The Fiscal Administration of the Former Hunza State: From Internal Machinery to Colonial Transformation

Figure 1: Three Generations of Hunza Rulers, 1930. Left to right: Mir Muhammad Nazim Khan (r. 1892–1938), Mir Muhammad Ghazan Khan II (r. 1938–1945), and Mir Muhammad Jamal Khan (r. 1945–1974). Photograph by Sir Marc Aurel Stein, 13 September 1930. Source: Stein Collection, Hungarian Academy of Sciences (Stein, 1930).

Abstract

Part I of this study examined the traditional taxation system of the former Hunza State. It focused on social classes, categories of taxation, and the methods used to collect surplus resources. Part II shifts attention away from the types of taxes. Instead, it examines the administrative machinery through which revenue was collected. It also analyses the wider territorial networks that provided fiscal resources to the state.

This article draws on colonial records, local historical accounts, ethnographic observations, and later scholarship. It argues that Hunza's fiscal system functioned through two connected dimensions. The first dimension was an internal system of agricultural and pastoral extraction. This system operated through a hierarchy that extended from the Mir's court down to village-level officials. Officials such as the Yerpa, Faraj, Arbob, Lumbardar, and Charbu collected grain, livestock, and labour. The second dimension involved revenue and political relationships beyond the settled valleys. These relationships existed particularly in the high-altitude pastures of the Pamir and along trans-regional caravan routes.

Therefore, the evidence suggests that Hunza's economy was not a self-contained valley economy. Instead, its political economy was connected to wider pastoral, commercial, and geopolitical networks. These networks extended towards the Pamir, Yarkand, and the wider Karakoram frontier. Grazing dues, tribute, and caravan-related revenues supplemented the comparatively limited agricultural base of the state (Kreutzmann, 2004).

However, British intervention following the Hunza campaign of 1891–1892 altered this fiscal and political order. The British suppressed caravan raiding and restructured frontier relations. This reduced some of the external revenue opportunities previously available to the Mir. Moreover, the 1937 changes concerning grazing rights in the Taghdumbash Pamir further transformed the relationship between Hunza and its trans-frontier pastoral hinterland. Available revenue records also indicate that the fiscal obligations imposed on Shimshal increased substantially between the late nineteenth and early twentieth centuries. Rather than attributing this increase to a single cause, this article interprets it within the broader transformation of Hunza's political economy under colonial influence.

Finally, the last section examines the abolition of the Hunza State in 1974 and the emergence of new administrative and community institutions. In conclusion, the history of Hunza's fiscal administration illustrates the interaction of ecology, political authority, pastoral mobility, trade, colonial frontier policy, and changing forms of governance in a high-mountain society.

Keywords: Hunza State, fiscal administration, colonial transformation, Karakoram, Shimshal, Pamir grazing rights, British indirect rule, dual fiscal structure

Key Takeaways

Hunza's fiscal system operated through two connected dimensions: internal agricultural extraction and external pastoral and commercial networks. The Shimshal community experienced a nearly sevenfold increase in recorded obligations between 1894 and 1938, from Rs. 200 to Rs. 1,398. British intervention after 1891 restructured Hunza's external revenue sources, suppressing caravan raiding and reorganizing frontier relationships. The 1937 Pamir changes reduced both revenue and the Mir's geopolitical influence over trans-frontier pastoral networks. The 1974 abolition ended princely authority but did not immediately eliminate historical social structures, which continued to influence social relationships, marriage patterns, and perceptions of identity. New institutions—government offices, elected bodies, community organizations, and civil society initiatives—gradually assumed governance functions.

1. Introduction

What This Article Covers

Part I of this series, titled "The Traditional Taxation System of the Former Hunza State: A Socio-Economic Analysis," examined the social and economic foundations of taxation in Hunza. It discussed the historical classification of social groups, including Lupon, Shana, Darqan, and Borwar. It also explained the Auyum system—a form of customary taxation—and various forms of Ilban or Hilban extraction. In addition, it examined Zarat (crop taxation), livestock-related taxation, and begar (compulsory labour service).

The analysis in Part I suggested that taxation in Hunza was closely connected to the ecological conditions of a high-mountain agricultural society. Limited cultivable land, dependence on irrigation, seasonal pastoralism, and strong social hierarchies shaped how agricultural and pastoral surplus was mobilised.

In contrast, Part II moves from the categories of taxation to the machinery of collection. It also shifts focus from the internal valley economy to the wider political and economic hinterland.

