The development of international trade in Eurasia had its beginning in the Early Medieral Florissance (ca. AD600-840) during the time when the Tibetan Empire was the major power in Central Asia.1
The Tibetan Empire up to the present is surrounded by Indo-European speakers on the south and west; by Turkic and Mongolic speakers on the north and northeast; by Chinese on the east; and by Burmese speakers on the southeast.2
The map3 shows the historic trade routes from the time of the Tibetan Empire at its zenith to modern times. These routes can be broadly grouped as shown below.
The main road to China goes from Lhasa to Tachienlu via Gyam-do, the capital of Kong-po, and then on through Cham-do. From the latter village there are two routes to Tachienlu one going to the east through Kan-ze, the other southeast through Ba-tang and Li-tang. Tachienlu is on the border between Tibet and China.5
By these routes tea which was the chief import from China pours into Tibet. This tea trade goes back to the Sung period (AD960-1280). In the year AD1074 even departments called 'Tea-horse' were created which officially controlled the trading of Chinese tea for Tibetan horses.6
Tea is pressed into the shape of bricks for conveyance of carriage. These are packed securely in coverings of yak-hide and conveyed on the backs of yaks, ponies, mules and donkeys throughout the length and breadth of Tibet, maybe for a journey of 3,000 miles.7 Tea was the most popular food money and was used particularly between 1875-1935. The use of tea as currency was however restricted to the fringe territories of the Chinese Empire and in particular to Tibet and Mongolia.
Tibet's yearly import of brick tea was almost 6,500 tons, 4,000 tons alone via Kan-ting. Numerous brands, sizes and shapes existed.8
At Tachienlu, hundreds of Tibetans come daily from the heart of Tibet as well as from all parts of the border states, and here is the great depository of the Tibetan-Chinese frontier. During the busy season there are as many as 400 Chinese coolies arriving per day. Since Tachienlu is the terminus of the Chinese coolie line of transportation, it is also the point from where the yak caravans are made up.
From the heart of Tibet, hides, wool, deer's horns, musk and gold dust all find their way, and these are exchanged on the streets of Tachienlu for tea, cotton goods and haberdashery of all kinds, such as are used in Tibet for bartering purposes.
In Tachienlu there are many [gochuang], and the people coming from the interior of China always put up in their own guild, and through managers of these guilds they buy their tea or other articles of import to Tibet. The articles bought from the interior of Tibet for the most part also go through the hands of these indispensable gochuang managers. They act as the middlemen between the Chinese merchant and the Tibetan trader.9
Another trade route to China passes through Sining in the KoKo Nor region.
The Northeastern route strikes north from Lhasa, past Nag-chu-ka across the Chang Tang to Urga, the capital of Mongolia, and then connects with the plains of Siberia.10
From Mongolia comes Chinese silver in the shape of horse's hoofs, some gold in the same shape but smaller and woolen cloth. The chief exports are musk, gold dust, wool, furs, deer horns and copies of Tibetan Scriptures.11
The trade routes passes through Kaskmir and across the Karakoram and thence to Kashgar, Khotan, Yarkand and other markets in Chinese Turkestan.12
Gartok was a trading mart in western Tibet where thousands of traders from the surrounding countries, from Chinese Turkestan and the Central Asian Khanates, even as far afield as the Russia dominions, came to exchange their goods for the native products of Tibet, borax, salt, gold, shawl wool and ponies and for goods carried overland from China, tea, porcelain and silk.13
Russian merchants of Asiatic origin were trading in Tibet when Bogle visited Tashi Lama. Many Russian subject especially amongst the Buriat mongols of Lake Baikal lived in Lhasa. One such man was Dorjieff.14
The trade between Tibet and its southern neighbors has been carried out since ancient times. the lure of trans-Himalayan trade was Lhasa: India and Tibet were the principal partners while Nepal formed the principal venue through which this trade was conducted. It was in the seventh century A.D. that the emergence of powerful Tibetan Kingdom with its capital at Lhasa transformed Kathmandu Valley into the intellectual and commercial entrepot between India and central Asia. It appears that only limited trade was carried out during the next several centuries.15
Throughout the remote ages, Tibet and Nepal communicated with each other through the 24 high passes (averaging 17,000 feet). The lowest of these are the historic Kuti (tib., Nyi-lam) and Kerong (tib., Kyi-rong) passes with elevations of 6,000 feet, located at Kodari and Rasuwa respectively. The other important passes are located at Takla, Mustang; Hati and Wallanchung. It was through these passes that Nepal exported to Tibet food grains in exchange for gold, salt, wool, sheep, goats and yak-tails. The two passes of Kutiand Kerong were often a source of dispute between Nepal and Tibet from the medieval period to modern times.16
The 16th and 17th centuries were a crucial period in the relations between Tibet and Nepal. Nepalese skirmishes with Tibet in the period AD1645-1650 resulted in a treaty which included.
