CIRCUITOUS TRADE BILL. (Hansard, 9 December 1813)

Mr. Grant
said, he could not help expressing his apprehensions, that the proposed Bill would be found to militate against a principle which, till of late, seemed to have been considered as fundamental in the commercial policy of this nation; namely, that the metropolitan country should be the centre of all the foreign trade of its distant dependencies; India, as well as those possessions strictly called colonies. This was the doctrine held in the long administration of Mr. Pitt, and particularly applied to India by the late lord Melville. Upon the first intimation, in the discussions on the renewal of the charter, of a wide departure; from this policy, Mr. Grant said he had lifted up his feeble voice against it.
It is now proposed to innovate upon the principle here mentioned; and, in fact; to break it down by opening a circuitous trade between the United Kingdom, India, North and South America, and the interjacent countries out and home, foreign Europe and our American colonies excepted. The effect of this would be, to enlarge the direct intercourse between India and North and South America, but to deprive the United Kingdom of part of the Indian trade which it now enjoys. The Bill indeed provides, that ships engaging in this circuitous trade shall clear out from the mother country; but having done this, they may, after performing the circuitous voyage, return hither in ballast, or, for aught that appears in the Bill, not 269 return at all. They may go on trading during their existence in the circuitous route between Asia, America, and Africa, without ever returning to this kingdom again. This was not a trade which promised much to enlarge the exports of British manufactures. The American continent, particularly Brazil, is supplied by other means with our manufactures to the extent of its demands. The islands at which ships may touch in their way to India, and India itself, can take off no large quantity of those manufactures in addition to their present consumption. Ships then may often go out partly in ballast, and either take specie to purchase their Indian cargoes, or procure cargoes by Indian capital, which will make the trade essentially Indian. This may be the way to enrich India and America, but is not the way to enrich this country. Even the carrying part of this trade cannot be secured to British shipping; much less the profits of the trade to British merchants; and in proportion as this becomes a direct trade between India and America, Great Britain loses the duties that would have attached by making it the medium; and its American and West Indian colonies will be well supplied with Indian manufactures by the subjects of the United States and of South America. What shall hinder foreigners, a native of South America, for instance, from settling in London for the privilege of carrying on this trade—for the purpose of fitting out ships from hence for it, and withdrawing with their property when they shall have acquired any in that trade. Is it supposable, that when a direct trade is established between India and South America, for instance, Indian shipping can be excluded from this trade? British residents and Indo British subjects will, under foreign flags, if not otherwise, carry on this trade; or ships navigating under the British flag might make those islands at which they are allowed to touch, places of depot for Indian goods, to be supplied to foreign Europe. But Mr. Grant said, he was glad to understand that a provision against this last-mentioned practice was intended to be introduced into the Bill. However, the trade would still be one, the benefit of which would centre in India, not in this country, and accelerate the progress of India to independence, as the trade of our former American colonies to foreign Europe accelerated their independence.
270 But some gentlemen are not satisfied because this innovating system is not pushed still farther—they require, that foreign Europe should be open to the importations of British subjects from India. Not contented with having broken down a system which had existed two centuries, to the signal advantage of this country, and broken it down upon pretences of opening a new world of commerce, which pretences have now proved "the baseless fabric of a vision," the same parties desire, that the restrictions upon the trade from India to foreign Europe may be abolished. And upon what plea? because it is said foreigners may carry on trade from India to any part of Europe, and this is denied to British subjects, who are therefore placed on a worse footing than those foreigners. The position, however, is erroneous. The only foreigners who of late years traded to the British ports in, India (excepting the Portuguese, of whom he should say something afterwards) are the North Americans; and they have been restricted to a direct trade, in exclusion of a circuitous one, to and from India and the United States; they have also been subjected to double duties. The same regulations ought to be observed with regard to all foreigners admitted to British ports in India. If any of the foreign European settlements on the continent of India are restored upon a peace, it should be with an express understanding that they are to admit no transatlantic flag but their own. This was undoubtedly the principle of the privilege originally conceded to them by the native sovereigns, on the east of India especially. They obtained each a place of trade for themselves, not a free port for the flags of all countries. This we, who have succeeded to the sovereignty in India, should insist on. The Portuguese only still retain ancient Indian possessions of their own, and privileges of trade, which, consistent with good faith, we cannot now annul without their consent; but east of Cape Comorin they have only one small settlement which is in Bengal, and there they ought to be subjected to the law just mentioned. Nothing in the late treaty with, them opposes this, seeing they are, as to our Indian trade, put only on the footing of the most favoured nations; and none should be exempt from this law. The Portuguese have indeed made Goa, which was originally a conquest, a free port; but it cannot supply the great staples 271 either of the east or west of India for the European market, without the performance of a double voyage. The whole of the argument in favour of the present measure, derived from the trade which foreigners have, of late years carried on with India, appears to be unsound; because, first, The considerable share of Indian trade which foreign Europe, and America, have enjoyed within the period of the Company's last charter, has been owing to the unnatural state of war in which the world has been long held. Secondly, Because upon a return of peace they will, not only be deprived of their preceding advantages, but we may admit them into the commerce with British India only on the principle of a direct trade between their countries respectively, and India, for the supply of their own wants; and, thirdly, If solid peace were to return, the advantages possessed by British subjects in the Indian trade (no foreigner being allowed to bring Indian commodities into the British dominions) would give the country a vast preponderance in this trade; all which advantages will be thrown away by the system now about to be introduced. Britain might be in a great measure, as formerly, the emporium of Indian trade; the superiority and variety of the Company's cotton fabrics, with the quantities of them imported in private trade, and the great staple of indigo, would continue to attract hither, as formerly in time of peace, a concourse of buyers from the continent, by which other speculations in the commerce of this country were also promoted; but by the proposed law, we shall deprive ourselves of this superiority; the resort of buyers from all parts of Europe, for the purchase of Indian commodities here, must so far diminish, as materially to affect the sales of the East India Company; and if British merchants are allowed to carry goods to foreign Europe, this resort must cease entirely.
The abilities of the noble lord may perhaps be employed to shew, that he has taken the golden mean, the happy medium between two parties; but it may be feared, we shall be found, in the rage of innovation, to have frustrated our own aim, of adding to the commercial resources and greatness of the country.

