Indian Political Thought:

Arthashastra

The historical process of tradition of Indian Politics is primeval and

traced back to the period of Vedas. The deliberations regarding politics
are found in 'smritis' and 'puranas' by the name 'dandaniti'. References to
various political texts are available which studied and discovered the
concept of 'dandaniti'. It is possibly Kautilya's Arthashastra which stands
out to be systematically scientific and most authoritative explanations of
these prehistoric studies. Arthashastra was Transcribed in around 4th
century BC by the Prime Minister of The Great Mauryan Empire
Kautilya, also called Chanakya or Vishnugupta. Arthashastra is one of
the most persuasive and comprehensive treatises in Political Science in
the Indian Vedic Civilization. Regarded as essence of ancient Vedic
wisdom in politics and economics, Arthashastra has noteworthy
significance in modern times with some inquisitive resonance with the
thoughts and theories of various philosophers, economists and political
scientists around the globe.

Arthashastra:
The Arthashastra is a primeval Indian discourse on statecraft, economic
policy and military strategy, written in Sanskrit. It had wide influence on
Sanskrit literature. The Mahaubhaurata mentions a number of schools of
Arthashastra principle, and the names of previous writers from the fifth
century B.C. agreed with those found in the Arthasastra of Kautilya.
Kautilya, also recognized as Vishnugupta and Chanakya, is traditionally
credited as the author of the text.
Arthashastra entails the science (sastra) of wealth/earth/polity (artha).
'Artha' however is bit wider and an all-embracing term with different
meanings. In 'Arthashastra' itself, it is being used in various contexts,
indicated by L N Rangarajan in his translation of Kautilya -Arthashastra.
It is used in the sense of material well-being, in livelihood, economically
productive activity trade etc. This is alike with 'wealth' which is defined
in 'Wealth of Nations'. In simple way, 'arthashastra' can be explained as
'science and art of politics and diplomacy'. This treatise is divided into
sixteen books dealing with virtually every topic concerned with the
running of a state, taxation, law, diplomacy, military strategy,
economics, bureaucracy etc. The book is a masterwork which includes
an array of topics like statecraft, politics, strategy, selection and training
of employees, leadership skills, legal systems, accounting systems,
taxation, fiscal policies, civil rules, internal and foreign trade etc.
Arthashastra backs rational ethic to the conduct of the affairs of the state.
The emphasis is on systematisation of law and uniformity of law
throughout the empire.
Kautilya's Arthasashtra is magnificent work on ancient political thought
which was undoubtedly composed between 3rd-2nd Century B.C.
Kautilya was the great Prime Minister of Chandragupta Maurya.
Kautilya's Arthashastra is mainly a work on the art of government. In his
political and administrative ideas, the focus of attention was the king.
According to his beliefs, for the smooth functioning of administration
and for the welfare of the people, the king had to be acquainted in the
four Vedas and four sciences of government (Anvikashaki Trai, Varta
and Dandniti). Kautilya's administrative and judicial structure was
hierarchical in nature. As for impartiality, he emphasised on the
principal of equity and immediacy. As for law and order, he believed
that law was an imperial command enforced by sanctions. Dissimilar
many other authors in the community, Kautilya is exceptional Indian
political philosopher who was both thinker and statesman. He
contributed in various social and political revolutions of his Age and
abstracted from his study of conflicts some general principles capable of
universal application and effective in all times and ages. With more and
more studies in the field of politics and economics and with a modern
outlook and understanding of world affairs, the significance and
indebtedness of Kautilya's 'arthashastra' is incontrovertible.
Kautilya's arthshastra had wide influence of Sanskrit literature (Sharma,
2001). In the previous stages of its history, the science of politics was
termed raujadharma, but when the study was extended to include both
politics and economics, it was called arthasastra, (In treatises which
emphasize that fear of retribution is the real basis of order, the term
dandaniti is sometimes employed.) Most political thought presumed the
existence of a monarchical form of government, and politics was
consequently demarcated as the science of monarchy. The intent of
arthshastra texts was to guide the king and his ministers, and they
included such subjects as public administration, economic regulation,
foreign policy, techniques of warfare, and civil law. The most significant
of these works is the treatise generally attributed to Kautilya, the
minister of the first Mauryan ruler.
Arthasastra, written in Sanskrit debates theories and principles of
governing a state. It is not an account of Maurya administration. The
title Arthashastra, which means "the science of material Gain" or
"science of Polity", does not leave any doubts about its ends. Kautilya
asserted that the ruler should use any means to attain his goal and his
actions required to moral sanction. The only problems debated are the
most practical kind. Though the kings were allowed a free restraint, the
peoples were subject to set of rules. This double standard has been cited
as an excuse for undesirability of the Arthashastra, though the real cause
of its ultimate neglect was the creation of a totally different society to
which these methods were no longer applied.
Arthashastra remains exclusive in all of Indian literature because of its
total absence of specious reasoning, or its unabashed support of scholars
continued to study it for its clear cut opinions and formal prose till the
twelfth century. Espionage and the liberal use of challenging agents is
recommended on a large scale. Murder and false accusations were to be
used by a king's secret agents without any thoughts to morals or ethics.
There are chapters for kings to help them keep in check the premature
desires of their sons and similarly chapters intended to help princes to
prevent their fathers' authoritarian authority. However, Kautilya
regretfully admits that it is just as difficult to detect on official's
fraudulence.
Economic ideas of Kautilya in Arthshastra: Kautilya's economic treatise
Arthshastra is an idea work, a perfect balance between State
management and people's welfare which was created 2,500 years before.
He was a great statesman as well as great intellectual. He described
Economics as the most important aspect as it provides the basis for
human existence and survival. He performed a dominant role in the
formation of Maurya Dynasity. With his guidance, empire conquered
growth with stability with the help of strong administration and efficient
fiscal management. He believed in public welfare because when his
work gave a strong focus on the wealth, effectiveness and wellbeing of
the king, his actual objective was not to benefit the king but to benefit
the people.

