^JIIIA . ^ (7 UNIVERSITY OF CALIFORNIA LOS ANGELES INDIA AND IMPERIAL PREFERENCE Mr. Chamberlain on Imperial Preference ' I am profoundly convinced that of all the bonds that can unite nations, the bond of commerce is the strongest ; and the perception of this fact will, I feel assured, ultimately lead to the closer union between Great Britain and her Colonies, which I can see to be the only foundation for a great Empire.' INDIA AND IMPERIAL PREFERENCE WITH STATISTICAL TABLES BY SIR ROPER LETHBRIDGE, K.C.I.E., M.A. LATE SCHOLAR OF EXETER COLLEGE, OXFORD FELLOW OF THE UNIVERSITY OF CALCUTTA, AND OF THE ROYAL ECONOMIC SOCIETY FORMERLY PROFESSOR OF HISTORY AND POLITICAL ECONOMY AND EXAMINER IN POLITICAL ECONOMY FOR THE UNIVERSITY OF CALCUTTA LONGMANS, GREEN, AND CO. 39 PATERNOSTER ROW, LONDON NEW YORK, BOMBAY, AND CALCUTTA 1907 ^11 rights reserved Q= HF PREFACE At this moment, the popular aspirations of India, in matters commercial and industrial, are summed up in the one word ' Swadeshi '— ' My own country's products « for me.' The existing fiscal policy, imposed on India by our British prejudices, is universally believed to be maintained solely in the interests of British manufac- turers — though, as I shall show, v/e are being steadily ousted from the Indian markets by our Protectionist rivals. And the extreme politicians of the Indian National Congress already, not unnaturally, gratify the national wishes by preaching a social boycott of British, as well as foreign, goods ; and they frankly declare that, if they were able to do so, they would impose protective, and even prohibitive, duties on all imports alike. But no British politician believes in the possibility of purely Indian ' Swadeshi,' as against British goods. It would ruin Lancashire, and cripple all our staple manu- factures, and no House of Commons, whether Radical or Conservative, will ever stoop to such quixotic folly. The aim of the essays here collected, founded mainly on articles contributed by me to the Englishman of Calcutta, is to advocate the only reasonable, the only patriotic, the only possible, 'Swadeshi,' which is Imperial Preference. That will benefit equally the Indian and the British subjects of King Edward. I dedicate these 112790 vi INDIA AND IMPERIAL PREFERENCE pages to my numerous friends of Indian birth, whose affectionate regard I am grateful for and warmly re- ciprocate. In the proposals submitted I know I am voicing the ardent wishes of many of them. I owe far more to India than I can ever repay, and my Indian friends will know that I advocate Imperial Preference, first, because I believe it will benefit India and her peoples, and secondly, because I believe it will attach her more closely than ever to the Empire of which we are all proud. I have prefi.xed an Analytical Table of Contents, to show at a glance the general scope of my arguments and conclusions, and I have added, as appendices, the extracts from the official publications of the British, Indian, Colonial, and foreign Governments upon which those arguments are based. I desire to express my gratitude to the editors of the Otitlook and the Western Morning News, as well as to the proprietors of the Englishman, for allowing me to make copious extracts from articles of mine contributed to their columns. And my thanks are also due to the Controller of His Majesty's Stationery Office for his courtesy in permitting me to reprint some statistical tables from the Blue-Books. ROPER LETH BRIDGE. ExBOURxNE Manor, Devon. § I § 2 § 3 § 4 § 5 § 6. ANALYTICAL TABLE OF CONTExNTS CHAPTER I INTRODUCTION The Position of India Unique PAGE § I. Commercial Importance of India only second to United Kingdom ....... i § 2. Commercial position unassailable . . . . . i § 3. Independent of all countries, save only United Kingdom ........ i § 4. India the Commercial and Industrial Complement of the United Kingdom ...... 2 § 5. Imperial Preference means for India absolute Free Trade within the Empire . . . . . 2 § 6. Her existing Tariff renders Preference easy . . 2 § 7. Preference politically necessary for India . . . 2 § 8. India demands Protection for her nascent Industries . 3 § 9. The Author's Method and Official Experience . . 4 CHAPTER II THE POLITICAL VALUE OF IMPERIAL PREFERENCE TO INDIA The Question for the Imperial Colonial Conference . 7 Colonial Preferences already commenced . . . 7 ' The First Constructive Work of the Unionist Party ' 8 Indian Opinion and Local versus Imperial * Swadeshi ' 9 Imperial Preference the true ' Swadeshi ' . . . 9 The greatest Free-trade area on earth . . . . ID Mr. Deakin on 'The Double Bargain ' . . .12 viii INDIA AND IMPERIAL PREFERENCE PAGE § 8. Mr. Chamberlain's Inspiration . . . 12 § 9. Chambers of Commerce properly cautious . . . 13 § 10. The Government of India should lead . . . . 14 §11. A Tentative Scheme ...... 15 § 12. Mr. Cobden's Opinion . . . . 15 § 13. The analogy of the United States .... 16 § 14. Mr. Chamberlain's patriotic Aspiration . . 16 § 15. Foreign expert opinion . . . . . -17 CHAPTER III IMPERIAL PREFERENCE OUR ONLY DEFENCE AGAINST FOREIGN PROTECTION § I. The trend of Indian Trade under the existing Fiscal System should warn Lancashire and our British manufacturing districts . . . .19 § 2. Testimony of the Blue-books . . . . 20 § 3. British Imports to India alone show a progressive comparative shrinkage, all protected Imports having increased far more rapidly ... 20 § 4. Simple explanation of the phenomenon that this shrinkage has not, as yet, largely affected British Imports of Cotton Goods into India . . . 21 § 5. British share of the Export Trade of India far worse, and rapidly approaching vanishing point . . . 22 CHAPTER IV THE 'SWADESHI' MOVEMENT IN INDIA: ITS POSSIBILITIES AND ITS DANGERS § I. Both 'Swadeshi' and the Boycott of British goods adopted by the Congress Party, and excused by the Hon. Rash Behari Ghosh, CLE. . . . 25 § 2. Dangers of the Boycott . . . . . 26 § 3. The Hon. Rash Behari Ghosh, CLE,, and Mr. Romesh Chunder Dutt, CLE., show that this movement has been produced by our Fiscal policy . 27 § 4. Mr. Subramani Iyer on the oppression of India by England's ' Free Trade ' policy .... 28 ANALYTICAL TABLE OF CONTENTS ix PAGE § 5. The Gaekwar's strong condemnation of ' Free Trade ' for India ; and the demand of the Hon. Sir Phiroz- shah Mehta for Protection 29 § 6. The Hon. Maharaja Sir Jotindro Mohan Tagore, K.C.S.I., on Indian unanimity in hatred of Free Trade. Which policy should we favour ? . -30 CHAPTER V EFFECTS OF IMPERIAL PREFERENCE ON THE INDIAN EXPORT TRADE Exports within the Empire § I. Benefits proved 32 § 2. The stock objection of Free Importers that Exports will diminish. Answer to Mr. Morley . . 32 § 3. Exports to the United Kingdom and the Colonies will of course increase ...... 34 § 4. Exports of Tea ........ 34 § 5. Tobacco 35 § 6. Coffee, Cocoa, &c 35 § 7. Exports of Wheat 35 § 8. Unlimited capacity of the United Kingdom to absorb Indian Exports ....... 36 § 9. Increased prosperity and buying power in India will cause Increased Exports to foreign countries . . 37 § 10. No fear of Retaliation 37 § II. German opinion 37 § 12. The example of Canada 38 § 13. Anyhow, Indian Exports within the Empire (626,000,000 rupees out of 1,346,000,000 rupees) will rapidly expand under Imperial Preference . 39 CHAPTER VI EFFECTS OF IMPERIAL PREFERENCE ON THE INDIAN EXPORT TRADE {continued) Exports to Foreign and Neutral Markets § I. Government of India strongly in favour of Retaliation 40 § 2. Principle involves the sanction of Preferential Duties . 40 X INDIA AND IMPERIAL PREFERENCE PAGE § 3. Two reasons why there is no danger of Retaliation from Foreign Governments . . . . 41 § 4. Strong approval of Sir Charles Elliott, the greatest and must experienced Indian expert . . . 42 § 5. Analysis of Foreign Trade by Sir Edward Law, late Finance Minister of India, proves that there is no danger of Retaliation ...... 42 § 6. Shows that China trade will not be affected . . . 43 § 7. Shows that Japan trade will not be affected, and Straits Settlements trade favourably affected . . . 43 § 8. Recapitulating this chapter and the last, out of a total Indian export trade of i ,346,000,000 rs. , it has now been shown that trade to the value of 920,000,000 rupees will be either greatly benefited and stimu- lated, or entirely unaffected by Imperial Pre- ference ........ 43 CHAPTER VII EFFECTS OF IMPERIAL PREFERENCE ON THE INDIAN EXPORT TRADE (continued) Exports to Foreign and Protected Markets § I . Recapitulation of two last chapters .... 45 § 2. Exports to Foreign and Protected Markets, now worth 426,000,000 rupees ...... 45 § 3. Temporarily growing at a far more rapid rate than inter- Imperial Exports, owing to our faulty Fiscal Policy. Tendency to oust British and Colonial Trade injurious both to the Empire and to India . 46 § 4. This export trade will be put on a sound and per- manently prosperous basis by Imperial Preference — which will tap new sources of supply in India, developing her resources, employing her surplus population, bringing into cultivation her cultivable wastes, improving the standard of comfort and the purchasing power of her peoples — for the Protec- tionist foreigner must have Indian raw material or cripple his own industries . . . . . 47 § 5. Value of Sir Edward Law's Minute on Preferential Tariffs 49 ANALYTICAL TABLE OF CONTENTS xi § 6. No danger of Retaliation from Germany . § 7. Nor from France ...... § 8. Nor from America or Japan .... § 9. Nor from Belgium or Austria-Hungary . . . § 10. Italy most unlikely to Retaliate §11. No danger from Russia or Holland § 12. The fear of Retaliation is, so far as India is con cerned, simply a Free Fooding bogey 50 50 51 SI 51 52 S2 CHAPTER VIII THE ECONOMIC RELATION OF IMPERIAL PREFERENCE TO INDIAN PATRIOTISM § I . Modern conditions render a ' National ' Fiscal System absolutely necessary both for the United Kingdom and for India ....... 53 § 2. xMready recognised in the Internal Trade of the United Kingdom and of India .... 54 § 3. Imperial Preference encourages Trade to follow its natural channels, instead of being deflected by foreign Protection . . . . . • • 55 § 4. Local ' Swadeshi ' is foolish, unpatriotic, and injurious to those who would practise it ; while Imperial • Swadeshi ' benefits both giver and taker . . 56 CHAPTER IX THE POSITIVE ECONOMIC ADVANTAGES THAT WILL ACCRUE TO INDIA FROM IMPERIAL PREFERENCE § I. Special points of benefit 57 § 2. In India Protection for Nascent Industries is specially needed by local circumstances .... 58 § 3. Agriculture a congested industry. Other industries need fair play ....... 59 § 4. How much Protection is necessary for fair play ? . . 59 § 5. Protection against British goods being at once unattainable and unpatriotic. Imperial Preference is the only alternative 60 xii INDIA AND IMPERIAL PREFERENCE PAGB § 6. Under Imperial Preference India will enjoy immense advantages for her manufaciures, equally with the United Kingdom 6i CHAPTER X IMPERIAL PREFERENCE WILL PROMOTE THE MORAL AND MATERIAL WELFARE OF INDIA § I. Political and Economic advantages already proved . 63 § 2. It will assure the Financial stability of India, and should be supported by the Finance Minister . 64 § 3. The aboHtion of the hateful excise on Indian Cotton goods will stimulate industry and remove a festering sore ......... 65 § 4. Will improve the position of English-speaking Indians 65 § 5. The encouragement of the Tea industry and the resuscitation of Coffee and Indigo ... 65 § 6. The encouragement of Indian Mill industries . 66 § 7. The encouragement of Wlieat-growing under Irriga- tion, and Indian Famine-insurance ... 68 § 8. The encouragement of the widely distributed Sugar industry ........ 70 § 9. The salvation of Indigo . . . . . . 71 § 10. Lord Curzon on ' The Protection of the Coffee Industry' 72 § II. Sir Edward Law, Finance Minister, on 'the immense advantage secured to Indian interests ' by the protection afforded to Coffee . . . . 72 §12. Lesson of the French Negotiations . . -73 § 13. The development of an enormous Tobacco industry . 73 § 14. Lord Beacon sfield's estimate of the political value of the united commercial strength of England and India ......... 74 § 15. Advantages in the cost of Carriage and Freights secured to Indian Exports by Imperial Preference . 75 CHAPTER XI THE RECOGNITION OF INDIA AS A SOVEREIGN STATE § I . The terms of the future Commercial Treaty between India and the rest of the Empire .... 76 ANALYTICAL TABLE OF CONTENTS xiii PAGE § 2. One condition might be the recognition of Imperial Citizenship (as already understood in the United Kingdom and in India) as inherent in every Indian-born subject of the King-Emperor . . 76 § 3. This claim is a just and reasonable one, but can only be enforced in the Colonies by education, per- suasion, and negotiation . . . . . . 77 § 4. A Treaty of Imperial Preference affords the best opportunity for negotiation . . . . . 78 CHAPTER XII GENERAL CONCLUSIONS § I. The moment Imperial Preference is established vast advantages, direct and indirect, will at once accrue to India ........ 80 § 2. Every branch of industry in every Province of India will at once be revived and stimulated, and the Indian peoples insured against Famine . . . 80 § 3. The stability of Indian Finance, now absolutely at the mercy of Foreign Governments, will be assured on the cheapest terms by Imperial Preference . 81 § 4. Reasonable and adequate protection will be secured for the nascent industries of India ... 82 § 5. And in every way, both Indian sentiments and Indian interests will receive from Imperial Preference that consideration which is their due, and which can only be secured on these lines .... 82 APPENDICES A. Existing Colonial Preferences 84 B. Value (in Rupees) of Merchandise imported into British India from each Foreign Country, from 1875-80 to 1904-05 ....,, 96 xiv INDIA AND IMPERIAL PREFERENCE PAGE C. Value (in Rupees) of Merchandise exported from British India to each Foreign Country, from 1875-80101904-05 98 D. Expansion of German Trade with India, 1897-1905 . 100 E. Area, Cultivated and Uncultivated, in 1904-05, in Acres 102 F. Area under Irrigation in 1 904-05, in Acres . . 