Two factors both physical and political, helped to strengthen this artery of commerce. First the barren waste-land of Tibet with little agricultural potentials, yet rich in minerals like gold, rock salt, tinsel, coral, musk and wool made Tibet a fertile ground for the congregation of South Asian traders, and *secondly, the policies of the Tibetan government was favorable for trade and commerce. No duties were levied on goods, and trade was protected and free of extractions.18
Lhasa and Shigatse are the chief centers of trade in central Tibet: Chamdo, Lyckundo, Derge and Tachienlu are important centers in easter Tibet and Gartok in western Tibet.
Taking Lhasa as the center, one of the routes to India is that which runs west and north throughout the length of southern Tibet to Leh, the capital of Ladakh; another goes westward to Almora.
Almora is the second largest entrepot of the Indo-Tibetan trade, the largest being Kalimpong, the latter is the capital of a tract in the eastern Himalayas, which was annexed from Bhuten in AD1865 and now forms part of the Darjeeling district. After the British military campaign on the Sikkim-Tibet border in AD1888 a trade route was constructed from Kalimpong in the district of Darjeeling, through the south-eastern corner of Sikkim to the Tibetan frontier. Much of the traffic between Tibet and the western Nepal was accordingly divided along the new route. Half of the entire trade between Tibet and India passes through Kalimpong.19
The merchants of Bhutan also conducted trade with China through Tibet. They bought Chinese goods, such as tea, rock salt, wool, sheepskins, etc., in exchange for rice, wrought iron and coarse woolen cloth.20
The Bhutanese representative in Lhasa bought goods for his master and sent them to Bhutan in exchange mainly for rice.21
The following narrative is essentially based on Rhodes, article, "Silver in the Himalayas".1
Locally minted gold, in bullion form, and as 'fine gold' (gold dust) was circulating as currency in Tibet from early times and was one of the items exported from Tibet. Tibetans travelling south used gold to pay for goods and services.
By the early 16th century, Muslim power in northern Bengal was beginning to decline. Hussain Shah had managed to conquer the area of Cooch Behar and western Assam in about AD1494, but had suffered a defeat soon after, and from then on the Kingdoms in this area developed free of Muslim control until the Moguls reached the area around the end of the century.
By this time, the importance of the monasteries, as centers of economic power in Tibet, was well established. Political power was, however, still in the hands of secular rulers. For most of the 15th century Tibet was ruled by the Phagmotgru-pas, but before AD1500 the power of that dynasty waned, and rivalry developed between the two central Tibetan provinces of U and Tsang. Generally speaking it was the Governors of Tsang, the rulers of the southern part of Tibet, bordering on the Himalayas, who were dominant, but the civil wars continued until AD1642. In that year the Mongol leader, Guari Khan, defeated the ruler of Tsang and installed the 5th Dalai Lama as ruler of all Tibet.
The late 16th century was therefore a period of instability, but one when an army had to be maintained and hostilities were confined to an area well away from the Himalayas. Trade with India would not, generally, have been disrupted and would have been necessary to support the army maintained by the rulers of the Tsang Province.
The first European account of trans-Himalayan trade confirms this basic picture. The English traveller Ralph Fitch mentions trade from Bengal in AD1583 passing through Cooch Behar and thence over the mountains, presumably through Bhutan to Tsang Province. He mentions several exports from Tibet, such as musk and gold, and these must have been paid for by the Bengalis with grain and silver. Cooch Behar kept a share of the profits and struck coins with silver.
Before Cooch Behar struck coins in AD1555, the small Nepalese Kingdom of Dolakah had struck silver coins about AD1550 - indicating that the trade route up the Kosi river was used for a short time.
The Portuguese missionaries Cacella and Cabral travelled through Cooch Behar and Bhutan to Tibet in AD1626, but found the route not frequented and made their return journey to India through the Kathmandu Valley in Nepal, which was by then the most important trading route.
The table below shows the chronology of coins used by the trans-Himalayan states which participated in the Tibetan trade.
This increase of silver coinage in Nepal about AD1640 was due to a major change in trading patterns. The main export from western Tibet was the extremely fine shawl wool, which was taken to Kashmir to be woven into the famous shawls. Formerly it was taken through Ladakh to Kashmir, but in AD1640 the King of Ladakh closed his country for the transit trade, because of a dispute with the Moghul rulers of Kashmir. The Kashmiri merchants managed to circumvent this problem by setting up trading posts in Patna, and routing the wool through Nepal.
Hence, by AD1642, when the great 5th Dalai Lama was installed in the Potala in Lhasa as undisputed ruler of all Tibet, Napal had a virtual monopoly of trade with Tibet. This situation did not, however, go unchallenged.
In about AD1648, the Ahom rulers of Assam began to strike fine octogonal silver coins, including one with a strange Chinese inscription, reading 'Tsang Pao', which can be translated as 'Tibetan coin'. This may have been an attempt to open up a trade route across the mountains further east, and to have Assamese coins accepted as currency in Tibet. The attempt at introducing Assamese coins into Tibet was not successful, but the Assamese silver coins continued from then until about AD1800.
About AD1650, there was a border skirmish between Nepalese and Tibetan forces, and the Nepalese forced the Tibetans to sign an agreement, officially granting Nepal a monopoly over trans-Himalayan trade. From then until about AD1754 large quantities of trade passed through the Kathmandu Valley. Not only did Nepal strike many beautiful silver coins, but also large number of fine temples were built using the profits of the trade. In Tibet, the Nepalese coins become an accepted medium of exchange as Tibet had not started to strike coins of its own.
