It has been recorded in history that the Vahlikas were settled beyond the Indus. Sometimes the country of the Vahlikas is identified with the region which is presently known as Balkh. In other words it can be said that, the Vahlikas should be identified with the 'Baktrioi' occupying the country near Arachosia.
In the Uttara Kanda of the Ramayana there has been a reference of a dynasty of kings who are said to have descended from one Kardama or Kardameya. They were related to the Aila race, and were associated with Valhi or Valhika over which they seem to have held sway. It has also been narrated in the Uttara Kanda that the Vahli or Vahlika country is situated outside the Madhyadesa, which must have extended as far as the Saraswati River in the west. From various historical references it can be said that Vahlika can well be identified with Balkh in Iran.
At many places it has also been said that Vahlikas or Valhikas should not be identified with the Vahikas, who seem to have lived between the Sutlej River and the Indus River. In many places the Vahlikas were also known as Jarttikas and Arattas and their capital was Sakala, which is the modern day Sialkot which is located towards the west of Ravi River. On the other hand history has also stated that Panini had said Vahika was another name of Punjab.