The Sun.
London, England, 1859-04-05 00:00:00

EAST INDIA FINANCE.

Lord STANLEY then rose to make a statement in refer-
ence to the finances of India. He said that he was bound to
admit that the statement whichle was about to place be-
fore the house was not as satisfactory as that which he had
brought before their notice in February last. He believed
that all measures relating to India would be considered by
the house upon their own merits ; and hero he would ob-
serve that it might be necessary for Government to ask for
larger borrowing powers than two months ago they could
have thought at all necessary. Was this owing to any
error in the calculations, to any excess of expenditure over
income, or to any deficiency of the revenue of India ? He
believed he would be able to show that this increased de-
mand of India upon the money market of the country was
not due to any one of these three causes, but was exceptional
and temporary in its character. It might be remembered
that, in February last, he stated that he had not before him
the Indian estimates for 1858 and 1859, and that, therefore,
his information was necessarily imperfect ; but still he had
no option but to come forward with a specific demand.
Even now he had not sufficient data for his calculations to
place them beyond conjecture. Ho thought that looking
at the fact that while the mutiny was raging—while great
destruction of property was going on—while great expense
was being incurred in raising new levies—and while the con-
fidence of the people in the stability of the British Govern-
ment there was shaken, and that India had been able to sup-
ply sufficient revenue for the government of the country----for
with the exception of £1,000,000 of bullion sent out in 1857
no money went to it from this country—it was not unnatural
that we should have considered that the resources of India
were equal to the demand made upon them. He believed
that the present failure was owing to remarkable circum-
stances in India. He would not say that the credit of
the Indian Gevernment in India was impaired, but that
its borrowing powers were diminished. Such a state of
things could only arise from want of capital, from want of
confidence in the stability of the security offered, or from
the capitalists hanging back for higher terms. He did not
apprehend that any one would allege that it arose from any
want of capital, for from all sides they heard that those
who required money for private undertakings experi-
enced no difficulty in obtaining it on favourable terms.
The capitalists of England were inclined to hold back, in
the hope of obtaining better terms than were now offered.
Without going into detail, he would take a general view of
the terms offered on the last three leans. In August, 1856,
they were 4t per cent. ; in January, 1857, 5 per cent. ; and
now they were 5t per cent. On the other hand, the native
capitalist thought that as the wants of the Government in-
creased, the rate of interest would increase in a similar pro-
portion ; and it invariably happened that when a higher
rate of interest had to be offered -there was a constant depre-
ciation of the existing stocks. The difficulty in which the
Government now found itself didnot resolve itself into a ques-
tion of larger expenditure or smaller revenue. It was simply
a question of having to borrow a larger sumlin England, in
consequence of the power to borrow in India being reduced.
What were the present requirements of the Government of
India ? The calculation of the Government was that they
would want in round numbers £11,500,000. That amount
involved a deficiency of ways and means to that extent, but
it did not involve a corresponding deficiency in revenue.
Tho calculations included payments to be made on account
of railways, amounting in the whole to £4,500,000; anduatftienr
making all deductions and allowances, the actual defi-
ciency of 1859.60 would be £9,000,000. In 1857 it was
the same; in 1858 it was estimated at £12_,500,000, b
reality had turned out to be £13,000,000. Referring to the
question of ways and means, the house had to consider in,
what manner the requirements of the Indian Government
were to be made up. The amount was £11,500,000. The
Government proposed to borrow in India £5,000,000. The
produce of the new taxes was estimated at £1,000,000, and
the difference would have to be made up in England. It
was proposed to take the cash balances required at
£11,500,000; but there would still remain claims for com -
pensation and prize money, and these added to the ordinary
expenses of the Home Government -would require £4,500,000.
By this bill it was proposed to raise £7,000,000, which, ac-
cording to present calculations, would give a margin to the
Government of about £1,600,000. The railway receipts
had increased in amount from £l,
bu6oo,llion to India, there
000 to £2,300,000, so
that, after sending £1,000,000
would still remain a surplus of £1 300,000. The payment
for railways in of
progress m India would, he was told, amount
to £4,000,000. If that were so, the sum taken in the bill,
with a slight addition, would be sufficient to carry them
through the year. But he must admit that as to those
payments on account of the railways there was complete
uncertainty. There was also much uncertainty as to the
revenue which opium would yield. There was a confident
hope that the loan would not amount to £5,000,000, but it
could not be accurately stated, neither could the amount of
military expenditure be very closely approximated. He did
not propose to recommit the bill, nor to ask the house at
present for any larger amount. He apprehended that
£3,000,000 would be more than sufficient to meet every
want; but the house must see, from his imperfect state-
ment, that it was impossible to make any precise and definite
statement, and .that much must be left to conjecture. An
obvious advantage would result from the course which he
proposed, namely, that Parliament would have an oppor-
tunity of re-discussing and re-considering this question,
and giving to it that close attention that it so eminently
deserved. He felt satisfied that the mere fact of the
bill now under consideration receiving the sanction of
Parliament would re-assure the people of India, and show
to them that Parliament was ready to meet the de-
mands of the Indian Government, but it would in agreat
&grog restgro cgdidenco to the capitaliat iu Lndia and ,