Welfare State:
Arthsashtra sets the conceptual groundwork for making India the first
welfare state. He backed welfare in all spheres. He did not talk only
about human welfare but paid attention to animal welfare also. He states
that "In the happiness of his subjects lies the king's happiness, in their
welfare lays his welfare. He shall not consider as good as only that
which pleases him but treat as beneficial to him whatever pleases his
subjects" He supported the protection of livelihood, of weaker section,
consumer protection and even the welfare of prisoners also. The King's
dharma is to be just, fair and liberal in protecting his people. His
boldness to his people should be like attitude of a father towards his
children. Kautilya demarcated the model ruler as one "who is ever active
in promoting the welfare of the people and who endears himself by
enriching the public and doing well to them."
Kautilya is not principally concerned with broad political speculation on
the origin and nature of the state (India provides no philosophical text
that can be compared with the major theoretical works of Europe), and
his originality is not to be found in the monarchy of abstraction. The
treatise is a collection and summary of earlier Arthasastra writings. Of
the three ends of human life, virtue, wealth, and enjoyment, Kautilya
allocates first importance to wealth, but he is always aware of the
instrumental value of religion and principled norms in preserving the
structure of society. He permitted the king to determine for himself what
shall have the sanction of law, although the Vedas are accepted as
sources of dharma, and statute law must be well-matched with the sacred
texts. Despite the importance he ascribed to the role of the king,
Kautilya is practical in his approach and would give importance to that
component of dominance which happens to be of most consequence at
any particular time.
In Indian theory, independence was usually thought to cover seven
elements:

1. - The king
2. - The ministers
3. - The populace
4. - The fort
5. - The treasury
6. - The army
7. - The ally

The theory, in which diplomacy is made an integral part of politics, is

intended to show the necessary conditions for the effective functioning
of the state.