The Dual Fiscal Structure

The central argument is that the fiscal history of Hunza cannot be understood solely through taxes imposed on settled agricultural communities. For example, the state also benefited from relationships beyond the valley floors. These included grazing arrangements in the Pamir, tributary relationships, and revenues associated with trans-regional caravan movement. These external resources were particularly significant because the agricultural resource base of Hunza was relatively limited when compared with neighbouring Nagar (Kreutzmann, 2004).

Consequently, this article uses the term "dual fiscal structure" as an analytical concept. It refers to the coexistence of two broad sources of state revenue. First, there was an internal system based primarily on agricultural, livestock, and labour extraction. Second, there was an external system connected with pastoral mobility, tribute, and long-distance trade.

However, this concept should not be misunderstood. It does not suggest that Hunza possessed a modern, centrally organised fiscal bureaucracy in the contemporary sense. Rather, it highlights the coexistence of different mechanisms through which political authority was converted into material resources.

Sources and Methods

This study draws upon several types of sources. These include colonial administrative records, Beg's (2006) historical account, Kreutzmann's (2004) analysis of pastoral practices, Dani's (1991) history of the Northern Areas, Lorimer's (1935) ethnographic observations, Schomberg's (1935) colonial-era account, and oral testimonies preserved by the Mountain Voices Project (n.d.). In addition, this article also references the comprehensive historical works of Zafar Iqbal (2017, 2018), which provide detailed insights into the region's diverse tribal domains and adventurous past.

The writings of Fida Ali Esar Hunzavi (2002) provide valuable insights into the historical and cultural landscape of the region preserved in oral traditions and community records, offering a valuable grassroots perspective on Hunza's socio-political history. Furthermore, the works of Alwaiz Abdullah Jan Hunzāʼī (1998, 2000, 2013) provide indispensable documentation of Hunza's folk traditions, ancient customs, and the political transition surrounding the state's dissolution. Dr. Neak Alam Rashid's (n.d.) study of Ismaili missionary history in Central Asia further enriches our understanding of the region's broader religious and cultural networks.

These sources vary considerably in purpose, perspective, and reliability. For instance, colonial records were produced within particular administrative and political contexts. Oral histories, on the other hand, preserve community memories that may reflect later interpretations of earlier institutions. Consequently, this article treats the evidence comparatively rather than as an entirely uniform historical record.

In addition, the article draws conceptually on Charles Tilly's (1990) discussion of state formation and revenue extraction. It also uses James C. Scott's (1998) analysis of administrative legibility. These comparative perspectives help situate Hunza within wider discussions of state formation. At the same time, they recognise the distinctive ecological and political circumstances of the Karakoram.

The following sections will examine the administrative hierarchy, internal revenue streams, external fiscal networks, colonial intervention, and the transformation of the Pamir relationship. The final section will then discuss the abolition of the state in 1974.

2. Administrative Hierarchy and Fiscal Officials

2.1 The Mir (Tham)

The Mir, commonly referred to as the Tham in local historical traditions, occupied the highest position in Hunza's political hierarchy. His authority extended over taxation, land allocation, labour obligations, irrigation, pastoral resources, trade, and the distribution of land.

Colonial-era accounts describe the Mir as claiming extensive rights over forests, mountains, and pasturelands. For example, Kreutzmann (2004) records a statement attributed to the Mir asserting ownership over Hunza's forests, mountains, and pastures. The Mir also claimed the right to graze royal herds wherever he wished. Such statements are important because they reveal the political conception of resource ownership under the Hunza State. However, readers should understand these claims as evidence from a particular historical and administrative context. They should not be treated as proof of an uncontested legal system.

The Mir's authority over revenue included several functions. He collected payments in kind, cash, and labour. He managed royal lands and regulated irrigation. He supervised trade and caravan movement and allocated land.

Traditional succession practices were an important element of political legitimacy. However, the political transformation following the British campaign of 1891–1892 demonstrated that succession was not simply a matter of hereditary principle. British intervention contributed to the installation of Muhammad Nazim Khan as Mir. This intervention altered the balance between dynastic legitimacy, local political authority, and colonial patronage (Dani, 1991).

2.2 The Wazir

The Wazir occupied one of the most influential positions below the Mir. His responsibilities could include political advice, military organisation, administration, and revenue collection.

This office also illustrates the close relationship between kinship and administration. According to Beg (2006), influential administrative positions were frequently associated with individuals connected to the ruling family through family or marriage networks.