perhaps go far toward(: superseding the necessity for the
loan. He was of opinion that, upon the whole, the finances
of India were in a less unsatisfactory condition than they
appeared to be ; for the revenue of last year showed alarger
growth than had ever previously been the case in India
The claims for eompensation would be dealt with at met,.
whilst forfeitures would fall in and swell the revenue. Large
ped, be made in the army in India,, reductions could, 11,1 ho
and ten regiments wean at present coming home. He did
not doubt but that afte2' the hot weather there would be a
considerable reduction. As to the new taxes, the subject
was considered in the Indian Council. He was prepared to
recommend an increase teethe Customs duties, as it was
thought the most unobject,
'enable and the wisest mode of
increasing the revenue. The Crnergency had come suddenly
upon the Indian Government, and they were prepared to-
deal with it, and to take the matter into their own hands.
Only two taxes were mentioned to be imposed at once : an.
increase in the Customs duties and the stamp duties. How-
ever, all the papers which he had received, and which could
with propriety be laid before Parliament, would be pro-
duced. He now proposed to take this stage of the bill.
Mr. V. SMITH observed that the statement of the noble
lord differed materially from that of the noble lord at the
head of the Government in another place. As regarded the
loan, it was most likely that the natives before they sub-
scribed were waiting to see if they could get better terms.
He must say, the whole accounts and finance of India ap—
peared to be in a most unsatisfactory state. The noble lord_
stated that he was not about to ask for more than £5,000,000 ;
if he had he should have agreed to it.
Mr. VANSIrf ART said that he was not aware that this
debate was coming on, and had not his notes with him.
From the information he had received he thought it would
be quite necessary to raise another £5,000,000 in addition
to the £7,000,000. As to an Imperial guarantee, it was
impossible to borrow from the natives at 51 per cent.
They would never be able to do witl tout a considerable force
of European troops in India, but a great reduction in the
native force might then be made. Ere would also remodel
the Legislative Council, and would encourage the construc-
tion of railways, and also the settler vent of Europeans.
As to the expenses of the establishment, he would sell the
old place in Leadenhall-street. He was WA! that it would
fetch £350,000. He would also reduce the coenicil front 15
to nine. He understood all the business was ,divided be-
tween three different committtees of five each. fl,e thought
three would do the work quite as well. He would .not turn
out any of the present members—the dear old creatures—
(laughter)—but would allow them to die out. He would
also do away with one of the Supreme Courts. Her amid
not see the use of two such courts. These alterations would
effect a large saving to India, and he believed would make
the Government popular.
Mr. R. CRAWFORD wished to call the attention of the-
house for a short time to the subject of Indian finance.
The present practice was to maintain an open loan, and for
the officers of the Government in the different presidencies
to receive money directly on behalf of the Government. On
the Ist of May, 1834, when a new state of things began in
India, the public registered debt in India was £30,195,000.
On the Ist May, 1856, it was £44,028,000, being an in-
crease of £14,000,000. The interest had not increased in
the same ratio. In 1853 the interest was reduced from sto
4 per cent., and a feeling of distrust had thereby been
created in the minds of the people of India. In 1854 the
deficiency in the revenue of India was £690,000, and the
prospective deficiency for the year following was estimated
at £872,000, making a deficiency of £1,560,000. Notwith-
standing that deficiency orders had been sent out by the
right hon. baronet the member for Halifax for a reduction
of the guaranteed interest from 5 to 4 per cent. Soon
afterwards a notice was issued for a loan, under the name
of loan for public works, but it soon appeared that it was
intended to cover the deficiency of £1,560,000 to which
he had referred, and to provide for a like sum required.
to pay off the dissentients who would not accept
per cent. instead of 5 per cent. The result had been a feel-
ing of intense distrust in the minds of the people of India
from that time to this with respect to the financial opera-
tions of the Government. Last year, at the very time the
Government ought to have upheld the value of Indian
securities in the market, they took measures, which had
brought about quite an opposite result. The only creditable
part of these transactions was the notification issued to ths
public by the Government of India, which has been pub-
lished in this country a few days ago. So long as different
schemes remained floating in the market, scarcely above
par, it would be difficult for the noble lord to procure the
means to carry on the public works contemplated in India.
Sir C. WOOD thought it was of the utmost importance
that steps should be taken at once to equalise the expendi-
ture and income of India. The expenditure was estimated
at £53,435,000, and the income at £46,692,500, leaving a
deficit of £6,742,500. Unless there was a reduction of ex-
penditure, not by tens of thousands or hundreds of thou-
sands, it was impossible to bring income and expenditure to
an equality. It was incumbent on the house to pests on
the Indian Government the necessity of such measures of
retrenchment. He did not think the mode suggested by
the hon. member for Northampton, by means of a com-
mittee, was the proper course, for if the Indian Govern-
ment, consisting of men who had a knowledge of the affairs
of India, could not accomplish the purpose, it was' not likely
that this house could do it.. It must be done by the Indian
Government in India, or by the Indian Council at home.
Unless the house was prepared to insist on the Government
in India doing it, he despaired of seeing it done at all. He
was aware of the difficulties which the Indian Government
had in reducing the salaries, &c. ; but when they looked at
the magnitude of the deficit, he hoped sone means would
be taken to meet the difficulty.
Mr. T. BARING said that the reduction of interest,
though it was said to have been successful, and it might
have been temporarily so, was permanently -unfortunate.
He viewed with anxiety the disposition to guarantee publics
works. Economy was to be established by letting India
pay only for Indian wants, and not making her aid in pay-
ing for our own national wants. He had some apprehene
increased,
e bo f
u tthoe only very
of
gEradngulaanll
and taxes could not be
sions that hereafter a time might come when, if the Minis-
ter was not sufficiently firm to resist, India might be made
totowards
sthinecre
contribute
Therevenue w
might
o be
put on without consulting the feel-
ings of the people. There must be retrenchment, and.that
mainly in the army. There was not now that double Gce-
vernment which was said to have acted as a sort of buffs
against pressure. The pressure now came directly on a
Cabinet Minister.

