[BILL 109.] SECOND READING.

HC Deb 21 May 1885 vol 298 cc1042-77

Order for Second Reading read.

MR. J. K. CROSS,

in moving that the Bill be now read a second time, said: This Bill is brought in principally in consequence of the recommendations of the Select Committee on East India Railway Communication, which sat last year, and reported in July last. That Committee reviewed the railway policy of the Indian Government, and decided that the proposals of that Government were moderate, and that— Looking to the experience of past years and to present prospects, there is a very fair ground for expecting that an extension of the railway system of India on the scale proposed will have the most beneficial effects. The Secretary of State for India in Council, on whom the Report of the Committee placed the responsibility of deciding what amounts should be borrowed, for the purpose of carrying out the works proposed by the Government of India, and sanctioned by him, considers that he cannot adequately fulfil the duties which devolve upon him, un- less he has power to borrow in the London market, if necessary, the sum of £10,000,000 within the next three years, charging the interest of this sum upon the Revenues of India. Of course, hon. Members will ask why the Secretary of State requires so large a permission. I will try to tell the reason; because we want the sanction of the House before we commit ourselves to a final and irrevocable decision as to the amount which we shall have the power to spend. The rule which has been followed of late years is that laid down by the Secretary of State in 1878 and supported by the Select Committee of 1879—namely, that we should restrict our expenditure from borrowed money to £2,500,000, or, rather, two and a-half crores of rupees a-year; but that, in addition to this expenditure, we may spend our surplus balances, and may also borrow what is wanted to extend the operations of the East Indian Railway, now owned by the State, and a source of considerable profit. The borrowings for Public Works and the East Indian Railway were, as a matter of fact, £11,130,000 in the four years from 1880 to 1883,or about £2,800,000 per annum; and we now propose to borrow directly, should we think fit, £3,500,000 per annum, giving an increase of £700,000 per annum. But there is one essential difference between the method in which we ask permission of the House to borrow now and the method which we have pursued in the last few years. We now ask for permission to borrow in sterling in England, when we consider it desirable, in place of borrowing in rupees in India, and as this is a distinct change in policy I must shortly explain to the House our reasons for advising this course. The reason is that we cannot borrow at moderate interest in India the sum which we consider it safe to spend. The current rate of interest in India on good mortgage security is 8 per cent per annum; and it is not reasonable to suppose that an ordinary Indian investor will be content with the 4 per cent he might get if he invested in an Indian Government railway, when he can get 8 per cent on a good mortgage. Mr. Westland, in his evidence before the Select Committee, made a careful estimate of what amount could be borrowed in India from Indian sources at moderate interest; and he did not think that the amount could be estimated at more than one and a-quarter crores of rupees a-year. Undoubtedly, if we were to issue Rupee Loans in India, for more than that one and a-quarter crores, they might be taken up in India, as they have been before; but in this case, subscriptions would come from people outside India—that is, people outside India would subscribe to these loans, and then the interest would have to be sent from India—the bills for this interest coming into the exchange market, just as will be the case if we ourselves borrow in sterling, providing the money for the discharge of the interest by drawing bills upon India. If we borrow in India we borrow rupees, and we pay interest in rupees, and we know for all time the number of rupees we shall have to provide annually to discharge the interest on any given amount of debt. As we receive our revenue in India in rupees, this system of borrowing is perfectly simple and involves no exchange complications. But there is one drawback to it; we have to pay a much higher rate of interest than we have to pay upon loans contracted in England. A 4 per cent loan contracted in Calcutta will now float at, perhaps, 94; a 3 per cent loan contracted in England may be expected to realize 88 to 90. The interest on the Calcutta loan would be 4.3 per cent; the interest on the London loan would be 3.37 per cent. The difference of interest, therefore, on each £1,000,000 sterling that we borrow on those terms is about £9,300 per annum. Let me illustrate this more fully. £1,000,000 borrowed in India, or rather the equivalent of £1,000,000—namely, Rs.l,25,00,000—will cost£43,000 a-year, or Rs.53,75,000. £1,000,000 sterling borrowed in England will cost India £33,700, or at present Rs.42,15,000. The difference between these sums, Rs.ll,60,000 in all, or £9,300 on every £1,000,000, is a heavy charge upon India, and if it were used as a sinking fund accumulating at 3½ per cent it would repay the corpus of the loan in 45 years. If, therefore, there were no drawbacks to borrowing in sterling here as compared with borrowing in rupees in India, we should have no hesitation in always borrowing here. But I am bound to allow that there are drawbacks to this course. If we borrow in sterling here, we must provide the interest here; and we are not certain what number of rupees we shall have to provide in India to cover any given amount of sterling interest here. Borrowing here, therefore, in sterling for use in India involves the consideration of a speculative element—namely, the value of the rupee as compared with the pound sterling. This factor must always be present in the minds of those who are answerable for the control of Indian finance; and it is only when the difference in the rate of interest between the two methods of borrowing is very great that we must resort to borrowing here, and we think that the present difference justifies us in pursuing this plan. I may say that one of the recommendations of the Select Committee on East India Railway Communication was as follows:— Your Committee think also that for political as well as for financial reasons it is desirable that loans should, as far as possible, be raised in India; but they do not believe that rupee loans which are not really absorbed in India differ materially in their effect upon exchange from sterling loans, as if held in Europe the interest upon them will probably be remitted from India and will come into the exchange market. They would, therefore, recommend, quoting the words of the Report of the Select Committee of 1879, that when 'the difference between the rates of interest in India and in England is so considerable as to afford full compensation for the great comparative disadvantages which inevitably attend borrowing in this country,' the Secretary of State in Council should not hesitate to borrow such moderate sums in this country as will enable the Government of India to complete such public works as shall have obtained his sanction. I may be asked, why we should resort to borrowing at all; why should we not leave to private enterprise the construction of lines of railway in India, in the same way that they are constructed in other countries? And the only answer I can give is, that the investing public have not yet made up their minds to trust their money in private railway enterprizes in India, and that the Government of India and the Select Committee which sat on this question last year consider it imperative, for the purpose of mitigating possible famine in certain districts and for the development of the country, that railway construction should proceed at a somewhat more rapid rate than of late years has been the custom. At the present time there are in India 10,832 miles of railway open, the nominal invested capital of which stands at £141,500,000. The gross earnings of these lines amount to £16,097,200 a-year, and the expenses to £8,026,000, or about 50 per cent; the net earnings being £8,071,000; the dividend on the broad gauge lines being 5.69 per cent, and on the narrow gauge lines 4.99 per cent. But I ought to call the attention of the House to the fact that a very large amount of money included in the £144,000,000 is not yet productive. The real amount of interest-earning money which is invested in Indian railways is £133,000,000 or £134,000,000. To show the large amount of business which the railways transact, I may point out that the number of passengers carried in 1883–4 was 65,000,000, and the amount of merchandize was 27,900,000 tons. The people employed upon railways number 185,261, of whom only 3,995 are Europeans, 3,979 East Indians, and the remainder are Natives. These figures show that a large number of Natives (177,287) find employment on the Indian railways. As the Productive Works form a large amount of the assets of the Indian Government, perhaps I may be allowed to say a few words with regard to them. The expenditure from borrowed money on Productive Works amounts to £60,034,000, and from Revenue, £12,957,000. Then follows £32,354,000 on the East Indian Railway, and £69,019,000 as guaranteed railway capital outlay. These sums make altogether an investment in Productive Public Works of £174,383,000. Besides this we have loans to municipalities, Native States, &c, amounting to £7,581,000, and the cash balances on the 31st of March last amounted to £14,133,000. Our assets, therefore, were altogether £196,097,000. Then we have liabilities amounting to £249,860,000, leaving the uncovered liabilities at £53,763,000. The net annual charge on India for interest on debt and expenses connected with railways and irrigation works has diminished of late years. In 1872–3, including exchange, the cost was £7,915,000, and in 1883–4 it was £4,358,000, giving an advantage to the year 1872–3 of more than £3,500,000, notwithstanding that the amount of loss on exchange had run up to a very much larger item than it was before. I may point out that the figures representing the earnings of the railroads—namely, 5.69 on the broad gauge, and 4.99 on the narrow gauge, are exclusive of loss by exchange on remittance of dividends to England, which loss is an uncertain amount, and which reduces the amount of net earnings on that portion of the capital which was provided in this country, when the current rate of exchange was higher than the present rate. The House should recollect that these earnings and this financial result are achieved, notwithstanding that most of the heavy lines have been made at an enormous cost; whereas in the case of any railways now being, or proposed to be, constructed in the future, with the exception of the strategic line to Quetta, the Government hope to be able to construct them for about half the cost of the Great Indian Peninsula, the Bombay and Baroda, and the East Indian Lines, and they have no reason to doubt that the dividends will be satisfactory. After the Select Committee had made its Report, we received from the Government of India a scheme of Frontier communications for strengthening the Indus Valley line of defence, which will cost in all at least £5,000,000. On Thursday, March 12th, I laid upon the Table the Papers explaining this proposal, and they have been seen by hon. Members. The scheme of these proposals is to make the Indus Valley line of defence impregnable, and also to perfect our communication with Quetta and Pishin. First, let me say a word about the Indus Valley line of defence. Railway communication on the broad gauge system will be established between Peshawur and Kurrachee, when the bridge over the Indus at Sukkur is finished. With the exception of this bridge, the work for which is very heavy, and which is now well in hand, this line of communication is now complete. But in order to be able to mass any number of troops which might be required at any given point along the defensible line of the Indus between Peshawur and Kurrachee, about 360 miles of railroad and about 200 miles of good road are required—the railroad to the East, the road to the "West of the Indus. This railroad will strike off from the present Lahore and Peshawur line at Lala Musa, where there is now a narrow gauge railway to the salt mines. This short line will be changed to broad gauge, and continued to the neighbour- hood of the Indus at Darya Khan, from which place the line will run down the Valley of the Indus to a point opposite to and parallel with Mooltan. The cost of this is estimated at £2,150,000. There will be steam ferries in conjunction with the railway; and this line will, together with the present Indus Valley Railroad, cover the length of the East bank of the Indus for some 600 miles. In order to strengthen the line of defence along the West bank of the Indus, it is proposed to make a good metalled road from Kushalgarh through Kohat and Banu to Dera Ismail Khan, which, as hon. Members know, commands the mouth of the Ghumal Pass. The length of this road is about 200 miles, and, including the Kuram and Gambela bridges, will cost about £300,000. But this is by no means all that is thought requisite. I have so far spoken of the line of the Indus; but we have also to consider our position at Quetta and on the Pishin plateau. We are now in peaceable possession of Quetta and the Pishin plateau, and since the punitive expedition to the Zhob Valley last year, there seems to be no danger of interruption to work by the wild tribes in that region. The Military Authorities in India are anxious to have ample means of communication between the defensive points on the Indus Valley and Pishin, and they propose, in addition to the railway to Quetta and Shibo, to make a military road from the Pishin plateau by Thai Chotiali, through the Han Pass and by Fort Munro to Dera Ghazee Khan on the Indus, opposite to Mooltan, and it is proposed to establish a steam ferry there, and also on the Chenab, in order to make this line of communication complete to Mooltan.