During the reign of Mir Muhammad Ghazan Khan II, Wazir Asadullah Beg held an important position in the administration. His son, Dara Beg (also known as Wazir Dado), subsequently served as Faraj (treasurer). Beg (2006) describes Dara Beg as responsible for the revenues of the state in both cash and kind.

Dara Beg's example is particularly significant. It demonstrates that administrative competence in Hunza did not necessarily depend upon formal literacy. For instance, linguistic ability, knowledge of local society, practical experience, political relationships, and personal reputation could all contribute to administrative authority.

2.3 The Yerpa: Steward of Royal Demesnes

The Yerpa occupied an important position in the management of the Mir's royal lands (or demesnes). These lands existed in different settlements. They were cultivated partly through labour obligations imposed upon local communities.

Lorimer's (1935) observations provide a particularly critical description of the Yerpa's position. He noted that the steward could potentially exploit both the royal household and the peasants working on royal lands. This exploitation could occur through corruption, excessive labour demands, and informal payments.

Readers should interpret such observations within the context of Lorimer's colonial ethnographic perspective. Nevertheless, they provide valuable evidence regarding the practical difficulties of administering royal estates. They also highlight the potential for local officials to exercise discretionary power.

The career of Muhammad Nazim Khan before his accession to the throne is also relevant. His experience as an official gave him direct knowledge of the administrative practices of the period. Later colonial and ethnographic accounts portray his reign as one in which central authority became increasingly concentrated.

Therefore, the Yerpa illustrates an important feature of Hunza's fiscal administration: the state's ability to extract resources depended not only on formal authority but also on the behaviour and discretion of intermediate officials.

2.4 Village-Level Officials and Local Administration

The administrative structure extended into individual settlements. Village representatives conveyed orders from the Mir. They also helped organise communal labour and other obligations.

The Arbob functioned as an important village-level authority. Oral testimony recorded by the Mountain Voices Project describes the Arbob as responsible for communicating the Mir's orders, implementing them, and organising routine community work (Mountain Voices Project, n.d.). Zafar Iqbal's (2017) historical narrative similarly documents the pivotal role of such village-level functionaries, confirming that the Arbob, along with the Lumbardar and Charbu, formed the backbone of the Mir's administrative reach into every settlement. Alwaiz Abdullah Jan Hunzāʼī (2000), in his documentation of Hunza's ancient customs, provides corroborating evidence of how these officials operated within the traditional social hierarchy.

In addition, other local officials included the Lumbardar, who represented higher authority at the village level, and the Charbu, who assisted with announcements, messages, and the mobilisation of households (Munshi, 2016). There were also officials responsible for irrigation and water management.

Sidky (1996) emphasises the importance of irrigation institutions in understanding state formation in Hunza. He argues that water management was not simply a technical matter. In a mountain environment, agricultural production depended upon carefully maintained irrigation channels. Therefore, control over water was closely connected with social organisation and political authority.

Through this hierarchy, broad categories of taxation were transformed into actual flows of grain, livestock, labour, and other resources.

3. Internal Revenue Streams and Tax Distribution

3.1 The Agricultural Base

Available colonial records indicate that the agricultural revenue base of Hunza was comparatively modest. Kreutzmann (2004) estimates the annual internal revenue of Hunza at approximately Rs. 2,660 in standardised 1916 British Indian rupee prices. In comparison, neighbouring Nagar had approximately Rs. 4,800.

However, readers should treat these figures cautiously. They represent administrative estimates rather than complete national accounts. Moreover, the conversion of historical payments into standardised monetary values inevitably involves methodological assumptions.

Nevertheless, the comparison is useful. It suggests that Hunza could not rely solely upon its agricultural base. As a result, pastoral resources, frontier relationships, and trade-related activities were important components of its political economy.

Colonial records from around 1894 provide an indication of the distribution of agricultural and livestock obligations. In the Hunza Valley, recorded grain contributions included approximately 60 maunds from Hindi, 10 from Maium, 9 from Murtazabad, 2 from Hassanabad, 6 from Aliabad, 2 from Dorkhan, 6 from Haiderabad, and approximately 7.5 maunds each from Ganesh, Baltit, and Altit. A maund was a unit of weight commonly used in South Asia, varying by region but approximately equivalent to 37.3 kilograms in British Indian standard measurements.

In Gojal, the records identify livestock contributions from Shimshal. They also show additional grain and livestock obligations from other settlements. The recorded village contributions amounted to approximately 132.5 maunds of grain and 350 sheep or goats.

In addition, the Mir's royal demesnes contributed an additional 175 maunds of grain and approximately 150 sheep or goats.

