Sarvajeet D Chandra

When the World’s First Business School Went Up in Flames

740 CE. A Gujarat port. A trader watches the horizon, dread coiling in her stomach. Not far away, A Vallabhi professor walks to his lecture hall. Then he sees it: black plumes cutting the sky. A soldier rushes in: “The Arabs have raided the harbour. Everyone must leave.”

By midday, Vallabhi empties. Students flee inland. Manuscripts stuffed in jars. “Hurry, seal the manuscript jars,” the professor shouts. Centuries later, some will be found. Most will not. The world’s first MBA programme is unravelling.

Fourteen hundred years ago, the world’s sharpest minds came from Persia, Tibet, and Tang China. They paid obscene sums to study at Vallabhi, near Bhavnagar, Gujarat. Not philosophy. Not metaphysics. Not enlightenment. But strategy, statecraft, economics. Centuries before Adam Smith.

Vallabhi rivalled Nalanda. Its graduates administered ports, courts, and markets from the Mekong to the Mediterranean. Then, around 775 CE, it vanished.

This is a story about an institution that trained minds to think like merchants instead of monks.

The Woman Who Understood Capital Before Capitalism

Imagine Riddhi. Merchant. Widow. Risk-taker. She ran trade routes across three empires. Her dhow cuts through foreign flags as she enters a Gujarat port near Vallabhi. She recalls her father’s words: “Wealth isn’t what you hoard, Riddhi. It’s what you circulate.”

Her son Nimesh sits Vallabhi’s entrance exam in two days. “The guild is watching,” she tells her son. “One wrong answer, Nimesh, and we’re back at the fish sheds.”

The Maitrakas ruled Vallabhi, but merchants like Riddhi made it rich. The Chinese monk-traveller Xuanzang visited Vallabhi in 640 CE. He recorded more than a hundred wealthy families. Each family was worth a hundred kotis.

Xuanzang also recorded over a hundred monasteries and six thousand monks. But unlike Nalanda, Xuanzang noted, Vallabhi’s monks were not absorbed in metaphysics alone. Xuanzang described them, barely concealing his shock: “deeply versed in worldly knowledge.”

Think Goldman Sachs analysts who moonlight as philosophy professors. Vallabhi refused to choose between thought and action, materialism and spiritualism.

The Curriculum That Put Modern MBAs to Shame

Students at Vallabhi did not study theory alone. The curriculum was startlingly modern.

• Arthashastra to navigate real trade disputes like the perennial problem of three rival empires sharing a single harbour.
• Nyaya and Tarka (logic and debate) so that contracts and treaties could be argued with precision.
• Languages: Sanskrit, Prakrit, Persian, Sogdian. Deals had to be struck across kingdoms and a mistranslated clause could ruin a merchant.
• Dharmashastra (legal studies) provided the legal framework for thorny questions. It addressed how to settle a maritime insurance claim. It also covered dissolving a trading partnership between partners. These partners answered to different kings. They also prayed to different gods.
• Vyavahara-ganita (commercial arithmetic) taught them to calculate interest rates. It helped them project profit margins. They could reckon honest returns in a trade where half the ships might never come home.

Vallabhi was not a monastery. This was Harvard Business School in saffron robes, nine centuries before Harvard existed.

The Logo That Gave the Game Away

In 1959, Archaeologist H.D. Sankalia brushes dirt from a terracotta seal near Vallabhipur. The inscription reads: “The Great Assembly of Vallabhi.” But the image is not a lotus, a stupa, or a meditating monk. It is a merchant vessel. Sails taut. Cargo visible.

Buddhist monasteries did not brand themselves this way. This was a trade school announcing: We are practical, connected, about results, about employment.

Today, every business school has a logo: Wharton’s shield, Harvard’s Veritas. Vallabhi’s seal sits in a Gujarat museum. Most visitors walk past it, uninterested. While Harvard’s crest travels the world on coffee mugs and T-shirts. Would you buy a Vallabhi T-shirt?

