Chapter VII: A Return to the Gold Standard (3)

“A convertible money finds its _raison d’être_ largely in the
fact that it economizes the precious metals, and makes possible
a saving to the community. If paper money or token money are
substituted for primary money, their substitution reduces the
demand for the precious metals by the difference between the
amount of metal used in the token money introduced plus that
contained in the primary money required for the redemption fund.
This economy of the precious metals results in an increased
supply being thrown upon the market” [which supply goes abroad
and into the arts and increases the non-monetary wealth of the
country by an equivalent amount: the gold obtained for the metal
economized represents a net gain to the community].

⁴³⁷ _Money and Credit Instruments in Relation to Prices_, p. 63.

The same kind of gain, says Kemmerer, attaches to the use of inconvertible money, and even on a larger scale, because there is no necessity to use primary money even for a redemption fund, as there is when the money is convertible. Such views as these have led Mr. Keynes to opine that the Indian currency system is a marvel of economy, and that other more advanced countries might usefully follow the lead. We will not draw from this the uncharitable conclusion that either Prof. Kemmerer or Prof. Keynes would recommend that because an inconvertible paper currency is the most economical currency a country should adopt it without remorse. What we are concerned with is to find out whether the rupee currency is really economical. When the process by which the rupee comes into being is carefully analysed it becomes impossible to take seriously the plea that the Indian currency is economical. First of all, gold is tendered to the Secretary of State in London for his council bills, or gold is tendered to the Government of India in India in payment of taxes or otherwise. Out of this gold the Secretary of State buys silver and coins rupees. As the price of silver is below the [pg 296] ratio, there arises a difference between the cost price of the rupee and its selling price in gold. To the extent of this difference there is, of course, a gain. But this gain or profit on coinage, as it is called, is no benefit to society. It is a hoard, and to that extent represents a useless abstraction of wealth. If the profit is not to be used for any current purposes of society it is as well not to coin rupees. It is therefore obvious that so long as the profits are merely held apart from the revenue resources of India there is no economy in the rupee currency worth naming. From another standpoint the currency of India is a wasteful asset to society. Metallic currency is primarily a capital good representing a form of social investment. Consequently it is necessary to see that the capital value of the currency is maintained. It is a happy circumstance to note that the Government of India is not dead to this aspect of the question with regard to its paper-currency reserve, and has very recently instituted a depreciation fund for the preservation of its capital value.⁴³⁸ Now, the considerations that apply to the paper currency should apply also to the rupee currency. Has the rupee currency maintained its capital value? The gold part of it, called the gold-standard reserve, is invested in interest-bearing securities. Interest is no doubt an additional source of gain, but have the securities maintained their capital value? Far from it. Turn to the rupee half of the currency. Has the bullion in the rupee maintained its capital value? There have been endless charts and diagrams drawn by playful economists in which the black line, showing the nominal value of the rupee, has remained up while the red line, showing the bullion value of the rupee, has gone down with the falling gold value of silver.

⁴³⁸ Cf. the Speech of the Finance Minister, Mr. Hailey, on the Indian
Paper Currency (Amendment) Bill, dated September 16, 1920,
_S.L.C.P._, Vol. LIX, pp. 308–9,

But what does that mean? Simply that the rupee is a wasting asset and is not worth at a later date what it cost to society when it was manufactured. Surely there was more economy in the project of the mad Chinaman who burnt his house to roast his pig [pg 297] than there is in the Indian rupee currency. The Chinaman’s house must have been very old and uninhabitable. The same cannot, however, be said of this converting of gold money into silver money, because we know that silver is an inferior kind of investment to gold. Thus viewed, the currency is not in the least economical. It appears to be so because people look only to the rupee. But, adding the cost of the rupee currency to that of the gold-standard reserve, can it be said that India would have required more gold if she had a gold currency in place of a rupee currency? Bearing in mind that with a fixed limit on the issue of rupees there can be no reason for a gold reserve, the only result of a stoppage of rupee coinage would be that gold, instead of being, as now, part reserved as a sinking fund and part transmuted into a rupee currency, would enter into circulation without being subjected to this baneful and wasteful process. No more gold would be required in the one case than in the other. We can therefore conclude without fear of challenge that with a complete stoppage of rupee coinage Indian currency would be truly economical, prices would be more stable, and exchange secure, in the only way in which it can really be said to be secure, and the rupee, although inconvertible, will cease to be a problem, which it has been ever since 1873.