104 INDIA AND IiMPERIAL PREFERENCE CHAPTER I INTRODUCTION : THE POSITION OF INDIA UNIQUE § I. In any reasonable scheme for the Commercial Federation of the British Empire India must occupy the chief place after the Mother Country. At this moment, among the constituent States of the Empire, she is at once the largest producer of food and raw material and one of the largest consumers of manufactured products. And potentially, with her 300,000,000 of thrifty, industrious, and progressive workers and consumers, she is a com- mercial unit of greater importance in the world, whether for exports or for imports, than almost any other. § 2. I shall show in these pages that she occupies a position of unrivalled and unassailable commercial strength. All the commercial countries of the world are really competitors for the privileges of buying from her and of selling to her ; for she is the best and cheapest source of their food and raw materials, possessing a monopoly of some of these, while she offers by far the largest and most receptive market for their manufactures. By her fiscal arrangements she could do deadly injury to any who attacked her, while she herself is practically invulnerable. § 3. I shall show that to India, by reason of her having drawn, and being able to draw, inexhaustible supplies of cheap capital and trustworthy technical skill 2 INDIA AND IMPERIAL PREFERENCE from the United Kingdom, her llritisli trade is of infinite importance to her financial and industrial stability. But she is perfectly independent, so far as her own interests are concerned, in her commercial relations with other countries. § 4. From every point of view of production and requirement the United Kingdom and India are almost exactly complementary. What the one most needs the other can best supply. Together they constitute an absolutely self-contained and self-sufficing commercial and industrial unit. § 5. I shall show that, for India alone, out of all the constituent States of the Empire, Imperial Preference will )nean practically (with quite insignificant exceptions) absolute Free Trade within the Empire. § 6. India already possesses a small General Tariff — quite sufficient for Preference within the Empire, and ready for defensive purposes outside. For this reason the adoption of Imperial Preference would be a much simpler and easier matter than anywhere else in the Empire, for it would not necessarily involve the imposition of a single rupee of fresh taxation, but only the remission of existing taxation on imports from the United Kingdom and the Colonies. If India thought this would be a good thing for her own industrial and trading interests — which it certainly would be when coupled with Protec- tion from foreign dumping — it seems quite incredible that Free-Trade fanaticism could be carried to such a lunatic excess as to induce any Lancashire member, or any elector in the British manufacturing districts, to oppose ' the open door ' of 300 millions of customers. § 7. The Colonies are already attached to us by ties of race-loyalty and kinship. With India we have only the golden link of the Crown, and all else must depend on the strength of mutual interest and mutual respect. Mr. Chamberlain, in his ' Message to Canada,' wisely INDIA DEMANDS PROTECTION 3 observed, ' I am profoundly convinced that, of all the bonds that can unite nations, the bond of commerce is the strongest, and the perception of this fact will, I feel assured, ultimately lead to the closer union between Great Britain and her Colonies, which I can see to be the only foundation for a great Empire.' This bond of union with the Motherland is desired by India and the Indian peoples : can any British patriot refuse to sanction it? § 8. For India is awakening — as Japan has already awakened — to the consciousness of her own greatness, and of her own inherent capabihties. She feels that she possesses qualifications for commercial and industrial success greater even than Japan — vast populations of industrious and intelligent workers, immense undeve- loped tracts of cultivable land, ample products of every useful kind, cheap and efficient labour in the masses, with much commercial ability among the educated classes, and the command of cheap capital from England. Her educated classes demand, and rightly demand, protec- tion for her nascent industries. Rebuffed and irritated by British 'Free-Trade' fanaticism, they are bUndly groping after some alternative form of protection in the shape of 'Swadeshi' — the voluntary abstention from the use of commodities not made in India — and the social boycotting of British as well as of foreign goods. I shall deal with this in my next chapter. But every intelligent man, be he Indian or European, knows full well that, so long as the House of Commons retains any authority over Indian administration, the idea of India imposing protection against Lancashire goods and other British- made commodities is an idle and mischievous dream. ^ ' I have been assured that, in I he General Kleclion of 1906, some dishonest Free Fooders actually had the audacity to ask for Lancashire votes on the absurd pretence that Imperial Preference might encourage such Indian Protection, thus defeating the very B 2 4 INDIA AND IMPERIAL PREFERENCE And, seeing that Parliament can never, by any possibility, confer on the Indian Government any powers of protec- tion against the rest of the Empire, any more than we can give Kent protection against Surrey or Sussex, the wise and patriotic Indian will gladly accept that form of Protection which is possible, and which will help her industries to compete on fair terms with the dumping and protected foreigner. That form of protection is Imperial Preference, which will at once protect Indian nascent industries, and foster friendly intercourse among the citizens of the Empire. § 9. I venture to claim for these papers of mine that their arguments and conclusions, whether right or wrong, whether accurate or inaccurate, have at any rate been framed on strictly scientific lines that will be accepted as such by every trained and experienced economist. Of course, in applying pure economics to questions of high policy, I admit at once that I rely very largely on considerations of political advantage or disadvantage. And — as an earnest believer in the ' National ' theories of List, Hamilton, Carey, and the other economists who have been universally accepted as the safest guides in fiscal questions by the whole civilised world outside the realms of the Cobden Club — I consider herein the poli- tical advantages or disadvantages likely to accrue, not so much to humanity at large (for the foreigner is taking very good care of himself everywhere), but to India in the first place, and in the second place to the British Empire. I believe it will now be generally admitted that this method is absolutely necessary in all questions relating to human action. Considerations of political advantage or disadvantage must be weighed with the simple busi- purpose implied in the word ' Preference," for which the policy is devised ! I deal with this atrocious hypocrisy — which is on a par with the * terminological inexactitudes ' about Chinese slavery — at pp. 9, 60, and elsewhere. ITS POLITICAL ASPECT 5 ness considerations of economical advantage or disadvan- tage. One of the ablest writers of the modern school, Mr. L. S. Amery, Fellow of All Souls, has aptly pointed out that the fundamental fallacies of the Cobdenite theory of Free Imports are due to the fact that it is ' based on assumptions contradicted by all the teachings of history, by the whole nature of man, and by the structure of human society.' And one of the most lucid, most sincere, and least arrogant of the writers on the other side — Mr. A. C. Pigou, Fellow of King's — has empha- sised this fact, in his interesting treatise on ' Protective and Preferential Import Duties,' by discussing the eco- nomic and the political aspects respectively of Imperial Preference, each on its own merits in separate chapters. Oddly enough— as it seems to me — his objection to Preference is almost entirely a political one. In these days every sciolist who has read Adam Smith, and knows something, perhaps, of the popular treatises of John Stuart Mill and his contemporaries, is ready to dogmatise about what he calls 'Free Trade' and ' Protection ' — terms which he frequently uses with widely different connotations almost in the same breath. But I can honestly aver— and I hope my readers will not think me presumptuous if I venture to emphasise the fact — that the opinions I have here submitted to the public are the results of life-long study. When I was an undergraduate at Oxford, in the time of Professor Bonamy Price, I took up the subject, like many others still in India, because it was understood to 'pay' in the exami- nations. But in after years I followed it because of its fascinating interest to every one who cares for the material welfare of India and its peoples. I became Professor of Political Economy, both in the Presidency College and in other Colleges of the University of Calcutta. For many years I was Examiner in Political Economy for the University, both in the examinations for the M.A. degree and in those for the Premchand Roychand studentship ; 6 INDIA AND niPERIAL PREFERENCE and I believe I had the privilege of teaching such dis- tinguished economists as Mr. Lai Mohun Ghose, the Hon. Mr. Justice Sarada Charan Mitra, and others. Subsequently, as Press Commissioner of India, I had the unwelcome task of endeavouring to justify to the Indian public Lord Lytton's introduction of the system of Free Imports — a system that was insisted on by Lancashire M.P.'s, and objected to by nine-tenths of the Civil Service, and by the whole of Indian public opinion — that was called ' Free Trade,' artfully enough, by those who wished to disguise the fact that it was intended to operate, and did operate, as ' Protection ' for Lancashire cotton goods. Now that I have long ago retired from the Service, and am no more bound to official reticence, I may freely confess that when I spoke or wrote of those ' Free Imports ' — free to the cotton goods of the * Protected ' mills of Saxony as well as to the ' Free- Trade ' mills of Lancashire — under the official name of ' Free Trade ' I was compelled by a guilty conscience to ' wink the other eye.' And so were we all at that time; no one really believed in the hypocrisy about ' Free Trade.' And later — when I had retired from the Service and was in a position of greater freedom and less respon- sibility — I had the pleasure of warmly supporting the efforts (unavailing though they unhappily proved) of such typical and honoured Indians as the Maharaja Sir Jotindra Mohan Tagore and others, in opposition to the mischievous and inquisitorial excise duties on Indian- made cotton cloth, that were imposed in 1894, duties which will, I hope, be swept away by Imperial Prefer- ence. I must apologise to my readers for mentioning these personal experiences. I do so merely to prove to them that the views which I am now offering to them for their acceptance have not been suddenly or lightly adopted, but have been earnestly held by me during a long and busy public life, CHAPTER II THE POLITICAL VALUE OF IMPERL^L PREFERENCE TO INDL4 § I. The Imperial Colonial Conference will hence- forward consist not only of the Colonial Premiers and of representatives of the Colonial Office, as hitherto, but also of delegates from India and from some or all of the chief Crown Colonies. It will at all meetings doubtless discuss Imperial Defence and other questions affecting the Empire at large. But all the world knows that the most important, because the most urgent, business to occupy the deliberations of the Conference will be the proposals for Imperial Commercial Federation, or Impe- rial Preferential trading, that took their origin in the former meetings of the Colonial Premiers, that have subsequently been advocated by Mr. Chamberlain, Mr. Balfour, and other fiscal reformers at home, and that are being adopted among themselves by the greater Colonies in a practical form. § 2. The tentative measures in the direction of Imperial Preference that are being started by the self- governing Colonies are, of course, as yet on a compara- tively small scale, for they are without the co-operation either of the United Kingdom or of India. I give, in Appendix A, the chief provisions of these schemes of Preference so far as they have already (January 1907) been settled by the Governments of New Zealand, South Africa (the Customs Union), Dominion of Canada, 8 INDIA AND IMPERIAL PRElTvRENCE West India Islands. Mr. Winston Churchill claims the result of the late General Election as a ' mandate ' against Imperial Preference, as between the United Kingdom and the rest of the Empire — though he frankly admits that his Government and Party will cordially approve of the principle if it be applied only to the Colonies. So in these tentative measures the Colonies have not courted a rebuff by inviting Mr. Churchill and his colleagues to join in their Imperial plans. Indeed, there is a regrettable significance in the fact that the New Zealand Government in a recent announcement regarding intending reciprocity, having regard to the claims of racial kinship, puts the United States of America into its list with the other British Colonies, in the place that would have been occu- pied by England and India if the elections had gone differently. And Canada, in the revision of her tariff arrangements that came into force on November 30, 1906, while she retained (and in some cases improved) the British Preferential rates on the most favoured scale, introduced also an ' Intermediate Tariff,' better than the General Tariff, though not so favourable as the British Preferential Tariff ; for the purpose of friendly reciprocity with such foreign countries as may offer like treatment. In all our Colonies, as throughout the whole of the civilised world outside the realms of the Cobdenite Mumbo Jumbo, the strong tendency of commerce is a centripetal one, in the direction of great agglomerations of kindred States united for fiscal purposes. The centri- fugal and disruptive tendency is now fostered only among the Radicals and Little Englanders of the United Kingdom. § 3. Mr. Balfour, writing as leader of the Unionist Party to Mr. Chamberlain on February 14, 1906, de- clared categorically that ' the first constructive work of the Unionist Party' must be 'to secure more equal terms of competition for British trade and closer com- ITS POLITICAL ADVANTAGES 9 mercial union with the Colonies.' This view, though not shared by Sir Henry Campbell- Bannerman and his supporters, has subsequently been re-affirmed as the official view of the solid Unionist Party, and will be carried into effect whenever that party regains the position in Parliament which it had held during so many years until last January. § 4. It is, therefore, of infinite importance to the welfare of India that the true public opinion of the country, both from the Indian-born as well as from the European side, should be elicited and formulated. It is obvious that that public opinion ought to be grounded, mainly and in the first place, on a purely material and economical basis — on what is likely to be most helpful to the economical development and enrich- ment of the country. At-the same time it will be admitted by all Anglo-Indians, and by a very large number of our loyal Indian fellow-subjects, that the political advantages of a closer commercial union with the United Kingdom and the British Colonies ought not to be overlooked or ignored, as has been too generally the case in India. We are all agreed that the political inclusion of India in the world-wide British Empire is of equal advantage to India and to the Empire. We are all desirous of seeing a great development of the industrial and commercial life of India; and most of us — probably nearly all Indians and a majority of Anglo-Indians — are convinced that that development cannot be attained without some form of fiscal preference, be that form small or great. § 5. We all know, as a matter of fact, that it is childish and futile to speculate on any form of preference that would act as ' Protection ' against Lancashire or against British products in general, for it is absolutely certain that no British Parliament, whether Conservative or Radical, would look at such an arrangement for a moment, lo INDIA AND IMPERIAL PREFERENCE Lui a ' Swadeshi ' movement that should include the United Kingdom and the Colonies, as well as India, in