Good Governance:
Governance generally incorporates all aspects of the way a country is
governed, including its economic policies and regulatory framework.
Arthashastra stated that good governance comes with peace and order
which can be accomplished through the partnership of different factors
in a community. The first of these factors is the leader. The leader is the
one held responsible for everything that is happening in a community. In
Indian society, the leader or the king plays a vital role as he is the one
leading the nation and thus, must display a lot of virtues.
Kautilya had enormous knowledge about different aspects of governance
such as taxation, diplomacy, trade, business, administration etc. It is
supposed that he also had a good knowledge of medicine and astrology
as well. It is a discourse on political economy alike to Machiavelli's, The
Prince and hence he has been compared to Machiavelli by some and
Aristotle and Plato by others. Kautilya explained the way a state's
economy is organized, how ministers should be selected, war conducted,
and how taxation should be organized and distributed. He put more
emphasis on the importance of a network of detectives and informers
which function as an investigation corps for the king, focusing on
external threats and internal dissidence.
The Arthashastra provides various qualities that defines a good leader
and most of stresses on honesty and responsibility. Kautilya gave much
emphasis on this issue as corruption ravaged the Indian society during
his time. Even through the passage of time, dishonesty still remains up
to the present society.
He followed a general approach to governance and enlightened several
areas critical to the operation of a country in depth. The main sections
deal with National security and Foreign Policy, Administration of
Justice, Strategies related to economic development, Taxation, Labour
Management, and Financial Management. According to him, attainment
of good governance requires that the objectives of the state are fulfilled
and realized. This is possible through accurately organized and guided
administration. He proposed that good governance should avoid extreme
decisions and actions. Decisions should be taken according to the
situation. When assessing Kautilya's four-pronged approach to public
finance and state planning, which was actually economics, monetarism
and much more, based on "dharma, artha, kama and moksha," many
thinkers agreed that understanding human welfare was the basis of
Arthshastra. It is said to be the ancient and most extensive treatise on
governance and administration of state in the world, which describe
theories of state craft and monetarism and also a code of civil and
criminal law still applicable currently.
The Arthashastra also dealt with the magistrates of their jobs. In the 4th
chapter, it elaborates that, "The magistrate should be impartial, and
decide on a case, remaining neutral between the King and the subjects."
This indicates that they should be impartial in every trial or case they are
handling no matter who the people are involved. This echoes true
justice: punishing the guilty and releasing the innocent, an ideal justice
system where everyone is judged similarly.
Key element in effective governance is the existence and
accomplishments of projects that will enhance the nation. In the
Arthashastra, Kautilya offered concrete proposals that must be
implemented appropriately. The most important of these is the
prioritization of education. This is because in any society, having a good
number of human capital is necessary good financial development. In
the Arthashastra, Kautilya cited the requirement of extensive training of
the people in various fields which resulted to a good outcome in those
times. Currently, there is an immense importance of education in all
sectors and growth of nation.
Although the Arthashastra's main goal and responsibility is the welfare
of the people, Kautilya still includes rules in his treatise the maintenance
of the environment and other living things. This is due to the fact that the
Indian society values all living things because of their belief.
The Arthshastra linked political governance with economic governance.
The end is economic governance while political governance is the
means. But as economic objectives are not understood in the absence of
political ones, then political governance becomes an end and economic
governance the means. 'The end justifies the means', this is supposed to
be the basis of Kautilyan beliefs. Political power and material wealth are
the means and ends of governance. And good governance - political or
economic - depends upon justifying the ends and means as the socio,
economic and political circumstances.
Arthashastra explicated that there is a sturdy connection between good
governance and the economy of a nation. Kautilya's Arthashastra
elaborated that it is contemporary Relevance, "the end is economic
governance while political governance is the means" (Chapter 2). It