SIR GEORGE CAMPBELL

inquired whether this road would run through British or Afghan territory?

MR. J. K. CROSS

It was formerly considered part of Afghanistan; but since the Treaty of Gandamak it has been regarded as British territory. This road will be 250 miles long, and will cost about £200,000. This is only an estimate of cost which may be exceeded. Besides this, there is the railway to Quetta and Shibo, about which I gather from the Amendment of my hon. Friend opposite (Mr. E. Stanhope) we shall hear a good deal more in the course of this debate. The cost of this railway is very uncertain; but it will, from the extreme nature of the difficulties met with in the route chosen, be much more than was at one time anticipated—namely, £2,000,000, and I do not think it can be made for less than £2,750.000. The only other item in this expenditure is the Ferozepore bridge, which will cost some £400,000. I will now say a very few words on the very considerable difficulties which stand in the way of the completion of the Quetta line, and for that purpose I will read a few extracts from the Report of General Browne. He says— The railway crosses a country where almost every obstacle to the construction of a line has to be overcome—extreme climate, unhealthiness of the country, and want of inhabitants, food, carriage, roads, timber, and every kind of building material, besides the natural difficulties of a mountain line rising 6,800 feet above the level of the sea. As regards natural difficulties they speak for themselves, from the general section of the line, but should be seen to be realized. Except the Quetta section, which is comparatively level, but shares all the indirect difficulties alluded to above, the railway is an Alpine line throughout, on which the earthwork, the bridging, the grading, the tunnelling, are of so exceptional a nature that comparisons of cost with an ordinary Indian that line are entirely deceptive. At Chuppur, Gurkhaie, and Spintangi, there are many miles of cutting in hard quartz and limestone rock. For 40 miles the geological formation consists of shale, requiring blasting when dry, but which has to be cut back to an easy slope, as it melts like sugar under rain. For 40 miles more the line crosses a species of boiled mud pudding, filled with enormous boulders. This formation cannot be tunnelled, in the total absence of timber for shoring. This entails cuttings of enormous depth, which, in many cases, may need to be secured by fully lined masonry tunnels and to be covered in again to prevent landslips. At the mud gorge an embankment 500 feet long and 105 feet high runs into a cutting 1,500 feet long and 75 feet deep, entailing an expenditure on earthwork of over three lakhs of rupees. Should it, as is quite possible, be necessary to secure the cutting by a covered tunnel, the cost of 2,000 running feet of line will be fully seven lakhs. Such and similar cases fully account for high mileage rates. The Nari river draining 10,000 square miles, is crossed six times, aggregating 30 spans of 150 feet. The Chuppur rift bridge will be about 300 feet above the river bed, and is only one of many similar, though not such formidable, bridges from 80 feet to 100 feet high. It need scarcely be said that in a country of ravines the mileage rate for minor bridges, drains, and culverts must be exceedingly high. Then he goes on to speak of the cost of the line, with which I need not trouble the House. I have only referred to this for the purpose of pointing out that this railway is an exceedingly difficult work, and, that being so, the Government have come to the conclusion that, in order to expedite the formation of communications between the Indus and Shibo and Quetta, it will be better to try to have a line laid down through the Bolan Pass, which has already been so levelled as to make it suitable for a good military road. It is possible to lay down a line there with gradients of about one in 20 without loss of time; so that, by the end of the year, we hope to have complete railway communication with Quetta.

SIR GEORGE CAMPBELL

asked whether this railway was to be in substitution for or in addition to the other line?

MR. J. K. CROSS

It is to be in addition, as the other line will be carried on at the same time. I will now recapitulate to the House the heads of the proposals that we make. First, the railway "West of the Indus from Nari to Shibo and Quetta, 175 miles in length, at a supposed cost of £2,000,000, or very probably £2,750,000; the second is the railway East of the Indus from Lala Musa, viâ Darya Khan and Muzaffargarh to Sher Shah, with a branch from Muzaffargarh to a point upon the Indus opposite Dera Ghazi Khan, and including a bridge at Pind-Dadan Khan, and ferries over the Indus and the Chenab, 361 miles in all, at an estimated cost of £2,150,000. The third is the bridge at Ferozepore, five miles in length, at a cost of £400,000. Fourthly, a road West of the Indus from Dera Ghazi Khan to the Pishin plateau, 250 miles in length, estimated to cost £200,000, but which will probably cost more than this sum. And fifthly, the other road West of the Indus, from Dera Ismail Khan to Khushalgarh viâ Kohat and Banu, including the Gambela and Kuram bridges, 195 miles in length, at a cost of £300,000. The nominal cost of the entire works is £5,050,000, or about five crores of rupees, a part of which will have to be paid from the Revenues of India and a part by the loan which I now ask the House to grant the Secretary of State the power to issue.

