New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1896-04-27
SILVER IN INDIA.
THE CLOSING OF THE MINIS. ITS CAUSES
AND RESULTS.
WHAT THEY INDICATE-LEssONS TO BE

FLUCTUATIONS IN THE RATE or EXCHANGE AND
WHAT THEY INDIcATE-LEssoNs TO BE
LEARNED FROM INDIA.
1t Is now nearly three years since the Government
OF India made grave impression on the hnanciai
world by the closing Of the Indian mnts. AL the
same time the Government declared FOR the ADOPTION
of a gold standard. For twenty years the gold price
Of silver had been falling. but the immediate cause
Of the closing OF the minis the fear OF sharp
further decline aroused first by the failure OF the
Brussels Monetary Conference. and as conse-
uuence of this by the expected cessation or the
silver purchases by the United States under the
Sherman act. The relation OF three dates Is I'M
portant December. 1892, end Of the Brussels None
tary Conference June g. 1893 closing OF tie Indian
mints; November T. 1893 repeal Of the Sherman Act.
From the first the brussels Monetary conference
promised little good for India. II was called only
ITO consider having for their object the
more extended Of silver and India felt that
any halfway measures. or. the Indian Currency
Association put It. ANY arrangement short OF an
agreement for the Of silver as full egaltender
noney, would be practically OF no use as a remedy
for the evils from which We suffer-
As for the policy Of the United States. India has
always felt that her silver currency was enor-
mousy affected by the attitude of the United States
toward silver. This inevitable from the fact
that during recent years the currency demands Of
India had been nearly a quarter and those OF the
United States rather than third. Of the whole
worlds production At the time Of the Brussels
Monetary Conference 1t even seriously proposed
that II general agreement through this conference
failed India and the United States alone might
come to some agreement. Finally, the Government
OF India declared Its main reason for closing the
minis It's fear OF the abandonment OF silver by the
United States.
Neither the Government the business men OF
India waited for these two severe blows to silver
N he str discounted
vance. At least early June q. 1892. the Gov
eminent OF India Chat is. the Viceroy and his
CouncD had shaped their policy. At that date they
announced to the Secretary OF State for India lin
Lordon) that In case all attempts az international
agreements failed 1t their belief that 1.-The
Government of India should at once close its
minis to the free coinage OF silver and make ar
rangements for the introduction OF gold standard
A month before the Indian Currency Association
comprising majority OF the chief business men In
India, had been founded. and began at 10
work vigorously for the same object But the Gov
eminent OF India is not empowered to change its
own currency system. Though 1t had declared
that the Indian mints should be closed at once. II
had first to devote twelve months 10 obtaining the
consent OF the Government In London.
ENGLANDs MOTIVES SUSPECTED
strong feeling existed In India that England
wished for selfish reasons to keep Indian currency
THE Standard" and THE Economist" while
strongly In favor OF gold standard for England
opposed the same standard for India. To them
midas simplest answer perhaps her strongest,
Most OF our commercial and all OF our financial re-
lations. she said are with gold country, England
IT, then. n gold standard IL good for England land
Europe except Russia). why is II also good
for India? Moreover. 1t charged. rightly or
wrongly that England wished to keep India on a
silver basis In the interest Of Lombard Street which
feared any disturbance Of s slender gold reserve,
just as England wished to forbid india to impose
cotton duties. in the interest OF Manchester.
Against any such exploiting attitude In England,
the Indian Currency Association stoutly urged
that England must remember that midas first
choice was not a gold standard, but international
bmetallsm. and las such international concert
would In all probability be attainable II England did
not consider 1t opposed to her own interests. 1t
would only be fair and just that India In seeking
a remedy should be allowed to do so with regard
exclusively to the interests OF India"
The English Government finally referred the
whole matter to an Indian Currency Committee.
under the presidency of Lord Herschel The report
OF this committee. after careful study Of Indian
conditions. recommended that the Indian Govern
merit be permitted to carry out its plan. with one
proviso. 1t could close its minis and adopt god
standard but must also announce Its readiness to
Issue rupees for gold the rate OF Is 4d M equals Is
rupees). Plainly this made 1t impossible for ex-
cnange 10 above that rate Dut IL was regarded
only a provisional measure. aimed to prevent
airy sudden and considerable rise IN exchange which
would have injurious consequences and excite APP
prehension In the public mind" These suggestions
being accepted both by the English and Indian
Governments on June 26. 1893. the Indian Govern
closed the minis to the free coinage Of silver
The Government retained the right to coin silver
rupees Its own account. In regard to gold. the
Government made the required announcement. but
II fixed no permanent ratio OF exchange between
gold and silver, and 1t did not make gold legal ten
der. These" said Sir David Barbour. the financial
member Of the Indian Council. ARE matters which
must be settled hereafter by legislative enactment
and In the light OF future experience"
Since the closing Of the minis any fear OF sudden
and considerable Else has been proved unfounded
Exchange for the rupee has never risen even to the
provisional rate o, Is 4d and consequently no new
steps toward the adoption OF gold standard have
yet been taken. Here the limits OF the chief
fluctuations Of demand bills London. The figures
all weekly averages: The month after the Cos
ing Of the mints sharp rise from Is. 21sd. to
Is. SD. BY the last week In May. 1884. exchange
had fallen to Is o232d. and with the exception Of
a rise In September. II remained low til the last
week In January 1885, when 1t touched it's low-water
mark, Is. 7-l6d. Since then exchange has been ris-
ing fairly steadily.
NOT AN EXPERIMENT.
1t has asserted that the closing of the minis
only experiment, which, since 1t did not
quickly raise upee~exchange to Is I'd, has proved
Nilurs Such . judgment only indicates Q mis-