Lord Castlereagh
flattered himself that he had so narrowed the operation of the Bill, that it would not occasion any very serious difference of opinion. He had 272 before stated, that at some future time a more extended measure might be expedient; but he had abstained from proposing any such at present, conceiving that it would hardly be candid in the present state of the session to push any thing to which very material objections might exist on any side. If it were thought that the islands in the Atlantic alluded to by the honourable director, namely, the Cape de Verd islands, the Canaries, and Madeira, were likely to afford a foreign depôt that would break in on the circuitous trade, he saw no objection to take them out of the Bill; but really as to the rest of the measure, he did not see how it could be objected to, unless the combat of last session was to be renewed, and unless the faith of parliament was to be violated, and the hopes of those to whom that faith was pledged were to be disappointed. The hon. director had argued the question as if our possessions in India were a colony. They were never so considered. They had never been considered as a colony, from which foreigners were excluded; but, on the contrary, great liberality had been exercised in that respect. Then as to the general policy, and the injury which this country might sustain from the fructification of the commerce of British subjects abroad, or from the employment of the capital of foreigners at home, he confessed that he could never think it an injury to the country that a British merchant should extend his commercial affairs in foreign countries, or that a foreign merchant, by carrying on commerce in England, should at once serve himself and benefit the empire. This was a subject which ought to be viewed with a liberal feeling; and so far was he from being alarmed at the two cases suggested by the hon. director, that he thought sound commercial policy demanded the encouragement of them. He must look at the question, not as the hon. director looked at it (and very properly) in a corporate, but in a national view. Parliament, in the act of giving to the East India Company the exclusive trade to China, hat declared to them, that they must share the remainder of their commerce with the other subjects of the land. Now, unless the private British merchant had the common facilities given him for constructing his voyage, and coming to an advantageous market on his way home, he would not start fairly with his competitors. He reprobated all attempts at obtaining undue advantages in commercial 273 matters. It was the general interest of commerce, that commercial men should stand on equal grounds; and when one party attempted to injure another, the wound was usually mutual. Let the English merchant prosecute his speculations to America, if they were favourable to him; and if they were not so, he would abstain of his own accord. He repeated, that he had already narrowed the Bill (and he would still further narrow it by striking out the Atlantic islands), in order to prevent any serious discussion. And he suggested the expediency of postponing the debate on the larger question to a future period; and of concurring not to tight by anticipation that battle which some time or other would probably be fought on the subject.

