to raise the native administrators to the same level as that of the native judges, of whose capacity all speak so highly, while insuring that a genuine control is exerted by Englishmen not overburdened with that excessive office-work that now removes them farther and farther from the mass of the people. To develope native talent, to encourage native originality in every department, is surely a nobler aim than to depress a whole community, comprising one-sixth of the human race, by a superincumbent mass of foreigners, who live less and less in the country, and therefore know less and less of it.

One of the saddest results of our present action is the decay of native arts and manufactures. According to the testimony of officials who have devoted especial attention to this matter, the impoverishment of the country, and the reduction of the native population to one dead level of poverty-stricken agriculturists, are utterly crushing out the beautiful native art-work in our territories. The statements in Dr. Birdwood's Handbook for the Indian Court at Paris show what a mischievous effect the cheap gaol-work, brought into competition with the manufactures of honest artisans, has produced upon more than one important industry. That we have erred through ignorance, and with the best intentions, I cannot say too often; but the result is, alas! the same. But the English people are fortunately strong enough and honest enough to change their system here, as often elsewhere, when once they fully understand the truth. It is not, never was, and never could be, their intention that any portion of our noble empire should be deliberately sacrificed to a mistaken view of its necessities, or that our fellow-subjects, whose increased welfare will react so beneficially upon ourselves, should die of starvation because a thoroughly upright and well-meaning body of men have been hopelessly afflicted with an economical craze. No; these things will be remedied, and that soon; and India will yet become a source of strength and prosperity instead of an element of weakness or even of alarm.

I am told, however, by my official critics that India is lightly taxed. They are bold men to say it. A bureaucracy acting almost unchecked by European, and wholly unchecked by native, opinion, can hazard observations with impunity in India, that read strangely when put side by side with other official observations in England. Here is an instance. Madras is lightly taxed, so lightly that Sir John Strachey has found it convenient to raise the salt-tax, in that province, in a famine year, over forty per cent. Now listen to the Government of Madras itself, speaking about the people under its rule :

The Madras ryot is very heavily taxed; five rupees for wet (single crop) and one rupee for dry being his average assessment. . . . Let the extent and nature of their holdings be considered. The number of leases is 2,392,064; of these 38,825 only are above 100 rupees, while upwards of one million and a quarter are below ten

rupees. The average extent of a holding is eight acres, and the average assessment payable is fifteen rupees or thirty shillings sterling. How are two million peasant proprietors of this kind to pay sixty shillings apiece next year, after a season of unprecedented calamity, which, in addition to other sufferings and losses, has brought about already the destruction of a great portion of their cattle, and will cause the loss of many more?

How indeed? But we shall take order with them somehow, we may depend upon it, and the extra forty per cent. on salt will still further improve their position. But, I ask, what sort of administration is this which, in the face of Dr. Cornish's official declaration that the poor ryots and agricultural labourers could not even before afford enough salt to keep themselves and their cattle in health, indulges in such terrible irony as to demand arrears of revenue' and claps a prohibitive duty on a necessary of life?

I pass on. I asked, Where is the wealth of India? Not one yet has told us. Its poverty is conspicuous enough. Even the most sanguine of Anglo-Indians admit that no more taxation can be raised with safety; and if there are those great accumulations what is being done with them? They are hoarded, it is said; the people will not either lend or invest. Surely this seems almost incredible among a population where interest-charges for advances is a subject thoroughly understood by every class of the community, and recovery of debt under our system is only too easy. All the gold and silver imported into India since the beginning of this century amounts to only 382,000,000l., which is but 21. per head of population after all, and is assuredly no excessive supply of the precious metals for a country which rests now upon a silver currency, and where 50,000,000l. of revenue is yearly collected in that metal. The import of bullion is at any rate far more than compensated by the drain from new resources already insisted upon. It is the constant lamentation that neither capitalists nor agriculturists develope the country. Yet it has been noted on all hands that the agricultural class in particular, the moment they are able to scrape a few rupees together, and have a full security of tenure, set to work to improve their property. During the period of the one great windfall India has had-the American Civil Warthe improvements made by the people of Bombay in their houses and way of life were most marked. Moreover, as showing how beneficial their prosperity would be to England, a brisk demand for all articles of small luxury sprang up at once. The very agricultural labourers also, who drag on a miserable existence in India, when transported as coolies to Trinidad and British Guiana, speedily save money and, in many instances, become well-to-do people. The impression that they are bad and wasteful cultivators is one which dies away, I find, in proportion to the amount of attention the observer has devoted to the matter. They cannot save, cannot accumulate, cannot improve, because the taxation, and the way in which the