The Famine, the King, and the Student Who Got It Right

Mid-morning. A Vallabhi lecture hall smells of sesame oil and ambition. Professor Sthiramati, whose commentaries will travel from Lhasa to Baghdad, poses a question: “A drought strikes. Grain prices triple. How does a king feed the people and maintain his army?”

Silence.

A Kashmiri student suggests suspending taxes. A Persian merchant’s son counters: “No taxes means an empty treasury. No famine relief. The king must choose between looking good and doing good.”

Then Nimesh speaks, voice cracking: “Respected Acharya, you draft laws that make hoarding costlier than circulation. Align the merchant’s self-interest with the people’s need. You don’t punish greed. You channel it.”

Three beats of silence. Professor Sthiramati nods.

This was no abstract theory. Vallabhi graduates shaped policy across continents. In Tibet, King Trisong Detsen hired one to overhaul the kingdom’s taxation system, a reform that held for centuries. In Kashmir, a Vallabhi grad Chandrapida earned rare praise for the precision of his fiscal administration. In Srivijaya, advisors trained in Vallabhi-vidya guided trade routes. They shifted the flow of trade from the Malacca Strait to the South China Sea.

The Debate That Still Matters

A Nalanda student, let’s call him Dharmapala, once challenged Nimesh directly.

“Vallabhi education is all transactions,” Dharmapala said. “Where is the pursuit of truth? You train clerks, not sages.”

Nimesh replied calmly: “Truth doesn’t keep people alive during famine. Effective governance does. Nalanda scholars debate reality. Vallabhi students plan grain imports when rains fail. Both have value. Only one is urgent.”

Dharmapala, the Nalanda student, paused. He thought for a moment. Then he asked, “What keeps your systems and policies from becoming instruments of oppression? Philosophy keeps power in check.”

Nimesh nodded. “Which is why we should collaborate, not compete. Bharat needs both.”

How a University Sustained Itself Like a Business

Vallabhi sustained itself like a modern university. Royal endowments. Merchant guild sponsorships: professorships in maritime law, currency studies. International tuition from Tibet, China, and Southeast Asia. And then the real income: consulting.

A 7th-century copper plate records a Vallabhi scholar settling disputes between three kingdoms. Kings hired professors for high-stakes negotiations. Ideas endure when they learn how to bill.

It Didn’t End in One Raid

Vallabhi did not end in one raid. Arab raids disrupted trade. The coastline receded, silt choking the harbour. When the Maitraka kingdom fell, patronage dried up. Routes became dangerous. Students stopped coming. By the end of the eight century, the campus shrank to a village. The village to memory.

The Idea That Refused to Die

Vallabhi solved what we still wrestle with: integrating spiritual depth with practical skill. Merchants funded philosophers. Monks taught accounting. Wealth and wisdom as partners, not enemies. What vanished was not a campus. It was the idea that a civilisation could train whole human beings.

Yet Vallabhi did not vanish completely. Ideas, once released, are indestructible. Maitraka legal codes shaped Gujarat’s property law for centuries. The hundi system bears Vallabhi’s fingerprints. Gujarati merchants (Patel families running American motels, diamond traders in Antwerp) are heirs to what Vallabhi systematised 1,400 years ago.

Institutions perish. Ideas travel.

The Lesson Vallabhi Left Behind

Riddhi knew wealth must circulate. Nimesh learned to align self-interest rather than crush it. Professor Sthiramati taught that integration beats specialisation.

Vallabhi’s lesson, distilled: you cannot separate how you make money from why you make it. People who know how but not why cause damage. People who know why but not how accomplish little. Strategy and execution are equally important, two sides of one coin.

The buildings are gone. But the ideas don’t disappear. They wait. And when we are ready, they return.

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The article is an excerpt from my podcast – India’s Golden Age. Available on YouTube, Spotify, Apple Podcasts and other Podcasting Platforms.