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Though farming was the main industry of the ancient Babylonian, trade was also an integral part of their life and of Babylonian civilization. A king could not raise taxes for some great war from poor peasants. Trade was the key to wealth. The kings knew that to preserve their own wealth they had to promote trade. They supported the merchants and would often ransom them if bandits or some hostile kingdom captured them. By promoting trade a king could tax people.
For trade to flourish the trade routes had to be safe and protected from bandits. Therefore it was good for trade when there were large stable empires. This is because if there were one empire controlling the trade route there would be peace and security because there would be no wars. This would mean greater prosperity.
If the trade routes were not secure and merchants were left to the mercy of bandits, trade would be discontinued and a general decline in the prosperity of the area would happen, as in 1000 BC, when throughout the Near East trade decreased.
Babylon became important in the Middle Eastern trade network. Not only were traders taking exports out and bringing imports in, but also merchants were carrying goods from places such as India, Europe, Persia, Anatolia and Egypt up the rivers west and down the rivers east again. Nearly all of this merchandise was carried on boats up and down the river. One important source of trade, which had declined by the time of Hammurapi, was the Indus valley (India).
It was largely because of nations attempting to control position on the trade routes that so many wars took place. There were other lucrative centers of commerce in the ancient world.