It is both — the end of one kind of power and the beginning of another. The chapter poses this as a question on purpose, and answers it in its own last pages.
The case for ‘an ending’. The Gupta Empire has lost its dominance. No single power now controls a large part of India. Kannauj is fought over for two hundred years with no lasting victor. Empires “rarely managed to cover a large part of India or to last more than a couple of centuries.” Judged only by the size of empires, this looks like decline.
The case for ‘a dawn’. The traveller in the chapter’s story sees “a land buzzing with new ideas, art, and culture”. In these same centuries India got the Kailaśhanātha temple, Māmallapuram, Vikramaśhilā, the Kādambarī, the Rājatarangiṇī, the Bhakti movement, Kannada and Telugu literature, and Brahmagupta’s rules for zero and negative numbers. Village sabhās were choosing their own members. None of this needed a single emperor.