itably discerned in the previous month showing that
the economic current had turned against India. The rupee was to be
"stabilised" at 2s. gold. The only dissentient voice in the Currency
Committee had been that of the one Indian member, a Bombay bullion
broker, Mr. D. Merwanji Dalal, who probably had more practical knowledge
and experience of the problem than all the ten signatories of the
Majority Report, and he had pleaded in vain for the retention of the old
ratio of fifteen rupees to the sovereign. The event was soon to
demonstrate his sagacity. The Secretary of State in order to establish
the new ratio sold "Reverse Councils" at rates from 2s. 11d. downwards.
The attempt failed egregiously, for the rupee fell steadily, and has now
fallen to and under 1s. 4d. The money represented by the Indian balances
with the Secretary of State had been put down in London at 1s. 4d.
upwards, and India had to pay at the rate of 2s. 11d. downwards to get
it back. The difference between the two rates represents, it is
calculated, a loss to the Indian tax-payer of thirty-five crores of
rupees, or L35,000,000 at the "stabilised" rate ordained by Government.

But the actual loss to India on these exchange transactions is not the
worst outcome of these conjuring tricks, as they have been
contemptuously called by Indian critics of Whitehall. Faith both in the
omnipotence and in the honesty of Government was by no means extinct in
Indian business circles, and when Government undertook to "stabilise"
the rupee at 2s. gold Indian merchants assumed that Government could and
would do what it said it was going to do. Their stocks of imported goods
had been completely depleted during the war, and prosperity had bred, as
usual, a spirit of excessive optimism. Enormous orders for cotton
piece-goods and other British manufactures were placed in England on the
basis of a 2s. rupee just when prices there had soared to their
dizziest heights. By the time the British manufacturers had fulfilled
their contracts and the goods were delivered in India, not only had the
rupee fallen headlong but prices too had declined, and the Indian
importer found that he had made both ways a terribly bad bargain, of
which in many cases he could not possibly fulfil his share. There was
L15,000,000 worth of Manchester piece-goods alone lying in India at one
time last winter on board the ships that brought them out or in the
docks. Of these the Indian importer simply refus