Taken together, the records therefore indicate approximately 307.5 maunds of grain and 350 sheep or goats from the categories recorded in the archive.

However, these figures should not be interpreted as a complete inventory of every form of taxation or redistribution in Hunza. Instead, they represent the particular categories recorded in the surviving administrative material.

3.2 The Fiscal Position of Gojal and Shimshal

The available evidence indicates that communities in Gojal carried significant fiscal obligations relative to their population and location.

Shimshal is especially important because of its geographical position and pastoral connections. Colonial records indicate that this settlement contributed a substantial number of livestock relative to its small population. Given Shimshal's limited household numbers during this period, the livestock obligations represented a significant burden on each household.

A note on interpretation: The claim that Gojal provided "four-fifths of all taxes" appears to originate from a particular reading of colonial records that may have combined grain and livestock figures without adequate population weighting. While later scholarship has questioned this figure, it nonetheless points to Gojal's disproportionate fiscal significance.

A more defensible interpretation is that Gojal (and particularly Shimshal) carried a disproportionately high share of certain recorded livestock and frontier-related obligations. This pattern may be related to Gojal's geographical position and its connection with the Pamir. It also demonstrates an important feature of mountain fiscal systems: communities located on politically and economically strategic frontiers could face obligations that were not directly proportional to their population or agricultural productivity.

4. The External Hinterland: Pastoralism, Tribute and Caravan Networks

The fiscal history of Hunza extended beyond the cultivated valley floors. Specifically, the high-altitude pastures of the Pamir, the routes connecting the Karakoram with Central Asia, and relationships with neighbouring communities formed part of the wider political economy of the state.

Dani (1991) describes the northern frontier as a region characterised by interconnected highland routes and mobile populations. From this perspective, political authority in Hunza cannot be understood exclusively through fixed territorial boundaries.

4.1 Khiraj and Grazing Rights in the Pamir

The term khiraj is used in historical accounts to describe dues associated with grazing in areas of the Pamir. Pastoralists, including Kyrgyz and Wakhi groups, used high-altitude grazing areas associated with the Taghdumbash Pamir and neighbouring regions.

According to Kreutzmann (2004), grazing payments could be made in livestock and various pastoral products. Historical descriptions include animals, felt products (namda), woollen blankets, ropes, cloth (kirpas), coats, and saddles.

These arrangements were not simply one-directional taxation. They also involved political relationships concerning protection, access, mediation, and trade. Therefore, the Mir's authority over such spaces had both fiscal and geopolitical dimensions.

This distinction is important. The Pamir relationship was not merely an extension of agricultural taxation into another territory. Instead, it involved pastoral mobility, negotiated access to resources, and the political authority of the Hunza ruler over a trans-frontier landscape.

4.2 The Shakshu Pakhpu Tribute

Historical accounts also describe tribute associated with the Shakshu Pakhpu region. Beg (2006) connects this revenue with military activity during the nineteenth century. He reports annual payments in the range of Rs. 750–800.

However, the precise political status of this relationship requires careful interpretation. Rather than automatically describing the payments as evidence of permanent territorial sovereignty, it is more appropriate to regard them as part of a broader system of tribute, political influence, and coercive frontier relations.

Following the British reorganisation of the frontier after 1891, this source of revenue was discontinued or substantially altered (Kreutzmann, 2004).

4.3 Caravan Raiding and the Daw System

One of the most controversial aspects of Hunza's external economy was the practice referred to in historical sources as daw. This term encompasses a spectrum of activities, from sanctioned toll collection to outright plunder. The distinction was not always clear in practice, and contemporary accounts likely vary depending on the perspective of the observer—whether colonial official, caravan merchant, or local source.

The daw system involved raids on caravans travelling through the Kilik, Mintaka, and Khunjerab routes. These routes formed part of wider networks connecting the Yarkand region with Ladakh and other parts of the Karakoram. Historical accounts refer to the movement of horses, silk, spices, wool, and other commodities.

Kreutzmann (2004) associates pre-colonial Hunza with revenues generated through caravan-related activities. He estimates a value of approximately Rs. 2,200 annually for certain forms of caravan revenue in the period before the British intervention.

However, describing the entire amount simply as "taxation" may obscure the distinction between legitimate tolls, customary payments, and coercive seizure. The historical evidence suggests that caravan raiding and toll collection existed within a complex frontier environment where political authority, commercial movement, and armed power overlapped.

The British campaign of 1891–1892 fundamentally altered this system. British authorities sought to secure caravan routes and prevent attacks on protected commercial traffic. Following the campaign, the political conditions that had enabled the daw system were substantially weakened. Consequently, the loss of caravan-related income was an important component of the broader transformation of Hunza's external fiscal resources.