But will that be all the advantage to the country? By no means. In drawing a moral from his comparison of the paper pound of 1797 with the paper pound of 1914, Prof. Cannan⁴³⁹ points out that

“there can in these days be no doubt that the experiment of
entrusting what no community should entrust to any institution,
the power of creating money without limit, to the Bank of
England, compares very favourably with the modern plan of
entrusting it to the Government itself or to a State bank
completely under the control of the Government. In the
comparatively short war of 1914–18 currencies ‘not convertible
at will into a coin which is exportable’ were issued by
Governments and Government banks in amounts compared with which
the 100 per cent. increase in [pg 298] thirteen years, which
made the Bullion Committee complain so vigorously in 1810, look
absolutely trifling.”

⁴³⁹ _The Paper Pound of_ 1797–1821, Introduction, p. xxxix.

There was a time when it could have been said that this indictment did not apply to the Government of India. Few Governments could be said to have been so very anxious to wash their hands of the responsibilities involved in, the management of a currency as the Government of India once was. In 1861, when the Government first undertook the issue of paper money in India, the anxiety it displayed was laudable. An impecunious Government, made prostrate by the heavy burdens of the Mutiny should have welcomed the project of a paper currency as a source of profit. But so great was its sense of responsibility that the Government refused to be content with convertibility as a check on over-issue. One of the principal reasons why the desperate paper-currency scheme, which that straitened financier Mr. Wilson had devised in 1860 to find ways and means for improving the finances of India, was rejected was so well stated by his successor, Mr. Laing, that in these days of frenzied finance his remarks may as well be reproduced in full. He said⁴⁴⁰:—

“There was another important reason why he (Mr. Laing) thought
that Sir Charles Wood’s principle was the soundest. All parties
were agreed that a paper currency ought to be identical with the
metallic currency which it displaced. But the system of issuing
against two-thirds of securities and one-third of specie, as was
proposed by Mr. Wilson, would not always ensure this identity,
and there was considerable risk that in times of buoyancy and
speculation the circulation would be unduly extended. He
thought that that was a point of considerable importance,
because if we looked at what had taken place in India during the
last three years, we should find a great increase in the wages
of labour and the prices of commodities, which should warn us as
to what the consequences might be if we were to accelerate the
process already going on so rapidly by any artificial inflation
of the currency. If you unnaturally [pg 299] stimulated the
rise of prices by an over-issue of paper circulation you ran
considerable risk of changing the healthy action of commerce
into a feverish excitement which was sure to bring about a
reaction. If we continued to go on as we had done for the last
two or three years, the result would be that many articles of
Indian produce might be driven out of the market by the
competition of other countries and he therefore thought that the
Government ought to be exceedingly cautious how it took any step
that might unduly accelerate the tendency to a general advance,
as might be the case under the system of paper currency which to
any considerable extent represented securities and not bullion.
Such an advance might even reach a point seriously embarrassing
to the Government if the general rise in the rate of wages and
cost of living made the present scale of salaries and the pay of
troops no longer adequate.⁴⁴¹ For these reasons he thought it by
far the wisest course to adhere to the principle of paper
currency adopted in England as laid down in Sir Charles Wood’s
despatch.”

⁴⁴⁰ His speech on the Paper Currency Bill, dated February 16, 1861,
_S.L.C.P._, Vol. VII, pp. 66–7.

⁴⁴¹ During the bank suspension period in England it is to be noted
that the Army and the Navy were paid in gold, for fear of causing
discontent.

Not only was the Government anxious to put a limit on the issue over and above making it convertible, but it did not want to be vested with the legal authority to issue notes. In a despatch dated April 27, 1859,⁴⁴² to the Secretary of State, the Government of the day observed:—

“We believe that the convertibility of the notes on demand would
not be a sufficient guarantee against over-issue. When once the
paper currency is established in public confidence, the
temptation to take dangerous advantage of this confidence will
be very great in a time of difficulty, if the power of doing so
is left in the hands of the Government of India alone.
Restriction by law, either to a certain amount of issue
absolutely, or to an amount relative to the balances in India,
will, in our opinion, be necessary. We think that such a law
ought to be passed by Parliament, and not by the Legislative
Council of India.”

