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GS Paper IV Probity in Governance

Administrative divisions at the time of Mughal

Main article: Subah

Subah (Urdu: صوبہ‎) was the term for a province in the Mughal Empire. The word is derived from Arabic. The governor of a Subah was known as a subahdar (sometimes also referred to as a “Subah[67]), which later became subedar to refer to an officer in the Indian Army. The subahs were established by Badshah (emperor) Akbar during his administrative reforms of 1572–1580; initially, they numbered 12, but his conquests expanded the number of subahs to 15 by the end of his reign. Subahs were divided into Sarkars, or districts. Sarkars were further divided into Parganas or Mahals. His successors, most notably Aurangzeb, expanded the number of subahs further through their conquests. As the empire began to dissolve in the early 18th century, many subahs became effectively independent or were conquered by the Marathas or the British.

The original twelve subahs created as a result of administrative reform by Akbar:

  • Agra Subah
  • Ajmer subah
  • Awadh Subah
  • Bengal Subah
  • Bihar Subah
  • Delhi Subah
  • Gujarat Subah
  • Kabul Subah
  • Illahabad Subah
  • Lahore Subah
  • Malwa Subah
  • Multan Subah
  • Thatta (Sindh) Subah


The Indian economy was large and prosperous under the Mughal Empire. During the Mughal era, the gross domestic product (GDP) of India in 1600 was estimated at about 22% of the world economy, the second largest in the world, behind only Ming China but larger than Europe. By 1700, the GDP of Mughal India had risen to 24% of the world economy, the largest in the world, larger than both Qing China and Western Europe. Mughal India was the world leader in manufacturing, producing about 25% of the world’s industrial output up until the 18th century. India’s GDP growth increased under the Mughal Empire, with India’s GDP having a faster growth rate during the Mughal era than in the 1,500 years prior to the Mughal era. Mughal India’s economy has been described as a form of proto-industrialization, like that of 18th-century Western Europe prior to the Industrial Revolution. The Mughals were responsible for building an extensive road system, creating a uniform currency, and the unification of the country. The empire had an extensive road network, which was vital to the economic infrastructure, built by a public works department set up by the Mughals which designed, constructed and maintained roads linking towns and cities across the empire, making trade easier to conduct.

The main base of the empire’s collective wealth was agricultural taxes, instituted by the third Mughal emperor, Akbar. These taxes, which amounted to well over half the output of a peasant cultivator, were paid in the well-regulated silver currency, and caused peasants and artisans to enter larger markets.


The Mughals adopted and standardized the rupee (rupiya, or silver) and dam (copper) currencies introduced by Sur Emperor Sher Shah Suri during his brief rule. The currency was initially 48 dams to a single rupee in the beginning of Akbar’s reign, before it later became 38 dams to a rupee in the 1580s, with the dam’s value rising further in the 17th century as a result of new industrial uses for copper, such as in bronze cannons and brass utensils. The dam was initially the most common coin in Akbar’s time, before being replaced by the rupee as the most common coin in succeeding reigns. The dam’s value was later worth 30 to a rupee towards the end of Jahangir’s reign, and then 16 to a rupee by the 1660s. The Mughals minted coins with high purity, never dropping below 96%, and without debasement until the 1720s.

Despite India having its own stocks of gold and silver, the Mughals produced minimal gold of their own, but mostly minted coins from imported bullion, as a result of the empire’s strong export-driven economy, with global demand for Indian agricultural and industrial products drawing a steady stream of precious metals into India. Around 80% of Mughal India’s imports were bullion, mostly silver, with major sources of imported bullion including the New World and Japan, which in turn imported large quantities of textiles and silk from the Bengal Subah province.


The Mughal Empire’s workforce in the early 17th century consisted of about 64% in the primary sector (including agriculture), over 11% in the secondary sector (manufacturing), and about 25% in the tertiary sector (service).[77] Mughal India’s workforce had a higher percentage in the non-primary sector than Europe’s workforce did at the time; agriculture accounted for 65–90% of Europe’s workforce in 1700, and 65–75% in 1750, including 65% of England’s workforce in 1750. Historian Shireen Moosvi estimates that in terms of contributions to the Mughal economy, in the late 16th century, the primary sector contributed 52%, the secondary sector 18% and the tertiary sector 29%; the secondary sector contributed a higher percentage than in early 20th-century British India, where the secondary sector only contributed 11% to the economy. In terms of urban-rural divide, 18% of Mughal India’s labour force were urban and 82% were rural, contributing 52% and 48% to the economy, respectively.

Real wages and living standards in 18th-century Mughal Bengal and South India were higher than in Britain, which in turn had the highest living standards in Europe. According to economic historian Paul Bairoch, India as well as China had a higher GNP per capita than Europe up until the late 18th century, before Western European per-capita income pulled ahead after 1800. According to Moosvi, Mughal India also had a per-capita income 1.24% higher in the late 16th century than British India did in the early 20th century. However, in a system where wealth was hoarded by elites, wages were depressed for manual labour, though no less than labour wages in Europe at the time. In Mughal India, there was a generally tolerant attitude towards manual labourers, with some religious cults in northern India proudly asserting a high status for manual labour. While slavery also existed, it was limited largely to household servants.