means that appropriate management and good governance has an effect
on the economic aspect of a nation. The Arthashastra offered the basic
guidelines for the proper management of the economy of the country.
Ruler must know how to manage resources, such as monetary funds. It
can contribute to the development of the economy. Major factor
emphasized by the Arthashastra is agriculture. "The importance of
irrigation and providing amenities could be taken up on a priority basis.
Systematic cropping patterns and irrigation systems followed by
Kautilya is what today's experts need to recognize". Kautilya also
identifies organic farming because of its non-usage of chemicals. Beside
from this, it is also required to learn different agricultural processes
because it will aid in the production and storage of sources that will be
used by the society.
Kautilya asserted that to guarantee good governance, there must be a
suitably guided public administration, where the ruler should surrender
his likes and dislikes in the interest of his subjects, and the personnel
running the Government should be responsive. Additionally, Kautilya
highlighted that for citizen friendly good governance, there should be
consistency in the administrative practices as well as competent
ministers and officials owning qualities of leadership, accountability,
intellect, energy, good moral conduct, and physical fitness, capable of
taking quick decision. Kaufmann and Kraay stated that‟ the concept of
Governance is not new. Kautilya presented key pillars of the art of
governance emphasizing justice, ethics and anti-autocratic tendencies.
He further detailed the duty of the king to protect the wealth of the state
and its subjects, to enhance, maintain, and it does also safeguard such
wealth as well as the interests of the subjects." A ruler must administers
justice on the basis of four principles: righteousness, evidence, history of
the case, and the prevalent law, shall conquer the earth. Kautilya
articulated in the Arthashastra that a nation would benefit from trade if
certain "safeguards and policy measures" are present. The trade policies
of the country are implemented and are not offensive for the other
parties would ensure the benefits of the nation when it comes to trading.
This promotes trust and well-being for both parties.
Kautilya on Law and Justice: Kautilya upheld that it is indispensable
duty of government to maintain order. He describes 'order' broadly to
include both social as well as order in the sense of thwarting and
punishing criminal activity. Arthashastra incorporate both the civil law
and criminal law. Kautilya attributed a lot of importance to 'dharma'.
According to him, 'the ultimate source of all law is dharma'. He enticed
in the name of 'dharma' to the sense of honour and duty and to human
dignity, to moral responsibility and to enlightened loyalty. It is quite
understandable that the judge in the arthashastra was called 'dharmashta'
or upholder of dharma. He said that so long every 'Arya' follows his
'svadharma' having due regard to his 'varna' and 'ashrama' and the king
follows his 'rajdharma', to sustain social order.
Kautilya mainly focused on duties of King to maintain law and order in
the society. He writes in Arthashastra, "Because the King is the guardian
of right conduct of this world with four 'varnas' and four 'ashramas' he
can enact and promulgate laws when all traditional codes of conduct
perish." The King was looked upon an embodiment of virtue, a protector
of dharma. He too was overseen by his dharma as any other citizen was.
Thus, if any actions of the King went against the predominant notion of
dharma, associations and/or the individual citizens were free to question
him. He recalls every time that 'dharma' alone is guiding star for every
king, or rather every individual and that following 'dharma' one shall
have a life of dignity while social order prevailing in society.
He comments, "A King who administers justice in accordance with
'dharma', evidence, customs, and written law will be able to conquer
whole world". Kautilya acknowledged the importance of rational law or
King's law and its importance to 'dharma', 'vyayhara' and 'charitra'. He
upheld that King's law was to be in harmony with the injunctions of the
three Vedas wherein the four 'varnas' and 'ashramas' are defined. King
was not the only interpreter of dharma. In fact, there was no specific
institution devolved with the authority of interpreting dharma. Every
individual was believed competent to interpret it. This was an important
factor in guaranteeing the non-religious character of the Vedic state.
Kautilya did not interpret law to be a manifestation of the free will of the
people. Thus sovereignty, the authority to make laws, did not vest with
inhabitants. Laws were derived from four sources, dharma (scared law),
vyavhara (evidence), charita (history and custom), and rajasasana (edicts
of the King). Kautilya recommended that any matter of dispute shall be
judged according to four bases of justice. These in order of increasing
importance are:

1. - 'Dharma', which is based on truth

2. - 'Evidence', which is based on witnesses
3. - 'Custom', i.e. tradition accepted by the people
4. - 'Royal Edicts', i.e. law as promulgated.

If there is conflict among the various laws, dharma was supreme. The
ordering of the other laws was case specific. Rajasasana ordered the
relationship between the three major social groupings, the citizen, the
association, and the state. The constitutional rules at the state level were
specified in the rajasasana but the constitutional rules at the level of the
association were to be decided by the members of the association. The
mutual choice and the operational level rules of the association were also
decided by the members of the association though the state did
promulgate laws to safeguard the individual member from the
oppression of the majority in the association. Arthashastra sketches a
system of civil, criminal, and mercantile law (now it is called business
laws).

Foreign Trade:
Foreign trade is vital element of any economic system. Kautilya
accepted that foreign trade in goods and services is a major source for
snowballing the state wealth. He ascribed that foreign trade should be
stimulated by providing some incentives such as exemption from taxes
so that foreign traders to make a profit. He gave huge importance to
imports. He further spoke that foreign trade is supportive to increase the
supply of those goods which may not be available domestically.
Through imports, a state can obtain goods more cheaply from foreign
sources. In this way, he framed a comparative advantage view of foreign
trade. He said that it is beneficial for the different kingdoms when the
product being imported are cheaper than those can be obtained
domestically. He accepted that trade based on the principal of
comparative advantage would be beneficial for both exporting and
importing nations. Trade is an important source of revenue for the
Treasury.
The Arthashastra favours foreign trade and urges the king to take part in
it through his overseer of trade. He should encourage the import of
goods produced in foreign countries by permitting concessions. And
those to bring such products in ships. He should grant exemption from
taxes that would enable them to make a profit. And no lawsuit in money
matters should be allowed against foreign trades except such as
members of local guilds and their associates (Tom Trautmann, 2016).
Thus the import of goods is treated as desirable practice. But at the same
time exporting should be permitted for those goods that are abundant in
quantity (Tom Trautmann, 2016).
Kautilya supports the use of tariffs, both export and import duties.
Kautilya backed attracting foreigners who possess good technical
knowledge. He Supports the use of tariffs, both import and export duties.
He suggested heavy taxation on those foreign goods which are items of
luxuries and on the other hand on the articles of common consumption
light duties were imposed. Any item which is highly beneficial for the
country should be free from any import duties. He was the first person to
discuss the passport is necessary to cross the boundaries.

Taxation:
Jha and Jha(1997) indicated that "Chankya paid supreme importance to
the maintenance of a rich treasury, which positively affected entire
activities of the administration." He focused on good fiscal management
and the ways to development of all the sectors of the economy.
According to him, public revenue does not exist for the desire of the
king but as a fund to be utilised to augment the wealth of nations. He
confessed the taxation is the main source of revenue. The power of
taxing of the state is boundless but taxation should not be excessive. He
supported that tax base should be increased not the tax rate. He
commented the excessive burden of tax on people. Kautilya stated that
King must collect taxes like honey bee, enough to sustain but not too
much to destroy."
Kautilya indirectly suggests a linear income tax. He highlights fairness,
stability of tax structure, fiscal federalism, avoidance of heavy taxation,
ensuring of tax compliance and subsidies to encourage capital formation.
He advocated limiting the taxation power of the State, having low rates
of taxation, maintaining a gradual increase in taxation and most
importantly devising a tax structure that ensured compliance many
postulates of Kautilya's philosophy of political economy are applicable
to modern times. Preferably, the government should collect taxes and do
welfare of people. Kautilya's system of taxation involved the elements of
sacrifice by the taxpayer, direct benefit to the taxpayers, redistribution of
income, and tax incentives for desired investments. He suggested tax
holiday as an incentive which means if any one brings new land under
cultivation, he should be relieved from agricultural tax for at least two
years. He advocates a mixed economy and argued for a very active role
of government. His conversation on taxation gave an idea of three
principles that include, taxation power is limited, taxation should not be
heavy and excessive and tax increase should be reasonable. He
recommended a system of tax collection and public expenditure of
revenue in such a way as to build up the permanent revenue yielding
capacity of the economy. He stated that tax base should be increased not
the tax rate. The functional relationship which conversed kautilya in
Arthsashtra between the rate of income tax and the magnitude of tax
revenue is now said in terms of Laffer curve.
He encouraged indirect taxes such as excise and custom duties and direct
taxes as income tax on individuals, wealth tax, and profession tax. He
also promoted land revenue, water tax and toll, fine and penalties.
According to him, tax receipts can be divided into three parts; income
earned through taxes on goods produced within a country, Income
earned through taxes on goods produced in the capital and income
earned through taxes on imports and exports. He supported that wealthy
people should pay higher tax according to their paying capacity. In this
way, he considers the ability to pay approach. Tax should be levied one
in a year.

