Which among the following observations about the economy in Gupta era is / are correct?
1. The coinage of later gupta era indicates an economic crisis
2. Guilds were major institutions in the trade and manufacturing
3. Buddhist Sangha participated in commercial activities
Choose the correct option from the codes given below:

Answer: [D] 1, 2 & 3

Revenue was derived from a variety of taxes – from the land, and from various categories of produce at various stages of production. The maintenance of an imperial façade was a purposeless expense in economic terms and must have resulted in a pressure on the economy. It is not surprising that the later Gupta coinage indicates an economic crisis. The reference to Harsha dividing the national income into a quarter for government expenses, another quarter for the pay of public servants, a third quarter for the reward of intellectual attainments, and the last quarter for gifts, although idealistic in concept, may have been economically impractical. Revenue came mainly from the land, commercial activities no longer providing as large an income as they had done earlier. Roman trade, which had brought in a vast fortune, declined after the third century A.D., and with the Hun invasion of the Roman empire it came to an end. Indian merchants meanwhile had begun to rely more heavily on the south-east Asian trade. The establishment of Indian trading stations in various parts of south-east Asia meant the diversion of income to this region. The commercial prosperity of the Gupta era was the concluding phase of the economic momentum which began in the preceding period.Guilds continued as the major institution in the manufacture of goods and in commercial enterprise. They remained, almost autonomous in their internal organization, the government respecting their laws. These laws were generally drafted by a larger body, the corporation of guilds, of which each guild was a member. The corporation elected a certain number of advisers and these were its main functionaries. Some of the industrial guilds, such as the silk weavers’ guilds, had their own separate corporation which was responsible for large-scale projects, such as endowments for building a temple, etc. The Buddhist church or Sangha was by now rich enough to participate in commercial activities.
In certain areas the Sangha acted as a banker and loaned money on interest. This was in addition to renting land, in areas where land gifts had been made to the Sangha and from which it took one sixth of the produce as its legitimate share. This was the same amount as taken by the state in tax. Privileged brahmans also lived off donations or off grants of land. The Vakataka kings were particularly generous in this matter. The brahmans tended to be a less ‘risk-taking’ community on the whole, and more rooted to the land than the Buddhist Sangha. Evidence of brahmans investing their income from the land in commercial enterprises is rare. The close association of Buddhism with the mercantile community must have encouraged the Sangha to invest in commerce.

This question is a part of GKToday's Integrated IAS General Studies Module