Networks of trade and bureaucracy

The Mughals were a Muslim dynasty who ruled over a majority Hindu population. By 1750, they had dominated much of South Asia for several centuries. During Mughal rule, Muslims averaged only about 15 percent of the population. Mughal rule was generally tolerant of the religions in the region. That policy created enough social stability to ensure healthy business, investment, and trade.

The Mughals built their empire by efficiently utilizing India's resources, developing its production capacity, and supporting a very rich Muslim-dominated trade system in the Indian Ocean. India was at the center of a global market for goods in which Muslims, from many backgrounds and regions, were the principal dealers. Muslims across the Indian Ocean benefitted by having a common language (Arabic), a common set of ethical codes, and a shared tradition of commercial practices.

While most of the population farmed foods such as rice, Mughal India had a thriving manufacturing sector, producing hand-loom textiles for the Indian Ocean economy. The trade in cotton and silk fabrics brought great wealth to India, and traders came from as far away as China and Persia. Yet this wealth made the region a target for competition.

By the fifteenth century, growing global markets allowed the Mughals to expand their textile production and distribution. India didn't grow many spices of its own, but it became the world's shipment center for spices. Columbus had sailed in search of an easier route to Indian’s spices.

Building the Mughal state

The Mughal state was established in the sixteenth century by the Sultan Babur, who used 20 cannons to defeat a much larger army. His grandson expanded Mughal territories and established a highly efficient governance structure. There was both extensive trade and textile production, generating great wealth. By the early seventeenth century, Mughals governed one of the world's most populous and affluent empires in world history.

This wealth was ensured by a wide-spread, efficient government. The Mughal rulers established a complex bureaucracy. Both Hindu rajas and Muslim sultans could become officers of the state. These military and civil leaders had armed horsemen ready for battle, and they collected taxes on behalf of the empire. In return, they got land rights, payment, and status.

Internal problems emerge

Around 1700, the Mughal state reached the limits of its territorial growth. When the state ran out of land, it was a lot like running out of money to pay for the nobles’ loyalty.

There was also continuous war and a decline of religious tolerance. Until Emperor Aurangzeb rose to power in 1658, the Mughal state had instituted practical policies and tolerance toward their diverse subjects. During his reign millions died in wars, and from drought, plague, and famine. At the same time, foreign powers began to put increased pressure on the Mughal Empire.

External rivals for power

As Mughal power diminished, Europeans— especially British merchants—gained power and wealth in India.

Source: Mughal Empire
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