Budgetary Governance and Fiscal Administration in the Arthashastra: Lessons for Modern Public Finance

Kautilya's Arthashastra (circa 4th century BCE) constitutes one of the earliest systematic treatises on statecraft, taxation, public expenditure, and fiscal accountability. While modern public finance literature draws heavily on Western classical and neoclassical traditions, the Arthashastra anticipates several principles now considered foundational to budgetary governance, including ex-ante revenue estimation, classification of heads of expenditure, internal audit, anti-corruption controls, and counter-cyclical reserves. This paper revisits Kautilya's treatise as a primary source on fiscal administration and conducts a structured comparative analysis with contemporary Public Financial Management (PFM) frameworks promoted by the IMF, OECD, and World Bank. Using a qualitative, doctrinal, and comparative methodology, the study identifies enduring lessons for transparency, accountability, treasury management, and corruption control. The findings suggest that several Kautilyan prescriptions—particularly the forty modes of embezzlement, the sealed-treasury principle, and performance-linked compensation of officials—offer instructive insights for emerging economies seeking to strengthen fiscal institutions. The paper concludes that the Arthashastra is not merely a text of historical interest but a relevant intellectual resource for re-imagining indigenous foundations of modern public finance. Keywords: Arthashastra, Kautilya, public finance, budgetary governance, fiscal administration, PFM, transparency, accountability.