SIR GEORGE CAMPBELL

asked if the cost of the railway through the Bolan Pass was included in the Estimate?

MR. J. K. CROSS

That is now being carried out and paid for out of Revenue, the cost, so far as it has gone at present, amounting to five lakhs of rupees. I have tried to explain as shortly as possible the proposals concerned in this Loan Bill. No doubt, the proposals I have made will be subjected to a searching criticism. I shall listen with the greatest interest and attention to what hon. Members may have to say, and hope to have an opportunity of replying to such criticisms as may be urged. I beg leave to move the second reading of the Bill.

Motion made, and Question proposed, "That the Bill be now read a second time."—(Mr. J. K. Cross.)

MR. B. STANHOPE,

who had given Notice to move, as an Amendment— That this House, while desirous of affording every assistance to the Government of India in completing the Quetta Railway, deeply regrets the unfortunate loss of time and of money which has been caused by the precipitate abandonment of the works in 1881, said, in the exceedingly clear speech the House had just heard, the hon. Gentleman opposite (Mr. J. K. Cross) had stated that the main reason for asking for this Loan Bill was that the loan was required for Public Works in accordance with the Report of the Select Committee of last year. He also said that the loan was to be raised for carrying on the work during the next three or four years. He (Mr. E. Stanhope) was not going to offer any objection to the proposal. Circumstances might, no doubt, greatly change during the next three or four years; but he recognized the importance of continuity of policy; and therefore it seemed, on the whole, desirable that the Government should present to the House of Commons their policy for the construction of Public Works for some years to come. But that rendered it all the more necessary that they should ask the Government for full explanations; and he regretted that the present opportunity had not been taken advantage of by the Government as a favourable opening for bringing before the House the usual discussion on the financial and general affairs of India. He always deprecated putting off, until the very closing days of the Session, the discussion of the Indian Budget; but on this occasion it was all the more ne- cessary to have taken an early opportunity for that discussion, because the proposals of the hon. Gentleman who had just sat down really depended on the financial position of India. In accordance with the desire to maintain some continuity of policy, the Government had now presented an Estimate based on the requirements of three or four years, and asked for power to borrow £10,000,000. He was not going to oppose that proposal; but he desired to point out that since the Budget Statement was made in India, two important events had occurred. First of all, the Government of India had been called upon to undertake military operations of a very extensive character, which had cost, or would cost, about £3,500,000, according to an Estimate given about three months ago; but they had not been told how the expense which had been incurred was to be met. At the present moment, however, he was most concerned to impress on the Government the duty of carrying the work out thoroughly when they were about it. India could not afford these constant scares. It was said that there was to be, and he should have been glad to notice, a considerable reduction in the ordinary Indian Expenditure; but that seemed out of the question, for, so far as he could see, there was hardly an item that did not show some little increase, except, perhaps, the Army, and they knew what was likely to happen to that item. But, in the second place, there had been an urgent desire for the establishment of a large and permanent system of Frontier communication and defence, that was to cost £5,000,000, an expenditure he very much approved of. It was obvious, however, that for a long time to come the Government of India would have no money to spare on Frontier railways out of Revenue. Not only would they have to make all preparations necessary for war, but they would have to give security to such portions of their Frontier as might be rendered necessary. Under those circumstances, it was obvious that the Government of India would have to take recourse to the loan market. Well, hon. Members opposite would agree with the Government in affording every facility for the adoption of that course; for they attached the greatest possible importance to the extension of these Frontier communications. It was a mistake, in his opinion, to dwell entirely on railways; many of the proposed roads were as important for strengthening the Frontier as any of these railways; and he hoped the hon. Gentleman would give the House the additional information it desired in detail, by laying on the Table a copy of the map now in the Library of the House. There was one point as to these Frontier communications to which he desired to draw the particular attention of the House. It was the portion which used to be called the Quetta, but which was now known as the Sibi and Pishin Railway. Everyone admitted now that this line should be made as quickly as possible. He attached enormous importance to the extension to Candahar; but that would lead to some difference of opinion in the House, and, therefore, he would put it on one side for the present. What were the facts, however, as to the Quetta Railway? In 1880, when the Conservatives left Office, it was completed beyond Sibi, and, owing to the energy of Sir Richard Temple, to whom the country were under great obligation in the matter, the line was laid with unexampled rapidity. It was the policy of the Conservative Government to occupy a strong strategical position upon the Frontier connected with it by railway, and they desired to' push on its construction as rapidly as possible. It had the support, amongst others, of Lord Napier of Magdala, Sir Donald Stewart, Sir Frederick Roberts, Sir Edward Hamley, and Sir Frederick Haines. Political opinion was no less in favor of it. On that point, he could not help reading to the House a snort passage from a Minute recorded in 1880 by Sir Henry Rawlinson. He said— Of all possible political shortcomings connected with Afghanistan, the most fatal, as it seems to me, would be the abandonment of this most promising undertaking. The railway was the most efficient arm of defence hitherto devised against Russian aggression, far more efficient than the conquest of Cabul or the establishment in power of a friendly Ameer, for its effect when completed would have been to transfer our military base from the Indus to within 350 miles of the threatened point of attack—namely, Herat. If we now abandon the work as a sequel to the withdrawal of our troops from the upper country, it must be remembered that we virtually deprive ourselves of the power of protecting the Afghan frontier from Russian aggression, and that the promises accordingly of assistance against external attack which we recently volunteered to Abdur- rahman at Cabul are rendered impossible of performance, for we could not and should not, whatever the emergency, march troops again from the Indus to the Oxus. So matters remained until the present Government came into power. But in May, 1880, the present Government announced their intention of withdrawing the troops from all positions beyond the Frontier, and the railway, which was the essence of the whole scheme, was abandoned a few months later.

THE MARQUESS OF HARTINGTON

Does the hon. Gentleman say 1880 or 1881?