Indian agricultural production increased under the Mughal Empire. A variety of crops were grown, including food crops such as wheat, rice, and barley, and non-food cash crops such as cotton, indigo and opium. By the mid-17th century, Indian cultivators have begun to extensively grow two new crops from the Americas, maize and tobacco.

The Mughal administration emphasized agrarian reform, which began under the non-Mughal emperor Sher Shah Suri, the work of which Akbar adopted and furthered with more reforms. The civil administration was organized in a hierarchical manner on the basis of merit, with promotions based on performance. The Mughal government funded the building of irrigation systems across the empire, which produced much higher crop yields and increased the net revenue base, leading to increased agricultural production. A major Mughal reform introduced by Akbar was a new land revenue system called zabt. He replaced the tribute system, previously common in India and used by Tokugawa Japan at the time, with a monetary tax system based on a uniform currency. The revenue system was biased in favour of higher value cash crops such as cotton, indigo, sugar cane, tree-crops, and opium, providing state incentives to grow cash crops, in addition to rising market demand. Under the zabt system, the Mughals also conducted extensive cadastral surveying to assess the area of land under plow cultivation, with the Mughal state encouraging greater land cultivation by offering tax-free periods to those who brought new land under cultivation. The expansion of agriculture and cultivation continued under later Mughal emperors including Aurangzeb, whose 1665 firman edict stated: “the entire elevated attention and desires of the Emperor are devoted to the increase in the population and cultivation of the Empire and the welfare of the whole peasantry and the entire people.”

Mughal agriculture was in some ways advanced compared to European agriculture at the time, exemplified by the common use of the seed drill among Indian peasants before its adoption in Europe. While the average peasant across the world was only skilled in growing very few crops, the average Indian peasant was skilled in growing a wide variety of food and non-food crops, increasing their productivity Indian peasants were also quick to adapt to profitable new crops, such as maize and tobacco from the New World being rapidly adopted and widely cultivated across Mughal India between 1600 and 1650. Bengali farmers rapidly learned techniques of mulberry cultivation and sericulture, establishing Bengal Subah as a major silk-producing region of the world.[8] Sugar mills appeared in India shortly before the Mughal era. Evidence for the use of a draw bar for sugar-milling appears at Delhi in 1540, but may also date back earlier, and was mainly used in the northern Indian subcontinent. Geared sugar rolling mills first appeared in Mughal India, using the principle of rollers as well as worm gearing, by the 17th century.[90]According to economic historian Immanuel Wallerstein, citing evidence from Irfan Habib, Percival Spear, and Ashok Desai, per-capita agricultural output and standards of consumption in 17th-century Mughal India were probably higher than in 17th-century Europe and certainly higher than early 20th-century British India. Increased agricultural productivity led to lower food prices. In turn, this benefited the Indian textile industry. Compared to Britain, the price of grain was about one-half in South India and one-third in Bengal, in terms of silver coinage. This resulted in lower silver coin prices for Indian textiles, giving them a price advantage in global markets.

Industrial manufacturing

Up until the 18th century, Mughal India was the most important centre of manufacturing in international trade. Up until 1750, India produced about 25% of the world’s industrial output. Manufactured goods and cash crops from the Mughal Empire were sold throughout the world. Key industries included textiles, shipbuilding, and steel. Processed products included cotton textiles, yarns, thread, silk, jute products, metalware, and foods such as sugar, oils and butter. The growth of manufacturing industries in the Indian subcontinent during the Mughal era in the 17th–18th centuries has been referred to as a form of proto-industrialization, similar to 18th-century Western Europe prior to the Industrial Revolution. In early modern Europe, there was significant demand for products from Mughal India, particularly cotton textiles, as well as goods such as spices, peppers, indigo, silks, and saltpetre (for use in munitions).[68] European fashion, for example, became increasingly dependent on Mughal Indian textiles and silks. From the late 17th century to the early 18th century, Mughal India accounted for 95% of British imports from Asia, and the Bengal Subah province alone accounted for 40% of Dutch imports from Asia.[92] In contrast, there was very little demand for European goods in Mughal India, which was largely self-sufficient, thus Europeans had very little to offer, except for some woollens, unprocessed metals and a few luxury items. The trade imbalance caused Europeans to export large quantities of gold and silver to Mughal India in order to pay for South Asian imports. Indian goods, especially those from Bengal, were also exported in large quantities to other Asian markets, such as Indonesia and Japan.