4.4 External Revenue in Perspective

The available evidence suggests that external sources could be economically significant in relation to the comparatively modest internal agricultural revenue base.

Historical estimates associate the pre-1890 period with approximately Rs. 750–800 from some tribute arrangements and approximately Rs. 2,200 from caravan-related activities. In addition, grazing dues represented another source of revenue whose value and form varied.

However, these figures should not be mechanically added together as if they constituted a modern annual state budget. They originate from different historical contexts and categories of evidence.

Nevertheless, the broad pattern is significant. Hunza's political economy extended beyond its cultivated valleys. It depended partly on access to wider pastoral and commercial networks.

The significance of Gojal within Hunza's external fiscal structure is further elaborated in Zafar Iqbal's (2018) dedicated study of the region. His work highlights how the diverse tribal domains of Gojal were not merely passive subjects of taxation but active participants in the trans-regional exchanges that defined Hunza's political economy. This perspective reinforces the argument that Hunza's fiscal system cannot be understood solely through the lens of the central court; rather, it was a network of relationships in which frontier communities like those in Gojal played a decisive role in shaping the state's external revenue streams.

Dr. Neak Alam Rashid's (n.d.) examination of Ismaili missionary networks in Central Asia also sheds light on the religious and cultural connections that paralleled and supported these economic relationships, linking Hunza to broader Pamir and Central Asian networks.

5. British Indirect Rule and the Transformation of the Pamir Frontier

5.1 The Installation of Mir Muhammad Nazim Khan

The Hunza campaign of 1891–1892 marked a decisive turning point in the political history of the state.

Following the departure of Mir Safdar Ali Khan, the British recognised Muhammad Nazim Khan as Mir in 1892. This intervention altered the traditional relationship between dynastic succession and political authority.

Dani (1991) regards Hunza as an important example of British indirect rule in the Northern Areas. The new political arrangement enabled the Mir to retain substantial internal authority. At the same time, it made his position increasingly dependent upon recognition and support from the colonial administration.

British subsidies and political support subsequently strengthened the position of the ruling house. However, this did not mean that the Mir became a simple colonial official. Rather, the arrangement created a hybrid political order in which indigenous institutions continued to function while their external political environment was increasingly controlled by the colonial state.

5.2 The 1937 Pamir Changes

Another major transformation occurred in 1937 when the status of Hunza's traditional grazing rights in the Taghdumbash Pamir was altered.

Kreutzmann (2004) describes an arrangement under which the Mir relinquished certain grazing-related rights. In return, he received compensation and alternative arrangements. The specific rights relinquished appear to have included traditional claims to grazing dues and political authority over pastoral communities in the region. The compensation received, while not fully documented in available sources, was likely financial or administrative in nature.

The consequences were wider than the immediate loss of a revenue stream. The Pamir relationship had connected Hunza's political authority with pastoral mobility, seasonal grazing, and trans-frontier diplomacy. Its transformation therefore reduced not only a source of revenue but also an important dimension of the Mir's geopolitical influence.

However, the consequences for local communities should be analysed cautiously. While the restructuring of frontier grazing arrangements changed the distribution of pastoral resources, the precise causal relationship between these changes and subsequent increases in internal taxation cannot always be demonstrated directly from the available evidence.

5.3 The Increasing Fiscal Burden on Shimshal

Historical records provide evidence of substantial changes in the obligations imposed on Shimshal.

For example, available records indicate that in 1894 the recorded livestock obligation was valued at approximately Rs. 200. However, by 1938 the recorded obligations included approximately 146 sheep or goats, two yaks, together with salt and grain. This had a calculated value of approximately Rs. 1,398 (Kreutzmann, 2004).

On the basis of these figures, the monetary equivalent increased by approximately seven times: Rs. 1,398 divided by Rs. 200 equals 6.99, or approximately seven times.

This is an important quantitative finding. However, it should not automatically be interpreted as proof that the entire increase was caused by the loss of Pamir revenue. Several factors may have contributed, including changes in valuation methods, administrative practices, population growth, livestock holdings, political conditions, and the structure of taxation itself.

Adding qualitative context: Oral testimonies from Shimshal (Mountain Voices Project, 2000) suggest that community members perceived these obligations as increasingly burdensome, particularly as traditional access to Pamir pastures became more restricted. However, it remains difficult to determine whether the recorded increase reflects actual extraction, changing valuation methods, or both.

