Vol. 6 · pages 46–50

31ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY of the country, through the medium and instrumentality of whom alone, any criminal complaint of personal grievance suffered by the subject can reach the superior courts. Imagine, at the same time, every subordinate officer, employed in the collection of the land revenue to be a police officer, vested with the power to fine, confine, put in the stocks, and flog any inhabitant within his range, on any charge, without oath of the accuser, or sworn recorded evidence in the case.” To this Mr. Martin adds, “If anything could open the eyes of those who uphold the Ryotwar System at Madras, these torture revelations ought to do so. The late Mr. Sullivan, member of Council at Madras, declared to the author, that when he saw the cartloads of silver leaving his cutchery (treasury) for Madras, and remembered the poverty of the people from whom it was collected, he shuddered at the thought of their prospect during the ensuing year, as the demands of the government were inexorable and a certain amount of money must be forthcoming.” The Pressure of Inland Transit duties will be considered later when we come to the economic condition of India during the Company’s rule. As over against this pressure of taxation we have very little information regarding the income of the people. Nothing gives a better idea of the pressure of the tax than its comparison with the income : but our knowledge of the income of the people is very scanty. According to Munro the average wages of an agricultural laborer was between 4s. and 6s. monthly and that the cost of subsistence was between 18s. and 27s. a head per annum. What was the pressure of the tax we do not know. Circumstantial evidence goes to prove that it must have been great. IV Mr. Martin sums up the entire financial history most succinctly as follows :— “The expectations raised by Clive of the prosperity which would follow the territorial acquisitions of the Company, were so far from being fulfilled, that it was found on this (when the Dewanee of Bengal and Behar was granted to the Company) and on subsequent occasions, that increase of revenue was almost invariably attended with more than commensurate

32 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES increase of expenditure : the cost of government by Europeans, the growth of a standing army in each Presidency, and other sources of legitimate or illegitimate expense, swallowing up all the anticipated surplus, and leaving nothing for the development of the resources of the country or even the maintenance of roads, canals, and other public works constructed by native rulers.” Strange to say, the financial afairs of the Company were woefully mismanaged. A writer of the time said, “We have an army officered by British soldiers, manoeuvered according to European tactics. The spirit and much of the letter of the English law pervades our jurisprudence : our assessments for revenue are supposed to be based upon the doctrines laid down by Adam Smith and his followers (?). Our finance alone is Indian. Our military men study the strategy of Jomini : Blackstone and Bentham, Mills and Ricardo are the text-books of our civilians, but the system of our financiers is almost the same now as that of Abul Fazal, Akbar’s minister some three centuries ago.” Year Gross Revenue Gross Expenditure ££ 1792-93 … … 5,512,761 3,873,859 1793-94 … … 8,276,770 6,593,129 1794-95 … … 8,026,193 6,567,808 1795-96 … … 7,866,094 6,888,997 1796-97 … … 8,018,171 7,508,038 1797-98 … … 8,059,880 8,015,327 1798-99 … … 8,652,033 9,139,363 1799-1800 … … 9,736,672 9,955,390 1800-01 … … 10,485,059 11,468,185 1801-02 … … 12,163,589 12,410,045 1802-03 … … 13,464,537 12,326,880 1803-04 … … 13,271,385 14,395,405 1804-05 … … 14,949,395 16,115,183 1805-06 … … 15,403,409 17,421,418 1806-07 … … 14,535,739 17,508,864 1807-08 … … 15,669,905 15,850,290 1808-09 … … 15,525,055 15,392,889 1809-10 … … 15,655,985 15,534,711 1810-11 … … 16,679,197 13,909,981 1811-12 … … 16,605,615 13,220,966 1812-13 … … 16,336,290 13,515,828 1813-14 … … 17,228,711 13,617,725

33ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY Year Gross Revenue Gross Expenditure ££ 1814-15 … 17,297,280 15,955,006 1815-16 … … 17,237,819 17,059,968 1816-17 … … 18,077,578 17,304,162 1817-18 … … 18,375,820 18,046,194 1818-19 … … 19,459,017 20,396,587 1819-20 … … 19,230,462 19,689,107 1820-21 … … 21,352,241 20,057,252 1821-22 … … 21,803,108 19,856,489 1822-23 … … 21,171,701 20,083,741 1823-24 … … 21,280,384 20,853,997 1824-25 … … 20,750,183 22,504,156 1825-26 … … 21,128,388 24,168,013 1826-27 … … 22,383,497 23,312,295 1827-28 … … 22,863,263 24,053,837 1828-29 … … 22,740,691 21,718,560 1829-30 … … 21,695,208 20,568,358 1830-31 … … 22,019,310 20,233,890 1831-32 … … 18,317,237 17,048,173 1832-33 … … 18,477,924 17,514,720 1833-34 … … 18,267,368 16,924,332 1834-35 … … 28,856,647 16,684,496 1835-36 … … . 20,148,125 15,994,804 1836-37 … … 20,999,130 17,363,368 1837-38 … … 20,858,820 17,553,525 1838-39 … … 21,158,099 21,306,232 1839-40 … … 20,124,038 22,228,011 1840-41 … … 20,851,073 22,546,430 1841-42 … … 21,837,823 23,534,446 1842-43 … … 22,616,487 23,888,526 1843-44 … … 23,586,573 24,925,371 1844-45 … … 23,666,246 24,293,647 1845-46 … … 24,270,608 25,662,738 1846-47 … … 26,084,681 26,916,188 1847-48 … … 24,908,302 26,747,474 1848-49 … … 25,396,386 26,766,848 1849-50 … … 27,522,344 26,960,988 1850-51 … … 27,625,360 27,000,624 1851-52 … … 27,832,237 27,098,462 1852-53 … … 28,609,109 27,976,735 1853-54 … … 28,277,530 30,240,435 1854-55 … … 29,133,050 30,753,456 1855-56 … … 30,817,528 31,637,530 1856-57 … … 31,691,015 31,608,875 1857-58 … … 31,706,776 41,240,571

