These two books reveal how Tamil enterprise and Bombay merchants helped build business in India

Kanaklatha Mukund’s The World of the Tamil Merchant: Pioneers of International Trade and Lakshmi Subramanian’s Three Merchants of Bombay: Doing Business in Times of Change are part of the History of Indian Business series, edited by Gurcharan Das. Unlike some others in the set, both of these are valuable contributions, shedding useful light as they do on some of the least-known and understood periods of Indian commerce.

When Tamil enterprise was a winner

Would it not come as a surprise to know that not only were Tamil merchants carrying on a roaring trade with Imperial Rome as early as 75 AD, but that the balance of trade was so heavily skewed in India’s favour that the Roman Emperor Vespasian had no other option except to try to stymie the unidirectional flow of precious metals from Rome by imposing curbs on trade? Or that one of the main imperatives of the first invasion of Sri Lanka in 668 AD were commercial, specifically to create new markets for Tamil goods?

Mukund has looked at and analysed with appropriate scepticism a variety of evidence – literary, archaeological and contemporary political and commercial documents – and concluded that Tamil businesses in ancient and medieval times were vibrant, developed with and aided by unique local institutions such as the nagaram, and most importantly in the medieval age, by temples.

In fact, Mukund’s métier as a thinking historian is thrown into sharp relief when she advances as many as six different reasons for which the growth of business and temples went so uniquely hand-in-hand in South India:

1. The construction of huge temples led to much economic activity.
2. Once constructed, the temple was a major buyer of local products such as grains for the prasadam and aromatic substances for worship of the deities and oil for its lamps.
3. Many temples leased out the lands they owned for agriculture, which in turn created tradable surpluses.
4. The temples often donated herds of cattle to farmers on condition that part of the milk and ghee would be given to the temple – this led to substantial livestock farming on a commercial basis.
5. The temple trusts lent large amounts of money (received as donations and grants) at interest rates that were, for all practical purposes, an accommodative monetary policy which facilitated trade and industry.
6. The temple was a major stakeholder in the economy, simultaneously being employer, consumer and financier, and was in a strong position to ensure stability in markets, which it often did ,except during periods of great political turmoil.

The book also succeeds in great measure in evoking the sights and sounds of such a distant time and, for many readers, an unknown land, particularly when it quotes contemporary accounts. Sample this description of a Madurai market from the Silappatikaram, one of the five great epics of Tamil literature written as far back as the beginning of the Common Era (CE1), which also serves to indicate how developed and rich the economy was even then:

“The market streets were heaped with many expensive goods that would be desired even by kings: covered carts, two wheeled carts, beautiful chariots, armour to cover the entire body, elephant goads set with gems, armguards made of leather, waist bands, balls of aromatic substances, white chowris, feather whisks, shields embossed with boar heads or forests, small leather shields, garlands made of pith, tools like saws, goods carved from ivory, scented paste and flower garlands.”

A trio of titans

Lakshmi Subramaniam’s book, Three Merchants of Bombay: Doing Business in Times of Change, focuses on a different time and place – the Bombay-Surat region of the 18th and 19th centuries – by means of biographical essays on three pioneering businessmen.

Trawadi Arjunji Nathji’s is virtually an unknown name today even to scholars of Indian history, but his ascent as a Shroff (banker) and subsequent career is an eye-opener in two ways. First, in understanding the hazards of an age when possession of the space created by the disintegration of the Mughal Empire was being contested by the Maratha Confederacy, local powers and various European countries through their trading companies. And second, in appreciating the brilliance, acumen, and flexibility of a merchant who built his fortune amidst the havoc of war and uncertainty. He was able to do this by, among other things, developing a payments network that piggybacked on trade routes, an astute knowledge of the exchange rates of the different currencies that were then prevalent in India, leadership of his community, and sound political judgment.

Sir Jamsetji Jeejeebhoy, the first Parsee baronet, also made his fortune in times of great political and business upheaval – that triangulation of circumstances which resulted in, as the historian Tan Chung puts it, “Indian opium for the Chinese, Chinese tea for the Britons and British Raj for the Indians.” In other words, Jeejeebhoy seized the opportunities thrown up by the booming trade in opium and tea, developed new supply chains, diversified his business interests and thus built such a vast fortune that he was relatively unscathed when the China trade collapsed in the wake of the Opium Wars. He was a great benefactor of charities in a manner markedly different from earlier Indian philanthropy – the colleges, hospital, and various other charities that he founded were formally structured entities with sustainable sources of revenue.

Premchand Roychand also acquired a vast fortune by means of that most devious route to riches: speculation in stocks, giving birth to the country’s first stock exchange in the process. He rode the crest of the cotton wave that engulfed Bombay in the latter half of the 19th century. He was given extraordinary support by British establishment figures, which led him, first, to a directorship of the Bank of Bombay, and then dominance of that institution, which in turn threw all caution and prudence out of the window by lending Premchand and his associates any amount they wanted without virtually any security.

Naturally, like all asset bubbles which eventually burst, the cotton euphoria too disappeared almost as suddenly as it had materialised, taking with it the Bank of Bombay and many dispirited investors. But even in adversity Premchand remained in command of his circumstances, repaid all his debt, and started trading in stocks again. He also endowed many educational charities and bequeathed substantial sums to the Universities of Calcutta and Bombay. Like Sir Jamsetji, he too contributed to Bombay’s civic amenities and architecture.

Subramaniam’s competence is not only in recollecting the facts, but in placing them in historical perspective and establishing convincing causalities and linkages. Premchand Roychand’s rise and fall, for example, is shown to be the direct outcome of the start and end of the American Civil War. With cotton supplies to England from America disrupted, the demand was directed at India which caused the boom, and when American supplies resumed, the fall came.

Sir Jamsetji’s career, too, was related, as mentioned before, to the great triangular trade among India, China and England. His charities were reflections of his colonial modernity, a state of affairs that paralleled developments in other fields. Arjunji Nathji’s banking house too prospered largely because the banker consistently sided with the power that provided the most stable, rule-oriented administration.

Subramaniam’s language is sometimes forbiddingly opaque (and she has an inordinate fondness for all forms of the word “foreground”), and her arguments are sometimes repeated much more often than necessary, but on the whole, this is a book that will leave readers well educated about the challenges that these merchants faced, how they overcame them, and a fine sense of those times.