MR. E. STANHOPE

said, he spoke of 1880, as the date when the Government first decided on the withdrawal of the troops from all positions beyond the Frontier; and he would show the noble Marquess the passage. But this abandonment was not decided upon without protest by some of the leading Members of the Viceroy's Council. Sir Rivers Thompson declared as to this as follows:— But perhaps the most grievous and humiliating part of the orders in this connection is that which affects not only the stoppage of the railway works now under construction by the Nari Gorge, but the dismantling of the rails and the destruction of the earthworks already completed to a considerable distance towards Quetta. We certainly are not acting herein exactly without precedent; for we can all remember the case in which the Chinese Government recently, having got possession of a railway, proceeded at once to demolish it, and to break up its rolling stock. There is, however, this difference between the two cases, and it scarcely tells in our favour. The Chinese Government had never seen a railway before, and may have had just that kind of excuse for its folly which ignorance and superstition would excite. We, on our side, cannot plead such excuses, and, least of all, in places where we come in contact with barbarism. This wilful and deliberate surrender of advantages, gained after a vast expenditure of time, and thought, and money, and which would subserve peaceful administration much more than they would supply the military requirements of our position at Quetta, may be intelligible by a stretch of the imagination to some people who fancy that there is a high moral motive concealed in our proceedings; but, as far as they affect India, they are absolutely beyond the comprehension of any Native in the country. The facts concerning the state of the railway at the time of its abandonment were as follows:—According to the official Report of 1880–1, the line to Quetta had been surveyed throughout, and partially staked out. At the time of the battle of Maiwand, engines were running from Sibi to Nari Gorge, and from Nari Gorge onward 12½ miles of bank had been made, and platelaying had been commenced. Buildings were more or less completed at 11 stations, at all of which defensible store yards had been constructed. A service road had been constructed from Sibi nearly to Kach, and on to Quetta and Gulistan-i-Kharez. As regarded the rails, a quantity of permanent way material had been carried forward, some six miles of line were laid North of Nari, and in the hill country beyond several miles of rail had also been laid. The amount expended on the construction of the line beyond Sibi appeared, according to the Budget Statement of 1882, to have been £560,000. So much for the progress made. But it appeared from the official Report also that the original intentions of Lord Lytton's Government was to have completed the whole line to Candahar by 1882. Owing, however, to the difficulty of constructing the line having proved greater than had been foreseen, this could not have been accomplished. But had it been proceeded with with the same energy as was displayed in 1880, it might easily have been completed by the present time; while as regarded the line now under discussion—that to the head of the Pishin Valley, which the Government were now proposing to construct—that portion of the line, if it had been persevered in, would have been finished long ago. At the beginning of 1881, the officer in charge of the railway received orders to abandon the line beyond Sibi. He had heard from more than one eye-witness what had then taken place. One described the plant and stores as being practically left just as they wore, and said that no attempt had ever been made to bring back rails and sleepers from the front. Some of the rails nearer Sibi were, however, brought back and utilized elsewhere. Everything else, including the accumulated stores, was abandoned to the plunder of the tribes. Another eye-witness stated that orders were sent for destroying the earthworks that had been constructed, which were accordingly shovelled down to the level of the ground. The result was that in this part of the country no trace whatever remained of a railway ever having been constructed. The present Government had placed the whole cost of the formation of this line to the charge of the Military Department, with the view, apparently, of swelling the offence of the late Government in having undertaken military operations. In 1883–4, however, orders were given by the present Government for the recommencement of the work which they had put a stop to. When the hon. Gentleman opposite (the Under Secretary of State for India) asked him what ought to be done in this matter, he should answer him in one single sentence—that the railway ought to be completed as soon as possible. When the hon. Gentleman suggested that it was desirable to lay an alternative railway line through the Bolan Pass, all he could say was the sooner it was laid the better. But what did this abandonment in 1881 involve? In the first place it involved the loss of some money, the amount of which it was difficult to estimate. But it involved also what was infinitely more serious—the loss of three precious years. God grant that we might never know how serious that loss was! It was, however, possible that we might even yet be made aware, by the commencement of hostilities with Russia on the Frontier, that our Forces might be paralyzed for the want of communication. If both sides of the House were so unanimous now about the construction of this railway, why was it that the Government thought fit to abandon it four years ago? Did the Government adopt that course from ignorance, from motives of economy, from military necessity, or because they regarded the idea of the advance of Russia as an old woman's fear? He did not think that either of those were the grounds that had induced them to abandon the construction of this railway. He believed in his conscience that the real reason for that abandonment was that this railway had been projected by Lord Beaconsfield. The Prime Minister, during the campaign in Mid Lothian, had pledged himself to reverse Lord Beaconsfield's policy in India, and he (Mr. E. Stanhope) believed that that was the only reason why it had been determined to abandon the construction of this railway. The step that the Government had taken in the matter was entirely without excuse, and it was a blunder almost without parallel. That step had been taken' in defiance of Indian military and political opinion, and its folly had now been clearly brought home to this country, and it was now about to be retraced, for he was sure the House tonight would be unanimous in giving the Government the necessary funds for proceeding with the reconstruction of the line. He had placed a Motion upon the Paper with reference to the subject; but he felt that it was no use crying over spilt milk; and, therefore, as they were unanimous on the subject, he did not propose to press that Motion to a division. On the whole, he regarded the absolute unanimity that now existed as being the best condemnation of the action of the Government in this matter, as being one of the most foolish and short-sighted steps which they had taken in the history of even the last four years.

SIR GEORGE CAMPBELL

said, that the hon. Gentleman the Under Secretary of State for India had, no doubt, made out a good case; but there still seemed to be a great deal more to tell. They could not hope that if it went on the extraordinary military expenditure of India would be less than £4,000,000 or £5,000,000 in the course of the present year, and they ought to have been told by the hon. Gentleman where the money was to come from. He (Sir George Campbell) understood that what they were asked to do was to give a general power to the Government of India to raise a loan of £10,000,000 for any purpose whatever; but, before that was done, he thought Her Majesty's Government were bound to state to the House for what purpose they intended this loan—whether it was to be devoted exclusively to railways, or whether they also contemplated that it should be used for the purposes of extraordinary military works and charges. He had always been rather a pessimist with regard to Indian finance. Indian indebtedness had been largely increasing, and there was no Sinking Fund as in England. Therefore, if the expenditure was to be met by taxation, he should like to know how this taxation was to be raised. He had always thought that if the day should come when our Indian Frontier should be coterminous with Russia, there would be great danger from a financial point of view, because great expenditure would have to be incurred. He deprecated a premature advance beyond our own Frontier. With regard to the advance of Russia in Central Asia, for 50 years we had cried out "Wolf" without reason; and at last the wolf had come upon us in the shape of great detriment, and almost ruin, to our finances. In whatever way our present strained relations with Russia might terminate, he was afraid they must leave behind doubts and difficulties, both with regard to the good faith of Russia and with regard to complications in Afghanistan, which would have a very detrimental and ruinous effect upon our finances. The advance of Russia had been so considerable—and it had been more rapid than he expected—that he feared the strain upon our finances must be very great indeed. He would not contemplate an unfavourable issue to the present strained relations with Russia; but he wished to point out that, under the most favourable circumstances, there were several great additions to our Indian charges for which there was no provision at all. It seemed to him clear that they were going to throw upon the finances of India, which in time of prosperity were only in a condition of equilibrium, very large charges of various kinds amounting to many millions; and he submitted that they were bound to make some provision by which, if part of these charges would be met by loans, at least part of them should be met from income. At the same time, while expending large sums on railways, many of which were merely fancy lines, the necessity of increasing the pay of our Native soldiers ought not to be forgotten. He was not very sanguine that they would be able to set things right by a reduction of expenditure. If they were to face this rapidly-increasing expenditure they must considerably raise their income, which he did not think was sufficient at present. No doubt, there were great physical difficulties in regard to the Quetta line; but, in his belief, the real cause of its abandonment was a pecuniary one. The reason why it was necessary to abandon that line from financial considerations was that the Government desired to obtain the goodwill of Lancashire by abolishing the Indian Customs Duties. He thought that was not a good or proper reason for the abandonment of the railway. He was afraid that in the matter of this Quetta Railway the interests of India had been sacrificed to those of Lanca- shire. The people of Lancashire were doubtless Free Traders so long as it was to their advantage to be so. He hoped the hon. Gentleman the Under Secretary of State for India would be able to tell the House that the finances of India would be managed on the same straightforward, honest principle upon which the finances of this country were managed, and that the Government, having this great expenditure before them, were prepared to raise additional Revenue, either by the re-imposition of those Customs Duties, or by some other means which would not affect the already heavily-taxed people of India. As a great portion of the money was to be devoted to railways, he hoped that the Government would not confine themselves to the unproductive lines, but would do all they could to acquire the profitable lines as well. Their policy hitherto had been to leave the paying lines exclusively in the hands of speculators. That course would, he trusted, now be abandoned, and the example of Belgium followed, where the State railways were cheap and effective; for he was strongly of opinion that a system of State railways managed in an economical manner, with cheap rates of transit, was very much better than the State getting rid of its liabilities by turning over the railways to speculators. It was a scandal that, in a cheap country like India, the fares on the railway should be dearer than in an expensive country like the United States.