taxation is levied and spent, ruin them. There is not a country in the world, which, after twenty years of peaceful, orderly, and wellintentioned rule, could present so little to show for it in the way of increased well-being as India. Its total sea-borne trade, even including that which is carried on between the Indian ports, is utterly insignificant for so vast a population, although 150,000,000l. at least has been spent in improving communications during the last twenty years. What is needed, therefore, are not mere dictatorial opinions by high-placed officials as to the wealth and contentment of the provinces which they administer, but undoubted facts which shall outweigh the terrible evidence of increasing famine to the contrary. At present no such facts are forthcoming.

I now come once more to the question of the public works. It is at least remarkable that Mr. John Morley, who must be looked upon as the principal official champion, does not touch my argument on this head at all. I may take it for granted, therefore, that up to the present time the public works, especially the railways, have represented a dead pecuniary loss to the country. Now no doubt the guaranteed lines are beginning to look as if a profit might shortly be expected in an ordinary year; but when the loss by exchange is calculated, this is not even yet the case. As to the State lines, the position is far worse; for, as I showed in October, the 17,000,000l. expended on them up to the present date does not show a return of even 1 per cent. upon the capital. Taking the interest of the money at only 4 per cent., the natives of India are forced to lose 500,000l. on this single investment. But this might have been anticipated. The original trunk lines connecting the great cities and centres of commerce, although built in the most extravagant way possible, and at a preposterous cost, might be expected to pay 5 per cent. in time, if only by the mere export trade; but these new lines are hopeless affairs in the majority of instances, and the prospect of a profitable return is remote indeed. Now, however, Sir John Strachey has imposed additional taxation to the amount of 1,500,000l. mainly upon the poorest class of the people, for the express purpose of creating a 'famine insurance fund.' This very 1,500,000l. so levied from the faminestricken inhabitants of Madras, Bombay, and the North-West Provinces, is to be expended, not in providing against future famines, as the name would imply, but in extending those unprofitable railways and irrigation-works which are already so heavy a burden on the population. Mr. Morley does not deny this. But can any human being, then, understand what is meant by the statement he has so charitably fathered? Instead of borrowing 1,500,000l. to spend on 'productive' works, which, all previous experience has shown, prove unproductive nine times out of ten, the Finance Minister imposes

**I am convinced that the imposition of any large amount of fresh taxation in India is impossible without serious practical risk.'-Sir John Strachey, February 6, 1874.

heavy taxation in a famine year, to apply to this same purpose, and then claims credit for extinguishing yearly an equal amount of the debt. Verily we have here a scheme for the Insurance of Famine, if ever one was set afoot. We drag food from half-starved people to build these losing State railways, and then wonder that starvation is perpetuated by the process. Not long since Lord Lytton proclaimed that 10,000,000l. ought to be spent in similar fashion in the North-West Provinces. I rejoice to believe that these harebrained schemes are now meeting with a check, and that this terrible mania for public works, which yearly absorbs 6,000,000l., 7,000,000l., 8,000,000l. of the revenue, may shortly receive its quietus. Meanwhile, however, the mischievous policy goes relentlessly on, and endless misery is engendered because Indian financiers will not see that to force natives to borrow at 12 to 60 per cent., to pay taxes which are invested to lose 3 per cent., is as baneful a superstition as ever blighted the fortunes of a people. For this is what it means. Every rupee thus foolishly squandered, every anna thus wantonly taken from the pockets of the people, is another step towards the hopeless impoverishment of the whole country.