its purview would meet, lo a large extent, the just and reasonable economical requirements of India. It would be at once immensely popular with our Colonists, with the solid Unionist Party in Britain and India, and with all that is best and most loyal among our Indian-born fellow-subjects. And when it is found that Imperial Preference, so far from injuring our foreign trade, would largely increase it — as has already been the case in Canada ' — while enormously stimulating our British and Colonial trade, and causing a marvellous expansion of Indian industries and Indian commerce, then even the doubting Thomases among our Anglo-Indian Radicals will be convinced, and the stoutest advocate of purely Indian Swadeshi will admit that Imperial Swadeshi is at least the ' next best thing.' Let us see to it that, when- ever the Imperial Conference meets, our Indian repre- sentatives know full well what India needs, and what she wishes to gain, within these reasonable and practical limitations ; as Mr. Chamberlain assured Sir M. M. Bhaunagri, the fiscal reformers wish nothing more than this for India, while the soi-disant PVee Traders will hardly have the face to propose less. § 6. For Imperial Preference in the case of India — therein differing somewhat from Colonial conditions — ought to commend itself equally to Free Traders and to Protectionists, if regard be had to the practical objects of both parties and to the existing conditions of Indian trade. For it means at once Free Trade for the Empire, including India, and for India herself adequate protec- tion without a rise of prices. In the first place, it need not, probably will not, involve the imposition of a single rupee of additional taxation on the goods we import from foreign countries. ' For Canadian statistics see p. 38. THE GREATEST FREE TRADE AREA ii It will only mean the remission of much existing taxation on British and Colonial products. These remissions will be more than amply compensated by reciprocal remissions of British and Colonial taxation on Indian products. And this reciprocity will mean (i) cheaper prices for Indian consumers, and consequently largely enhanced purchasing power among them for foreign as well as for British and Indian goods, and (2) stimulated production of exports for the similarly improved British and Colonial markets. And to these very obvious advantages should be added the many benefits that will flow from the abolition of the odious excise duty that is now levied on products of many Indian mills — not the least of those benefits being the stoppage of that popular irritation that is always caused by a tax of an inquisitorial nature. It has often been remarked that, with the adoption of Imperial Preference, the United Kingdom and India alone will constitute the greatest, richest, and most populous fiscal unit and Free Trade area that the world has ever seen — far more important in all these aspects than the United States of America, which now form the biggest area possessing internal Free Trade and fiscal unity. This consideration ought to be sufficient to fire the imagination of every economist who has learnt the advantages of real as distinguished from one-sided Free Trade ; for we can supply all each other's wants, and thereby retain within the fiscal unit all the benefit and profits of ' the double bargain,' on which the far- sighted policy of the immortal Alexander Hamilton founded the prosperity of the United States. And at the same time the mutual preference will be sufficient to ensure so much ' protection ' for the industries both of England and of India as may be compatible with absolute commercial union and absolute mutual friendli- ness. 12 INDIA AND IMPERIAL PREFERENCE § 7. Afr. Deakin, who may be regarded as the Alexander Hamilton of the Commonwealth of Australia, in a great speech delivered in the Federal Parliament on December 8, 1904, showed in a few words how immense would be the benefit of the Hamiltonian ' double bargain ' to the British Empire, and how largely it would increase the ' national dividend ' of each of the States partici- pating in its profits under a system of Imperial Prefer- ence. He said, in the course of a convincing speech on the general subject : — ' The only figures I propose to quote here are those which indicate the possibility of diverting within the Empire trade which is at present without it, I find that in 1903 the imports — including gold and bullion — into the Empire represented upwards of ^900,000,000. Adding the exports of the Empire for the same year, I find that the total trade was ;;/^ 1,600, 000, 000. There must be a large proportion of these imports which the Empire cannot produce profitably, and a large propor- tion of exports which we cannot consume. With those I will not deal. The enormous magnitude of those figures suffices to show the margin we have to work upon. They show the portion of our trade which now leaves only one of its profits within the Empire, and puts another profit in the pockets of our rivals and possible enemies. That trade may be retained within the Empire.' § 8. And the political advantages that will flow from fiscal union — the welding of the constituent parts of the scattered Empire into one compact homogeneous body — were the considerations, as affecting the Colonies and the Mother Country, that first induced Mr. Chamberlain as Colonial Secretary, to become the apostle of Com- mercial Federation. It is strange that they have, as yet, been so little regarded in India — for surely India, though thoroughly loyal to the British Raj, stands more in need DANGERS OF PRESENT SYSTEM 13 of this friendly welding that is brought about by mutual acts of goodwill than many of the Colonies that have already the ties of race and kinship to bind them together. The old Scottish proverb teaches us that ' GifF-gaff males guid friens ' ; and 'giff-gaff,' the friendly ' give and take,' the kindly interchange of mutual benefits, is equally potent in cementing the friendship of nations. Every Viceroy and -every Secretary of State in turn has warned us of the infinite political danger of the sempiternal fiscal war between Britain and India ; and yet the wiseacres of the free-fooding and free-foreign- importing persuasion affect to believe that there will be danger of friction between us if we attempt to substitute friendship and mutual preference for hostility and mutual taxation ! Lord Salisbury, when Secretary for India, spoke of this mutual taxation as 'a matter of dangerous conten- tion.' Even Lord George Hamilton in 1896 admitted that : ' the controversy concerning the imposition of duties in India upon the cotton imports of Great Britain is one of the most serious character — it provokes between the two contending industries intense animosity.' These controversies and animosities will be ended for ever between England and India by the adoption of the friendly system of mutual preference and the aboli- tion of those custom-house barriers which now divide us as foreigners from each other. If we refuse to adopt that system, it is quite certain they will become more and more embittered. § 9. It was quite reasonable and proper that these political considerations should have found no prominent place in the discussions on the subject that have taken place in the Bengal Chamber of Commerce, and that no mention of anything of the kind was made in Sir Ernest Cable's clever address, as the representative of that Chamber, to the Conference of the Associated Chambers 14 INDIA AND IMPERIAL PREFERENCE of Commerce of the Empire. ' Business is business ' is a sound maxim to be applied to strictly business affairs. The extremely adroit ex-President of the Bengal Chamber was well within his rights when he dispassionately informed the Associated Chambers that, as Germany and the other protectionist foreign countries had already ousted Great Britain from at least three-fourths of the Indian export trade, and as they were yearly increasing that lead — a most important and significant admission — the Bengal Chamber could do nothing that might have even a colourable appearance of favouring the British one-fourth to the disadvantage of the foreign three- fourths of their customers. The argument, stated in these correct terms, is unanswerable. But the fallacy lies in the assumptions (i) that British Preference means a disadvantage to the foreign customer, and (2) that foreign Governments are in the least likely to retaliate, out of mere pique, on account of domestic arrangements within the British Empire that do them no harm, and that are at most only a very small advance in the direction of their own methods. With these fallacies I will deal in Chapters VI. and VII. § 10. But it seems strange, and somewhat re- grettable, that in the great despatch of Lord Curzon's Government dealing with the general question of Preferential Tariffs not a single word or reference occurs to any of the political advantages that might accrue from a commercial federation between the United Kingdom and India. That despatch dealt simply with the economical side of the question, and was mainly directed to disprove the conclusions of the masterly Minute of Sir Edward Law, the then Finance Member, on which it was supposed to be based. The despatch seemed to be coloured and inspired by a curious dislike of Mr. Chamberlain. It certainly made no attempt whatever either to prove or to disprove the accuracy of A TENTATIVE SCHEME 15 Mr. Chamberlain's views in regard to the poHtical value of Preference — opposing to all such contentions a stolid non possumus, entirely inconsistent with the very re- markable array of facts and figures given in Sir Edward Law's Minute. § II. Leaving, then, the consideration of the numerous economical questions involved to be treated of in subsequent chapters, I here venture to insist simply on the political advantages to India and to the Empire of the proposed establishment of a system of Preferential Trading between the United Kingdom and India. That system would mean that the United Kingdom and the Colonies would give more or less free entry (subject only to revenue necessities) to Indian tea, tobacco, sugar, wheat, oil-seeds, and all Indian staples. It is probable that for the present an import duty, perhaps of 2d. a lb., would still have to be charged on Indian and Ceylon teas for revenue purposes, but this would not in itself be a very great disadvantage, while the retention of the existing duty on foreign-grown teas would largely aid the revenue without diminishing the increased consumption certain to result from the large remission of duty on British-grown teas. Further than this, the excise duties on the products of Indian cotton mills would be either abolished at once, or at any rate reduced pari passu with the reduction of the Indian import duties on Lancashire cotton goods, Yorkshire woollen goods, Sheffield cutlery, and all the numerous imports from the United Kingdom on which we in India now levy a duty. § 12. And while India would thus gain both morally and materially, is it nothing that the Empire should be able to draw, from within its own limits, and on terms favourable alike to producer and consumer, all the supplies it needs, both of food and of raw materials ? Fas est et ab hosic doceri—\it\. me quote what Mr. Cobden 1 6 INDIA AND IMPERIAL PREFERENCE himself said on thai point. In a speech made at Roch- dale on October 29, 1S62, Mr. Cobden said : ' And I will say this, that I doubt the wisdom — I certainly doubt the prudence — of a great body of indus- trious people allowing themselves to continually live in dependence upon foreign powers for the supply of food and raw material, knowing that a system of warfare exists by which, at any moment, without notice, without any help on their part, or means of prevention, they are liable to have the raw material or the food withdrawn from them — cut off from them suddenly — without any power to resist or hinder it.' § 13. This is the 'Commercial Federalism' which was the dream of Alexander Hamilton for the United States of America, as it was of Friedrich List for Germany. In both cases it has been carried out by such patriotic statesmen as McKinley and Bismarck, not without great difficulties, not without certain sacrifices, but with the approval and applause of the whole world. It is the policy which is now pursued every year with greater confidence and perspicacity by all the great in- dustrial nations with the sole exception of the United Kingdom. In Hamilton's own words, ' it meant the obliteration of State rivalry and the sweeping out, as by a flood, of the litter and decay of ancient jealousies.' Its ultimate intention, like all the rest of his policy, was union. ' His vision,' it was said of him, ' was of one great nation, capable of producing within its own wide borders everything that its citizens would require for life, for comfort, and even for luxury. Independent of its neighbours, it might hope to escape from embroil- ment in their quarrels ; dependent on the co-operation of its members, it would be secured in the possession of internal peace.' § 14. This, too, is Mr. Chamberlain's vision of the United States of the British Empire. He sees the A SELF-SUFFICING EMPIRE 17 United Kingdom, India, Canada, Australia, New Zealand, South Africa, and the rest of them, forming one great nation — at once united, self-contained, and self- sufficing. They are all brought by nature within a ring-fence, in the ' setting of the silver sea ' — for in these modern days, contiguity by sea is more commodious for commerce than actual contiguity on land. Such an Imperial Federation, in strength, in wealth, in area and population, in everything that makes for national greatness, will far transcend anything that the world has known or can know, if thus united commercially and fiscally. Without those elements of cohesion, its disin- tegration and ruin would only be a matter of time. § 15. I will conclude my examination of this portion of the subject with a quotation from a German expert of the highest authority, the learned Professor Fuchs of the University of Freiburg. • His words were published in the early days of the patriotic movement for Imperial Commercial Federation within the British Empire. But their prophetic sagacity is even more apparent now than when they were first published ; while the prediction with which he concludes is almost startling when read in the light of recent events : — 'This is the object of the advocates of this policy — that the British Empire should be economically indepen- dent of all the rest of the world. Their starting point is that all goods that are objects of demand are produced, in sufficient amount and quality, within the British Empire, or might be by such an Imperial trade policy, and that the British Empire, more than any other country or Empire, might fulfil the conditions of a self- ' The Trade Policy of deal Britain and her Colonies since i860. By Carl Johannes Fuchs, Professor of Poliiical Economy in the University of Freiburg. Translated liy Constance H. M. Archibald. With a Preface by the Ritjhl Hon. J. Parker Smith, M.A., M.P. , formerly Fellow of Trinity College, Cam bridge. C t8 INDIA AND IMPERIAL PREFERENCE sufficient commercial State, ... On political grounds, England needs, now more than ever, to retain her great colonial Empire. But, owing to the numerous and active centrifugal