MR. ONSLOW,

who had a Notice on the Paper to the effect that the Bill be read a second time that day six months, said, that the present measure was for the exigencies of the Public Service in India generally, whereas the Committee last year was on the question of railways to be made for productive purposes. The Bill was to authorize India to borrow money for non-productive services—namely, the making of military railways. He congratulated the hon. Gentleman the Under Secretary of State for India (Mr. J. K. Cross) upon having been able to state that the Government intended to strengthen the Indian Frontier. For his own part, he would not grudge a sixpence for that purpose; and his impression was that the proper construction of Frontier railways and roads would cost a good deal more than the £5,000,000 which was stated to be the amount intended to be spent upon them. He should be glad to know whether the money to be borrowed under the Bill would be spent entirely upon public works, because he earnestly hoped that no portion of that sum would be thrown into the general Revenues of India, or would appear in the Indian Budget. India was incurring £3,500,000 of extra expense for military purposes; and that expenditure only extended over three months. If the war preparations for which that expenditure was incurred were to go on for another six months or longer, there would be a great financial, social, and political danger, which ought, if possible, to be obviated. Where was it to end, and how long was India to go on preparing for war? The finances of India could not be at the present time in a satisfactory position, and the expenditure could not go on increasing without bringing matters to a crisis. India was already very heavily burdened, and a prolonged strain in consequence of military preparations might very conceivably lead to a total breakdown. If we were to desert the Ameer and to throw him into the hands of Russia, we should be involved in very great expenditure for the protection of the Frontier. It was to be remembered that not only were railways and military roads to be made, but that it would be necessary also to erect extensive fortifications on the Frontier which would cost a large sum of money, and thus swell the demands upon the resources of India. The expenses would be enormous, and the revising of the Estimates for 1885–6 would, be a serious question indeed. Still, it was high time that the Frontier of India should be protected, and he was ready to support the Government in any proposals having that object. It was difficult to determine how that enormous expenditure was to be met; but met it must be, and it must be recollected that the effect of what had recently happened would entail on the finances of India a large additional permanent charge. There was no use in blinking the serious position of Indian finance at the present time. Unless matters were amicably settled, it was doubtful whether the amount of this loan could be obtained in the London market. It was already a significant sign that Trustees did not like to invest in Indian Securi- ties. The Bill was a simple one, but it involved an enormous principle. As the matter stood, however, both sides of the House would admit it was high time our Frontier should be protected, and their unanimity would show the people of India that we were determined to do all we could to protect them.

MR. SLAGG

said, that his hon. Friend (Sir George Campbell) appeared to consider that there was some connection between the abandonment of the Quetta Railway and the abolition of import duties on Lancashire goods. He (Mr. Slagg) entirely failed to see this connection, nor could, he imagine how anyone who had grasped the first principles of Free Trade could offer the slightest opposition to the emancipation of the Indian ryot from the tax imposed upon him for the benefit of the Indian manufacturers. It was popularly supposed that, when Lancashire was successful in obtaining the abolition of the tax, something was put into the pockets of her manufacturers. Nothing of the sort took place; for the whole of the duty was actually given in a reduction in the price of clothing to the Natives. With regard to the Quetta Railway, the hon. Member who had given Notice of an Amendment (Mr. E. Stanhope) made, he thought, a very good case, when he showed that many of those things which Her Majesty's Government were now doing were matters which they strongly condemned the previous Administration for undertaking; and were he (Mr. Slagg) to say one single word in defence or approval of the Quetta Railway project, he thought a most ample apology would be due from him because in 1880, he did his best to turn the late Government out of Office for having, amongst other things, undertaken that line. He saw a good deal more in this matter than simply the construction of a line as far as Quetta. It meant that Her Majesty's Government had fallen into the hands of the same clique of military advisers who prompted hon. Members opposite before 1880 to construct a line into Afghanistan. The line meant the obtaining of a point of advantage which would enable the Indian Government, at anytime it chose, to continue the line to Candahar; to march troops, and plant them in Candahar; and, if necessary, to pursue military operations on a large scale in the regions of Afghanistan, and so repeat the miseries and horrors for which they so strongly condemned the late Government in 1880. It was said that military authorities were almost unanimous in favour of this project, and several names were quoted which were, no doubt, of great influence. But there were other military authorities of equal eminence on Indian questions who had denounced, in the strongest possible manner, any interference in the affairs of Afghanistan or its Frontier arrangements, and who were absolutely in favour of the defence of India on her own proper Frontier, within her own territories. Among such authorities he might name Lord Lawrence and Lord Dalhousie as civilians, and Sir James Outram, Lord Napier, Sir Neville Chamberlain, and Sir Henry Norman as soldiers. Although he should express himself with extreme diffidence on military questions, yet, looking to past history and the result of our interference in the affairs of Afghanistan, lie was driven to the conclusion that we should act most wisely if we held our own territory, made that as strong as we possibly could, and avoided complications in the territories of Khans and other Potentates. In regard to the other portion of the Bill, the House could have really little criticism to make. His hon. Friend the Under Secretary of State for India (Mr. J. K. Cross) had stated that the works to be undertaken would probably prove of a remunerative character, and on the Government would rest the responsibility of only undertaking works of that nature. He shared the apprehension expressed by almost every speaker as to where the money was to come from to provide the necessary funds. In surveying the financial condition of India, he stood appalled at the idea of putting further burdens on the shoulders of that much-taxed people; and although the House would be told they were a lightly-taxed people in relation to the actual sum paid per head, yet they could not conceal from their minds that they were miserably poor. It was therefore difficult to consider what might be a light taxation with reference to persons whose incomes were less than 40s. a-year. Perhaps the House would be told how the money was to be raised; but he was perfectly assured of this—and Sir Evelyn Baring, no mean authority, confirmed the statement—that no more money could be raised by fresh taxation. As regarded the Famine Lines—erroneously called Famine Prevention Lines—it had been clearly demonstrated that no lines had ever prevented famines. Certainly, when famines had occurred, the railway communications had greatly relieved the distress by bringing food supplies more rapidly to the places of scarcity; but the cure of famines lay far deeper than any point raised by these lines. Famine was undoubtedly produced in India, not only by the desperate poverty of the people, but by a system of government which he would not say was bad, but which had certainly not in all respects been successful; and when they talked of famine and famine prevention, surely their attention ought to be turned to those financial means of relief and those possible methods of ameliorating the condition of the people which could only be affected by wise and economical government. One view which he strongly entertained with regard to this vast expenditure on the Frontier was that, when another Government came into Office, they were certain to be presented with a totally different scheme, and the scheme which had been adopted at the instance of the previous Administration would be denounced as so utterly bad that it must be changed at once. Thus the balance oscillated between one extreme and the other, and the outcome of it all would be an immense victimization of the people of India and an increase of their burdens. He did not intend to oppose the Motion; because, as to the commercial portion of it, having been a Member of the Select Committee on whose Report that portion was based, he was bound to agree. But as to the undertaking at Quetta, which no doubt had been forced on the Government by its Military Advisers, he felt bound to enter his emphatic protest against it.