Mr. Grant
, in explanation, said, he had not considered India as if it were tinder our colonial system, having expressly spoken of the rights of other European nations settled in that country. Nor had he treated the present question as the India Company might be affected by it, but upon principles of national policy.

§ Mr. R. Thornton
expressed the satisfaction which he felt, and which he was sure the India Company would feel, at the noble lord's having consented to except the islands from the Bill; apprehending, as they did, that those islands would otherwise form a depôt, whence to supply England at present, and foreign Europe at a future period. Neither were they very partial to the concession which was now to be made to British merchants, of allowing them to embark in the coasting or carrying trade of India. They knew that the merchants were to be allowed to go from port to port in India, for the purpose of disposing of their cargoes, or collecting freight; but they conceived that the coasting trade should be left to the country ships. Although he was not much alarmed at the present Bill, he confessed that he did feel alarm at what had fallen from the noble lord, as to measures that he might propose at a future time. He hoped that evil day, however, would never arrive; and while be thanked the noble lord for the liberality he had shewn upon the present occasion, be trusted, that it would be an encouragement to him to continue that liberality.

§ Mr. Finlay
thought it evident, that the Capital of the East India Company was not sufficient to embrace the whole trade of India, as well as China; and that it 274 therefore stood to reason, that the British merchants should be allowed to embrace that part of it to which the Company was not equal. When this was permitted to them, he thought they should have the same facilities that foreigners had for carrying on the trade. He denied that it wag on account of her neutral character that America had of late years traded so extensively to India. While most of the ports of Europe were under French controul, they were shut against American ships laden with India produce, as much as against British ships. The great advantage which the Americans possessed was, in their being at liberty to embark in the trade to India with ships of whatever burthen they thought proper, and which they might send at whatever time was most convenient. He was convinced that the depriving British merchants of those facilities for carrying on the trade which foreigners enjoyed, was not the way to make this country the emporium of the India trade. There was no occasion for binding the British merchants to return immediately to this country; for every British merchant would naturally feel, desirous to return to Britain, unless his commercial interests should detain him abroad.

Mr. Robinson
re-stated several of the arguments urged by his hon. friend (Mr. Grant), though he admitted that the expulsion of the islands from the Bill would remove much of his objection to it. He condemned, however, the privilege which private vessels were to enjoy of carrying on the coasting trade in India. He had understood that those vessels were to be permitted to go from port to port in India, for the purpose of selling their outward, and of purchasing their homeward cargo; but he had not been aware, that it was intended to allow them to interfere with the Company's shipping interest in the coasting trade.

§ Mr. Alderman Atkins
was proud to see that this Bill was likely to extend the intercourse to India through British shipping. He thought the noble lord had most accurately laid down the true principles which should guide the practical merchant, as well as the statesman. If, in order to gain exclusive advantages, we were lay on duties, or embarrass the trade of foreigners, they might also lay on counter duties; and in this manner the general interests of commerce might be injured, with out our obtaining those advantages which the fair principle of competition might 275 ensure to us. When be contemplated the advantages possessed by the neutral traders, he felt alarmed; but he now saw that the present Bill gave the same to British merchants. He thought that, in consequence of the operation of this Bill, England would really become the emporium of the East.