7 billion, +6.7 %). Services exports — led by IT, finance and consulting — grew 13.6 % year-on-year, reinforcing India’s role as a digital superpower. The Economic Times+1
In contrast, India’s merchandise imports stood at $720.2 billion, creating a trade deficit of $282.8 billion, driven largely by its 88 % dependence on imported crude oil. Yet a strong services surplus of $188.6 billion helped offset the gap, much like how ancient India balanced goods trade with the export of knowledge, culture and religion across Asia.
From Silk Routes to Digital Corridors
India’s geography has always been its advantage. Ancient traders navigated Himalayan passes and maritime monsoon routes — the same corridors that today are being reimagined as the India–Middle East–Europe Economic Corridor (IMEC), the Chabahar–Central Asia route, and the Eastern Maritime Corridor linking India, Myanmar and Thailand.
Modern logistics mirror ancient efficiency. Where the Mauryans had Sulkadhyakshas, India now has digital customs clearance, e-invoicing systems, and AI-led port management. What used to be paper toll receipts are now blockchain-verified trade documents. Even the spirit of the ancient śreṇīs — the merchant guilds that set fair prices and maintained ethical codes — lives on in industry councils, export promotion boards, and trade associations that shape policy today.
The evolution of trade tariffs also reflects India’s balancing act between openness and protection. While the ancient model taxed goods to ensure fairness and fund infrastructure, the modern state uses tariffs to shield emerging sectors and negotiate from strength. For example, tariff reductions under FTAs with Japan, South Korea and ASEAN have boosted electronics and automobile components exports, while selective tariff hikes protect sensitive industries like steel and agriculture.
Yet India’s strategy remains pragmatic rather than ideological — a reflection of its ancient ethos. The goal is not free trade for its own sake but fair trade that enhances competitiveness, ensures employment and strengthens sovereignty.
Lessons from the Past, Directions for the Future
Ancient trade offers enduring lessons for Viksit Bharat:
Diversification of routes: When western routes were blocked by invasions, ancient merchants turned eastward toward Southeast Asia. Similarly, today’s India must strengthen multiple trade corridors — Chabahar to Central Asia, IMEC to Europe, and the Indo-Pacific partnerships — reducing over-dependence on any single region.
Trust and transparency: The singchyad tally stick that guaranteed fair trade in the Himalayas can inspire blockchain-led supply chain systems today. Transparent documentation can reduce fraud, lower transaction costs and speed up customs — ancient wisdom meeting modern technology.
Value addition and branding: India’s ancient wealth came from craftsmanship — muslin, silk, spices and gems. The same logic applies now: high-value manufacturing, branded exports, and innovation-led services must replace low-margin commodities.
Polylateral trade partnerships: Ancient India traded simultaneously with Rome, Persia and China. Modern India can mirror this with diversified partnerships across the U.S., EU, ASEAN, Africa and Latin America, ensuring resilience amid geopolitical uncertainty.
Adaptive tariff strategy: Just as Mauryan officials adjusted tolls based on routes and risks, India must calibrate tariffs dynamically — lowering duties on inputs to encourage exports while maintaining strategic protection for critical industries.
The Engine of Viksit Bharat
India’s rise as a global economic powerhouse is not accidental; it is civilizational. The DNA of Indian trade — innovation, openness and resilience — has remained intact for millennia. Today, as merchandise exports approach $437 billion and digital services exceed $387.5 billion, India stands at the threshold of becoming the world’s third-largest economy and a global trade hub.
Geopolitical headwinds, tariff barriers and shifting supply-chains are not new phenomena — India has faced them before and turned them into opportunity. Ancient traders adjusted to empires and climates; modern India is adapting to algorithms and artificial intelligence.
By combining the trust-networks of its past with the technology of its present, India can build a trade ecosystem that is both global and grounded. A Digital Silk Route, heritage-linked economic corridors, and AI-driven logistics can make India not just a participant but a leader in the next phase of global commerce.
A Legacy Renewed
India’s trade story is one of resilience and reinvention — of ships that once sailed the monsoon winds now replaced by data packets crossing fibre-optic cables. The goods have changed — spices and silk have given way to semiconductors and software — but the essence remains the same: to connect, to create, and to contribute.
As the nation charts its path to Viksit Bharat, it carries with it a priceless inheritance — the intuition of its ancient traders, the pragmatism of its early tariffs, and the ambition of its modern innovators.
From the bustling bazaars of the Mauryan era to the digital marketplaces of today, India’s trade journey reflects a single truth: a civilization that understood exchange not just as economics, but as destiny.
And as global commerce looks east once more, India’s ancient seas and modern markets are once again converging — to power the world’s next great growth engine.
By Authored by Suketu Thanawala and Anamika Singh, StraCon Business Advisory Services.