MR. BUCHANAN

said, in reply to his hon. Friend who had just sat down, that by constructing the railway to Quetta, they were not pursuing the policy of advancing beyond their Frontier; but they were simply making secure their communications within their Frontier. His hon. Friend had also stated that railways did not prevent famine. That was literally true. But they obviated the worst results of famine, and largely diminished the mortality. He could not help noticing that the Bill had undergone several changes since it was introduced. In its original form, it was a Bill to supply means for carry out the recommendations of the Select Committee which sat last Session, and the funds were to be devoted principally to the construction of commercial railways, whether reproductive or not. But since the Bill was introduced, they had had laid before them some Correspondence with the Government of India; and from that Correspondence it appeared that a very large portion of the money which was to be raised under it was not to be spent upon the construction of the description of railways recommended by the Select Committee, but upon the construction of Frontier railways, which, he contended, were really military works, and in no sense commercial undertakings. He gathered from the speech of his hon. Friend the Under Secretary of State for India that the estimate made of the cost of the Frontier railways was very considerably below the mark. Several important statements had also been made with regard to an additional railway through the Bolan Pass, and the cost which it would entail upon the country; and also with reference to the enormous cost laid upon India in consequence of the military preparations which were now going on. He joined with the hon. Member for Mid Lincolnshire (Mr. E. Stanhope) in regretting the course taken with respect to this Bill. They had not now before them Sir Auckland Colvin's Financial Statement, which was made two months ago, and was ordered to be printed more than a month ago; but considering the information which had reached them in newspaper abstracts as to that Statement, he must say that he did not think that the prospect of the finances of next year was very satisfactory. Sir Auckland Colvin anticipated a surplus of £508,100. He believed that surplus would not be secured. Last year, Sir Auckland Colvin anticipated a surplus of £319,000, and the result was not a surplus, but a deficit of £716,000. They could not, therefore, anticipate that he was likely to realize his estimated surplus this year. This was not merely his (Mr. Buchanan's) surmise. The Finance Minister himself used these words in concluding his statement— There is no reason why our resources should not fully suffice to meet all the normal expenditure of 1885–6. But if abnormal expenditure, whether of a temporary or permanent kind, is forced upon us, our Estimates may very probably prove unequal to meet it. Yet everyone must allow that a very abnormal strain had been for the last three months, and was now being, put upon the finances. The Under Secretary of State for India had informed him that evening, in reply to a Question, that the military expenditure incurred until the end of July was not less than £3,000,000, plus £385,000 for ordnance. Then they had heard from his hon. Friend that there was to be a new railway through the Bolan Pass. Neither the exact estimate of the cost of that railway, nor the period that would be occupied in its construction, had been given; but they had been informed that it would cost 10 lakhs during the next two months. Besides that, they had had most distinct warnings that the estimate put forward by the Government of India as to the cost of the Frontier railways could not be relied upon. They were, there fore, in this position—that the Frontier railways which the Government desired to construct would cost, according to the estimates of the Government, £5,000,000, and according to the Statement of his hon. Friend £5,800,000, or nearly £0,000,000, and in that amount the expenses of the new railway through the Bolan Pass were not included. Added to that, the Government already had liabilities amounting to £3,000,000 for four months, so that already the Government of India for Frontier railways and military expenditure would be indebted to the extent of £10,000,000, equal to the total sum now asked for. There were increased obligations in the immediate future, and it was right that the House should consider the Bill in view of the financial prospects of India as affected by recent political events. One other point ho wished to bring before the House. He objected to the Government mixing up Frontier railways and commercial railways, for the recommendations of the Select Committee applied only to the latter. Frontier railways were as much military works as fortifications and barracks. The Government of India proposed that those Frontier railways and military works should be made entirely out of money raised by loan; but Sir Auckland Colvin was so opposed to the course that he entered a strong dissent against it, in the Minute printed in the Correspondence which had been circulated., He pointed out that such a proposal was contrary to the declared opinions of Lord Lawrence, Sir Richard Temple, Sir John Strachey, and other eminent authorities, and that the result would be that the charge for military railways would be a charge prior to the charge for the construction of commercial railways. The Secretary of State for India had also expressed his concurrence with the opinions of Sir Auckland Colvin rather than with those of the majority of the Governor General's Council. Yet now these works were to be proceeded with out of borrowed money. That was an entirely new departure, and a departure in a wrong direction; and Sir Auckland Colvin anticipated that if the intention were carried out, it would indefinitely postpone the carrying out of railways for commercial purposes. They were undoubtedly in a position of considerable embarrassment in regard to voting this Bill. No one wished to hinder the carrying out of military works which might be deemed to be necessary for the defence of India. Still less did they wish to retard the speedy construction of commercial railways for developing its resources. Whenever the Indian Government made up its mind what the Frontier was to be, the House would not scruple to vote funds for the purpose; but they ought to be careful to ascertain clearly for what objects the money asked for was to be devoted. They ought not to confuse the two issues, and they ought, in sanctioning a large loan, to consider it in its bearing on the general financial position of India.

MR. HARRIS

said, he was glad to hear the hon. Gentleman the Under Secretary of State for India (Mr. J. K. Cross) say that the new lines would not cost more than 50 per cent of the outlay on the old lines; and he was thereby induced to hope that the existing high freightage charges which had so much hampered the export trade of our Indian Empire, especially in the wheat-growing districts, would, in consequence, be reduced. That was essential to the in- terests of trade. As the conquering country, we were bound to develop the resources of India as much as possible, and should pay especial attention to those lines that ran into the wheat districts. In his opinion, these railways ought not to be left to private enterprise. He thought it was much better that Government should undertake the construction of these lines than that they should be left to speculators, because they would have them, to a great extent, in their own hands. The wheat trade of India was capable of enormous development; but the Government did everything in their power to discourage the higher cultivation of the soil by adopting the principles of Mr. Henry George, and increasing the taxes on land as its value was improved. The free import of Manchester goods had been mentioned in the course of the discussion. Much had been said against the imposition of a duty on imports; and while he did not wish to raise any Free Trade or Fair Trade discussion, yet he considered that taxes which were far more antagonistic to the received principles of political economy were the export tax on rice, and the large land tax which handicapped the productive power of the Natives of India. There was no doubt that the more the Natives were encouraged to grow wheat by the construction of railways, the cheaper they could send it to the seaboard; and the more wheat came to this country, the more Manchester goods would go out to India. He maintained that any existence of duties on exports was a much more pernicious principle than duties on imports. Those were his reasons for supporting in every way he could the Motion made by the Under Secretary of State for India. He was strongly of opinion that the construction of military railways was a necessity, if they wished to inspire confidence in India; and if this country did not inspire confidence in the Natives of India as to its grasp in that country a great mistake would be made. Whether the Russians intended to attack India or not, that confidence needed to be promoted all over the country, in order to encourage the investment of English capital, and to develop the country in every possible way.

MR. ASHMEAD-BARTLETT

said, he merely wished to point out to hon. Gentlemen opposite, who had not been very numerous in their attendance that evening, and did not show that interest in an important measure of this kind which he thought it demanded, that nearly the whole of this expenditure, or rather the whole of the £3,500,000 expended on warlike expenditure during the past few months, was entirely due to the Government's policy of the abandonment of Candahar. The Vote the House gave four years ago, by a majority of 120, in favour of the abandonment of Candahar, and of the destruction of the Quetta Railway, thereby reversing the policy of Lord Beaconsfield, was directly responsible for the expenditure which India and this country were now undergoing. This question of military expenditure was not to be settled by the result of the Motion of that night. The country was now paying the bitter penalty, in money and in blood, for the incredible blindness of Her Majesty's present Ministers, and the Leaders of the Liberal Party. If this country were now in occupation of Candahar, and if the railway had been completed, the Russian Forces would not have dared to approach Afghan territory, or even to enter into possession of Merv. He hoped that the railway would be completed, not merely to Quetta, but to Candahar; for, until the railway communication was complete to that great position, we could not be sure against a Russian absorption of Afghanistan. That railway must be completed to Candahar by an arrangement with the Ameer, so that British troops could be thrown into that place whenever occasion arose; and if the Ameer were willing to consent to such an arrangement, by all means let it be effected at once. It was assumed by some that this railway would not be remunerative; but that, he believed, was a mistaken idea, and that the accession of trade to be acquired by it was considerable, for we should gain the whole trade of Afghanistan, of Northern Persia, and of all those tribes not subject to Russia. He deplored the policy of surrender which had characterized the action of Her Majesty's Government, and he contended that unless a more vigorous policy were pursued, nothing but danger was to be apprehended from the constant encroachments of Russia in the direction of our Indian Frontier.