Growth Oriented Public Expenditure:

Kautilya supported that most of the revenue generated from taxation
should be spent on creative activities and public welfare. He argued
different items where state should incur expenditure such as on national
defence, public administration and salaries of the ministers, government
departments, maintenance of national store house and granaries,
maintenance of armies and on the acquisition of valuable gems, stones
and ornaments and whatever was left should be deposited to the
treasury.
In Arthashastra, it is elucidated that law was not viewed just as code of
prohibition, nor was it limited to corrective justice of law courts. Its
range was wider than ethics itself and institutions were creation of law
while traditions and customs rested on its sanctions. All philosophies of
society were formed by it and law was blended with religion, with
morality and with public opinion and by its subtle operations subjected
the society to its will. The role of law in the society was to bring a just
order in society and the remarkable task was to be carried by the King
along with his assistants.
Kautilya indicated in his famous verse:
"In the happiness of his subjects lies the King's happiness;
In their welfare his welfare.
He shall not consider as good only that which pleases him but,
Treat as beneficial to him whatever pleases his subjects".
The Arthaśaūstra treatise elaborated that writer is slightly concerned
with ethical considerations. Political expedience had been a
characteristic of the Arthasastra tradition, and in such works as the Santi
Parvan right is likened with might in a world in which the stronger live
upon the weaker. Kautilya generally recommends unprincipled tactics
only against those who would undermine the social order, and he is
aware of that power, if not restrained in its use, can be unhelpful of
itself. The writer of the Arthasastra was sensitive to the economic bases
of power and opposed any distributing tendency that would wane the
control of the state over the economic life of society. Yet the state
should not seek to eradicate the independent group life of the
community. The caste structure was recognized as long as the general
well-being was not prejudiced by narrow class rights. The Arthasastra
signifies an important step in the direction of authority based on the
interests of all. The king was recommended to see no interest other than
the interest of his subjects. However, Kautilya clarified that affluence
rests on the good will of the people and that the power of the state
depends on wealth. This idea of authority must necessarily include many
functions formerly reserved to institutions that were not considered
political.
The Nutisaura of Kamandaka, usually retained in the Gupta period
(fourth or fifth century a.d.), is basically an synopsis of the Arthasaustra,
although the later writer disregards a number of subjects that Kautilya
clearly believed of great importance. Two-thirds of the Kamandaklya
Nitisara relates to foreign policy and the conduct of conflicts. All the
literature that has been considered far was shaped in northern India, and,
except for Buddhist writings, in Sanskrit. Several Jaina texts can be
categorized among the Arthasaustra literatures.

A Western Perspective on Kautilya's

Arthashastra:
However, the influence of Kautilya to economy has been ignored by
western researchers despite the fact that his coverage of this subject was
perhaps the most sophisticated and broadly based on internationally until
Adam Smith published his Wealth of Nations in 1776.
The influential treatise, Arthashastra discovers issues of social welfare,
the collective ethics that hold a society together, counselling the king
that in times and in areas distressed by famine, epidemic and such acts
of nature, or by war, he should initiate public projects such as building
irrigation projects, building forts around major strategic holdings and
towns, and exempt taxes on those affected. The text was powerful on
other Hindu texts that followed, such as the sections on king, governance
and legal procedures included in Manusmriti. The Arthashastra was
written at the end of the fourth century BC, it seems to have been
revived only in1905, after centuries of oblivion. The dissertation in its
present shape is most likely not the text written by Kautilya, though it is
perhaps based on a text that was authored by Kautilya; and is no case
can the text in its completely be credited to Kautilya on account of
numerous stylistic linguistic distinctions.