A more cautious conclusion is therefore that Shimshal experienced a substantial increase in recorded fiscal obligations. This increase occurred during the period in which Hunza's external fiscal environment was being transformed. This correlation provides an important basis for further investigation into the relationship between colonial frontier restructuring and internal taxation.

5.4 Expansion of the Nobility and Concentration of Political Authority

Colonial intervention also influenced the structure of Hunza's political elite.

Kreutzmann (2004) notes that colonial administration increasingly regulated matters such as succession. It also recognised or supported sections of the local nobility through subsidies, land arrangements, and tax privileges. This altered the traditional balance between the Mir and the upper social groups.

Schomberg (1935), writing from a colonial perspective, was highly critical of the Hunza elite. He described sections of the ruling class as privileged and economically dependent on their social position. Readers should read such descriptions critically because they reflect the attitudes and assumptions of a colonial official and traveller. Nevertheless, they provide evidence that social privilege and political authority remained central features of Hunza's political structure.

Schomberg also portrayed Mir Muhammad Nazim Khan as possessing an unusually high degree of centralised authority. Therefore, the evidence suggests that the colonial period did not simply weaken the Mir. Paradoxically, British recognition and support could simultaneously constrain his external sovereignty while strengthening his internal position.

This is one of the most important features of Hunza's colonial transformation: political dependence on the colonial state could coexist with increased centralisation within the state itself.

6. The Dissolution of the Hunza State and Its Aftermath

6.1 The Abolition of 1974

The final transformation came in 1974. On 24 September 1974, Prime Minister Zulfikar Ali Bhutto announced the abolition of the remaining princely institutions in the Northern Areas. This included the Hunza State. Contemporary reporting in Dawn recorded Bhutto's argument that Pakistan could not continue to accommodate separate princely states. He stated that the abolition was based on broader political principles rather than directed personally against the ruling family (Dawn, 2024).

The decision formally ended the political authority of the Mir. It also brought the remaining institutions of the former state under the administrative framework of Pakistan. With the abolition of the state, the traditional system of compulsory labour, princely taxation, and royal resource administration also came to an end.

6.2 Fiscal and Administrative Transition

The abolition of the Mir's authority did not simply represent the replacement of one tax collector by another. Instead, it marked a broader transformation in the relationship between state, community, land, labour, and resources.

The traditional system had combined extraction with forms of political authority, patronage, redistribution, dispute settlement, and community organisation. Therefore, its abolition required the development of new institutions capable of performing administrative functions previously associated with the princely system.

Oral testimonies from Shimshal suggest that the transition was psychologically and socially complex. Communities had to adapt to new concepts of citizenship, administration, authority, and social organisation (Mountain Voices Project, 2000).

At the same time, it is important not to romanticise the earlier system. The traditional order was also characterised by social hierarchy, compulsory labour, unequal taxation, and unequal access to political authority.

Therefore, the significance of 1974 lies not simply in the replacement of an "old" system by a "new" one. Rather, it lies in the transformation of the institutional foundations through which authority and resources were organised.

6.3 Emergence of New Institutions

Following the abolition of the state, government administration increasingly replaced the Mir's administrative hierarchy.

District-level government offices and state institutions assumed responsibilities for administration, policing, taxation, and public services. In addition, the Numberdar system provided another mechanism of village-level representation. Elected local institutions, including Union Councils, introduced new forms of political participation. However, their authority remained subject to wider governmental structures.

Community institutions also became increasingly important. The development experience of Hunza subsequently included participatory organisations and community-based approaches to natural-resource management. Kreutzmann (2004) highlights the importance of water management and local development initiatives in the region.

In Shimshal and elsewhere, community-based dispute resolution also continued to operate alongside formal state institutions.

The development of these institutions illustrates an important feature of post-1974 Hunza. The disappearance of princely authority did not result in the disappearance of local governance. Instead, governance was progressively redistributed among state institutions, elected bodies, community organisations, and civil-society institutions.

6.4 The Continuing Legacy of the Traditional Social Order

The abolition of the Hunza State did not automatically erase historical social distinctions.

Oral histories indicate that older social categories and distinctions continued to influence social relationships, marriage patterns, status, and perceptions of identity. This persisted even after the formal political system had disappeared (Mountain Voices Project, 2000). This demonstrates that political institutions can disappear more rapidly than social structures.

The experience of the Shimshal Nature Trust provides another important example. Community-based environmental organisation emerged in response to concerns about external management of local resources and conservation policies. Such developments demonstrate the capacity of local communities to construct new forms of collective governance while drawing selectively upon elements of traditional social organisation.

