The work embodies the author’s critical study of Kautilyan  concept of of inter-state relations in the light of the theory and practice of modern diplomacy. The explorations in the subject reveal that the underlying assumptions and principles of modern diplomacy did exist in the thought of Kautilya in an embryonic form. Even many of the principles regarding peace, war and neutrality as analysed by Kautilya prove the maturity of political knowledge that India had ettained in the days of such remote antiquity.