forces of to-day, this can only be done by a closer union. Such a union England must try to secure at any cost. . . . We have seen to what an extent England is dependent, not only for her industry, but also for the food supply of her people, on foreign trade, and on the undisturbed continuation of the same in time of war. The safeguarding of this immense British trade, and especially the transport of grain, would be altogether impossible without the possession of all her naval bases and coaling stations, in the different colonies. . . . How great an advantage it would be if the supplies of grain came wholly, or preponderantly, from other parts of the Empire, and if England were almost independent of foreign countries for the food supply of her people, is evident when we consider that to-day the greater part of the British grain supply comes from Russia and the United States. . . . And how war can quite suddenly cut off the supplies from a foreign country has been clearly proved by the stoppage of the cotton export from the American States during the AVar of Secession. ... It remains to be seen whether time will raise up to Eng- land a statesman who possesses clear - sightedness, courage, energy, and tact enough to bring this question to a happy issue — a question which is of so much import- ance for the future of England, as well for her position among nations as for her trade. But it must be soon, or it will be for ever too late ' These words of wise and friendly warning to us were written by Professor Fuchs in 1893. CHAPTER III IMPERIAL PREFERENCE OUR ONLY DEFENCE AGAINST FOREIGN PROTECTION § I. It is admitted that the Protection in their own home markets that is enjoyed by the great commercial nations that are our rivals in India enables them to use the Indian market as the dumping ground for their sur- plusage so long as we refuse to allow India to set up a preferential tariff. Of course the manufacturers of the United Kingdom and India do not enjoy this advantage ; and that is why the import into India of the protected manufactures of Germany and other pro- tected countries — save only in some special lines whose conditions are discussed in § 4 — is progressing at a far more rapid rate than that of the unprotected manu- factures of Great Britain. This fact is proved in detail by this year's tables, as shown in Appendix B and C. It is to a large extent masked for the present (a) by the immense volume of the Indian trade that we still hold as a survival of the trade established before this pro- tected competition arose ; and {^) more especially by the exceptional and temporary considerations discussed in § 4 ; and consequently, some short-sighted Free Importers -relying on these ephemeral conditions, and blind to the obvious tendencies disclosed in the statistics — declare that we Britons are ' holding our own ' in India. The issue is clearly one of vital importance to c 2 20 INDIA AND IMPERIAL PREFERENCE Lancashire and the other manufacturing centres of the United Kingdom, and therefore I earnestly invite the attention of Lancashire and all other manufacturing experts to the figures in Appendix B. and those I shall submit to them in this chapter. From the bottom of my heart I believe they stand now at the parting of the ways. The verdict of the manufacturing districts in the General Election of 1906 is sometimes quoted as a refusal of Imperial Preference ; if so, I am convinced that, if that verdict be persisted in, it will mean the absolute loss of the Indian trade and the ruin of our commercial and industrial supremacy. § 2. Let me take tlie last decennial Statement of the. Moral and Material Progress of India (Blue-book No. 249), published by the India Office in 1903, and check it by the tables given in Appendix B., Appendix C, and the Blue-book No. Cd. 2473 of 1905. These show beyond the possibility of doubt the rapid growth of the protected trade of our foreign rivals, and the stagnation or shrinkage of British trade in all except one or two specially favoured lines. At page 247 of the Blue-book, the general movement of the external trade of India for the twenty years from 1881-82 to 1901-02 are clearly exhibited by the aid of index numbers. The number 100 indicates, for the year 1881-82, the amount of (i) the aggregate import trade from all countries, (2) the amount of the import trade from each country separately, (3) the aggregate export trade to all countries, and (4) the amount of the export trade to each country separately. § 3. Let us take the imports first. The index number indicating the aggregate of the whole import trade of India has risen from 100 in 1881-82 to 176 in 1901-02 : and consequently, if any one country has ' held its own,' the index number for its imports will have risen from 100 to 176. Now what are the facts DWINDLING OF BRITISH TRADE 21 shown by this table ? The index number for imports from the United Kingdom has risen from 100 to 136; while the index numbers for the respective imports from the protected countries have risen from 100 in each case to the following numbers: — Germany, 3,881; Belgium, 3,843 ; Austria-Hungary, 1,332 ; United States, 253 ; Russia, 282; France, 203; and Italy, 186. It will be seen that in the whole of this list the United Kingdom's is absolutely the only import trade that has not ' held its own.' I have never been able to understand how any Free Importer can regard these figures without horror and alarm. For let it not be forgotten that, at the beginning of this period, only twenty-five years ago, out of a total import trade of 393 million rupees, we Britishers sent to India our manufactures to the tune of 323 millions, while all the rest of the world only supplied 70 millions. At this moment (see Appendix B.), while we have not doubled our consignments, twenty- five years of Pro- tection have enabled Germany and our other rivals to increase their consignments from 70 millions to 300 millions ! § 4. I have observed above that this disastrous ten- dency has been somewhat concealed and masked by the very exceptional conditions under which our vast export of cotton goods to India — a trade firmly established long before the adoption of Protection by our rivals — is still carried on. It is quite true that the trade in cotton piece-goods is, apparently, for the present a striking exception to the general rule, and still for the time preserves its supremacy, encouraging the unscientific observer to hope that it will always be able to defy the competition of protected rivals. I do not remember ever to have seen an expla- nation of this anomaly from the point of view of strict economics — though, indeed, it is not far to seek. The 22 INDIA AND IMPERIAL PREFERENCE simple reason is that the Indian market for these goods is so vast as to be practically limitless. Its power of absorp- tion — at a price — is simply boundless. Consequently, for this cotton-goods market, and for this market only, British manufacturers, equally with their German and other protected rivals, are able to work on the largest scale and at the highest pressure that may be physically possible. Hence, in this cotton-goods market, and in this market only, British manufacturers are only slightly handicapped by the protection enjoyed by the Germans and others in their own home markets, for those home- markets are dwarfed into comparative insignificance by the immensity of the Indian market for cotton-goods. But this is not the case with the Indian market for other British exports : for shawls and hosiery, for hardware and cutlery, for steel and iron, and the rest of them. In all these, British trade with India is notoriously being ousted, gradually but surely, in favour of its protected rivals. And the turn of cotton, too, will come sooner or later if we persist in our suicidal Cobdenite folly. The considerations I have here noted leave the markets of India still open to Lancashire and Scotland, until the cotton industries of Germany, America, and our other protected rivals are enabled, by their artificial expansion, to use the same methods that have been so successfully used in other industries. But after that, the deluge ! If we are to avert that awful calamity it can only be by the timely adoption of Imperial Preference. But, in the words I have already quoted from Professor Fuchs, ' it must be soon, or it will be for ever too late ! ' § 5. So much for the imports. Now, can the Free Importers get any comfort from the Indian exports ? Here are the figures from Blue-book No. 249 : — In 1901-02 the index number indicating the aggre- gate export trade of Ind'a has risen from 100 in 1881-82 to 152. Has the index number for the exports to the BRITAIN AND INDIAN EXPORTS 23 United Kingdom risen from 100 to 152, which would be just * holding our own ' and no more? On the contrary, our index number has actually fallen from 100 to 90 ! — so that, notwithstanding the vast increase of the general export trade of India, we are now taking actually ten per cent, less of Indian food and Indian raw materials than we were taking twenty years ago ! On the other hand, the index number for exports to Germany has risen from 100 to 1,342 ; that for Belgium from 100 to 240 ; that for the United States from 100 to 311 ; and that for France from 100 to III. Even the most bigoted Free Importer will be forced to confess that these figures, vouched for by the ofificial returns, are at least such as to demand the most serious instant consideration. They are obviously alarming. It is true that Mr. Morley regards them philoso- phically. He tells us frankly, in his last Budget speech, that the Protectionist foreigner has already ousted us from three-fourths of the Indian export trade, and does not deny Sir Ernest Cable's pleasant warning that this tendency is rapidly increasing year by year. But he appears to look on it as a matter of kismet — it is our fate as Free Importers to be ousted by Protectionist rivals, and we had better ' take it lying down,' lest the Protec- tionists go off in a huff and leave India with no foreign customers at all. I will endeavour to deal with Mr. Morley's serious arguments in a later chapter. But, anyhow, this much at any rate is common ground : that India is the best and cheapest market in the world wherein to buy the raw material of most of our manufac- tures for the employment of our working men ; that formerly, before the foreigner took to Protection, we used to buy by far the greater portion of that raw material ^ — that already the protected foreigner takes ' As an old Bengal officer I can myself remember the time when we used to take, for the mills of Dundee and London, -4 INDIA ANP IMPERIAL PREFERENCE more than three-fourihs of the whole, to be worked up by (lerman and otlier foreign artisans — and that every year, under our so called ' J'ree Trade' system, we take less and less of these raw materials, and the foreigners take more and more. practically every hale of jute exported from Calcutta ; now the protected foreigners take by far the greater quantity, and some of our London factories have had to shut up and discharge their workmen. CHAPTER IV THE 'SWADESHI' MOVEMENT IN INDIA: ITS POSSIBILI- TIES AND ITS DANGERS § I. Lord George Hamilton and Sir Henry Fowler, and every other writer or speaker on Indian economical questions, have asserted roundly, and with perfect truth, that Indian public opinion is 'intensely Protectionist.' We have deliberately chosen to insult and irritate that public opinion by the senseless arrogance of what is worshipped in the United Kingdom — but nowhere else in the civilised world — as insular ' Free Trade.' And the natural consequence is, that the National Indian Congress this year, under the leadership of Mr. Dadabhai Naoroji, formerly a Radical M.P., has formally adopted not only the policy of ' Swadeshi ' — ' My own country's products for me ' — but also the social ' boycott ' of Lancashire and other British manufactures. I was sorry to observe that the Hon. Dr. Rash Behari Ghosh, CLE. — a most eminent Indian lawyer and the President of the Reception Committee of the Congress — actually excused this ' boycott ' resolution, which he must know to be an unfriendly act towards the British com- mercial community, on the following very in.sufficicnt grounds : ' It seems that if you call the movement a boycott of foreign goods you are a traitor to England ; but competition with Manchester is not yet treason in the Indian Statute Book,' That is true enough ; and the sentiment would be praiseworthy if only the form of 26 INDIA AND IMrERIAL PREFERENCE ' Swadeshi ' advocated by the (Congress were that of Imperial Preference, which would mean friendly 'com- petition with Manchester.' I hope and believe that that policy would really meet the wishes of Dr. Ghosh and his friends. And I shall show presently the reasons for that belief and the possibilities that would attend such a policy. § 2. But the ' boycott' is not in any sense 'compe- tition with Manchester ; ' it is actual prohibition of Manchester goods, and other Briti.sh goods, so far as a social sanction can effect such a prohibition. That would not be a friendly act, even if applied to the goods of a State like Russia, that levies almost prohibitive duties on those Indian goods which it does not require for its own industries. But when directed against the goods of the Motherland of the Empire, or even against those of any State under the sovereignty of King Edward, its impropriety (to use a very mild term) is obvious on the face of it. I do not attach any great importance to this resolu- tion, for several reasons. Its bitterness was obviously due to the political excitement among the Bengali- speaking delegates about the partition of Bengal, a question on which they are clearly entitled to hold and express very strong opinions, either on the one side or on the other. When the irritation caused by that unfor- tunate controversy has passed away, I have little doubt that such an extreme measure a.s a social boycott will be condemned by all. And even for the moment it seems to have been disapproved as a general measure, and approved only in the special temporary circumstances of Bengal. But its adoption, even partially and for the time only, ought to teach us the dangers that attend our imposing on India a fiscal system, disapproved by Indian public opinion, that puts British and Colonial ORIGIN OF 'SWADESHI' 27 goods on a par with foreign goods, and that forces Indian custom-houses to put British goods in the same category with foreign goods. Such a system not unnaturally suggests the adoption of boycotting in times of public irritation ; and I shall show in the next section that this was the origin of the idea in Calcutta. § 3. For the Hon. Dr. Rash Behari Ghosh, in his speech as President of the Reception Committee of the Congress, used these remarkable and very sensible words : — ' What reasonable man can doubt that the real strength of the Swadeshi movement is to be found in our natural desire to nurse our own industries, which the Governmeyit of India, with their Free Trade priticipks, are unable to protest by building up a tariff wall}' The italics are mine. And the same perfectly intelligible sentiment was even more strongly expressed by Mr. Romesh Chunder Dutt, CLE., on the occasion of the opening of the second Indian Industrial Conference at Calcutta on December 29, 1906. Mr. Dutt is one of