Archaeological finds in India as well as in South East Asia have conclusively proved that both of them were actively engaged in trade relations from the earliest times. This trade has been generally termed as “Prestige goods trade or luxury trade”. These theories closely link Indian trade with the development of polity and culture in South East Asia. It is assumed that Indian traders coming to South East Asia brought not only exotic goods made of glass, agate and carnelian, but also exotic ideas on kingship and religion. Due to this overemphasis on the role of Indian trade in political and cultural evolution of South East Asia, the real nature of this trade has become obscured. The present study aims to explain that India's South East Asian trade was not confined only to high value prestige goods exchange, but it was only a part of this regional trade. It is important to note that recent researches indicate that South East Asia had centralized states even before the advent of Indian traders. In such circumstances, prestige goods trade has a very limited scope and commercial relations restricted to such exchange cannot survive for long. The large number of seals and sealings inscribed in Indian languages, used for making merchandize, imply that a part of exchange was definitely market exchange, was conducted under organized trade network and was motivated by profit making.