⁴⁴² For a copy of it, _see_ Commons Paper 183, of 1860, p. 1.

Equally sane was the view of the Government in 1876 with regard to the rupee currency. The Bengal Chamber of [pg 300] Commerce, it will be recalled, had urged upon the Government of India to close the Mints to the free coinage of silver, without opening them to the free coinage of gold—a project which practically meant that the Government should undertake the management of the rupee currency. The reply of the Government of India was a sharp rebuke. It declared⁴⁴³:—

“8. … the Chamber invite the Government to take a measure
calculated to enhance indefinitely the value of the rupee by
suspending the long-established legal right of all comers to
have silver bullion manufactured upon uniform conditions under
State supervision into legal-tender coin, and temporarily
substituting a system of coinage, at the discretion of the State
…

――――――――

“11. It is essential to a sound system of currency that it be
automatic. No man or body of men can ascertain whether at any
particular moment the interests of the community as a whole
require an increase or diminution of the currency; still less,
how much increase or how much decrease is, at any moment,
exactly needed. No Government which aspires to keep its
currency in a sound condition would be justified in attempting
that impossible task, or in leaving the community, even for a
short interval, without a fixed metallic standard of value.
Under an ‘open coinage system’ these things regulate themselves
without official interference.”

⁴⁴³ Resolution of the Government of India, relating to the
Depreciation in the Value of Silver, dated September 22, 1870,
Commons Paper 449 of 1893.

Now, compare with this the later pronouncements of the Government with regard to the principles governing the paper and rupee currency respectively. During the war, when the Government of India resorted to the enlargement of paper issues, Honourable Members of the Supreme Legislative Council pointed out the effects it would produce on prices in India. But the late Hon. Sir Wm. Meyer, who as a Finance Minister piloted the Indian finances during the last war, in the course of a speech on the Indian Paper Currency (Amendment) Bill, dated September 5, 1917, replied⁴⁴⁴:— [pg 301]

⁴⁴⁴ _S.L.C.P._, Vol. LVI, p. 35.

“The note circulation was sixty crores before the war and is now
about a hundred crores. But the Hon. Mr. Sarma shivered at the
idea of inflation. I may remind him that one of the accepted
(!) doctrines of economists is that artificial inflation of
paper currency only exists when the note circulation is not
fully covered. Now we have covered every rupee of our note
circulation … in securities …” [How could there be an
inflation?]

The change in the Government’s view with regard to the rupee currency is equally noteworthy. In 1908, when the exchange value of the rupee fell below par, the Government was reminded that it was the result of the excessive coinage of rupees. But although in 1876 the Government did not think it was possible for it to so increase and decrease the currency to suit the needs of commerce, yet in 1908 the Government advanced the opposite view. The Finance Minister, the Hon. Mr. Baker, in his reply, went on to argue⁴⁴⁵:—

“In the first place the whole of the new coinage that we have
undertaken during this period has been undertaken solely to meet
the demands of trade. Not one single rupee has been added to
the circulation except to enable us to meet these demands. …”

⁴⁴⁵ Cf. Financial Statement for 1908–9, p. 229.

