Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1897-11-11
INDIA AID SILVER COINAGE.

pttllb we luli itNi VI tllb IlEthtNla ilhtl
the government OF Indin TO Lord Sails
bury, in relation To the proposed re-
opening of the India min;s to the coin
bgs of silver III is as folows:
Simla, Sept. IL, lsaT.--My Lord: We
have the honour to acknowledge receipt
OF your lordship'a dispatch of August
9th Last. asking for our opinion whether
the Indian minis may be reonened to
silver as part Of contemplated ar
Fangement under which France and the
United Statea OF America will open
their minis TO silver as well rs gold.
The present currency systems Of the
three countries may bo thus described.
France and the United States both
have gold standard; their mipts are
open to gold and ulosed to silver; but
gold and silver coins ars alike legal
teuder to an unlimited amount in both
countries at ratio of 15la to 10 the
former, and of IL to l in the latter
The currency system OF india is in
transition state; the governments of
India in 1893 decided to establish
gold standard, and the first etep
towards that object was the closing OF
the mints TO silver by Act VIII. of
1893. The silver rupee is still the sole
loyal tender coin, though tue govern
ment has by executive orders under
taken to receive gold and aoveTeigns
under certain restrictions set forth in
NotifidationsNos. 2, 662 and ., 663 Of J une
Goth. 1898, the rats of exchange adopted
being led. the rupee, or 10 rupees :
Ell. The measures to he taken when
the transition reriod has passed have
not been laid down, but it is probable
that the Indian mints will be opened
to gold and gold coins will be made
legal tender to an unlimited amount |;
silver rupees would also still continue
to be legal tender to an unlimited
amount, and the ratio between the
rupee and the geld coins as legal tender
would at the same timU be finally
settled, The system towards which
India is moving il thus gold standard
OF the same kind as that which new
exists in France and the United States.
hut with different ratio for legal
tender; but for the present the minis
are closed both to gold and silver. The
transition period has lasted for more
than four years, but there is ground
for hope that it 10 now drawing to
clnse.
The changes which are involved in
the arrangements proposed to her
Maiesty'H Government are this follow
ing: France and the United StateR are
TO open their mints to the free coinage
of silver, continuing the free coinage
OF gold and the unlimited legal tender
of coins of both metals, the ratio re-
manning unchanged in France and
being altered to the French ratio OF
1875 to in the United States. India
is to open her mints to silver, to keep
them closed to gold, and to undertake
not to make gold legal tender France
and the United States would thus be
bimetallic; India would be mono
metallic (silver) while most OF the
other important countries of the world
would be monometalic tgoldj.
The object which the pruposers have
in view is the establishment of stable
relation between the values of gold and
! of silver. This would include the es-
tablishment of stable exchange he
tween the rupee and sterling currency.
which was the object OF the govern
ment Of India in the proposals made in
our financial dispatch of June 2lst,
1892, which proposals ultimately re-
suited in the adoption, in view to the
attainment OF that object, OF the policy
of gold standard, and in the closing
Of the mints to the free coinage OF all
NoIs III II WOTo IuIu llHb tut
suggested measures would result in thu
establishment of a stable ratio, thu
government of India might well con
slider whether their adoption would mo-
be preferable TO the policy to which
they committed themselves 10 1893 il
the hone of attaining the same result
by isolated action on the part Of lndii
Elone. The principal questions, Their .
fore, for uE to consider, are whethe
the measures are moro likely to sue
coed than the policy of 1882 and wha
consequences to India may be appre
hended if the measures should fail o
success after being brought into opera
tion. From this point of view we pro
pose to discuss the effect on trade an,
industry and on our own revenues, o
the changes when made, and of thu
failure of the arrangement If it shout,
fail, the chances of SUCCESS, and tn
risks of failure.
The first result OF the suggested meas
ure, if they even temporarily succeed
in their object, would be an irtens
disturbance of Indian trade and indus
try by the sudden riss in the rate o
exchange, which. IL the ratio adopte
were 1919 to !, would be rise fror
about led. to about 23d. the rupee
Such a rise is enough TO kill our OK
port trade, for the time at least. /
the public were not convinced that tn
arrangement would have the effect in
tended, or believed that it would no
be permanent, tbs paralysis of trade an
industry would bu prolonged and &C
companied by acute individual suffer
ing, none Of the advantages expects
would be attained, and this countr
would pass through a critical perio
which would retaFd its progress 70
years. How long the crisis would las
before normal or stable conditions wer
restored it is mot possibs to conjecture
1t would be long even if the mercantil
and banking community saw that silve
was being steadily maintained at th
prescribed ratio, while any indicatio
of unsteadiness would greatly prolon
the period by giving foundation &c
doubt. II the doubt should happen /
be justified by the results. the positio
would be disastrous alike to the State
to individuals and to trade geuei all,
The exchange value of the rupee havin
risen suddenly, without any intel
mediate steps, from led. to some hieht
figure it would fall quite as sudden
to point far lower than it's preser
level, probably to sd, or even lowe
Such fall woulu apart from otht
disastrous results, nesaesitate the in
position of additional taxation to III
extent OF many crures.
We may here remind your lordshi
that such an agreement as ia propose
is an infinitely. more serious auestio
for India than for either OF the 9th,
two countries. for it seems clear tbs