Therefore, the post-1974 history of Hunza should not be understood simply as a movement from "traditional" to "modern." It is better understood as an ongoing process of institutional adaptation in which older practices, new governmental structures, community organisations, and changing economic conditions interact.

6.5 Comparative Reflections

Hunza's transition from princely rule to integration within Pakistan can be compared with the wider transformation of princely and semi-autonomous political systems in South Asia.

However, its timing was distinctive. Whereas most princely states in the Indian subcontinent were integrated into new national political structures during the late 1940s and early 1950s, Hunza retained its traditional ruling institution until 1974.

The delayed transition is significant because the political economy of Hunza had already undergone major transformation during the British period. By 1974, many of the external revenue networks that had historically supported the Mir had already been reduced or transformed. Thus, the 1974 abolition represented the final stage of a longer process rather than an isolated event.

The fiscal transformation of Hunza can therefore be understood as occurring in several stages. First, there was the traditional system of internal and external resource mobilisation. Second, there was the colonial restructuring of external relations after 1891. Third, there was the further transformation of Pamir grazing arrangements in the twentieth century. Finally, there was the abolition of princely authority in 1974.

Conclusion

In summary, the fiscal history of the former Hunza State reveals a political economy shaped by the interaction of agriculture, pastoralism, trade, geography, social hierarchy, and frontier politics.

The internal fiscal system depended upon an administrative hierarchy. This hierarchy extended from the Mir and Wazir to officials such as the Yerpa, Faraj, Arbob, Lumbardar, and Charbu. Through this machinery, agricultural produce, livestock, labour, and other resources were mobilised from settlements across the state.

At the same time, Hunza's fiscal system extended beyond the cultivated valleys. Specifically, grazing arrangements in the Pamir, tribute relationships, and caravan-related activities connected the state with wider networks stretching towards Central Asia and the Karakoram frontier. Therefore, the evidence supports interpreting Hunza as a polity whose political economy was both territorial and trans-regional.

However, the British intervention after 1891–1892 fundamentally altered this structure. Caravan raiding was suppressed, frontier relationships were reorganised, and the political position of the Mir became increasingly embedded within a colonial system of indirect rule.

Furthermore, the 1937 changes concerning Pamir grazing rights represented another major transformation. They reduced the economic and geopolitical importance of a relationship that had historically connected Hunza with pastoral communities beyond its immediate territory.

Available records also demonstrate substantial changes in the recorded fiscal obligations of communities such as Shimshal. The nearly sevenfold increase in the monetary valuation of its recorded obligations between 1894 and 1938 is particularly striking. Yet the evidence does not justify attributing this increase exclusively to the loss of external revenue. Rather, it should be interpreted as part of a wider transformation in taxation, administration, resource valuation, and political authority.

Finally, the abolition of the Hunza State in 1974 brought the princely fiscal system to an end. However, the disappearance of formal taxation and princely authority did not immediately eliminate the social structures that had developed around the earlier system. New governmental institutions, elected bodies, community organisations, and civil-society initiatives gradually assumed different aspects of governance.

Taken together, Parts I and II present a broader picture of Hunza's fiscal history. Part I examined the social foundations and categories of extraction. Part II has examined the administrative machinery and external networks through which those resources were mobilised. The combined evidence demonstrates that Hunza's traditional political economy cannot be reduced either to a simple feudal model or to an isolated mountain subsistence economy. Rather, it represented a historically specific combination of agricultural production, pastoral mobility, social hierarchy, political authority, and trans-regional interaction.

The case of Hunza also has wider implications for the study of mountain societies. High-mountain polities were not necessarily isolated political units operating only within their valleys. Their economies and political institutions could be deeply connected with pastoral corridors, caravan routes, neighbouring territories, and larger geopolitical systems.

The colonial transformation of Hunza demonstrates, moreover, that changes to external networks can have consequences for internal social and fiscal relations. When traditional sources of external revenue and political influence were restricted, the relationship between the ruler, local officials, and producing communities also changed. This does not mean that colonial intervention alone caused every subsequent transformation. Rather, it suggests that colonial frontier policies formed one important part of a longer process of political and economic restructuring.

Ultimately, the story of Hunza's fiscal administration is not simply a story of taxation. It is a history of how authority, resources, mobility, and social hierarchy were organised in a high-mountain society. It also shows how those arrangements were gradually transformed by changing regional and global political forces.