GENERAL SIR GEORGE BALFOUR

said, he greatly regretted to see, by the very small number of Members present, how little interest "was taken in these matters relating to India. At one time there were not 15, seldom not 20 Members present, and even now there were only between 20 and 30.

MR. CALLAN

In consequence of the observation of the hon. and gallant Member, I beg to call the Speaker's attention to the fact that there are not 40 Members present.

House counted, and 40 Members being found present,

GENERAL SIR GEORGE BALFOUR,

in resuming, said, it was to be regretted that some more information was not given with regard to the finances of India, seeing that £9,000,000 of new outlay would be made within the next few years; and he trusted his hon. Friend the Under Secretary of State for India, in his reply on the debate, would give further information, as the last Budget for 1885–6 was not of a very hopeful character, so far as meeting this increased civil and military expenditure was concerned. He (Sir George Balfour) had no belief in the promises of the Russian Government, and was convinced a forward movement of a strong Force into the healthy table laud of Pishin was necessary on our part for the defence of the North-Western Frontier of India. Ho therefore hoped the preparations against the advance of Russia would be such as would deter that great Power from moving on. He joined most heartily with those who felt that the engagements made by Russia were unworthy of credit; and, therefore, most cordially approved of a policy of preparation for India. In connection with that point, he would urge upon his hon. Friend the necessity which existed, in the first place, for extending our trade in all directions, especially with Afghanistan, and thereby lessen the inducements for Russian merchants to try and open a trade; and next in improving and strengthening the Native Army, so as to make it more efficient than it was at present. It was exceedingly small, and the money inducements for able-bodied men to enter the Service were small. Indeed, the Sepoys pay was at present less than it was 100 years ago. Whatever Force we maintained there of that character ought to be as efficient as possible by the men being trained in these military exercises to the highest state of perfection. Another object which ought also to be carried out without delay was the extension of commercial railways along with a large reduction in transport rates. At the present moment, he believed, it cost 50 or 60 per cent more to convey wheat from Delhi to Calcutta or Bombay than from Chicago to New York, the distances being nearly alike—1,000 miles. If Indian wheat was to compete with American they must reduce the transport rates. One great inducement to Russia to advance on India was to get possession of her trade, and that of Afghanistan; but we ought to do everything in our power to prevent that country being filled with the goods of Russia, and cheap transport in India would do more to save that trade than any other measure.

MR. JACKSON

said, he wished to say a few words in support of the Bill before the House, as having had the honour of being a Member of the Select Committee on Indian Railways. In the Committee there was a difference of opinion among the Members on such points as whether the money should be borrowed in India or in London, and the amount of interest to be paid; but, so far as he had been able to judge, there had been no difference as to the absolute necessity and great advantage of railway extension in India. The Bill before the House appeared to point to this fact—that unless the Government were entrusted with powers to raise money, in this form or some other like it, the extension of what were called "commercial lines" would be seriously interfered with by the absolute necessity of making the lines to which the hon. Gentleman opposite the Under Secretary of State for India had referred that evening. He desired to put on the Government the responsibility of their own proposals in this matter. They had come down to the House and said the making of these lines and the expenditure of this large sum of money was absolutely necessary for the defences of India. Now, he held the opinion that England was so committed to India that it was absolutely necessary it should be clear that, so far as the question of the safe retention and preservation of that country was concerned, this country was bound to do everything that was necessary for the purpose. Some desire had been expressed for more information as to how it was proposed to deal with the money which was asked for; and he thought the House was also entitled to know whether this money would involve any additional burden upon the Revenue of India, or any additional taxation upon the people of that country. The Indian Railway Extension Committee, he would point out, was very positive on one point—namely, that the people of India ought not to be called upon to bear the cost of making railways in India. The hon. Member for Kirkcaldy (Sir George Campbell) had entered what he called a strong protest against the Government making all the lines, he being in favour of the Government only making such lines as were absolutely necessary in districts where they would pay, and leaving to commercial enter-prize the construction of them in districts where they would not pay. He (Mr. Jackson) had no doubt that no one would be better pleased than the Under Secretary of State for India if he could have lines which were necessary for military or famine purposes made by private enterprize; but he (Mr. Jackson) himself considered it would be unreasonable to expect the commercial companies to undertake lines the primary necessity for which was the protection of the country. It was only by Government—who, in that case, would have no option in the matter—adopting that course that the two classes of railways could be proceeded with at the same time. He was sorry to hear the hon. Member for Guildford (Mr. Onslow) cast a doubt on the security offered by the Indian Government. The last thing he (Mr. Jackson) should expect any friend of India ought to desire to do was to make any remarks which would cast any doubt upon the security, and thus increase the difficulty of raising money for the necessary purpose of India. He believed that the British Government owed a great duty to India; and he would even go the length of saying that his idea was that, if necessary, the British Government should guarantee the money for the construction of the railways. The hon. Member for Manchester (Mr. Slagg) seemed to doubt the advantage of making railways in India, because of the danger there was of fur- ther taxing the people, who already were so wretchedly poor; but in the Report which was issued by the Committee, of which the hon. Member for Manchester himself was one of the Members, it was stated by General Strachey, who, he (Mr. Jackson) believed, was recognized as a very high authority, that he estimated the annual benefit arising to the people of India from the construction of railways had been £30,000,000 to £40,000,000. If that was accepted, as he thought it would be, as an authoritative statement of the probable benefit which had accrued to India by the making of railways, they might, he thought, set their minds at rest on the point that the making of additional railways in India would add to or impose any additional taxes on the people of India. There was another point which he might mention in connection with this subject, as showing the enormous progress made, and which, he thought, they were entitled to claim as having partly been the result of the railroad extension in India. He referred to the enormous progress which had taken place in the exports from India. In the same Table, to show the average annual value of exports, it was stated that from 1869 to 1873 the value amounted to £54,990,000; while the exports in 1883–4 amounted to £88,076,000. These figures were, he thought, conclusive as to the advantage which had accrued from railroad extension; and he had no doubt or hesitation in his own mind that a very considerable extension of the railroad facilities in India would continue in the same way to benefit the people of India. If the making of the necessary Frontier lines and of the fortifications were, in any sense, crippling or retarding the progress of a great many of what were called "commercial lines," which were necessary to develop the resources of India, he thought that, in itself, would be a sufficient reason for the Bill, the justification for which, if any were wanted, would be found in this—that the direct result of it would be to defend and to develop the resources of India. He believed, further that the present proposal was one which was necessary for the defence of India; it was a measure of protection against famine, and in relief of famine; because, although exception had been taken to that statement, he thought it had been conclusively shown that, while it could not be said that railways were a protection against the occurrence of famine, they certainly saved the people from results which would otherwise accrue from famine. He thought it was also necessary for the development of Indian resources, and would tend to open up new markets, and was thus one of the best means at their command of benefiting the people of India. On these grounds ho cordially supported the Motion for the second reading of the Bill.