Now, if it is dangerous to entrust a Government with the power to manage currency, how very dangerous is it to entrust it to the Government of India, which professes to carry out its trust on the basis of doctrines such as these! No one is so ill-instructed in these days as to suppose that these are sound maxims. If security is enough, what need is there for convertibility? If currency is issued only in response to trade demand, what fear is there of over-issue? A Government acting on such a principle may well go on indefinitely increasing the currency without remorse. History abounds with instances of ruin caused by the management of currencies on such naive principles as these.⁴⁴⁶ Happily for the country, the paper [pg 302] currency profoundly altered in its basis—one might almost say, tampered with—in 1920 by the Government is yet far away from currencies regulated on the theory enunciated by the Finance Minister. It is the rupee currency which has been, ever since the Mint closure, the chief source of danger to the welfare of the Indian people, particularly because of the principle governing its issue. Because that principle has the support, in itself a surprising thing, of such eminent authorities as Prof. Keynes,⁴⁴⁷ Mr. Shirras,⁴⁴⁸ and the Chamberlain Commission,⁴⁴⁹ it cannot alter the case for depriving the Government of this power of managing the rupee currency, for the principle is essentially unsound. The reason why the fallacy in the reasoning, that there could be no excess of rupees because of their being issued in response to trade demand, does not appear on the surface is due to the peculiar nature of money. Money is said to be wanted only because money has a purchasing power. That is no doubt true, but that does not quite explain why people so incessantly want money, even when they know that the value of money is so unstable. Indeed, if purchasing power was the only consideration we should not find such a desire for the current means of purchase. That desire can only be accounted for by the fact that money has a differential advantage over other goods, in that it has in the highest degree what Menger called the quality of saleability. That one can more often buy at a bargain than sell at a bargain is simply another way of stating that every one desires to hold his resources in the most saleable form of money. In this sense it is absolutely true that no more money can be issued than there is demand for. But from that it does not follow that there can be no over-issue of money purely for the currency needs at any given time. All money is acquired in response to trade or services, but all money is not retained in currency. Indeed, all commodities are exchanged for money, because money is supposed to bear the option of being used for non-monetary purposes. In the case of the rupee the option-of-use quality is nonexistent. Consequently, although issued in response to [pg 303] trade demand, it remains in currency whether it is wanted or not, and thus tends to bring about its depreciation. That such a depreciation is possible cannot be denied even by those who maintain that rupees are issued only in response to trade demand, otherwise why should they be so very anxious for an increase of the gold reserves of the country. But the danger to the rupee currency does not merely arise from the possibility of indiscretion on the part of the Government. Besides the Government there have been statesmen in India so interested in the welfare of their fellow-subjects that they have rebuked the Government on several occasions for not making the profits on rupee coinage available for the advancement of the moral and material progress of the country,⁴⁵⁰ and in 1907 the profits on rupees were actually employed in the extension of railways. It must fill every one with horror and despair to contemplate the consequences sure to emanate from the manipulation of currency for such ends. Is it not time this source of danger and temptation be removed by depriving the Government of this power to manage the rupee currency? But what is the means of bringing this about? If it is desirable to do away with the management then convertibility is an insufficient measure: for with convertibility the rupee will still remain a managed rupee. Only the complete stoppage of rupee coinage will remove the governmental interference in the management of Indian currency; and it is this that we must therefore ask for. Queer as it may seem, SAFETY LIES IN AN INCONVERTIBLE RUPEE WITH A FIXED LIMIT OF ISSUE.

⁴⁴⁶ Cf. E. R. A. Seligman, _Currency Inflation and Public Debts_, New
York, 1022, _passim_.

⁴⁴⁷ Op. cit., p. 111.

⁴⁴⁸ Op. cit., p. 39.

⁴⁴⁹ Report, par. 66.

⁴⁵⁰ Such a sober politician as the late Mr. Gokhale took the lead in
this matter. Cf. his speech in the _Financial Statement_ for
1907–8, pp. 203–4; and the same indiscretion is repeated by Prof.
V. G. Kale in his _Currency Reform in India_, 1919, p. 65.

Administration:
Changes in 1833, 21
Civil Service reforms, 1853, 90, 91, 97
Table of costs, 92
Agricultural exports, 104
Althorpe, Lord, 161 _note_

Babington Smith, Sir Henry. _See_ Smith Committee on Currency Bagehot, Walter, 130, 131 Baker, Hon. Mr., 301 Bank Charter Act, 1884, 279 Bank of England Notes, depreciation, 1797–1818, 243, 247 Banks in India, table, 37 Barbour, D., 184 _note_ Belgium, Bimetallic system in, 23 Bengal: Double standard experiments, 1766–93, 14 Reform of currency, 18 Bimetallism: Abrogation in India, 22 _et seq._ Drawbacks of, 138 Gold to silver ratio, 83 Indian Government’s position, 140, 141 Market and Mint ratio divergences, 84, 85 Monetary conferences, discussions at, 135, 136 Bombay, currency reforms, 16, 18 Brown, Hon. Claud, 45 _note_

