Travellers coming to India in the medieval period noted that there were a number of urban centres of various sizes, from cities to small market towns throughout India, though the country was primarily rural. The urban population was probably quite small as a proportion of the total, but it had an economic and cultural significance which was much greater than its actual size.
What were the factors which facilitated urbanization? It has been observed that cities and towns fulfilled diverse and overlapping roles in the economy. The large cities were centres of manufacturing and marketing, banking and financial services. They were usually located at the intersection of an extensive network of roads which connected them to other parts of the country. Smaller towns were marketing centres in local trade connecting the immediate rural hinterland. Cities also served as political and administrative centres, both in the capital region (for instance, Agra and Delhi) and in the provinces (Patna, Ahmedabad, Lucknow). Major pilgrimage centres like Varanasi also grew into cities, because the regular inflow of pilgrims provided a market that attracted manufacturing and trade.
In South India, especially the Tamil region, urbanization went hand in hand with temples. Temples were large economic enterprises requiring a variety of goods and services to function. They needed and employed a large number of people to man the religious services, the kitchens and for other work. Devotees coming to worship at the temple needed many services and goods, so that temple towns also became marketing centres. The pace of urbanization increased during the Vijayanagar period when there was a great increase in the construction of temples across Tamilnadu.
It must be remembered that the distinction between rural and urban was not as marked as it is in the present day. Most urban centres also displayed rural characteristics. For instance, it was not uncommon to find fields with crops within a city. But it is interesting to note that most of the large cities and market centres which existed in the medieval period are still to be found in north and south India, even though their relative importance might have changed over the centuries.
The medieval period covering more than seven hundred years of Indian history was a time when momentous changes took place in the political landscape which also transformed the social and economic fabric of the country.