The metaphor of Indra's Pearls describing the mutual constitution and reflection of universe and individual consciousness goes back to Huayan school of Buddhism in 7th century AD:"And every dew drop contains the reflection of all the other dew drops. And, in each reflected dew drop, the reflections of all the other dew drops in that reflection. And so ad infinitum. That is the Buddhist conception of the universe in an image", according to Watts. The Vedic source is much older, but it does not seem to involve mutual reflection and self-reference.
In Western philosophy an early and perhaps the most lucid expression of the idea, is given by Pascal in Pensees:"Through space the universe grasps me and swallows me up like a speck; through thought I grasp the universe". In Leibniz's monadology monads consitute the world, and each monad reflects all of it from its own point of view, like a drop of dew. Less visually, and more cryptically one finds this expressed in Heidegger's Being and Time by the hermeneutic circle ("Dasein", literally "being-here", is Heidegger's term for embodied human existence):
"The 'circle' in understanding belongs to the structure of meaning, and the latter phenomenon is rooted in the existential constitution of Dasein, in interpretive understanding. Being which, as being-in-the-world, is concerned about its being itself (but this "its being itself" is intrinsically determined by the understanding of being...), has, ontologically, a circular structure."
More recently, Hofstadter used Indra's Pearls in his classic Gödel, Escher, Bach (1979) as a metaphor for complex interconnection and self-reference in advanced networks: physical, neural and social. Indra's Pearls, the book by Mumford, Series and Wright explores a mathematical manifestation, namely self-similar patterns created by iteration of Möbius transformations, self-similar fractals.