In AD1720 a large Chinese army arrived in Lhasa, carrying with them 5 years advance pay in silver ingots. Silver ingots were a standard medium of exchange in China at this period, but they were very inconvenient, as the weight had to be checked before each transaction was completed, and each one tended to be rather heavy for the day-to-day needs of the average Tibetan. For these reasons, the Nepalese coins circulated at a considerable premium over the silver ingots, and the Tibetans found it worthwhile to send the ingots to Nepal, have them struck into coin, and then bring them back to Tibet. This arrangement, with the Tibetans bringing silver to Nepal for striking into coin, continued for several years, but after about AD1736 the Nepalese took undue advantage of the Tibetans and began to debase the alloy of the coins supplied to 67% and later to only 50% silver. Very large numbers of these debased coins were sent to Tibet.
After AD1754, however, Nepalese coins become very rare, and the reason can be traced to trading patterns. In the late AD1740's, the ruler of Gorkha, a small kingdom to the west of Kathmandu, embarked on a campaign to conquer the Valley. His main tactic was to block the trade routes, and by AD1754 he had succeeded in doing this. It took him another 14 years to fulfill his ambition, but gradually the siege of the Valley weakened it sufficiently to give him an easy victory.
This blocking of the trade routes in AD1754 did not please the Kashmiri traders in Patna, who relied on their supply of wool from western Tibet, which had been passing through Nepal. The wool was still being produced in Tibet, so another trade route had to be found. The evidence of the coins shows that three routes were used; one through Bhutan and Cooch Behar, one through Garhwal, and one direct to Kashmir through Ladakh.
In Garhwal silver coins were struck in the periods AD1760-1771, 1774-1780 and 1804-1814. In Ladakh, dated coins were struck in AD1772-1773, and although the other coins struck in Ladakh are undated, they can almost certainly be attributed to the periods when Garhwal was not issuing silver coins - i.e. AD1781-1803, and after AD1815 until about AD1850. The coins show, therefore, that the major part of the trade in wool from western Tibet to Kashmir passed along one trade route each year, and numismatic evidence can show which route was used each year.
The use of the eastern route through Bhutan and Cooch Behar cannot be traced in such detail, as the coins are not dated. Certainly after about AD1760 the silver coins of Cooch Behar became rather more plentiful then they had been in the pervious century. Also, it was not long before the British East India Company, under the able control of Warren Hastings, began to eye the potential trade with Tibet. Gradually Cooch Behar was drawn into the British sphere of influence, and in AD1783 the British severely restricted its right to strike coins, in an attempt to ensure wider circulation of the British Indian rupee.
Turning now to the situation in central Tibet; in AD1754 the supply of silver coin from Nepal had ceased because the trade route had been cut by the King of Gorkha. This caused a shortage of coin in Tibet, and in AD1763 the Tibetan Regent tried to rectify this by striking a coin of his own. For some reason these were not popular, and few have survived. In AD1768 Prithvi Narayan of Gorkha conquered the Kathmandu Valley, and established the Shah Dynasty, which still rules Nepal today. Unfortunately the debased coins supplied to Tibet by the previous Malla Kings caused a dispute between the two countries, as the Tibetans insisted that the debased coins circulate at the same value as the new fine silver coins. While this was a matter of principle to the Tibetans, who had exchanged the coins for fine silver (so all the additional profit had remained in Nepal), King Prithvi Narayan could not agree, as he would then either have to debase his own coins, or incur considerable loss by buying in the old coins at face value. On the other side, the Tibetans routed most of their trade with India through the Bhutan route.
The problem could not easily be resolved. In AD1775-1777 the internal shortage of coin in Tibet was relieved when the Nepalese agreed to supply specially debased coins to Tibet, but these pieces were not acceptable at face value in Nepal. In AD1785 another unsuccessful attempt was made by the Tibetans to strike their own coins, but fine silver was used and they disappeared quickly into the melting pot. Then in AD1789 matters came to a head, when the Nepalese decided to invade Tibet. After the Nepalese had enjoyed some successes, the Tibetans called upon the Chinese for assistance, and in AD1792 the Nepalese were defeated. In AD1791 the Tibetans started striking their own coins purely for internal use, and were never again dependent on the Nepalese for their coins. Trade from Tibet through Nepal to India recommenced, but never became as important as it had been in the years before AD1750.
During the early 19th century the British became more and more powerful in northern India, and began to trade directly with the Tibetans, initially using various routes to the west of Garhwal, and later the route through the Chumbi Valley, between Bhutan and Sikkim. Particularly after AD1840, large numbers of British Indian rupees entered Tibet. These circulated freely in Tibet, but the Tibetans needed silver to buy tea and various luxuries such as silks from China. As the silver content and weight of the rupees was reliable, they could be used for trading with the Chinese, so they gravitated eastwards, and became a popular currency in western China. So popular did they become that the Chinese copied them.