The Sun.
London, England, 1860-04-14 00:00:00

PAPER CURRENCY IN INDIA.

A paper currency is with us so established an
olement of civilization, that when Mr. Wilson states
the case for its introduction into India the feeling

of the British reader will be simply surprise that it
should have been deferred so long. Almost any
barbarism would be as intelligible as that the ordi-

nary transfor of " treasure" from one part of India
to the other, for the adjustment of the balance of
trade or the payment of troops, should entail an

addition of 30,000 men to the standing army. With
scarcely less surprise do we hear that the Indian
M int is now coining rupees at the rate of £12,000,000

sterling a year, and that it is taken for granted
that a large proportion of this money will be
hoarded. Our histories and story-books tell us of
Indian treasuries, deep in castles and caves, guarded
by dragons or jins, accessible by an " Open, se-
same," or an old lamp, and we think it very natural
that such golden dreams should once have had a
sort of reality in some barbarous age of tyranny
and rapine ; but that British machinery should now
be at work at its utmost speed, manufacturing day
and night, from Spanish dollars or Mexican ingots,
rupees destined to be buried in Hindoo fastnesses,
and to figure in future tales, seems simply a mis-
take and an absurdity. Why should this be ? Why
should money go to and fro in India any more than
in England ? Here, as we .know, immense sums of
money are flowing across the isle every day in all di-
rections through the quiet channels of the post, and,
though the work is unseen andthe means impalpable,
the result is attained as effectually as if every pay-
ment were made in boxes of gold and silver, con-
veyed in waggons, and escorted by troops of
cavalry. Unfortunately, there is nothing so easy
as to send £l,OOO or £lOO,OOO to anybody any-
where in this isle. It is but a stroke of the pen.
Your left hand need not know what your right
hand is doing; and the letter once despatched you
can neither see nor stop the process ' • nescit vox
missu reverti. Philip of Macedon, had he lived in
these days, would not even have wanted an opening
in the wall large enough for an ass laden with gold.
A draught on a good commercial house, hidden in a
shoe or a sword-hilt would have answered all pur-
poses. Naaman would have given Gehazi a
cheque on his banker, which the latter would have
kept in his pocket or laid by in his desk, instead of
clumsily stowing it away in his tower; though it
must be admitted the transaction would have been
not the less open to investigation. All this we
understand. We feel that modern usages are as
handy and convenient, compared with the actual
transfer of whole shiploads and caravans of the
precious metals, as the lighter coin of Athens WAS
compared with the iron currency of Sparta, or as
the universal dollar is compared with cowries, rock
salt, leather, and other bulky media of exchange.
But everybody must feel it a mere oversight of the
Anglo-Indian Government, and a confession of its
want of enterprise, that now, in the middle of the
19th century, so wealthy and intelligent a commu-
nity should not have the commercial facilities that
we have long enjoyed at home, and that contribute
so much to our convenience and wealth.
As to what is to be done, the story is soon told.
Mr. Wilson proposes five banks of issue, with cor-
responding circles or districts. For himself, he
would evidently have no objection to rupee notes,
but he proposes a middle course between the £5
Bank of England note and thaler note of Ger-
many, and the still smaller note of Sweden and
other countries. The lowest note is to be for
five rupees, or ten shillings. Each bank in giving
notes in exchange for coin is to lay up at least s
third of the coin in its vaults, and to invest not elc-
ceeding a third in Government securities, which
will thus be withdrawn from the hands of the pub-
lic. This proportion is taken from our own Bank
Charter Act, and Mr. Wilson considers that it will •
be at least as safe in India as at home. The note
itself, mutatis mutandis, is to be the same as the
Bank of England's, both in paper, water-mark, and
engraving, and no doubt it must for a long time
baffle the ingenuity of forgers. As for the metallic
basis, Mr. Wilson decides in favour of the existing
silver currrency, which from time immemorial ha'
always been supposed in Indian payments. fie
rests on the injustice of substituting one metal for
another by a mere act of sovereign power, and the
proved impossibility of a double standard of value.
This is a point that has long been settled, and the
argument is only reproduced to reconcile us to the
objection that will certainly be felt to a silver ear'
rency which is to pervade a fifth of the human
race, and of which the British nation is to be the
guardian and manager. That they may not inter'
fere with the new Banks of Issue, the privilege ct
issuing notes now enjoyed by some of the India:
banks is to be withdrawn, and Mr. Wilson inform;
us that they will be no great losers by the loss °...1
it, so costly are the restrictions with which it
clogged. Side by side with the Banks of Issue,
and having the same relation to them as the ban 1,,
ing department of the Bank of England, Mr. Vn.,
son contemplates the future formation of the I`,:e
tional Indian Banks, but they are not part of
present proposition.
It is possible that Mr. Wilson may see his N'7_ll,
to the future substitution of a gold for a silver cu
rency, but may think it necessary at ,pr.es,e, 0,
to give no hint that may be misrepresented ni,e",o
breach of faith. Of course it is quite possibct
commute engagements for silver into equiva.LuPt
engagements for gold, giving, if necessary, a sp_g,,ea
premium for the change. Unless the proPria
paper currency and five district banks sb utio
almost entirely obviate the costly and dangerv,et
carriage of coin to and fro at the call of the me,_"'„re
or the demands of the public service, then tn.'_,„
will still be a constant loss and considerable.ruiri;
through the weight of the metal. One 'l'l os;
sterling in the shape of gold weighs about 10 ttor
in silver about 150. It is true that a railway ttibe
can carry one just as easily and as quickly as,i the
other ; but the rail does not go everywhere, and of
escort of the one will be more costly than t,u'•ort
the other. If this future saving by the subst.it,:
at
of gold for silver can be capitalised, and g1;',13,1.
once to the possessors of obligations in silver, of
of
could not reasonably object to the substitute ilot
gold, which would save all future troubaon_c
1331' o_
score. Ten or twenty years hence the oh.
_aiu,3 a
not be so easy as now. At the presentv the
silver its owners are sure to be no losersu_u?tioo,
change. This, however, is a secondary 1 '4", the
At home more importance will be attached.iv.Lrisoi
ratio of bullion and securities fixed by
edge °f
This
local circumstances and national ha
This is a point which dends on a
P° tier
we expect at once to hit the right prof,
Titneb
bk.cts°7 lor -

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