After some reading, here are some views about the economic system largely followed in India before the Mughals.
1. A prominent feature of economy in ancient India was the division of labor through the caste system, which later became the compulsorily inherited social division despised by most intellectuals today. The heritability of caste is a logical causatum given the home-based workplaces of those times. The offspring of an individual was most likely to excel at the job he/ she grew up around. However, the compulsion of the inherited labor and the hierarchial grading of the castes was possibly the result of manipulation at the hands of the erudite priests and professors who enjoyed monopoly in the knowledge of the scriptures. The interesting point is how society itself was built around this idea of labor division and exchange of expertise or goods developed thereof.
2. There appears to be some debate about the actual ownership of the land in ancient India, opinion being divided among individual ownership (like the modern capitalist system), collective ownership of a community and monarchial ownership. The well-established social setup of ancient India points towards the first two types of ownership. Monarchial ownership was most likely limited to the unfarmed wild lands within the territory of the kingdom. Most evidence appears to support individual ownership towards a piece of land of that individual who took the initiative to clear the land for agricultural use. Such ownership was, however, different from the modern concept of ownership in that such ownership lasted only as long as the individual farmed the land and that the rights of ownership were not bequeathable. Also, ownership of the land required the individual to be responsible towards the welfare of the community in a manner not very different from the social security system or the welfare state. As soon as the owner lost his ownership, the community owned the land. In this sense, the land was only leased out to an individual and actually owned by the community. The monarch was employed by the community for defense and justice. This again is not very different from the modern democratic system. And like the modern tax, individuals/ community paid the monarch and his royal team from the fruits of their labor. However, at some point monarchy became hereditary, perhaps for the same reasons that the other labor became hereditary.
Traces of the modern capitalist democratic system with social welfare are visible in this old economic system. Perhaps the absence of specialized organizations, that labor was not open for hire or sale in the market for such organizations and the lack of bequeathable ownership are the biggest consequential factors making this ancient system veritably different from the modern capitalist system.
