The main character in the story "A Horse and Two Goats" by R. K. Narayan is Muni. We can know this by several ways.

Muni is the character who receives the most "narrative action," meaning most of the narrative is centered on Muni and his actions. In most narratives, the narrative events tend to center around the main character, or "protagonist."

We can also observe that we, the reader, have more access to Muni's interiority (his internal thoughts) than we do for any other character. We hear Muni's thoughts much more frequently than the American's thoughts, for example: "Muni felt totally confused but decided that the best thing would be to make an attempt to get away from this place."

We also know that Muni is the main character because the meaning of the story is most tied to his thoughts, actions, and fate. We can say that this is Muni's story, because it is tied, intrinsically, to who Muni is as a person. For example, we know that Muni likes to sit out by the highway because it allows him to get away from the village, where he feels humiliated by other people's judgments. Another character, less prone to feeling bad about his poverty and age, would not have sat by the horse statue and met the American. Another character may not have been so indulgent as to talk with the American for so long, despite not understanding his speech. Another character would not have been so eager to sell his goats.

Said another way, "A Horse and Two Goats" is the story of a materially poor but spiritually rich man who catches a lucky break because of his nature and his circumstances. It could not be such a story if Muni were different than he is.

The lead character in a story, also called the protagonist, is the central figure around whom all the action revolves. In M. K. Narayanan's charming tale "A Horse and Two Goats," Muni is the one around whom the story develops. The story focuses on his circumstances, his relationships with other characters, and his beliefs. Muni is central to the plot and, therefore, he is the lead character. If we take Muni out of the story, there would be no story.

The horse, on the other hand, plays a critical role in plot development. Unlike Muni, however, it is not the main subject of the story. The story does not focus on its history or its journey to its current setting. Although the story provides some detail about the horse, it is not as extensive and specific as the particulars about Muni. Furthermore, the horse serves as a symbol to indicate the contrasting perspectives between two cultures.

Finally, it is Muni and the American's inability to fully understand one another that results in a favorable outcome for both parties. Even though the clay horse is the subject of their interaction, it is a mere bystander.

Muni is the main character in R. K. Narayan’s story, which is told via third-person omniscient perspective. The story’s action revolves around Muni: he leaves home in an attempt to sell his goats, he meets the American at the statue of the horse, he has an exchange with the American (although neither can fully understand the other), and at the end of the story, he is the one who benefits from events that have taken place.

The horse, on the other hand, is a symbol. To Muni, it is a cultural symbol and worthy of respect, but to the wealthy American (who thinks Muni is its owner), the horse is the ultimate souvenir of his trip to India. Through the use of this inanimate object, Narayan effectively and comically demonstrates a clash of cultures where money, ultimately, is the only unifying bond between the two men.