Europeans started sea trade with India not in XVI century, but in XIV/XV. Portugase sailor Vasco da Gama invented sea way to India.
Why they were using sea way?
1)It was faster. Don't forget that that time there were no highways :) and even slowest ship was much faster than toe (horses has not been used to carrying wagons into trade).
2)It was cheaper - merchants didn't have to pay anyone for passing. And what is more important they didn't have to tell what way are they going, so that way to India was Portugaese secret :)
3)It was safier. It's much easier avoid pirates than robbers. And big trade conwoys can be easy guarded by war ships.

Hmm rotorgun - looks like they were sailing across Horn not across Good Hope.