Relevance of Arthsashtra in modern time:

Kautilya is one of the most renowned Indian political philosophers.
Though, he lived a long time ago, certain philosophies from his theory
are still applicable in modern political framework. The book, written in
Sanskrit elucidates theories and principles of governing a state. Kautilya
established an extremely vital imperative: governance, polity, politics,
and progress have to be linked to the welfare of the people. When
assessing the some economic ideas of kautilya, it can be understood that
even the terminology employed in Arthsashtra may have changed but
the nature and role of state in the economic system seem persistent in all
settings. Covering various topics on administration, politics and
economy, it is a book of law and a treatise on running a country, which
is pertinent even today. His philosophies remain prevalent today in
India.
He offered cherished basis for economic science. It comprises of very
useful economic ideas on foreign trade, taxation, public expenditure,
agriculture and industry. Good governance and stability are inseparably
linked. If rulers are responsive, accountable, removable, recallable, there
is stability. If not, there is uncertainty. This is even more applicable in
the present democratic system. He recommended that heavy taxation
should be avoided. If tax rates are high, public will not be willing to pay
the tax and discover the ways of tax evasion. Low rate of taxation will
produce more revenue to the state.
He was well mindful that terms of trade were not just depending on
economics but also on various factors. There is no autonomous
mechanism that will ensure that a nation would benefit from trade in the
absence of certain precautions and policy measures. Social welfare is the
main focal point of kautilya‟s economic notions. The State was required
to help the poor and helpless and to be proactive in contributing to the
welfare of its citizens. Kautilya gave more emphasis to human capital
formation that is relevant in current times because development is not
possible without human capital growth. Besides these ideas, there are a
number of things in Arthsashtra which is very significant such as
conservation of natural resources. Arthsashtra provides much basic
knowledge about economics, and several of his ideas are still important
in today's economic system.
To summarize, Arthashastra is an exceptional test in all of Indian
literature because of its total absence of erroneous reasoning, or its
blatant support of realpolitik, and scholars continued to study it for its
clear cut arguments and formal style till the twelfth century. The
Arthashastra provides broad coverage on the overall economy, which
includes: infrastructure (roadwork, irrigation, forestry, and fortification),
weights and measurements, labour and employment, commerce and
trade, commodities and agriculture, land use and property laws, money
and coinage, interest rates and loan markets, tariffs and taxes, and
government expenditures and the treasury. It is noteworthy that a book
such as 'Arthashastra' should have been written more than 2000 years
ago in northern India. It is a book of substantial size. It includes
economics, political science, public administration, low and statecraft. It
is projected to provide practical advice for the management of the state
and thereby enhance the wealth of the nation.
Especially, Arthashastra is a discourse on political economy interpreted
in its broadest sense. It was written somewhere between 321 and 286
BC. A Modern of Aristotle, Kautilya, a Brahmin, played a governing
role in the formation and functioning of Maurya Empire. Afterward
under his leadership, growth with stability was conquered in the empire
with the help of strong administration and efficient monetary
management. His accomplishment in the domain of scholarship is
certainly creditable. The 'Arthashastra' consists of detailed analysis of
different aspects of ancient Indian economy." Intelligence and the liberal
use of stimulating agents is suggested on a large scale, Kautilya
remorsefully acknowledges that it is not easy to identify an official's
deceit. Kautilya has delivered a comprehensive and explanatory
description of the duties, responsibilities and role of the king, prince(s),
ministers, and other state officials. As for the state's political
administration, Kautilya provided a complete commentary as to how this
should be effectively undertaken. He gave instructions about the defence
of the state's limits, protection of the forts, and the manner in which the
attack by the rival must be controlled. The Arthashastra categorizes legal
matters into civil and criminal and it stipulates extravagant strategies for
administering justice in terms of evidence, procedures and witnesses. It
can be said that Kautilya‟s Arthshastra offers valuable foundation for
economy. It consists of valuable insights about finances. It can be used
to glen of significance to modern time and can be useful to exemplify
several contemporary economic thoughts. He offered a set of different
economic policy measures to encourage economic development.