the most distinguished of those Indian gentlemen who have won places in the Indian Civil Service by open competi- tion. After a long and meritorious service in Bengal — in which he rose to the eminent position of a Commissioner of Division — Mr. Dutt, in 1904, became the Revenue Minister of his Highness the Gaekwar of Baroda. Since then he has been Lecturer in Indian History of University College, London. He is an acknowledged authority on Indian economics, and has written a valu- able work on the economic history of his country. And at the Industrial Conference, after giving a most in- teresting summary of the industrial history of the past twelve months in India, Mr. Dutt continued his speech in these remarkable words : — j8 INDIA AND IMFICRIAI. PREFERENCE 'There is a movement which is growing and spread- ing day by day over the whole continent of India, which the nation has begun earnestly, and which the nation will not let die. The Swadeshi movement is an industrial revolution, more far-reaching in its effects than many political revolutions ; and history will record in future ages how the people of India, in the commence- ment of the twentieth century, effected their own in- dustrial salvation. Without any cotitTol over our own /rtr/^or financial arrangements .... we have determined, simply by giving preference to our home manufactures, to revive the industrial activity of this vast country and to improve the condition of our industrial population.' § 4. In a fiscal debate in the House of Lords in 1903 the late Lord Northbrook hazarded the remark that India ' had prospered under its recent adoption of Free Trade.' The whole of that portion of the Press of India that is conducted by Indian-born scholars, and not a few Anglo-Indians, cried out with one voice against this statement. A well-known Madras economist, Mr. Subra- mani Iyer, put forth a strong protest in East and West, one of the leading Indian reviews, published in Bombay. This is what Mr. Subramani Iyer, after discussing the results of so-called ' Free Trade ' in the United Kingdom, says of what he calls ' the policy of England in her control of India's economic interests ' : — ' This policy is the same now as it was at the time when the East India Company began to apply the political power it had acquired for its commercial aggrandisement. Nay, it is much worse now, because it is carried on under the cloak of disinterested beneficence, and with the resources of the whole British nation, instead of those of a Company. . . , From the time of Adam Smith down to the present day — when a new school of economists has arisen on the theories of Continental and American, and especially German, writers — there is not a single writer of fame who has INDIAN OPINION UNANIMOUS 29 applied to the conditions of India under British rule the orthodox economic doctrine, and considered the results from India's point of view. We come across casual expressions of opinion now and again, but these are mostly one-sided and erroneous, as witness Professor Marshall's evidence before the Currency Committee. . . . What might have been the career of India if England had not deliberately crushed her industries it were vain to consider. But Indian opinion is entirely opposed to that of Lord Northbrook, who thinks that India has prospered under Free Trade. She has not prospered, but can only prosper under a system of Protection.' Now, it is no answer to this indictment to say that it takes an extreme view. I admit that it is so. But there is only too much ground for Mr. Subramani Iyer's complaint of the fiscal system we have imposed on India — which, as he shows elsewhere, we have shrunk from imposing on our self-governing colonies. § 5. In his opening address to the Calcutta In- dustrial Conference on December 29, 1906, his High- ness the Gaekwar of Baroda referred to the Swadeshi movement in sympathetic language. He pointed out that, notwithstanding the growth of the larger industries, the labourers employed in them formed only an insigni- ficant proportion of the industrial population. India was, and would remain, a country of cottage industries. ' It was,' he said, ' the humble workers in towns and villages who demanded sympathy and help ; and if the Swadeshi movement had widened the sphere of their labours, and brought some light to their cheerless homes, it had his cordial sympathy. He did not minimise the difficulties. The old ways must be abandoned ; modern knowledge and skill must be acquired and applied. Under those conditions only could Swadeshisni be a genuine economic force. The sugar industry and the 30 INDIA AND IMPERIAL PREFERENCE Madras tanning industry furnished pitiable instances of the defeat of India by modern methods of production and manufacture.' The Gaekwar is not only the absolute ruler, under the King-Emperor, of a kingdom larger than Saxony and more populous than Greece, but is also one of the cleverest and most advanced thinkers of India. In another address, delivered at the inauguration of the Ahmedabad Industrial Exhibition in 1903, he strongly condemned the policy of Free Imports in India. Re- ferring to the teaching of the modern school of economics in Germany and America — of which his Highness evidently knows more than the sleepy professors of some of our British Universities — he used the following sig- nificant words : — 'It is true that Free Trade enables a country to procure at cheaper rates those articles that can be manu- factured more conveniently in foreign lands ; but this cheapness is dearly bought by the loss of industrial status and the reduction of a whole people to a helpless pro- letariat. National defence against alien industrial inroads is more important than the cheapness of a few articles.' And on the same occasion the Hon. Sir Phirozshah Mehta, the leader of the ' Young India ' party, declared that the claims of India on the British Government for Protection are ' founded on their past policy, which has annihilated our once flourishing arts and industries.' § 6. I well remember, when I was in India in 1894, the great anti -Free-Trade meeting in the town hall of Calcutta that was presided over by the Hon. Maharaja Sir Jotindro Mohan Tagore, then (as now) the acknow- ledged head of the Indian community. The Maharaja commenced his speech by declaring that the occasion was unique in the history of India, for 'hardly do I remember another instance in which such intensity and THE ALTERNATIVE POLICIES 31 unanimity of feeling has prevailed among all the different sections of the community.' It is, indeed, unnecessary to labour this point, for it is admitted that India is, as Lord George Hamilton said, ' intensely Protectionist.' And the practical question that obviously arises is simply this : How can we, in face of such a strong and general sentiment, maintain the trade between Britain and India that we know to be so im- portant to both countries ? The Free Importers reply, ' By dragooning Indian opinion into submission to our notions of " Free Trade," which are despised and laughed at by all Indian-born statesmen and economists,' The advocates of Imperial Preference, on the other hand, reply, ' Let us frankly offer an honourable and sufficient quid pro quo — British preference for Indian products in return for Indian preference for British manufactures — and then Indian national self-respect will join with Indian loyalty to yield a hearty acquiescence.' Can there be any reasonable doubt as to which of these two rival policies is the wiser and more politic, as well as the more generous and honourable ? CHAPTER V EFFECTS OF IMPERIAL PREFERENCE ON THE INDIAN EXPORT TRADE Exports within the Empire § I. I claim to have shown the immense poUtical value of Imperial Preference to India — (i) as drawing closer the ties that bind India to England and the rest of the British Empire, by including the whole in one great fiscal unit, and thus doing away both with the friction of hostile tariffs and with the senseless affecta- tion of treating each other as foreigners ; (2) as protect- ing India, the United Kingdom, and the Colonies from the industrial inroads of foreign Protectionist com- mercial rivals ; and (3) as fulfilling the reasonable ' Swa- deshi ' aspirations of our Indian fellow-subjects, and fostering the development of Indian industry and com- merce, so far as is compatible with friendliness towards the rest of the Empire. I have shown that Imperial Preference means the reduction — and, where revenue considerations permit, the abolition — of all custom-house barriers between India and the rest of the Empire, without necessarily raising those barriers between India and foreign countries. § 2. I will now consider the one great objection that is always raised by the Cobdenites — though I have never seen any attempt to prove it — against the inclusion of India in any scheme of Imperial Preference of this kind as advocated by Mr. Chamberlain. Mr. John Morley, MR. MORLEY'S VIEW 33 with his accustomed straightforward honesty of speech, put this objection ' in a nutshell,' as he said, in his speech on the Indian Budget of 1906. He pointed out, truly enough, that India is a debtor country, and must, there- fore, take care, above all things, to maintain and foster her export trade, for any diminution of her exports would seriously dislocate her financial system. So far so good. Mr. Morley goes on to point out that the foreigners — who protect themselves up to the hilt, and raise or lower their tariffs on our goods exactly as it suits the interests of their own manufacturers and working men, without the slightest regard to our convenience, which certainly is not their affair — have already securely annexed three- fourths of the Indian export trade. Though we all know that thirty or forty years ago, before the foreigners adopted protection, Britain enjoyed nearly the whole of this vast export trade, now she hardly takes one-fourth of the Indian exports. Here, too, Mr. Morley is un- fortunately quite right — I say ' unfortunately,' because it would be better for the Empire at large if a larger pro- portion of the Indian exports of raw materials went to be worked up in British factories by British working men, though I quite admit that to the Indian mercantile com- munity and to the individual Indian producer it does not matter a scrap whether his or their customers are British or foreign so long as they are solvent and honest. But here comes the fallacy. Mr. Morley goes on to declare that, if India were to give and receive an Imperial Preference — that is, if she took off some or all of her duties on imports of British and Colonial goods without simultaneously altering those on foreign goods — our Indian exports would diminish. I should like to ask Mr. Morley why. I think that a careful and detailed consideration of the facts of the case will convince Mr. Morley, and every other sincere and earnest enquirer after truth, that the exact opposite will occur. It is obvious D 34 INDIA AND IMPERIAL PREFERENCE that Indian exports to the United Kingdom and to the Colonies will largely and rapidly increase, by reason of the Preference ; while there is no reason whatever for believing that Indian exports to foreign countries will fall off, the probability being that they too will respond to the general prosperity of the country, and will keep pace with the increased buying powers of the Indian peoples and the general improvement in their commercial and industrial activity. These points I now proceed to discuss, § 3. It is unnecessary to show that Indian exports to the United Kingdom and all the Colonies will go up by leaps and bounds when Indian products are given a preference in those markets which are still the largest and richest in the world, and with the growth of the new giant-nations in Australia, New Zealand, Canada, and South Africa those markets will grow more and more valuable.' All this is admitted, even by those bigoted people who call themselves ' Free Traders,' but who oppose Free Trade within the Empire because we cannot get Free Trade outside the Empire and cannot raise revenue without some taxation. § 4. The United Kingdom alone still takes from thirty to forty million pounds of foreign-grown tea every year — mainly from China, or from Java through Holland — because our non-preferential fiscal system puts a pre- mium on the cheaply grown product of sweated labour in countries where silver is free. But even Free Traders admit that such a preference as, say, a duty of 2d. on ' The enormous expansion of Canadian trade since 1897-8, when Canada adopted Preference, is shown below, § 12. And it is a well-known fact that the rapid growth of Canada's manu- factures makes her look more and more to tropical sources of supply for her raw materials. If the Cobdenites insist on main- taining fiscal barriers between Canada and India she will be com- pelled to supplement her West Indian supplies by recourse to the Southern Slates of America. BRITISH NEED OF PRODUCTS 35 British-grown tea and 4? 4. Now, if the truth of all these arguments be admitted — and 1 cannot imagine any honest man of good education denying it — surely it follows that the establishment of an Imperial Federation for Preferential Trading would offer simply an ideal and unique oppor- tunity of obtaining for British subjects of Indian birth the full franchises and rights of Imperial citizenship in the self-governing Colonies that they already enjoy in the United Kingdom. For be it remembered that in every Colony — even in the most democratic, like the Transvaal — there is a considerable body of educated public opinion that is in favour of the juster and truer policy, and that will gladly welcome the reinforcement of their views by such a valuable and tangible conces- sion as the offer of a trade preference in the vast and limitless markets of India. Men of light and lead- ing, like Lord Selborne in South Africa or Sir Wilfrid Laurier in Canada, would find their hands immensely strengthened for this great and truly Imperial reform if they could carry with them in this way the enlightened self-interest of the commercial and industrial classes in their respective Colonies. The British colonist will never submit to be dragooned into goodness, any more than the Lancashire man will submit to a boycott ; such AN IDEAL OPPORTUNITY 79 methods defeat their own objects and tend to render them absolutely unattainable. But education and per- suasion, when backed up by commercial and industrial self-interest, would soon prove irresistible. If I were an Indian delegate, and entered the Imperial Conference with a mandate to offer Indian Trade Preference in return for British and Colonial Trade Preference plus equal treatment for British Indian subjects in all parts of the Empire, I should do so with the fullest confidence of success. CHAPTER XII GENERAL CONCLUSIONS § I. In conclusion, then, I ask my readers to imagine, with me, that an Imperial Commercial Federation of the whole British Empire has been established, and that India has taken her proper place therein as the most important member of it, except only the United Kingdom, and then to consider how many and great will be the advantages accruing immediately and directly to her commercial and industrial communities, and indirectly to the whole of the population. § 2. The tea, coffee, and indigo industries will at once be enormously stimulated ; for whilst their exports to foreign markets will at least be uninterfered with — and may even be improved by the power of bargaining with foreign Governments that will be acquired for the first time — it is certain that the Indian exporters will at once capture a far larger share than hitherto of the British and Colonial consumption. Cotton mills will be relieved from the odious excise duties. Their products, with those of the jute, leather, and other factories — obtaining a preference in the United Kingdom and the Colonies, and the advantage of the bargaining power with foreign countries — will rapidly find a greatly expanded market. Shares in tea, jute, cotton, sugar, and other industrial concerns will naturally increase rapidly in value. A tobacco industry will arise in Rangpur, in Dindigal, and many other parts of India, equal to that which has INDUSTRIAL EXPANSION 8i enriched Cuba and Virginia. The sugar-cane lands that have gone out of cultivation by reason of the deluge of European beet sugar will once more yield their rich and lucrative harvest to the Indian cultivator and the Indian refiner. The millions of acres of cultivable wheat-growing land in the Punjab and Upper India, now lying waste for want of an adequate stimulus and security for the trade, will be brought under irrigation, and will give employment and a higher standard of living and comfort to millions of the population of the so called ' congested districts.' And as this great staple food grain will be grown on irrigated land, and will therefore be independent of the vagaries of the monsoon — and as it is obvious that any heavy rise in price of other food grains will react on wheat prices, and will automatically retain Indian wheat in India in time of threatened famine to save precious Indian lives — I honestly believe that this one benefit alone is amply sufficient to induce every true and enlightened Indian patriot, every wellwisher of India, whether of English or of Indian birth, earnestly to strive for the great boon of Imperial Preference for India. § 3. Further, Imperial Preference will increase and secure the stability of the Indian financial system, not only by increasing generally and largely her export trade, but especially by at once largely increasing the direct trade with the United Kingdom. For India's financial indebtedness for the capital sunk in her railways, in her debt, and in her undertakings of all sorts is entirely to the United Kingdom, and it is a mere truism that that indebtedness must be liquidated far more cheaply by direct than by indirect payments, by consignments sent direct to London rather than by consignments to Ham- burg, Antwerp, or Havre, there to enrich the thousands of foreign middlemen before being sent on in a manu- factured form to London. G S_' INDIA AND IMPERIAL PREFERENCE Moreover — and this is not less important than the last-named consideration the export trade to the foreign Protected countries is, obviously and undeniably, at the mercy of their protectionist Tariffs. In other words, the financial stability of India, under our present fiscal system, depends absolutely on the convenience and the goodwill of foreign Governments, over which neither we nor the Imperial Government can exercise any control whatever. § 4. Indian public opinion is absolutely unanimous in demanding some protection for our Indian nascent industries. It is, at the same time, as absolutely certain that no Indian Government will ever attempt to accord this protection at the expense of Lancashire ; and I think that no Indian patriot, who is also patriotic to- wards the Empire, would wish for this. But surely the Indian Government should defer to Indian public opinion in this matter, so far as it reasonably and properly can do so; and Imperial Preference enables it to give a considerable and appreciable protection to Indian products and the Indian manufactures of the future, not only in India itself, but also in England and the Colonics. So that the Indian Protectionists — that is, the whole of the Indian peoples — may fairly accept half-protection in the United Kingdom, and the Colonies as well as in India, as something like an equivalent for that complete protection within the more restricted markets of the country for which they have been asking. § 5. And lastly, into the Imperial Commercial Federation of the British Empire India will enter as a Sovereign State, under her own Emperor and Govern- ment, on absolutely equal terms with every other member of that Federation. She will be entitled, and will be able, to secure for her subjects that honourable treat- ment and consideration for her own peoples in every other of the States of the Federation which is already VAST MORAL BENEFITS 83 theirs by birthright in India and the United Kingdom. She will be entitled, and will be able, to secure for her merchants and producers and manufacturers every privilege, and every franchise, enjoyed by their fellows in the United Kingdom, in Australia, in Canada, in South Africa, in New Zealand. As Sir Edward Sassoon has acutely observed, it will raise the international status of India in a way that no other measure could raise it. These may be sentimental considerations, but the strength of the feeling that has been aroused by the unfair and improper treatment of British Indians in the Transvaal, by the Japanese question in Cali- fornia, by the Lascar question in Australia, and by similar questions elsewhere, shows clearly enough that these considerations are of infinite importance where national self-respect is concerned. And, however this may be, I have shown that in its solid material advan- tages to the progress and prosperity of the Indian peoples, equally with these less tangible but not less im- portant or far-reaching moral benefits, the cause of Imperial Preference is one that should command the earnest support of every wellwisher of India. APPENDIX A EXISTING COLONIAL PREFERENCES From Blue-book Cd. 3195 New Zealand Preferential Trade. — Under the New Zealand ' Prefe- rential and Reciprocal Trade Act, 1903' (No. 78 of 1903), which came into force on November 16, 1903, it is provided that on the undermentioned articles, not being the produce or manufacture of some part of the British dominions, the following duties be imposed : — An additional amount equal Cement Basket and wicker ware, n.o.e., not being \ furniture ...... Bicycles, tricycles, and the like vehicles ; also finished or partly-finished or ma- chined parts of same, n.o.e., including weldless steel-tubing cut to short lengths Boots, shoes, and slippers, n.o.e. ; goloshes, clogs, patterns, vamps, uppers, and laces Candles ....... Carriages, carts, drays, waggons, and perambulators, and wheels for the same China, porcelain, and Parian ware . . ] to the amount payable under the General Tariff. An additional amount equal to 50 percent, of the amount payable under the General Tariff. PREFERENCE IN NEW ZEALAND 85 Clocks .... Cordage and rope, n.o.e. . Cream of tartar Earthenware, stoneware, and brownware Fancy goods and toys Firearms, all kinds . Fish, potted and preserved Furniture and cabinetware, n.o.e., and other than iron Glass, crown, sheet, and common window Glassware ; also plate-glass, and glass polished, coloured, and other kinds, n.o.e. ; globes and chimneys for lamps Hardware, ironmongery, and hollow-ware Hops Iron nails Iron pipes and fittings for same, includ ing main cocks .... Lamps, lanterns, and lamp wick Musical instruments — viz. pianos . Paperhangings Paper, wrappings — viz. blue glazed cap, glazed casings hand, lumber-hand, and tissue Paper, wrapping ; other kinds, including brown, cartridge, and sugar papers Plate and plated ware .... Pumps and other apparatus for raising water Bicycles and tricycles, fittings for— viz. rubber tyres, pneumatic tyres, outside covers, and inner tubes ; rubber and cork handles, and pedal rubbers ; also drop-forgings and stampings, ball-bearings, weldless steel tube in full lengths, rims, forks and spokes in the rough 1 When the produce or manufacture of British Dominions these articles are duly free New Zealand. candle, small- An additio7ial amount equal to 50 per cent, of the amount payable under the General Tariff. 20 per cent, ad valoreju ^ some part of the on importation into 86 INDIA AND IMPERIAI. PREFERENCE 20 per cent, ad 7>alorem} (}as engines and hammers, and oil engines ..... Gumboots ..... Iron and steel cordage Iron, plain black sheet, rod, bolt, bar and plate Printing-paper ..... Rails for railways and tramways Sailcloth, canvas, and unbleached double warped duck .... Surgical and dental instruments and appliances ..... [Note. — For the rates of duty levied under the ' General Tariff,' see under the head of ' New Zealand ' in the body of this return.] The Preferential and Reciprocal Trade Act of 1903 further provides, with respect to all the above-mentioned articles, that — {a) The full duty shall be payable unless there is pro- duced to the collector an invoice of the goods having written or printed thereon a certificate signed by the sender or consignor, in such form as may be prescribed by the Commissioner, stating that the goods are bond fide the produce or manu- facture of some part of the British dominions named in the certificate. {b) No such invoice shall relate to any goods other than those to which the certificate refers. (r) Where such goods are imported in packages, such packages shall not contain any goods other than those specified in the invoice, and if any other goods are found in any such package they shall be forfeited. {d) Every importer or agent of an importer who pro- duces any invoice or certificate under this section, ' When the produce or manufacture of some part of the British Dominions these articles are duty free on importation into New Zealand, PREFERENCE IN NEW ZEALAND 87 knowing the same to be false in any particular, is liable to a fine not exceeding 100/., or, at the option of the Commissioner, to treble the value of the goods specified in such invoice. In the form of certificate prescribed to be used for entry of goods under the Preferential Tariff from and after April I, 1905 (Commissioner's Order No. 744 of June 21, 1904), it is laid down that a substantial portion of the labour of one or more of the countries entitled to preferential treatment must have entered into the production of every manufactured article to the extent in each article of not less than one-fotirth of its value in its present condition, ready for export to New Zealand. In the case of the non-production of the prescribed certificate (owing to accident) at the time of the importation of the goods which the Collector has reason to believe are the ho7id fide produce of the British dominions, the full amount of duty paid may be held on deposit by the collector at the port of importation, and returned to the importer if the invoice with the certificate is produced within six months from the date of payment of the deposit (Order in Council of November 7, 1904). It is required that goods imported into New Zealand shall be accompanied by the original manufacturer's invoice. Note. — Information as to the e.xact form of the certificates of origin required for the entry of goods under the New Zealand Preferential Tariff may be obtained at the office of the Commercial Intelligence Branch of the Board of Trade, 73 Basinghall Street, E.C. Reciprocal Trade. — The following provisions are also enacted in the Act No. 78 of 1903, respecting Reciprocal Trade relations with any part of the British dominions and with foreign countries : — Where any country being part of the British dominions reduces or abolishes, or proposes to reduce or abolish, the duty on any product or manufacture of New Zealand, the Governor may enter into an agreement with that country to reduce or abolish the duty on any article or articles the SS INDIA AND IMPERIAL PREFERENCE produce or nianufaclure of such country to an extent that the estimated revenue, so remitted, shall equal as nearly as possible the estimated revenue remitted by that country ; Provided that no such agreement shall have effect until ratified by the Parliament of New Zealand. Where any country not being part of the British dominions reduces or abolishes, or proposes to reduce or abolish, the duty on any product or manufacture of New Zealand, the Governor may, subject to or by virtue of a treaty with His Majesty, negotiate with such country for an agreement with that country to reduce or abolish the duty on any article or articles the produce or manufacture of such country to an extent that the estimated revenue, so remitted, shall equal as nearly as possible the estimated revenue remitted by that country ; Provided that such agreement shall not have effect or be operative until ratified by an Act of the Parliament of New Zealand. South African Customs Union The following articles may be imported free of duty : — (i.) All raw produce of South Africa and animals bred in South Africa imported into the Union overland ; also all animals bred and articles grown, produced, or manufactured within the South African Customs Union are free of duty within the Union, except — Spirits, beer, or blastings compounds, distilled or manufactured in the Union, in case of the imposition of an excise duty, or the prohibition of manufacture for sale. Preferential Tarij^. — Under Article III. of the South African Customs Union Convention of 1906, which came into force on May 25 of that year,' a rebate of the duties is ' The imposition of the new duties on match splints, timber, galvanised, ci:c., sheets, skimmed, condensed milk and second-hand clothing, was, in some Colonies, suspended for a time, but the duties on the above articles were all in force on October I, 1906, except in the case of match splints imported in all Colonies (except the Cape), the duties on which are to come into force on January i, 1907. SOUTH AFRICAN PRTiFERENCE 89 allowed on articles the growth, produce, or manufacture of the United Kingdofn imported into the Union for consumption therein. The rebates granted are as follows : — {a) On certain goods charged with specific rates of duty, a rebate of varying amount, for which see under the various articles in the body of this return. [Such rebate is equivalent to about 3 per cent, ad valorem^ {b) On goods liable to mixed rates of duty — i.e. specific and ad valorem rates — and also on goods liable to ad valorem rates of duty, a rebate of 3 per cent. ad valorem} Provided that the manufactured goods and articles in respect of which such rebate as aforesaid is granted are bond fide the manufactures of the United Kingdom, and that in the event of any question arising as to whether any goods or articles are entitled to any such rebate, the deci- sion of the Minister or other Executive Officer in whom the control of the Customs Department immediately concerned is vested shall be final. Article IV. provides that a similar rebate to that granted to goods imported from the United Kingdom under like provisions may be granted to goods and articles the growth, produce, or manufacture of any British colony, protectorate, or possession granting equivalent reciprocal privileges to the colonies and territories belonging to the South African Customs Union. Under the above Article the same rebate is granted to goods the growth, produce, or manufacture of the Dominion of Canada By Article V. it