ed to take delivery,
because to do so would have meant ruin, as, what with the depreciation
of the rupee and the fall in market prices, they seldom represented
one-half, sometimes not a quarter, of the cost to him, if he took them
up. It was useless to preach to him about the sanctity of contract, for
had not Government itself, he declared, set the example of a gross
breach of contract by undertaking and then failing to "stabilise" its
own rupee currency? Government pleaded that it had given no undertaking
that could be construed as a contract, but the Indian retorted that the
Government's word had been hitherto held as good as its bond, and Indian
Extremists found only too ready hearers when they imputed the exchange
policy of Whitehall not so much to mere incompetence as to unholy
influences behind Whitehall which robbed India in order to fill British
pockets.

A wiser spirit ultimately prevailed, and merchants and buyers came
together and agreed to compromise, and large stocks were gradually
cleared. If this year's monsoon is followed by good harvests, and the
European markets recover something of their former activity, Indian
trade will be gradually restored to more normal conditions. But the
ordeal which it has passed through will have taught some enduring
lessons.

Remembering, too, the large profits which London firms used to make on
silver purchases for the Government of India, and the enormous Indian
balances kept in London in pre-war times which were supposed to be
essential to the maintenance of Indian credit but were still more
clearly of great convenience for London bankers who had the use of them,
Indians who are by no means Extremists ask themselves not unreasonably
why, instead of leaving the ordinary laws of supply and demand to work
through the ordinary channels of financial and commercial enterprise,
the Secretary of State should persist in carrying on big financial
operations connected with the adjustment of the balance of trade or any
purpose other than his official requirements in regard to what are known
as "home charges," _i.e._ payments to be made in England on account of
the Government of India.

That the effects of the present system as it has worked recently have
been deplorable from a political as well as from an economic point of
view is shown by the large number of recruits made by Mr. Gandhi from
what one might have regarded as the most unlikely classes. Indian
merchants whose interes