Sir G. C. LEWIS should like to hear from the Governi-
ment some statement as to the prospects of diminishing the
number of the European forces in India. (Hear, hear.) Ifs
could not understand it to be the interest of the War De-
partment to maintain a larger force in India than ti tat
country absolutely required, and he believed the Homes
Guards would be glad to hear that it was in the-power of
the Indian Government to dispense with some of the reg
i-
ments at present in India. Looking at the present state 'of
the Continent, it was not desirable that 90,000 of our army
should be maintained in that empire. Ho hoped the Go-
vernment would be prepared to announce the probable re-
duction of the number of Earopean troops now serving -in
that country. (Hear.)
Mr. H. BAILLIE believed that if India were governsed
in the spirit of the Queen's proclamation, and without ho'
terference with the religion of the natives—(hear,
our troops, with the assistance of the native army, could b•
reduced to 60,000 men. (Hear.)
' Colonel SYKES said that there was a large deficiency ill
Indian finance, and it was likely to continue. He believed
that philanthropists on this side of the water had much to
answer for in diminishing the tax derivable from opiu3a2.
Neither an. import tax nor an export tax would meet it he
deficiency. Some people thought that an increase in the
excise duties would suffice ; but this source would be quite
inadequate. Works of irrigation, by improving the soil a ;nd
increasing its value, would very much increase the revers as.
inof
ttlse.dirnecettiroonn,ohmbutensut cwhasa pdlawneletouulpdono.nlyof be
200 per cent. upon the outlay of capital might be obtain led
course
rtesnul;
curtailment of expenditure in this direction would tend to
equalise revenue and expenditure ; but it did not look much
like retrenchment to send twelve battalions of artillery ( sos
to India when their presence was not required.. The brig'
bear which had been raised was that England might be
made responsible for Indian loans. These loans were for
Imperial purposes, and it was only reasonable that the
mother country should bear the burden of responsibility , in
case of any sudden emergency. By the last mail ho lod
received a letter from Sir James Outram, in which he said
that he did not anticipate much result from the issue of
Treasury bonds, and that the natives of India labiured
under the conviction that unless an Imperial" lean. were
raised in England Indian securities would become depre-
ciated. Without such loan the Indian population would
not believe in the identity of the home and Indian Govern-
ments. His own belief was, that if India was restored to
the normal condition she presented before the mutiny, .ex-
penditure and income would be made to balance themselves.
Lord STANLEY said that all these questions of taxation
were being considered in the Indian Council, although their
deliberations had been somewhat interfered with by the fact
that the Indian executive had themselves undertaken the
subject.
The bill was read a third time and passed.