34 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES Taking into account the period between 1792 to 1857 Mr. Romesh Chandra Dutt says, “It will be seen that if there were fourteen years of deficit, there were thirty-two years of surplus; and if the deficit amounted altogether to nearly seventeen millions the surplus amounted to nearly forty-nine millions. The net financial results of Indian administration was therefore a surplus of thirty-two millions during forty-six years. But this money was not saved in India, nor devoted to irrigation or other works of improvement. It went as a continuous tribute to England to pay dividends to the Company’s shareholders; and as the flow of the money from India was not sufficient to pay the dividends, there was an increasing debt called the Public Debt of India.” [1. R. C. Dutt. “India under Early British Rule.” p. 408.] There were two distinct ways in which loans were raised in England and in India. In India when the government was in need of money it advertized that the Treasury was open to receive money upon loan at certain rates specified in the advertisement and upon the conditions there contained. So long as the loans remained open, parties were admitted to make what payments they pleased, and to receive what are called loan notes in acknowledgment, and these to any amount. The money raised on loan was all raised in India. In England a different mode operated. The only mode, it was so stipulated by the Parliament, by which the East India Company was able to raise loan there was analogous to that of other corporations viz. on bonds, and all the Home debt was raised on bonds. The Public Debt of India, at least under the Company’s rule was entirely the creation of war. We will follow the progress of these two debts separately. The Indian Debt In 1792 the Indian Debt was a little over £7,000,000 : within seven years it had risen to £10,000,000. In 1800 it was £ 14,625,384 carrying a total interest of £ 1,342,854. Now came the wars of Wellesely with the Marathas and in one sweep he

35ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY raised the Indian Debt to the amount of £ 30,098,857 in 1807-08 bearing a total annual interest of £ 2,339,087. After the conclusion of peace, attempts were made to lower the debts by redemptions : as a consequence of this policy the Indian Debt was brought down in 1810-11 to £ 22,545,843 and the interest to £ 1,503,434. But wars were the rule and peace the exception : and in 1819-20 by the Nepal War and the First Maratha War the Indian Debt was raised to £ 31,338,855. By 1823-24, as a result of the intervening peace, the debt was reduced but the next year the First Burmese War of 1824-25 raised it to £ 38,316,486. In 1835-36 the debt was reduced to £ 31,821,118 : but a train of military operations were awaiting India. The Afghan War, the Sindh War, the two Sikh Wars, the Second Burmese War increased the debt which in 1852-53 amounted to £52,313,094 and the interest to £2,479,133. In 1853-54, however, the Indian Debt was reduced to £49,762,876. In 1853-54 the Public Works policy was inaugurated and as a consequence of it the Indian Debt increased to £ 55,546,650 in 1855-56. The year 1857-58 witnessed what is known as the Indian Mutiny or the War of Independence, raising the Indian Debt to £ 60,704,084. The Home Bond Debt (in England) In 1800, the Home Bond Debt amounted to £ 1,487,112 at 5 % interest. But the wars of Wellesly also told upon the Home Debt and increased to £ 4,205,275 in 1807-08 : in 1811-12 the Home Bond Debt reached its maximum limit of £ 6,565,900 at 5 %. In 1816-17 the rate of interest was reduced to 4 % and it never rose above it. In 1814-15 the Home Bond Debt was reduced to £4,376,976. By occasional reductions it lowered to £ 1,734,300 in 1840-41. As a result of the Afghan War and the Mutiny the Home Bond Debt rose to £ 3,894,400, besides £ 40,000,000 as the cost of the Mutiny. It is likely to be a matter of surprise when one sees the smallness of the Indian Home Bond Debt as compared with the Indian Debt. But the surprise will no longer exist when we know that the capacity of the East India Company to borrow in England was strictly limited by Parliamentary Regulations. The Parliament