MR. ARTHUR O'CONNOR

said, that, looking at this question from a Home Rule point of view, he thought that the people of India would be quite justified in opposing this proposal with all their force, seeing that guaranteeing funds for the construction of railways in India, when those lines were not likely to prove remunerative or profitable, was a most unfair mode of proceeding towards the unfortunate Native taxpayer for the benefit of the British capitalist. Then, again, they had no information whatever from the Government as to the probable financial condition of India during the coming year, when it was well known that the Revenues of India were not able to bear any further over-taxation; and he also thought it was not right that a financial Bill should be passed through the House, without an opportunity being afforded of ample consideration and full discussion. Statements heretofore made with respect to Indian finance had not been justified by results; for, in some instances, where a Department showed an increase, that increase had been largely counterbalanced by the augmented cost of administration. Enormous sums were already taken away from India every year for the purpose of paying interest on loans which had been expended in the construction of railways which were unprofitable. A larger revenue was derived from the Salt Tax now than it yielded some years ago, although they had been told recently that the Government had lessened the burden of this cruel and oppressive tax upon India. The Customs Duties had been lowered for the benefit of Manchester; while the Excise Duties, which pressed so heavily upon India, had been raised. In fact, the people of India were ground down by a system of taxation more searching and distressing than probably any other financial system in vogue. Yet they were now asked to vote £10,000,000 for these railways, which would never benefit the people of India at all. There was one clause in the Bill which seemed to challenge the opposition of anyone who held the political opinions that he did, and who thought that a people ought to be left to manage its own affairs without the intervention of any other people. That clause provided that all the bonds and debentures issued should be charged upon and payable out of the Revenues of India. What had the people of India done that they should be saddled with this further expense? If the Russians and the British were at rivalry in Central Asia, that was not the fault of the Indians. In his judgment the people of India would be specially benefited by the proximity of Russia, for British administrators in India would then endeavour to do something like justice to the unfortunate Natives of that country. If the hon. Gentleman who threatened the Amendment (Mr. E. Stanhope) had proceeded to a division he (Mr. Arthur O'Connor) would have been obliged to vote against it, as ho was not inclined to regret the abandonment of the Quetta Railway, which, from the very moment of its inception, he had regarded as an impolitic and unjust undertaking.

MR. J. K. CROSS

said, that, by the indulgence of the House, he might, perhaps, be allowed to say a few words in reply to some remarks which had been made. Attention had been called to the despatch of the 21st of May, 1880, and his hon. Friend opposite (Mr. E. Stanhope) intimated that it showed the policy of the Government, which resulted in the abandonment of the Quetta Railway. Ho (Mr. J. K. Cross) would refer, however, to another despatch, written by his noble Friend (the Marquess of Hartington) on the 29th of July, 1880, when he had been informed what the condition of the railway was supposed to be at that time. His noble Friend said— As to the Candahar Railway, it is represented that the line is open as far as the foot of the Murree Hills, and 'that on the Nan lower section 100 miles of road to the Quetta plateau will probably be ready for opening in 1881, while a further section as far as the Amran range is being surveyed, and that between that point and Candahar nothing has been done. I need offer no remarks in regard to the first two sections of the railway which are either open or ready for opening. In regard to the two latter sections, I am of opinion that the surveys as far as the Amran range may be, with advantage, completed, and that the country beyond as far as Candahar may also be surveyed; but nothing further should be done on either of these two sections with regard to the construction of the railway without previous reference to me. It was quite clear from this despatch of the 29th of July, 1880, that the noble Marquess accepted the first two sections of the Candahar line—namely, that from the Indus to the foot of the Murree Hills, and also that from the foot of the Murree Hills to Quetta, and that he said in this despatch that he need offer no remarks as to the first two sections, which are either open or nearly ready for opening. This clearly indicates that the line to Quetta, at any rate, was accepted by the noble Marquess, and that he also authorized the completion of the surveys to the Amran range beyond Quetta, and as far as Candahar.

GENERAL SIR GEORGE BALFOUR

inquired whether that despatch had been laid before the House?

MR. J. K. CROSS

said, that it had not; but he proposed to present it. Statements had been made to the effect that the railroad had been to some extent destroyed by order of the present Government a short time after they came into power, simply because of the fact that the line was proposed by Lord Beaconsfield; but he could assure the House that the question was one of policy, and not of pique. It had been also indicated from the opposite side of the House that the line had. been destroyed, if not by the Home Government, at least by the orders of the Government of India. He (Mr. J. K. Cross) denied that that was the case. The reason the line was stopped eventually was that it was not considered to be by any means certain that the occupation of Quetta and Pishin would be continued. His noble Friend Lord Ripon was not personally in favour of abandoning the line, when that abandonment occurred; and there was no truth in the assertion that it had been destroyed, for he found on page 38 of the Administration Report of 1880–1 the following statement:— The existing buildings were not dismantled, and such parts of the lines as had already been laid were not lifted.

MR. E. STANHOPE

said, he spoke on the evidence of eye-witnesses.

MR. J. K. CROSS

said, he could also give the evidence of eye-witnesses. Major General Trevor, who was Director General of the Railways under the late Government, wrote a letter to The Timesin the spring of 1884, in which he stated that there had been a misapprehension on the subject, and that very little loss of money had been incurred when the line was abandoned. Major General Trevor had also since informed him (Mr. J. K. Cross), in writing, that no rails were pulled up when the Quetta section of the Candahar line was abandoned. With regard to what had been done on the line and the progress of the works, he would quote a Report from Mr. Moles worth, the principal engineer in India, who reported, on November 14, 1884, that in his original note of April 20, 1880, he had included a list describing the character of the different sections of the line under the heads of "easy," "moderately difficult," "heavy," and "very heavy." Mr. Moles worth stated that no great progress had been made in the surveys, and that in many places they had not passed beyond the stage of simple reconnois-sances. His hon. Friend quoted a Minute written by Mr. Rivers Thompson (now Sir Augustus Rivers Thompson), in February, 1881, in which the latter proceeded on the assumption that the lines were to be dismantled, and instanced a case of such dismantlement in China as the only one which had ever occurred. Mr. Rivers Thompson's Minute was written on the receipt of a despatch of the noble Lord who was then Secretary for India, dated December 3, 1880, and was founded on a misconception of the meaning of that despatch. Thus the only evidence which his hon. Friend opposite had brought forward—namely, the Minute to which he (Mr. J. K. Cross) had just referred—proved absolutely nothing. With regard to the general question of the Quetta Railway, he was quite willing to allow that it had been stopped in 1880, when it was undecided whether Pishin should be retained, and not begun again till 1883–4. The line was then re-surveyed, and it was found that a better alignment could be made than the one originally intended; and it would be seen, when the engineers' Reports were presented to the House, that, so far from the discontinuance of the work for two years having been a loss, there would be a very considerable financial saving on account of the difference in the cost of materials, and from the saving effected by means of the improved plans which would be carried out. If they had to go back into the past to throw stones at each other about railway communications, he would like to ask the hon. Gentleman opposite (Mr. E. Stanhope) to remember how long the late Government occupied the Pishin plateau, without any reasonable communication between that place and the Indus.

MR. SPEAKER

said, he must call the hon. Gentleman's attention to the fact that he was trespassing rather too far on the indulgence of the House, as he had no right to reply.

MR. J. K, CROSS

said, he would not pursue the subject further. He would only add that he was much obliged to the House for their indulgence in listening to those few remarks, and he would conclude by explaining that it was not possible now to lay before the House the annual Financial Statement, as it had been suggested by several hon. Members he might, and which he should have been only too glad to have done, because some millions of additional military expenditure had been incurred; and until they ascertained how long that expenditure would last, it was impossible that the Budget could be presented. He hoped the House would now allow the Bill to be read a second time.

Question put, and agreed to.

Bill read a second time, and committedfor Monday8th June.