The dry-zone water-harvesting and management system in Sri Lanka is one of the oldest historically recorded systems in the world. Keywords: internal trade, International trade, Social change, Commercial commodities, Trading groups, Muslim Merchant community. The research will be mainly based on primary sources and wherever necessary material will also be obtained from limited secondary sources published on the political system of the island. A commercial market is a place where meeting of merchants and consumers takes place. Commerce is a factor which is based on buying of items, transaction, selling and consumption. Therefore, from this research, the growth of commercial activities will be discussed based on those views and how the commercial activities affected the society. Benda has clearly shown from his primary studies that economy based on agriculture and commerce has affected the changes of society and political organization. He points out that there was only one new major irrigation project undertaken between the seventh and the ninth centuries, in sharp contrast to the intense irrigation activity in the period immediately proceeding. The explanation for this is that commercial gain provided the resources for hydraulic engineering. Gunawardhana has suggested that periods of prolific activity in building of irrigation works in Sri Lanka coincided with the most flourishing periods of trade. Those are an economy based on agricultural activities and economy based on trading activities. The economic factor which was a reason for the origin and development of socio- political organization of ancient Sri Lanka can be studied under two major divisions. Several scholars have analyzed through their various researches that commercial activities and development of commerce are major facts which a society will organize systematically in the world. The economic factor can be regarded as the decision of social development in a human society and with that development of the economic situation various structures of a society similarly are described.
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March 2023
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