is provided that every contracting party to the Customs Union Convention shall collect the Customs ' Consequently, goods subject to a duty of 15 per cent. ad valorem, would, if entitled to rebate, be liable to a duty of 12 per cent, ad valorem only. 90 INDIA AND IMPERIAL PREFERENCE duties payable ui)on all goods imported within its borders from outside the limits of the Union for removal from the collecting colony or territory into any other part of the Union, and recover for and pay over to the Government of the colony or territory into which the goods are so removed for consumption the duties so collected by it on such goods, subject to a deduction of 5 per cent, of the duty collected. The Customs Regulations provide that no rebate will be allowed unless there is produced on importation, for the purpose of proving that the goods are bond fide the manu- facture of the United Kingdom or the Dominion of Canada, to the proper Customs officers — {(X) A signed statement by the suppliers on the in- voice, or ip) A certificate of origin duly signed by the manu- facturers, or (r) Such other or further evidence as may be required. In order to obtain the rebate of duty on manufactured articles, not less than one-fourth of their value, in the con- dition ready for export to South Africa, must have entered into their production in the United Kingdom or the Dominion of Canada. Note. — Information as to the e.xact form of the certificates of origin required for the entry of goods under the South African Customs Union Preferential Tariff may be obtained at the office of the Commercial Intelligence Branch of the Board of Trade, 73 Basinghall Street, E.C. The Customs Union Convention of 1903 was superseded by the Convention of 1906, which came into force on May 25, 1906. The new Convention was agreed upon at a Confer- ence held at Pietermaritzburg in March of that year by representatives of the Governments of — Cape of Good Hope, Natal, Orange River Colony, Transvaal, and Southern Rhodesia. CANADIAN PREFERENCE 91 At the same time provision was made for the admission to the Union of — Basutoland, Bechuanaland Protectorate, Swaziland, and Barotzeland (North-Western Rhodesia). North America (Dominion of Canada) British Preferential Tariff" {b) {c). — Under the provisions of the British Preferential Tariff Act y] of 1898, as amended by Act 15 of 1900 : — ' Articles which are the growth, produce, or manufacture of any of the following countries may, when imported direct {a) into Canada from any of such countries, be entered for duty or taken out of warehouse for consumption in Canada at a reduction of one-third of the duty ' : — The United Kingdom. British West Indies — coni. Bermuda. Windward Islands ; — British West Indies : — Grenada. Bahamas. St. Vincent. Jamaica. St. Lucia. Turk's and Caicos Islands. Barbados. {a) Goods imported in transit through an intermediate country will be taken as imported direct on production of bill of lading, &c., proving that the goods were originally intended for Canada. {b) The British Preferential Tariff Act y] of 1898 super- seded the Reciprocal Tariff on August i, 1898, and the reduction of one-fourth of the duty allowed under Act 37 of 1898 was, under Act 15 of 1900, increased to one-tJiird as from July i, 1900. {c) Under Act 11 of 1904, which came into force on June 8 of that year, certain fixed duties are imposed on woollen fabrics (except blankets, flannels, bed-comforters and counterpanes), cordage and twine, table-ware of china, &c., and common window-glass, when imported under the British Preferential Tariff. 9= INDIA AND IMPERIAL PREFERENCE British West Indies — conf. British Guiana. Leeward Islands : — ; British India. Virgin Islands. Antigua. St. Kitt's and Nevis. Montserrat. Dominica. Trinidad and Tobago. Ceylon. Straits Settlements. New Zealand (from Feb- ruary 26, 1904J. South African Customs Union (from July i, 1904). Also any other British colony or possession the Customs tariff of which is, on the whole, as favour- able to Canada as the British Preferential Tariff above referred to is to such colony or possession. Provided, however, that manufactured articles to be admitted under such preferential tariff shall be bond fide the manufactures of a country or countries entitled to the benefits of such tariff, and that such benefits shall not extend to the importation of articles into the production of which there has not entered a substantial portion of the labour of such countries. Any question arising as to any article being entitled to such benefit shall be decided by the Minister of Customs, whose decision shall be final. The British Preferential Tariff provides that the above reduction of duty shall not apply to wines, malt liquors, spirits, spirituous liquors, liquid medicines, and articles con- taining alcohol ; tobacco, cigars, and cigarettes ; and further that the reduction shall only apply to refined sugar when evidence, satisfactory to the Minister of Customs, is fur- nished that such refined sugar has been manufactured wholly from raw sugar produced in the British colonies or possessions. The Customs Regulations provide that, in order to obtain rebate under the British Preferential Tariff, ex- porters must furnish a separate invoice to the Customs authorities for goods entered under this tariff, and that the certificates of origin required must be written, printed, or stamped on the invoice. It is laid down in the certificates prescribed that not less than one-fourth of the value of every article, in its condition ready for export to Canada, must have entered into the production of every manufactured article in the countries entitled to preferential treatment. CANADIAN PREFERENCE 93 The same reduction (of one-third of the duty) is allowed upon raw sugar when imported direct from any British colony or possession. Note. — Information as to the exact form of the certificates of origin required for the entry of goods under the British Preferential Tariff of the Dominion of Canada may be obtained at the office of the Commercial Intelligence Branch of the Board of Trade, 73 Basinghall Street, E.C. Surtax on German Goods. — It is also provided by Act 15 of 1903, which came into force on April 17, 1903, that — ' Articles which are the growth, produce, or manufacture of any foreign country which treats imports from Canada less favourably than from other countries may be subject to a surtax equal to one-third of the duty ' imposed under the Canadian General Tariff. The Minister of Customs has decided, under powers granted him by the above Act, that the goods of the follow- ing country are subject to the surtax in Canada : — Germany The surtax is to apply to any articles the chief value of which was produced in such foreign country, although it may have been improved or advanced in value by the labour of another country, notwithstanding the provisions of the British Preferential Tariff and Regulations thereunder. Such surtax at the present time only applies to German goods. The Customs regulations, which were approved on November 28, 1903, for the purpose of carrying out the provisions of the above Act 15 of 1903, provide that, ' in determining whether or not any article imported into Canada which has been produced, improved, or advanced in value by the labour of any country other than Germany, is subject to the surtax by reason of a portion of the value thereof having been produced in Germany, the fair market value of the article or material grown, produced, or manu- factured in Germany which has entered into the manufacture of the article imported into Canada shall be held to be tlie value produced in Germany within the meaning of the Tariff" 94 INDIA AND IMPERIAL PREFERENCE Act respecting the surtax.' A certificate from exporters is required to be written, printed, or stamped on all invoices of goods, certifying that none of the goods included in the invoice were produced in Germany, except otherwise stated. Any (jucslion arising as to any foreign country or goods coming under the operation of this Act shall be decided by tlie Minister of Customs, whose decision shall be final. The importation of the following articles is prohibited : — Goods manufactured or produced wholly or in part by prison labour, or which have been made within or in connection with any prison, gaol, or penitentiary. The Ciovernor in Council may remit the whole or any portion of the duty upon wine, currants, raisins or other articles imported into the Colony direct from the country of production, when it shall be proved to his satisfaction that the duty on codfish, the produce of Newfoundland, imported into such country has been or will be reciprocally reduced. By an Act, assented to on May lo, 1906, the Governor in Council is empowered to grant to any company or person engaged in the herring fishery in the United Kingdom who shall furnish satisfactory evidence that it or he is about to engage during the year 1906 or 1907 in the herring fishery on the coasts of Newfoundland, in the manner and according to the method known as drift net fishing on the open sea, free entry for all boats and outfits necessary for the undertaking. Note. — The following is an extract from the ' Supplement to the Board of Trade Journal ' of Dec. 27, 1906 — Dominion of Canada New Tariff Proposals. — The Board of Trade have received from the Canadian Customs Department copies of Memo- randa (Nos. 1,379 B and 1,381 B), dated November 30, 1906, giving the Tariff Resolutions which were introduced into the Canadian Parliament on November 29 last [1906], and which affect the rates of duty leviable on various articles imported into the Dominion of Canada. The present proposals, which came into force on Novem- ber 30 last, provide for the application of three tariffs — viz., a British Preferential, an Intermediate, or a General CANADA AND WEST INDIES 95 Tariff, instead of a British Preferential and a General Tariff, as previously in force. Underthe British Preferential Tariff, preferential treatment is accorded goods, the produce or manufacture of the same countries as under the old tariff, but on a somewhat modified basis — viz. a duty, vaiying with the article, but lower than under the General Tariff, is imposed upon certain articles, instead of a similar percentage reduction of the general rate of duty being allowed on all articles (with few exceptions as to alcoholic liquors, tobacco, woollens, cordage, glass and chinaware, &c.). The surtax of 33^ per cent, of the duty on goods of any foreign country which treats Canadian goods less favourably than those from other countries is continued. Provision is also made, as under the old tariff, for the imposition of special duties in certain cases. West India Islands (Jamaica) Whenever it shall be proved to the satisfaction of the Governor in Privy Council that the interests of the Island will be advanced thereby, he is authorised, with the advice and consent of the Council, to e.xempt from duty such articles as may be required for use in connection with local industries, or in the preparation of native products, or otherwise, sub- ject to such regulations and conditions, and for such periods as he may see fit. 96 INDIA AND IMPERIAL PREFERENCE 28 ^ 'I " ".''i ^3, 00 >o •«• ♦vo Ocomr^Nt^c--vouim«t~i-i r'.oo oo o n 25 ■«• t-. h m m 53 8::rS'S!?,s ^'^ssq;?:: c?C;53;!lS Rf:rs23f If^ J5^s;S8^g^;f^KS 8>8 S-.S g,S8 S,^ 2 &8 ^ ^ ^^5 S,?3 000 u^vp '^■^ O "O cf in 10 tC nS 03 (^^ tN.co r^tZS " vo o rs.fn.-t ) \0 'n O 00 CD O 00 CD 00 vO O r^vO !>• t^ « vo moo t- « O\oo t^NO O H. \0^ 10 "^ r- lO (^ 1^ -^ t^ &» t^ t^oS ^o owo c=- * & 6 %5 o cj g a»00 O* OcpvC'OQvDOO^ CD »O00 ro 9- 00_ ■* 6 •* tN. CD 00 ■* o 'o a> 00 ro m -^ »rtSo On "^ vo" O vo" <*" CO 000 ro rs.cT) 1 a* t^ro I 0\ ts. f- ■-•ooooO'+Oeo C-( *- HHII §:§^°2S 8tg;;.g.2S ■ ^ ^"i"l cSoq^roO»nfoo*o6 iot>.t^tH^-c>] ' ■" o" ;J o"vo NJ" rn r^ -" tCco 00" O »n 6" co~ in isn ^ 0\ rn o* lO «o »n inoo oocD ■'j-inMT^oiij en -jco -^oo rCcr^hTMCTrt-^^crtCd^Hr^ •cnmro-«-ro mio^ini*-^ ^-^fOtomS- ) \0 O lO o ) r^ rnS ^ n in o" .-T 00 hs ro On ' " M OnCO r^ o" On fO ro r^ o c^ r^) c^ (^, in in CO vO ON O '>CJ5 o tC <> i-T '^j-m fo ^ cn^ • ^ »n in r^ m 00 onoo on w as R" 2^^ SJv!:^92°*"°3.5^3''^ c^o mvo m^ 00 iCmM «oo «^ ts.co fnr^o> •-'in-^OOCDNooONM'.i-o -^oo co vo no o t^ On M t^ O b* ' ' ~ "" O CT) CO ON c 00" vo rC ( ) M o ■* ■* ( 1 O o r- o>CN3 ) 03 NO -* tnini-.a) onc ■ CO '^ ^a* iNiNo ■^^o * tC VO 00 CO On O- 00 OO'^-'^inO ONfOfOroOOJ inNWtn-^CN] o^mw-'j-rft^ tvMOoorO'O- Oh<.i-ioooc— ''""'■o"c5"vo"tCrCa,(~ NO^ co^ " ' _ _ , 1 pT cd" I Oi On o^oo o o a> 8.88n2c2m SS 2.^ S.2S 22.^0000 ONMH ONND ^ «f0N0C0.-H ONinOMroo C" Ji S ^ " J« Ql SL ^^'^ r**^ c^roMMrxCD mONMrxinccNO o»co 11 in 00 ln^o m tn o* 00 •^ *Q ^^ ^ ";; *C '^^ '0 ^ ^„ t "0 t ^ ^i. ^« '^ ^ 1 ^"^ --* ^o ONNO M S NO o^ CI ri fT S N NO M w ^ a P> ^ N N o tC N fo inoo" c-f tC rooo" pT ro r^T VO cT N o tC lO a o"" ro -^ o lq" d oo_^^ t^ rH vo_ inco 0> rn 00^ NO -^ in ro-o ro a^ '^ mco tr- O t-.oo a> ci lO t^t^'^o NO OnO '^'rCiO* iCn"^ uSno" t^ wd^cO'4-tCo"NodNinfrrot-r MCii-t cjpjcoinjotd- ON ro'O Oooio i^'«j-wM'50ro -♦o^'coin,-* Mt-ip)M,-H pi«"«Ni-rM~crfnrofororO aS,2.9;2£S 2 2.PO-SS3 ooooooc t^oMinoso moooNfoc- ocj-* moo o ^^^^^^'^ ^ ^« *^ ^ 1 ^„ *0 °°^ *^ " *^ "^^ '"' t^WO»-'-*OS 4rof)«>ON5- M vo^ « ro pZ K 5^ J^'S vS* S M ^ ff ^ ^ ^" 2' 2^ ° ;fi J$ sf ^* "^ o "^ =■" <^*" o <> ^co" c> in 00" d; tC o" fo ^^ ^; *^ ^: ^^ -"1^9.^'^'^ "^^ "^co foro woNNM-fl-r-o 'n t>.NO 00 po^ i^mnomcooj HMMi-H MNWm-«^rO "*rs.t>.tN.t>.CD00030fO'-'0 rOrf-M-^rriJi m o^\n N 6 i-( h-wMf-T MMcrww"^ forowpr^r^ 2 2.^ 9^2^S 2^^29-92 osooooa mnonoi^oo NooMoocDNO«^^«o-rf-in vS s3,?:?s ?3^g^¥?5_^?s,jsas s^^jsss sisaass KSK,sas J" V ■••••« ... U) bS bS n CI c3 « s s ... j- > > ►I^ fS, 2" 2 O - N ro^ c "ivo 1^00 oc Qi-icifi.lrc "in^o t^co on? OM«m»e INDIAN IMPORTS 97 OOOOO"* 000000 0O00O03 r/>OP^ lO'O Q? Mo^ov] vo romCT'n-j.— I int»*^Ot^iO u^« iam"" — ■" - - - ■ — -^ '^'^ «.-rs ootCM'rCi-rcjr f^oiw"tjS»Arrr inMiooNC?"**" «* a\^ tC ro r-T oTvo" ro n in ^ 6'co in « •* o U voo*o»cinc— oooowwo .\o*oo\t-s-*oo o^t^wiNosO SJfl i -^^Tt-mo"^|^ ONH»ocnooo covo •-•'^cmo t^^nHO^■*lD to\o m o o »h cn.^o 00 rn rn od .% ■^r^MOO^OO i-tO-^OWLO lOMcOW-^CD O'-'inrOMO roO^ONt^'-i^O •^<^^'^^ ^^ S'S -w ' co" cC ON N w ro in tC w" T? -»? CO* rC in fo ?r -a5 m'OCjO'*'-* ^ino-^r^co "*^ ^ "-^ *^ 00 ■^'*,^0^ iTD^ 00? rC tf -too o 1-4" in o >n o tC itT 00" fo '-T c>oo' ^ in cT inco cT *3-" 00 o^ <> t^ cp" 'O" in-o tN.\o go tL(0 ^inin-^iniio mm m^o muO'Ot>.oo^t^cocoQOc^ln^-H ^m^^T^t>»l^oo^-^^t^M^ O^ w m V 00000*3" 00OO0»* 0000000 Om rooo m *rt- ri- r^, tvOO >-• C^ O^ -^ m^O « 00 >-« t^ o> o m CO ^o moo -^ <-> to mco mi-r-^o wovomNCTi mq O*"© o ctj m r^\o « « 01 Moooot^O^ m-^OmWr-H oooot-'0^<^J t>*or^O^Ooo »-'00'«j-rnr--'srco'^*-«cioooo I CTi M o O*"© o CTJ M r^\o L °^^ '^^^ ■ " — — — — wwco MM'^m'^ro •^m^Mcoro wnnmcon w^mm^ro t^^ -^ t^ O t- ^ r-^ t^ m t— (N IN -^ -"J-vO 00 CO ^ 0> ■<*- !^) CD « f-K?^ se N O^0O 0\ 0^ 0^ m o^ m TT cc \0 ^^ 000000 oooooca ooooocovo«oD a>\o 00 t^oo-^i-t- oswoomt^eo >^ 5 0*00 a\iri -^ t-* «<^mt»*wc- ONOf. O"-"^ inmo^-MCoooD m\o co r^ co ** ■*oo i>» o O «"^ ^>.«m■*o^O wmt^OfOr-H fo\o o^^lo ■^Nr^.m-c— ^ocQ0fn«-inC>a5 -^OmmNi-H )vowoo-*oooot^«Cir')OJ\ot^wr''moo -^mpiMr^ro mmoro»no^oovnOs'-'i-tpH •voommt— * om^r^mcD moo t^oo ^ o oo •- in^t>*f-H avt^c>mONCT) o>o -^Ofno i\o t> n'o^ w" t>^dv'nrCpcr^t*tCtCmc^ ^00 o QnvcT q" fn cT h t^oT ^«.Or^.c^•^t• o^o^ mvo « cJ ■* <7» o> t^oo 05 MOf^m^OT orN,omt^ro wvoomt-*^ ^*mo^«^oo Ov'-O»»no»i;o in^fn-*OLOvoo>i^o>r>'f— « o^^*^^fnc■^^ tN."