Cairnes, Prof. J. E., 47 _note_, 82 Cannan, Prof. Edwin, 246 _note_, 262 _note_, 297 Cassel, Prof. G., 253 _note_ Cassels, Mr., 34, 35, 41 Castlereagh, Lord, 211, 241 _note_ Chamberlain Currency Commission, 1913, 164, 167, 171, 187, 225, 231 _note_, 234, 237, 249, 259, 272, 277, 278 _note_, 302 Cheque system, failure of, 64 China, trade with India, 1889–1908, table, 183 Civil Service, economies in, 90, 91, 97 Coinage and Mint Act, 1870, 49 _et seq._, 147 Coinage under the Moghul Empire, 4 Cotton trade, development in India, 102, 106 Council Bills: Drawings, 1803–94, 189 History of, 263 Reverse Councils, 166, 220 _et seq_. Sales of, 130, 131, 166, 187, 213, 264 _et seq_. Cromer, Lord, 113 Currency. _See_ Indian Currency Currency Act, 1835, 22, 23, 36 Curzon, Lord, 275

Dalal, Mr., 260 _note_ Datta, Mr., 210 _note_ Davenport, Prof., 257 Dawkins, Hon. C. E., 274, 277 Demonetization of gold, 1833, 19 Demonetization of silver, 71 _et seq._ Discount rates, chart, 66 Dislocation of silver standard parity, 49 _et seq._

East India Company:
Double standard experiments, 1766–93, 14 _et seq._
Silver standard prescribed, 9
English currency, early history, 2, 6, 27
European countries, money stocks distribution, table, 134
Exchange:
Fall of, economic effects, 87 _et seq._
High exchange policy, 1920, 208
“Natural level” fallacy, 225, 226
Stabilization of, 203
Exchange rate:
Gold value of rupee in terms of, 196
London on Calcutta, 1914, 1915, table, 192
London on India, 1907–8, table, 191
Purchasing power parity, 252 _et seq._
Exchange standard, stability of, 181 _et seq._

Falkner, Prof. R. P., 62 _note_ Fetter, F. A., 234 _note_ Finances, Imperial and Provincial, separation between, 207 Fisher, Prof., 83, 84, 250, 257 Fowler, Sir Henry, Indian Currency Committee, 1898–99, 156, 239, 263, 269, 283, 288 Foxwell, Prof. H. 8., 72 _note_, 79 _note_ France: Bimetallic system, 23 English and French currency systems compared, 161 Gold and silver mintage, 1803–73, table, 137

Germany, currency difficulties in, 132
Giffen, Sir Robert, 129
Gokhale, Hon. Mr., 258, 303 _note_
Gold:
Consumption in various countries, table, 245
Discoveries, effect of, 23, 25
Issue, 1917, 218
Notes, value in terms of, table, 243
Price-levels compared with other commodities, 242
Silver and gold, value and production, 76 _et seq._, 79
Gold currency for India:
Arguments in favour, 257 _et seq_.
Commission of 1868, 47
Imports of gold, 1863–64, 42
Legal tender notification, 1864, 46
Proposals, 1864–66, 42 _et seq_.
Gold exchange standard:
Chamberlain Commission, 1913, 164, 167, 171
Mints, closing for silver, 168, 169
Objections to, 167
Gold payments:
Army remittances, 97
Burden of, 186
Civil Service remittances, 97
Rupee, cost of, 87, 88, 89
Gold standard for India:
Bengal Chamber of Commerce support, 1876, 122
Currency Committee, 1886, 129
Currency Committee, 1898, 129
English fiscal difficulties, 26, 27
Government scheme, 1878, 125
Monetary Conferences, 135 _et seq._
Movement towards, 118 _et seq._
Proposals, 1859, 38, 39
Smith, Col. J. T., plan of, 121
Temple, Sir R., plan of, 118
Gold standard reserve:
Danger of, 238 _et seq._
Maintenance and distribution, 230 et seq.
Gregory, Dr. T. E., 239 _note_
Gresham’s Law, 138
Gupta, Mr., 210 _note_