Preview of Part III

Part III: Social Change and Transformation

The third part of this series will examine the social and institutional transformations that followed the abolition of the Hunza State in 1974. It will focus on changing class relations, the evolution of community institutions, development initiatives, the continuing influence of historical social distinctions, the emergence of new forms of political participation, and the broader struggle for democratic and institutional recognition in Gilgit-Baltistan.

Note on Currency, Evidence and Sources

Readers should understand that the monetary values cited in this article are historical estimates. They are not precise measurements of the total fiscal income of the Hunza State.

Where applicable, Kreutzmann (2004) standardises historical values using 1916 British Indian rupee equivalents. A British Indian rupee in 1916 had different purchasing power than modern currencies; direct comparisons with contemporary values are not meaningful. For context, a British Indian rupee in 1916 had purchasing power significantly different from today's rupee, and the figures should be understood primarily as relative indicators of change rather than absolute values.

The colonial records cited in this study, particularly IOL/P&S/10/973 and IOL/P&S/12/3292, provide important quantitative evidence. However, they were produced for administrative purposes. Such records may therefore reflect colonial categories, selective reporting, and the administrative priorities of the period.

Similarly, ethnographic works such as Lorimer (1935) and Schomberg (1935) contain valuable observations. However, they also reflect the intellectual and political environment of colonial scholarship. Local histories and oral testimonies provide complementary perspectives but may preserve retrospective interpretations.

For these reasons, this article has treated the quantitative and qualitative evidence through triangulation. It has not treated all sources as equally definitive. Where the evidence establishes a clear pattern, the article states it directly. Where interpretation remains uncertain, the language has been deliberately qualified.

This distinction is essential for understanding the fiscal history of Hunza. It helps avoid imposing modern concepts of taxation, sovereignty, or state administration uncritically upon a historical mountain polity.

Chronological Timeline

The fiscal transformation of Hunza occurred in several distinct stages. Before 1891, the traditional system of internal and external resource mobilisation operated through a combination of agricultural taxation, pastoral dues, tribute, and caravan-related revenues. The year 1891–1892 marked the British Hunza campaign and the installation of Mir Muhammad Nazim Khan, beginning the period of colonial indirect rule. Around 1894, colonial revenue records were compiled, showing Shimshal's livestock obligation valued at approximately Rs. 200. In 1937, Pamir grazing rights were restructured, and the Mir relinquished certain trans-frontier claims. By 1938, recorded Shimshal obligations had reached approximately Rs. 1,398, representing a nearly sevenfold increase. Finally, in 1974, the Hunza State was abolished by Prime Minister Zulfikar Ali Bhutto, bringing the princely fiscal system to an end. In the post-1974 period, new institutions emerged, including government offices, Union Councils, the Numberdar system, and various community organisations.

Glossary of Selected Terms

Arbob: A village-level representative responsible for communicating and implementing orders and organising certain communal activities.

Auyum: A form of customary taxation in the Hunza State.

Begar: Compulsory or unpaid labour service imposed through the traditional political and social system.

Charbu: A village-level assistant associated with communication, announcements, and mobilisation of households for communal tasks.

Darqan: A social group or category in Hunza's traditional hierarchy.

Daw: A term used in historical accounts for caravan-raiding activities associated with Hunza before the consolidation of British control over the frontier; encompasses a spectrum from sanctioned tolls to plunder.

Faraj: An official associated with the management or collection of state revenues, particularly revenues in cash and kind.

Gushpūr: A term associated with members of the nobility or elite families in Hunza.

Ilban (also Hilban): A form of extraction or taxation in the traditional Hunza system.

Khiraj: A historical term used for dues or payments associated with grazing and pastoral use of frontier areas.

Kirpas: Cotton cloth mentioned among commodities used in historical pastoral exchanges.

Lumbardar: A village-level headman or representative associated with the ruling authority.

Lupon: A social group or category in Hunza's traditional hierarchy.

Namda: A felt or woollen blanket used as a pastoral or customary commodity.

Numberdar: A government-appointed village representative in the post-princely administrative system.

Shakshu Pakhpu: A region referred to in historical accounts in connection with tribute and frontier political relations.

Shana: A social group or category in Hunza's traditional hierarchy.

Taghdumbash Pamir: A high-altitude pastoral region north of the Karakoram, historically connected with Hunza's trans-frontier pastoral relations and now within China's Xinjiang region.

Tham: A local designation associated with the ruler of Hunza, commonly rendered as Mir in historical literature.

Yerpa: An official responsible for managing royal lands or demesnes.

Zarat: Crop taxation in the traditional Hunza system.

References

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End of Part II