SUPERANNUATION BILL.
This bill went through committee.
POOR LAW AND MEDICAL CHARITIES gla.
LAND) ACT AMENMENT BILL.
This bill was read a second tithe.
LAW OF PROPERTY AND TRUSTEES' RELIEF

AMENDMENT BILL.
This bill was passed through committee.
DEBTOR AND CREDITOR BILL.
This bill was read a second time.
SAVINGS BANK (IRELAND) ACT AMENDMENT
BIL.
This bill was read a third time.
PUBLIC OFFICES EXTENSION BILL.
This bill went through committee.
In reply to Sir H. WILLOUGHBY,
Lord J. MANNERS stated that in reality no money
would be required to be expended in order to carry out the
purposes of this Act, although power would necessarily be
taken for voting it in committee of supply in the usual way.
The amount to be contributed by the suitors' fund, would, '
more than cover the expenditure contemplated by the Go,
vernment.
The bill was ordered to be read a third time to-morrow:'
INMMNITY
T
went into committee on this bill, which was
orderedhe home
be read a third time to-morrow. ,
Some other bills Were brought in and forwarded a stage,
and the house adjourned at a quarter to twelve.

BIRTHS.
CARTWRIGHT.—On the 3d inst., at Leamington, the 'wife
of Aubery Cartwright, Esq., of a daughter.
GRAY.—On the Ist inst., at Carse-Gray, Forfarshire, Mrs;
Gray, of a son.

MARRIAGES
CLARKSON—HARRIS.— On the 2d inst., at St. John's,
Notting-hill, Eugene Comerford Clarkson, Esq., of Lin-
coln's-inn, barrister-at-law, to Emilie Jane, the eldest
daughter of J. Harris, Esq., of Hampstead.
HEWETT—MITeRELL.—On the 4th inst., at the parish
church of St. Marylebone, John, only son of J. Hewitt,
Esq., late of Crofton Hall, Kent, to Rosina, widow of the
late Henry Mitchell, Esq., of Bath.