Halifax, Lord, 119 Hamilton, Lord George, 158 Herschel Committee on Indian currency, 1893–94, 146 _et seq._, 288 Huskisson, 27

Inchcape, Lord, 213
Indian currency:
Additions to coinage, 1893–1920, 218 _et seq._
Army establishment, effect on, 30
Banks, table of, 37
Barter, trade reduced to, 7
Chamberlain Commission, 1913, 164, 167, 171, 187, 225, 231 _note_,
234, 237, 249, 259, 272, 277, 278 _note_, 302
Coinage and Mint Act, 1870, provisions of, 49 _et seq._
Convertibility of, 174
Credit currency, lack of, 1859, 36
Currency circulation, tables, 199, 200
Dislocation of parity of exchange, 69, 70
East India Company Units, table, 11
Expansion measures, 1898, 152, 153, 154
Fowler Committee, 1898–99, 156, 239, 263, 269, 283, 288
Gold currency. _See that title_
Gold exchange standard. _See that title_
Gold standard for India. _See that title_
Herschell Committee, 1893–94, 146 _et seq._, 288
Imperial and Provincial finances, separation, 207
Mint for gold coinage, 157, 158
Mints, opening to silver, 149, 150
Moghul Empire, 1 _et seq._
Money market fluctuations, causes of, 60 _et seq._
Monopoly of issue by Government, 169 _et seq._
Paper currency. _See that title_
Precious metals imports, 31, 32, 33
Redemption, 220, 224 _et seq._
Reforms, 1833, 18, 19
Rupee. _See that title_
Silver standard. _See that title_
Smith Committee, 1919, 194, 201, 248, 249, 263
Trade currency, 1860–70, table, 43
Trade expansion, 1842, effect of, 30, 32, 33
Industrial pursuits, England and India, tables, 100, 101
International coinage, uniformity in, 71 _et seq._
International Coinage Commission, 119
International Exchange, American Commission, 1898, 133, 135
International Monetary Conferences. _See_ Monetary Conferences
Investments, Indian, Price-movements of, 94
Italy, Bimetallic system of, 24 _note_

Jevons, 63, 82, 132 Jute industry in India, development, 103

Kemmerer, Prof., 172, 249, 251 _note_, 253, 295 Keynes, J. M., 170 _note_, 172, 173, 184 _note_, 201, 214, 232, 248, 249, 251 _note_, 252, 256, 257, 295, 302 Kitchin, Joseph, 245 _note_

Laing, Mr., 39, 40, 298 Latin Currency Union, 1865, 24, 72 Laughlin, Prof. J. L., 73 _note_, 74 _note_, 76 _note_ Law, Sir Edward, 278, 279, 282, 283, 284 Legal tender: Limitation of, 285, 290, 201 Rupee as legal tender in U K., 145 Lewis, Prof. W., 79 _note_ Lindsay, A. M., 154, 164, 165, 166, 177 _note_, 238, 240, 289 Liverpool, Lord, 28 London, A. C. B., 35 _note_

McCulloch, J. R., 48 _note_ Madras, currency reforms, 15, 18 Mansfield, Sir William, 46 _note_ Marshall, Professor, 108, 130 _note_, 17, 186 _note_, 203 Meston, Sir James, 275 Meyer, Hon. Sir Wm., 300 Mint and Coinage Committee, 1803, 13 Mint regulations under Coinage Act, 1870, 51 Mints, opening to silver, 149, 150, 269 Mitchell, Professor, 242, 256 Moghul Empire, economic system under, 2, 3 Mohur: Currency unit, 119 Issues of, 14, 217 Monetary Conferences, 1878, 1881 and 1892, 135, 149 Money and stocks distribution, table, 134 Money market, Indian, causes of fluctuation, 60 _et seq_. Monometallism. _See_ Silver standard Muir, Sir William, 123

Newmarch, F. W., 264 _note_, 265 _note_ Nicholson, Professor, 175 _note_ Nickel coinage, 218