Textile industry

The largest manufacturing industry in the Mughal Empire was textile manufacturing, particularly cotton textile manufacturing, which included the production of piece goods, calicos, and muslins, available unbleached and in a variety of colours. The cotton textile industry was responsible for a large part of the empire’s international trade. India had a 25% share of the global textile trade in the early 18th century. Indian cotton textiles were the most important manufactured goods in world trade in the 18th century, consumed across the world from the Americas to Japan. By the early 18th century, Mughal Indian textiles were clothing people across the Indian subcontinent, Southeast Asia, Europe, the Americas, Africa, and the Middle East. The most important centre of cotton production was the Bengal province, particularly around its capital city of Dhaka. Bengal accounted for more than 50% of textiles and around 80% of silks imported by the Dutch from Asia, Bengali silk and cotton textiles were exported in large quantities to Europe, Indonesia, and Japan, and Bengali muslin textiles from Dhaka were sold in Central Asia, where they were known as “daka” textiles. Indian textiles dominated the Indian Ocean trade for centuries, were sold in the Atlantic Ocean trade, and had a 38% share of the West African trade in the early 18th century, while Indian calicos were a major force in Europe, and Indian textiles accounted for 20% of total English trade with Southern Europe in the early 18th century.

The worm gear roller cotton gin, which was invented in India during the early Delhi Sultanate era of the 13th–14th centuries, came into use in the Mughal Empire sometime around the 16th century, and is still used in India through to the present day. Another innovation, the incorporation of the crank handle in the cotton gin, first appeared in India sometime during the late Delhi Sultanate or the early Mughal Empire. The production of cotton, which may have largely been spun in the villages and then taken to towns in the form of yarn to be woven into cloth textiles, was advanced by the diffusion of the spinning wheel across India shortly before the Mughal era, lowering the costs of yarn and helping to increase demand for cotton. The diffusion of the spinning wheel, and the incorporation of the worm gear and crank handle into the roller cotton gin led to greatly expanded Indian cotton textile production during the Mughal era.

Once, the Mughal emperor Akbar asked his courtiers, which was the most beautiful flower. Some said rose, from whose petals were distilled the precious itr, others, the lotus, glory of every Indian village. But Birbal said, “The cotton boll”. There was a scornful laughter and Akbar asked for an explanation. Birbal said, “Your Majesty, from the cotton boll comes the fine fabric prized by merchants across the seas that has made your empire famous throughout the world. The perfume of your fame far exceeds the scent of roses and jasmine. That is why I say the cotton boll is the most beautiful flower.

Shipbuilding industry

Mughal India had a large shipbuilding industry, which was also largely centred in the Bengal province. Economic historian Indrajit Ray estimates shipbuilding output of Bengal during the sixteenth and seventeenth centuries at 223,250 tons annually, compared with 23,061 tons produced in nineteen colonies in North America from 1769 to 1771. He also assesses ship repairing as very advanced in Bengal.

Indian shipbuilding, particularly in Bengal, was advanced compared to European shipbuilding at the time, with Indians selling ships to European firms. An important innovation in shipbuilding was the introduction of a flushed deck design in Bengal rice ships, resulting in hulls that were stronger and less prone to leak than the structurally weak hulls of traditional European ships built with a stepped deck design. The British East India Company later duplicated the flushed deck and hull designs of Bengal rice ships in the 1760s, leading to significant improvements in seaworthiness and navigation for European ships during the Industrial Revolution.

Bengal Subah

The Bengal Subah province was especially prosperous from the time of its takeover by the Mughals in 1590 until the British East India Company seized control in 1757. It was the Mughal Empire’s wealthiest province, and the economic powerhouse of the Mughal Empire, estimated to have generated up to 50% of the empire’s GDP. Domestically, much of India depended on Bengali products such as rice, silks and cotton textiles. Overseas, Europeans depended on Bengali products such as cotton textiles, silks, and opium; Bengal accounted for 40% of Dutch imports from Asia, for example, including more than 50% of textiles and around 80% of silks. From Bengal, saltpeter was also shipped to Europe, opium was sold in Indonesia, raw silk was exported to Japan and the Netherlands, and cotton and silk textiles were exported to Europe, Indonesia and Japan. Akbar played a key role in establishing Bengal as a leading economic centre, as he began transforming many of the jungles there into farms. As soon as he conquered the region, he brought tools and men to clear jungles in order to expand cultivation and brought Sufis to open the jungles to farming. Bengal was later described as the Paradise of Nations by Mughal emperors. The Mughals introduced agrarian reforms, including the modern Bengali calendar. The calendar played a vital role in developing and organising harvests, tax collection and Bengali culture in general, including the New Year and Autumn festivals. The province was a leading producer of grains, salt, fruits, liquors and wines, precious metals and ornaments. Its handloom industry flourished under royal warrants, making the region a hub of the worldwide muslin trade, which peaked in the 17th and 18th centuries. The provincial capital Dhaka became the commercial capital of the empire. The Mughals expanded cultivated land in the Bengal delta under the leadership of Sufis, which consolidated the foundation of Bengali Muslim society.

After 150 years of rule by Mughal viceroys, Bengal gained semi-independence as a dominion under the Nawab of Bengal in 1717. The Nawabs permitted European companies to set up trading posts across the region, including firms from Britain, France, the Netherlands, Denmark, Portugal and Austria. An Armenian community dominated banking and shipping in major cities and towns. The Europeans regarded Bengal as the richest place for trade. By the late 18th century, the British displaced the Mughal ruling class in Bengal.

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