Economics of Kautiliya Shukra and Brihaspati.pmd

Introduction
CHAPTER SIX
GOVERNMENT FINANACE
The government finance has been discussed by Kautilya,
Shukra and Brihasapti in detail. According to Kautilya his treatise
presents basic principles for mobilizing resources from the earth1- natural resources, agriculture, trade and commerce etc., which are
related with people. The meaning of word palan in the Kautiliya
definition is related with manusyawati that denotes the land with people
should be developed by taking returns- labha from that earth. The
return is obtained by mobilizing natural resources and manpower.
Kautilya uses the word kosa-danda frequently that refers peace and
order and the government income go parallel to each other. In this
background the science of government finance as visualized by Kautilya
deals with resource mobilization and resource use for the purpose of
the smooth functioning of the state. (Panchmukhi, 2006: 260) In
Shukra's definition the word Political Economy has been used clearly.
In this chapter we shall evaluate the primciples and practices
of government finance in Kautiliya Arthashastra and Shukra-niti. The
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relevancy of their theorues shall also be analyzed. Measures to raise
government fund applied by Kautilya and Shukra also should be
compared with classical and modern views of government finance.
Treasury
It becomes clear after the study of Kautiliya Arthashastra,
Shukra-niti and Brihaspati-sutra that they had paid supreme importance
for a rich treasury- the kosa. In ancient times the word treasury has
been used in two senses. In narrow sense treasury means wealth,
fund, and income and in wider sense treasury means the economy or
the economic prosperity of the country. The narrow meaning has been
clearly defined by Shukra in the following words- the collection of
same article or thing is kosa and the kosa is of different types. (Shukraniti,
4.2.1.1) The definition given by Shukra is similar to the modern
word bank. We use commercial bank, book bank, or blood bank in
this sense. In wider sense the kosa is used to denote the efficiency of
national economy, for example the income generation capacity of
agriculture, animal husbandry, trade, and mines in the country. Modern
economists also agree with the concept that one important function of
state is to acquire public goods and to develop agriculture, animal
husbandry and commerce.
Sources of Revenue
In Mahabharata five sources of government revenue have been
traced. These are- mine, salt, grain market, water route and elephant
forest. In Shukra-niti the classification of revenue sources is as follows-
1. Tax
2. Fee
3. Labour tax
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