Overstone, Lord, 162, 163

Paper currency in India:
Banks of issue, 53, 54, 57
Department for, 55
Encashment regulations, 58
Establishment of, 49
Fiduciary issue, extending, 215 _et seq._
Independent Treasury system, 66, 67
Notes, issue of, 1915–19, table 217
Paper pound, 1797 and 1914, compared, 297
Reserve distribution, 1862–91, table, 56 _note_
Values, table, 41
Paper Currency Acts, 42, 63, 147, 215
Parnell, C. S., 239
Peel, Sir Robert, 27, 30
Pierson, Professor, 160
Pittman Act, U.S.A., 219
Prices:
Committee of Enquiry, 1910, 210
Gold exchange standard in relation to, 250 _et seq_.
Indian and foreign price-levels, Chart, 250
Inflation during War, 250, 251
Movements of prices as standard of value, 256
Rupee and sterling securities, 1873–92, 94
Wages and Prices in England and India, 112
Wages, silver and prices, table, 110
Probyn, Mr., 154, 177 _note_, 238 _note_
Public works in India, development, 91, 93

Reddi Garu, M. L., 236
Revenue and expenditure in India, 88 _et seq._, 92
“Reverse Councils,” sale of, 166, 220 _et seq._
Ricardo, David, 28, 238 _note_, 241 _note_
Ripon, Lord, 95
Ross, H. M., 213 _note_
Rupee:
Alteration of par, 1917–1919, table, 193
Coinage additions, 214, 215, 219
Convertibility, 174
Cost of fall of, 1894–97, 190
Depreciation, 1914–19, 205
East India Company’s rupee, 9
Economy of rupee currency, 294, 205
Gold payments, cost of, table, 89
Gold standard reserve and rupee circulation, 233
Gold value, 1802–1922, tables, 188, 194, 195, 196, 197
Imperial bimetallic, 145
Legal tender in United Kingdom, 145
Moghul Empire, 4, 5
Monthly fluctuations, chart, 113
Purchasing power, 198 _et seq._
Rupee-sterling exchange, fall of, 71
Stability, general survey, 187
Standard of value, 257
Uniform, coinage, 1833, table, 19
Weight, increasing, 144
Russell, H. B., 48 _note_, 72 _note_, 73 _note_

Sconce, Hon. Mr., 58 _note_, 59 _note_
Seignorage, levy of, 25, 167
Shirras, Mr., 201, 210 _note_, 249, 302
Silver:
Bounties and the fall of, 108 _et seq._
Cost of purchases, 1893–1920, 236
Depreciation, attempts to prevent, 130, 131, 132
Gold and silver, relative production and value, 76 _et seq._, 79
Indian Government purchases, 1915–20, 219
Limited legal tender, 285
Price movements of, 191, 192, 204
Silver standard for India:
East India Company’s decree, 9
Evolution of, 22 _et seq._
Demonetization of silver, effect of, 71 _et seq._
Dislocation of parity of exchange, 1873, 70 _et seq._
General nature of, 49 _et seq._
Instability, 87 _et seq._
Smith, Colonel J. T., 121, 143
Smith Committee on Indian Currency, 1919, 194, 201, 248, 249, 263
Subedhar, Mr., 263
Switzerland, bimetallic system, 24 _note_

Taussig, F. W., 161 _note_ Taxation, increases in, 88 _et seq._

Temple, Sir Richard, 55 _note_, 59 _note_, 67 _note_, 118, 119
Thackersay, Sir V., 269, 273
Trade:
Adverse balance and fall of exchange, 209, 246
Agricultural exports, 104
Bounties and the fall of silver, 108 _et seq._
China and India, 1889–1908, table, 183
Cotton trade development, 102, 106
Distribution of, tables, 105
Falling exchange, general effect of, 99 _et seq._
Imports and exports, tables, 99, 100
India and U.K. before and after Mint closure, 182
Jute industry development, 103
Speculation caused by exchange fluctuations, 114
Treasury Notes, Indian, interest-bearing, 35
Trevelyan, Sir Charles, 42, 45 _note_

United States, currency difficulties, 133, 143 Units of currency, tables, 11

Van Don Berg, Mr., 60, 62 Vishram, Hon. Fazulbhai, 276

Walker, Prof. F. A., 143 _note_ Waterfield, Sir Henry, 189 _note_, 263 _note_ Westland, Sir James, 276 Whitaker, A. C., 161 _note_ Wood, Sir Charles, 63 _note_, 67 _note_, 298