«j-i-«ov0^ca o^mMoo•*^o ^00 t^\0 rn o^ rnd^tCrCo"^d^ ONtn'w'tC^ 05* O cf moo ►h' ^T vd tC «" d'ocT r-T m" en in d'd" i-T ■^ w" m -^ m o N w f-H -^ m m a CO 0000 oooooto 000000 mmmw-Tfc^ mo^o^O'*c^30C^NO^■*^ dfNtN.tNC^^; mMvomrnco cr''^MOQ'-^^oofnminOv«*^tN.Tf moo o " f n d cT ocT d rnsd^ tC 1— T d> i^ rooo s SvS « M « OOOOOCN! OOOOOcj 0000000 \ri-o O foo CO mopimtNCD m«mo«o> >^ t^ o^ -^ ^ ^Hlot^0^c^co CN.mmtNNix> mMoNfOOO woovommoi O tN.so ^o o^ ro t>.Nmi-ciinK> mn coco ^*3- ocoro-^wcD moOoomi-m^ ^d'c^dcT rd" vd" «" d m « if^ m m mvo m lO m ■^\o ^ ■^ lO m m*o m^o lO rN^o vO 'O ■* cD m t^. o t^to !>• r»«. o\ t^ tN,o t^ 000 000 0^ 00000 f\] 0\<* N vo m in ovOl m t^ r^ r^ roc^ 6 n 00 ro 6^ Ov -l-OO N •* 5'>o a m 1^00 00 ,Vi ci moo ooso » .-1 M a*co 1-^ CM vo M u- N N mo m oro OvN vo IT t-. c^ - c- vo M I-. - - 1-1 IJ-<>00 CO 00 OvCO 05 Ov H « mcM *£) r^oo 00-^ N-om-^m-— %£) in.co o>q-3 MMfn*m*^%o t^oo OoO^'^ m w fo •<*■ m— r>. tN r-, ts-co rooocooococo noooooooootn a»0»O^Q*0\" 0'0«o»o\w <5 00000" 111 II 311.1' 3I1III 3)1 iTi siiiit sTTrrrs mo t^co o^c dwwrO'*c "^o r«-oo »c OMMfO'^c "^o r^co o>c Q'-'«*^^C |N.t>.tNtN.r%cOOCOOO00OO nOOOOOOCOCO a O'O^CT'OONc C^OC^0>0^rt QOOOgfl OOCOOOOOCO ^ COOOOOOOOO ^ 0000000000 JI COOOCOOOCfj ^ COeOOOOOCO ^ O^O^C^O* CTt^ 98 INDIA AND IMPERIAL PREFERENCE H _ _ o *'0 ■§8 5? e^ o» o* r*. o» Q t- CO '^oo Oi r»* fo r»* f*^sD « o^ rH r».c6 o o O> m r^oo oo" •- ^ •♦ O no" «■" ^ Voo nT^ CTrcotCcriA«?r-r m"« tCoo r^oo o^ o «^ -^ ^*^ "^ "!. "^ ^ ® ^ *^^ *^ ^ ^'^ ^'^ '^**^ '^ ^°^ ~" ^ 00 oo r^ CN. ►^ r*^ II r-l O^oo (?« 0» 0> ^ in ^ »o tn iC lO lO 00 00 00 CO O'oo o « oo t-;^ .Cs.M0Q^Q'OC4^O0Cl000O»-oo \0 r^co .— « NO t^oo O «iO CO »nr*.rra'>-H <- moo ^NOOOQNONi-irnOO ^NOOmO*^ M o- f*iNO woo c^o»lnMooo OrN-m ^moi^ iC inco o rC ctT tC«o pTm'—cd' 'fr^fn'^'^r- "^o'lnffi^Q'af -^^ w* tC cTvo cT d oo rCocToo co" Ninwmo^W inc*oo r*.>o o « oo o^oo f^. N fONrnf^, f^rd -^r^-^f^^ lO in -^ r?oo »nco CO m o* lO "^ •; "^^ t^ nT cT m NO ■* ^ o oo m O ^ 1^ PO m w g* oo o;co CO m^o o o' d d oo" f^ m" rC i-^'O oo 0» ro o^ CO rncD ''J-nO O ,__.„_ - _ . iC rn in- > NO ^ Ot CO On On O^OO O O* O •- - r^NO ~.NO m^ 3 N^NO »o »^ ai n (O r^ f^ rn o w N- ^ O>oo a> -* « -Tt-oo NO is o» w CO ^no oj M'^mONf^^ civo rv.oo — ^ o « O'co o rN^iroinmoj m-mps-omio oo^»««t^co fc-ww— — mNO 0O'0a:> OwO'«'Ot- c*©-* r^co ^ p^ w O' w o- ( OvCQ «^inh*ot- in< - r* pn o *-• 00 — " o" ud «* P< M\0 ( PO o t«- * • ■) hd -tfocr tCii -^NO O^t- CO r^ *- NO Ov o> t* r* -^ I m CM *o « I p^ in ■ o t*"( 0\0 O 00 30 «v. -^NO __..--_ _ '■^ pn a.NO «•• t* 00 c-vo m o^ «3- 0*00 o p^ w o> r*-oo t>.vo On 03 pn ^ p^ONP^dt^ca pnin^T w \d itT di " -_ ^ -'CD O C>00 o P*" 00_^ , , _ - _ , ^NO » N \0 d CM^\o^6^\oinc7i(r> *^C>^*^*^^. • pn -f ^*_pn pn po rn d ^-T, "^. ^ .. ^^ '^ _^ ^^ Oi ■* ^ ►- povo o r^ to On in invo m CD - -iOnOn*-^ P 0_ CD_ p^ ^ NO Ci 0*0 r^pnr>.wo^ _, -- -_ nOOO NNt^mC>lO ^ .-I NO 0^00 *^ "^ f - "* ^ f^ 1 ON CD^ Tno ONp^rCaT -^M f^-^'fo NO -^Tj-iO oo ■♦O>'->nO00 w CO "♦03 9 3 •gj O m r* ro On lO m O w m .- CO ■; rC m d " ) 00 o> ►■ m, fioo r-t rrco vo mvo oo _ '♦03 C* N N ^ I- rOQO t- m lO T\0 nOO pnmMr>.^co pcoo m »- no cO "od" i-H en On ►-« ■* M ,— I p*' ^^NO "^ CO w o Onvo rvd On— I 1 ■* P^ ^O" ^O W O**© PO ^ O ' 05 '♦OC NO O- O s d cd^ d M^ m P*^ P^ •ONr-t \£>^ N w oro vONO"— «'OT'^^.r~-.oo ON0 0^^■*co pn 00 pin po rn ^ in "^^ -^m^-^irr*"^ r*", mp'^'^rofo cr~CD~NO rN.\0 *- C» t- C) M r^, ^^.n© CO t- in O* « W CO _oi?S fincomoNPOvocj^tti/iasNCoo-^procNa r>.OOJ t^moONpnt— 'oor^t^r-O'fO oi^oo»-«coir; ~TS-" '-^m.'^f^t*^ ^"c>r^^r5p^ m moo" in rC eg rs. M o o < o* M « oo ( On -" 0^<>* »^ dvd pn I ^ m t*. ■* M OQ pn N 00 m •»»■ w M O* On t-«.0O r-« tN. ^ ^ ^ pn OO O r^ ■* m osiH '\d tC d cd ■ O' -^lOO . ^- 0^ ; cd 1 1^ o pn » iro ONOt^OO'to r^ -t-vO I ONpn . . ■♦ o t^oo N^ On ^ fn M m" q NO e> odod d r«svO r-. pn M LO inO^^coiO OOr^pn On 00^ "dtC ■*■ r— o^ m pn o^oo cnj M »o On -♦ in cT c* « « oo" N p< pnoo ro PJ On O N PO o>co ^ u^ ^ oo Ov in .-T in T? rd" 1 O O ID O ON -^ O NO inrZr-T M^inrCrn w w ^ m pn f^ pn pn i p*- pn o * w o cv » "> tC (> cc" pT -^ t 1 pn mro pn m < ■ mo f^ N ""J- w ro I pn r^po . CO ■* rC pC cd » -^vo 00 r^ O • ■^ pn rC rn pd i o^ -& t fn -^ -^ rCod ud oo NO r* ■«»■ On ft' o On O* pn ^ ro NONOod d d o" -" "CO c— dco" NO lO w" w" pn * h» NO r^oo o c 0« On O ^ On O* obooeodboo JS oooooooooo jj; ooooooooqo ^ oooooooooo ^ oooooooooo ^ dNd»d>o.o* — vo l^O < ' §?????§ INDIAN EXPORTS 99 2: s.^ fn w TO o c- IX « « in h^ « in M -^-CM tN.vo M mo ^ M- 000 >o ^ In M M OOO m M o on 9 « « N r-l t^ M m ooo CM OOvO w -»*- - W 0^ Oi « M \0 f-H O in c^ CJv O f-* ■^ o r>.\o t*. •— « ro ooo^ pT cj^ ro \0 O m o 0> c ■^Co" f^. »^ r^, lO" 00 "^*0 inro 00 -Sea tC i^ of M O rno^ 6 ro in ^ r^ tC p-^ tN o tC tC po oT in cTno' m" CO ^ 1 "^ '^ *^ ^' ^ oi w" pT m M ctT tN ro in ro ro C>3 « iC o o" « oo' -*^ -^ Pi O ro CO__ roco ro c^ocT cd" CO invo Inoo t- i-T o (> i-T cT «=t^ in o -^ « N CO CO ■<^ in o -* CO ro O'-O t-^ lO (s»0O CO m In. CO 00 hT i^ tC co" ;f "" rjiog m n" rnoo" c5" tC r^ (nT 8ffff S "4^ ro tC pT c> c^ tC -«? c> ro tC *d^ invO vO V ^0 (I^ t^OO oo CO CO 00 00 oo c^ c> Oi « O « o OWN minro 'O 00 O tN tN 05 ft \n 0\ -*-'bN^~05~ '2^':^ '^'^^ vD rn in "^"w cvj vO "-«»- ro »N r>. ^ O -^ in rooo CO . c « ■a- OMO in m o oo « CO kO ^ \0 N tN. M <3- rs.\o in M 00 ro in in ro ■* O C— ■£'S c lO t^ tN. d U-) P-H r;>o^ *1 "0 '!? ^_ Ooo >o lO M tn c> f^ M^ N x) oo* hT tC m" i^J '^"^ oo^ M ■* T^ ro 30 rC-o" i-Tvo" tC cjT r>. qoc3^ C4^ t^ lO^ oo" in pT in in lo O'O oo VO Pi CD inoo" rC -^ nT ro" oo^ mco r^ m OJ w involve « cc^ O r* o IN in o *^ 9, 9. 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N~ ro" in cJ^NO oo pT of ocTvD tN. M in fO N « « »n m O *-i ■* cv\o in in ■"l^ "^ ov in tv ro « M o ei o CO r^ mco CN oj O C< M w VO CM 6 So e^ t^ ^ lO «■" jn tC cT CD o in o ON pj lo oo'vo -^ ^ -^ lO pT ro tC d" od" cjv ro On ro in od' \0 rn\0 t^ In. CD w inio -^ ro »0 M «- roOO W l>. Oi t^oo vO CVJ (^ ro-q^ C);oo lo q*o t^ ■* -* 0_ f J N « N « Oq rn m re re m ro fn ■* ■*■ -^ -iij- ^*" in in ■^'.r m u:>_ \d" in -^ in in lo" *N\0 r*« rN.vo t- KJ »;• •I' CO O- O M O M M o «• CO 00 *b ooo 00 CO ro in ►- w r-i ■ f*-, _H f 1 M ^ (N M ^ CO '<|-O0 -«*■ CO O -O Th rovO t»- C N C>^ « O^ C£) lO <^^ Ooo txOO o^ co\0 (s in in O C r% t>m 1^ o CO H U1 U- PJ CNJ -^oo in O; q O-^ w \0 m" -«?00 cT re O dioo' w" clT oo" in\o ro (> tj-~ tC rT ro ►^ ■* co' ro N ■«? d" in ro" cyi ■* pT cT m" lO vo hs in O m ro ixio M IX 00 w in t^ w M ro O -* roco \0 CD iNNO inoo in oa •— * 1-1 mco fO ce cecoco o t^ t^ M ro N (N w O "- « 00 «* «" D ■* in -* CO •- " N N C< CV] « ro r^ q « C- W Pi 'O 'd- O ^* oo q w N^ CO lo^ ooo ■«*- IN CD cT -^ -^ invd" ^^ O IN m M CO lO cTvo" inoD OCD CMn t^ m foro N Oim M « OO "in t^~inoo~^CM CO wCOvO OCO 00 in « mco t^oo 00 mco Oi *i? t 51 2. *^ ^ M in in-o ,-( N rx -e- O fO m in t^ - 00 O ro C4 O c» lO rt t; "^ in cTv r* o inoo 0_ ^O 00 \0 c> ro « CD ■* ooo iH o CO invooooo -^oo m ■* t^ O r-« i oo" o M* cT^c oo" \S o M \c"vo ocT inco w o" tC oJ" inco" el" inNO ^ tCvO oo O" in lO" O" -" pT c<" '^ o" IS re in o in -^ ro r^ CO N M vo ^ CJ ro •* O IN. en ooo tN ' N 03 ■+ « vo txvo 05 in CO c> in mio 'tf^ rT in fj" o cm" VO m" OvO ro O^ CO JN O O In CO irno rN.«o in CM c^^o M M in «3- ^0 ■«*- '-' c> <»■ ■«rco_ in M^*o^ ro^ ooo « 00 Pi^ «3-^ ■<• re re re N ro « ro ro ^ ro ro ro ro w pr -^ ro" t-i IV. moo OCO CO « 2" rO re re M oo .-1 fx in IX 5 mro l^ N \o ** O CO -^ CO ~rovo ■* i-o c^ O P» O PI "in t*' e o •-• ■«*• m tN. oi O w p) in f- Q in ttco ■«• O IN ro M lO vD\0 w ■* CJ> CO w 0» t^OO ^r M -a- m ooo tN C>\D M - q N cj>^ ■>. IN. -^vo o* fn tc 0\0 m O t£> N oo OMO o c- ro roo w .-H invo CO vd rC of O moo ro lO CO '^'O CO pT q P*^ M tN P»_vO^ CD c> N in -a- CD O in M ro M^ CD^ q^ M^ in ro o en ^ inoo^ P*^ tC tO_ U \n M -(J- u-j M (T> t*_N o re in ro i-T c>co"\d" fT itT 00 ro •-*" c>. c>f \o" O ro M w 00* a^\0 "^ *^ "^ ^^ O fO in 0^ O N Ooo O fn O \0 O c* M « w C* « (M w m" eT w" « w" eT p? ro ro r^, ro" r^. ro -^ -^ ■'re">^ •«- mco' in c< oo "- fo' o -«■ ro in M ^ ^ N P) " N ^ NO g *C M 00 t^ ■* t*- w IX C3* r^ M CM M in « oo c^ ro in 0^ o q^ ^_^ \0 ^ M M -^ CD Tj- o U-. PI CO in rn «^ «^ <> N oo_ o_ N_^ reio oo_^ w "2 ^^ ^ ^„ 00 NO NOVO in oq ro t-. W CO 6 CM pT hTio re r^ CO IN* t-i N OO VO t>- 6" cTvd" d" m" oo" hT tC ■-? o in O^ tC'o" M d" CO ctT r^ q^oo ^ a t-H M N t^ o cr- IN rs. 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N N O O resO mio CO O r^ M lr^^^ ua u tN. t; 0^00 N m re o re « r-i in M 1^ o ^^ O INOO *^ t^ o^ O m fNOO m t* 11 <> w" c> rC -w^ o" •^ re inoo S ^ V- M i-( in M CM inco pT o 'h' •-*" ro C> O ■»? pT o" so ro CO O co ■*•««■ OO M ro tn -^ w vo in ai^ 00 o.o_ t; 'J ro_ O inoo m ro 00 vO O »-. Pi o PI VO ■* m 00 w6 CO ^ 0\ rC-o" .-T re IX re o' of ro in "-T ooo' cjT c^ c^^o"oo pT oo" oo" CO m" rCocT r c« rt • ■ ■ 'gS oi g -i CO 00 CO op 8. g M N '^ ■* ^ rs o o o o o 2 VO INCO 0-2 o O O O M w ?9???1 invO t^co o c « N m V c in-o rxco O c O O O O O c in^o r>.oo o c M PI ro ■♦ O §^8« 8181812 H M M M » < rs. r^ IN. rs r^ r- oocccooooo 1 CO CO oo 00 oo c CO CO CO 00 00 ^ 0*0000 c 00 oo CO 0000 ^ coco ODOO CO ^ APPENDIX D. From the oflicial German ' Statistisches Jahrbuch,' 1906. Showing the expansion of German trade with India, 1897-1905. The amounts are given in millions of marks, (A million marks equals ^48,960.) 1897 1898 1899 1900 1901 1902 1903 1904 1905 Thus in this short period the exports have more than doubled, and the imports have increased by more than one-half. The trade represented is that with Ceylon and British Malacca, as well as with British India proper. The goods which Germany purchases from India are almost entirely either foodstuffs or materials for manufac- turers — not manufactured articles competing with German products. In 1905 the German imports from British India (not including Ceylon and Malacca) amounted to 277'8 and the principal items of this amoimt were (in millions of marks) : — Raw cotton Imports Exports to India. from India. 204-6 . 47-3 220-9 • 57-1 230-5 . 65-3 224-7 • 70-0 214-8 . 79-6 238-4 . 70-2 283-8 . 89-9 327-8 . 95-9 311-2 . 98-6 Jute Hides . Rice Linseed Rape . 50- 1 47-6 28-4 25-1 22-6 14-3 GERMAN STATISTICS Shellac IO-5 Oilseed 8-5 Wheat 70 Poppyseed 6-6 Caoutchouc and guttapercha 6-4 Coffee 4-6 Copra 4-5 Fleeces and goatskins . 3-8 Cotton waste .... 27 Oilcake 2-4 Rice offals 23 Cocoanut fibre .... 2-2 In April, 1903, the Canadians put a surtax on imports from Germany. The effect of this tariff is shown by the following statistics from the German 'Jahrbuch' : — German Exports to Canada Marks. 1902 38,700,000 1903 35,800,000 1904 23,200,000 1905 21,800,000 102 INDIA AND IMPERIAL PREFERENCE APPENDIX E. Area, Cultivated and From Blue-book Area according to Survey Deduct Administrations Feudatory and Tributary States Area for which no Returns exist' Total Bengal .... 122,392,054 24,711,680 — 24,711,680 United Provinces (Agra) . 1 57,016,816 3,791.488 2,375.396 6,166,884 (Oudh). ' 15.337.846 - — Punjab . ; 86,748,004 1 24,527,360 5,022,720 29,550,080 North-West Frontiei Pro- 8.497.558 140,800 140,800 vince Upper Burma . ' 53.038,576 3,997,140 — 3,997,140 Lower Burma . 54,970,893 — — Central Provinces 74.174,539 18,838,423 4,990,90s 23,829,328 Berar , 11,332,580 — — — Assam . 33,893,100 2,558,080 12,918,417 15,476,497 Ajmer-Merwara 1.693.728 — 733.197 733.197 Coorg ' 1,012,260 — — — Madras . ! 96,821,342 i 6,147,430 24,359.725 30,507,155 Bombay . 85,565,952 36,953,600 4,412,717 41,366,317 Sind ■ -^ Pargana Manpur *" 33.916,197 38.871 3,872,000 124,908 3,996,908 Total 736,450,316 125,397,201 55.078,785 180,475.986 " A British district in Central India. LAND AVAILABLE FOR CULTIVATION 103 Unxultivated, in 1904-5; IN Acres Cd. 3166 Net Area Cultivated Uncultivated According; According to • to Village Survey ■ Papers 97,680,374 97,680,374 Net Area actually Cropped Current Fallows 51,472,400} 4.939,712 50,849,932 50,858,912: 26,583,488 1,609,119 15,337,846 15,463,239, 9,321,903 425,876 57,197,924! 57,186,019 23,217,955^ 4,292,929 8,356,758 8,464,13s! 2,018,378: 675,735 49,041,436 54,970,893 50,345,211 11,332,580 18,416,603 960,531 49,041,436; 4,622,300 2,293,493 Cultivable Not Waste other available for than Fallow 11,918,532 Cultivation Forests 5. 178,695! 24,171,035 I I 7,813,419, 6,381, S48j 8,471, 338| 2,878,534; 2,231,485; 605,441' I7,9SS>853| 8,337,748| 3,375,534^ 1,999,764 8,965,823 15,353,637 14,869,454 54,970,893, 7,932, 748| 557,502 50,560,412 17,688,321' 2,519,062 14,869,454 4,460,203 : i j 11,368,463 7,351,106 617,734 215,303 847,575 18,416,603' 4,965,329 1,226,890! 7,889,950 1,904,351 960,565' 327,570 86,490 106,043 351,402 3,480,512 289,746 25,852,895! 7,306,925 25,029,2931 6,097,713 1,012,260 1,012,260: 139,727 136,916 23,435 66,314,187 66,441,505 25,525,978 44,199,6351 44,199,635; 23,190,391 29,919,289 29,919,289 3,357,078 38,871 38,871! 7,641 555,974,330556,576,611207,722,313 7,967,143' 6,468,312 7,145,891 1,512,126 301,467 13,556,677 5,018,567 4,993,030 592 39,488,114 6,619,374; 14,280,706 9,550 1.315 i04,599,'09i36,2o6,779 I04 INDIA AND APPENDIX F. IMPERIAL PREFERENCE Area UNDER I [^RIGATlo^ J From Blue-book Administrations Total Area Cropped Area Irrigated By Canals By Tanks Government Private Bengal .... 63,210,900 826,204 - — United Provinces (Agra) 32,238,349 1,831,118 2,890 1,032,998 (Oudh) 12,249,662 — — 715,396 Punjab .... 26,956,996 5,374,888 458,766 19,927 North - West Frontier Province Upper Burma 2,419,254 5,009,992 186,051 290,819 406,193 236,590 125,880 Lower Burma 7,936,649 30 25,640 2,944 Central Provinces . 19,281,557 556 — 596,189 Berar .... 7,369,949 — — 102 Assam .... 5,287,587 — — Ajmer-Merwara . 361,307 — 15,168 Coorg .... 141,141 1,370 — — Madras 28,755.657 2,923,570 67,165 2,010,452 Bombay 23,697,170 114,188 12,810 95,"o Sind .... 3,682,749 2,008,465 794,497 — Pargana Manpur . Total . 7,993 — — — 238,606,912 13,557,259 2,004,551 4,614,166 STATISTICS OF INDIAN IRRIGATION IN 1904-5 ; IN Acres Cd. 3166 Area Irrigated Crops Irrigated » By Wells 2,961,287 1,004,177 3,522,102 92,589 12,051 1,186 67,751 35,292 44,804 1,222,873 489,637 30,209 333 9,484,291 Other Sources 359,411 29,666 143,752 25,787 56,160 46,042 30,024 293 17 396,665 77,731 200,811 Total Area Irrigated Wheat 826,204 20,924 6, 1 87, 704' 1, 905, II 8 1,749,239' 628,119 9,5i9,435;3,956,i7o 710,620 234,520 721,500 4 75,842 694,520 22,775 35,687 1,051 ! I 59,989' 16,971 1,370 — 6,620,725 t 789,476 181,638 3,033,982 333 452,706 23 1,366,359 31,026,62617,420,019 Other Cereals and Pulses 729,841 3,153,693 862,67 2,331,395 327,172 709,931 73,531 614,019 203 46,151 1,370 ■I- 407,695 2,334,907 509 11.593,090 Miscella- neous Food Crops Other Crops '79,255 1,506,707 56,529 312,284 605,038 2,626,8321 47,559 101,369 31,244 104 2,343 22' 54,789 2,937| 34,267 166; 1 3,666 12,371' + 1- 142,942 139,800 41,680 527,49s 14 139 1,266,647 S.238,344 * Includes the area irrigated at both harvests. t Figures not availabU. HRIN'TED BV SPOTTtSWOODE AND CO. LTD., KKW-STREKT SQUARE LONDON INIVERSITY OF CALIFORNIA. LOS ANGIXES THH UNIVERSITY I.IHRARY This book is DUK on the last date stamped below Form L-» 2.-,M-10. '11(2191) UNIVEKSITY OF CALIFOKNIA AT LOS ANGELES LIBRARY HP Lethb ridge - 3508 India and I4L5 imperial prefer* ence. UCSOUTMt- AA 001 006 010 EF 3508 I4L5