Until we can build public works out of savings from a really light

' I must deal briefly with a few of Mr. Morley's remarks unnoticed in the text. (1) In touching on the local and municipal causes (p. 873), the writer challenges my figures, but gives none of his own to correct them by. (2) The Sikh Government, whatever its drawbacks, levied one-tenth of the salt-tax we get out of the Punjab. (3) Mr. Morley says that I am guilty of 'a singular inconsistency,' because I extol a light permanent settlement as 'one of my panaceas,' and in the next breath deplore 'the miserable, abject condition of the Bengal ryot.' Mr. Morley himself can never have written this. The miserable, abject condition of the Bengal ryot' is not my remark at all, as Mr. Morley will see if he will refer back to my article. I am in favour of a light permanent settlement undoubtedly, and though that of Bengal was made by Lord Cornwallis with the wrong people, it has been a great boon to the Province. (4) If Mr. Morley will examine into the facts he will find that in many districts the ryots who had got out of the hands of the money-lenders have been thrown back into them by the rigidity of our assessment. (5) How is it, if the North-West Provinces are so much improved as Mr. Colvin alleges, wages, according to the Moral and Material Progress for 1872-73, have scarcely varied at all since the early part of this century, and after payment of the rent the margin left for the cultivator's subsistence is less than the value of the labour expended on the land'? (6) Indian investments are, as I said, almost unknown; and Mr. John Morley himself shows what a ridiculously small fraction of the total debt is held in India. What is more, it has decreased of late years. (7) The import of cotton has ruined the weavers. When the employment of a whole caste is destroyed, and they are reduced to pauperism, I can see, free-trader though I am, that more harm is done than all the free-trade maxims will salve over in India in one generation. (8) I put the home charges since 1857 at 270,000,000l. at least. But, says Mr. Morley, ‘a large amount is, for example, interest on capital which has been most profitably invested in railways.' The total amount so paid since 1857-58 is 28,000,000l., excluding net traffic receipts; or including these about one-fifth of the total, 270,000,000l. Besides, the profitable investment is a matter itself in dispute. But when I read Mr. Morley's concluding sentences, his 'most sombre views,' his certainty that there is boundless room for improvement in all our methods,' I wonder what possessed him to come forward to champion, in this half-hearted way, the system which evidently he sees the weakness of as clearly as I do.

taxation, until we have stanched, in part at least, this exhausting economical drain, every public work-no matter how promising to start with -should be charged as unremunerative, and no further mock surpluses should be foisted on Parliament. For they are mock surpluses still. The deficits of the last three years have been, as I stated, over 16,000,000l., and it is futile for the Indian Government to deny its own figures, or to claim works as 'productive' on which, by their own showing, they lose not less than 3 per cent. Owing to the extra taxation for famine insurance' (which, now that the illusory phrase has served its turn, is put in, I notice, as part of the regular Budget), and an exceptional return from opium in excess of the estimate, the deficit this year will probably be a good deal less than was anticipated. But who can say that the war now being waged in Afghanistan will not cost more than is calculated? Yet further taxation, I repeatnay, the very taxation already levied-is most hurtful to the population and dangerous to ourselves. Unavoidable, therefore, as this Afghan war was, to lay any considerable portion of the extra expense on the Indian exchequer, is both impolitic and unjust.

So obvious is the peril of the situation, that all sorts of schemes are floating about to relieve debt by counting two and two as five. But there is no financial philosopher's stone to transmute the famine and deficits of extravagance and miscalculation into prosperity and surplus. The total net revenue of India, even now that the extra taxation has been imposed, is scarcely 40,000,000l. a year, and of this sum little short of one half will be expended in home charges alone, when the loss by exchange is taken into account. Apart from the gradual substitution of natives for Europeans in all branches of administration and management, which, though absolutely necessary, must be in its nature a slow process, the only hope of improvement lies in persistent economy, in a relentless determination to curtail home expenditure, and in the encouragement of those simple native methods of agricultural development, which have been so ruinously neglected to foster more ambitious but less beneficial projects. Only now are we beginning to understand that forests, groves, tanks, and wells do more to enrich a poor tropical country than vast systems of railroads and irrigation works. Economy must commence with the army, the public works, and the home expenditure. In these departments alone at least 6,000,000l. a year might be saved, to the positive gain of both England and India. It is needless, however, to point out what grave difficulties will be encountered. There will be plenty to cry out

On this point nothing can be added to Mr. Fawcett's admirable article in the last number of this Review. Had his persistent warnings for years past-given altogether without reference to party-been attended to, we should not.now be in such serious difficulty. Fortunately there have been many signs of late that the Government of India at home intends to look closely into the affairs of our Empire, and cautiously to introduce necessary reforms. With two more famines threatening, retrenchment will indeed have been begun none too soon if commenced at once.