§ 2. Mr. DOUGLAS HACKING
asked the Secretary of State fur India, whether he can make any statement to the House regarding the proposals of the Government of India to increase the existing import duties upon British goods entering India, with special reference to the imports of Lancashire cotton goods?
§ 10. Mr. PHILIP OLIVER
asked the Secretary of State for India whether he made any and, if so, what representation to the Indian Government on the recent Measure for the increase of the Indian tariff?
§ Sir S. HOARE
His Majesty's Government were satisfied that an increase in the revenues of India, both direct and indirect, and falling upon all classes of the community, was essential for the balancing of the Indian Budget. As part of the increase of indirect taxation, it has been necessary to impose an all-round surcharge of 25 per cent. on all existing import duties. In consequence, the duty on cotton piece goods of British manufacture will now be 25 per cent., and on piece goods of foreign manufacture 31¼ per cent., with a minimum duty in both cases of 4⅜ annas per pound on plain grey goods. Hon. Members will observe that the difference between the ordinary rates on British and non-British cotton piece goods is now 6¼ per cent. as against 5 per cent. prior to the emergency Budget. Other factors which mitigate the effect of the increases upon British trade are that a Customs duty of 10 per cent. has been imposed on imports of machinery and of half an anna per pound on raw cotton, hitherto admitted free of duty. It is further the case that under present exchange conditions British exporters will be more favourably placed in trading with India than exporters in countries such as Japan, which adhere to the Gold Standard. I am hopeful that these factors will go some way to compensate British exporters for the effect of the increased duties. In the course of the discussions which preceded the introduction of the emergency Budget, His Majesty's Government did everything in 781 their power consistently with the Fiscal Autonomy Convention, to lighten the burden falling upon British trade as a result of the increased taxation, and they will continue to watch the situation in a sympathetic spirit.
§ Mr. MARLEY
Would the Government cause inquiry to be made into the excessive military expenditure in India, which amounts to 45 per cent. of the total Budget?