GOVERNMENT OF INDIA ACT, 1935. (Hansard, 6 June 1939)

§ The Under-Secretary of State for India (Lieut.-Colonel Muirhead)
I beg to move, That an humble Address be presented to His Majesty in pursuance of the provisions of Section 309 of the Government of India Act, 1935. Praying that the Government of India (Adaptation of Acts of Parliament) (Amendment) Order, 1939, be made in the form of the draft laid before Parliament. Briefly, the purpose of this Order is to extend for a further five months the period during which goods imported from Burma will be exempted from the application of the Import Duties Act, 1932, to allow time for a trade agreement to be completed between the United Kingdom and Burma and put into effect. Section 5 of the Import Duties Act of 1932 exempted from duty goods from Empire countries other than the Dominions, India and Southern Rhodesia. At that time Burma was part of India. Section 4 of the Import Duties Act exempted from duty goods from the Dominions, India and Southern Rhodesia, but the exemptions were due to expire on 15th November, 1932. That is to say, in default of other arrangements, goods from the Dominions, India and Southern Rhodesia would become subject to duty. That of course included goods from Burma.
In the autumn of 1932 the Ottawa Agreements Act was passed, and Sec- 383 tion2, Sub-section (I), of that Act excluded from the operation of the Import Duties Act goods from all countries having agreements mentioned in the Schedule to that Act. That is to say, it substituted for the duties of the Import Duties Act the duties contained in the several agreements arrived at at Ottawa. Still, of course, Burma was part of India. In 1937 Burma became separated from India and the effect was that Burma came under Section 5 of the Import Duties Act. That is to say, that Section which was related to imports from the Empire countries other than the Dominions, India, or Southern Rhodesia. The status of Burma with a new Constitution was such as not to make it desirable that it permanently should remain in that category, and it was intended that Burma should come eventually under Section 4 of the Import Duties Act. The point was, however, that the exemptions accorded under Section 4 of the Import Duties Act had, as I have just said, expired on 15th November, 1932, and Burma, in this particular instance, had had no separate agreement under the Ottawa Agreements Acts. Although coming under Section 4 would give her a certain status, it would in point of fact provide no exemption for her goods from the full application of the Import Duties Act ditties. Therefore it was not desirable that Burma should come under Section 4 of the Import Duties Act until she had negotiated a trade agreement of her own.
By the Adaptation of Acts of Parliament Order, 1937, Burma was to come under Section 4 in respect of all goods imported after 31st March, 1938. That, by inference, implied that there was a hope at that time that a trade agreement between the United Kingdom and Burma would by then have been arrived at. However, by that date, no trade agreement had been arrived at and so subsequently that date, 31st March, 1938, was extended first to 30th November, 1938, and then to 30th June, 1939. We now under this Order ask that the date should be still further extended to 30th November. It may be asked why there has been no trade agreement up to now between the United Kingdom and Burma and why such an agreement has not been arrived at. The conclusion of such an agreement has been necessarily dependent on the progress of the trade negotiations between the United Kingdom 384 and India. Burma and India have been closely tied together as regards tariffs by the trade agreement between India and Burma. Those countries under that agreement have mutual free trade, and, generally speaking, have a common customs tariff. It has not, therefore, really been practical for Burma and the United Kingdom to agree to a trade agreement until a new trade agreement has been arrived at between India and the United Kingdom, so that the question whether Burma should adopt similar tariffs to those in India under the new trade agreement could be studied. Now that a new agreement between India and the United Kingdom has been arrived at it is hoped that active negotiations for an agreement between the United Kingdom and Burma will very shortly be resumed and I hope by the new date included in this Order it will be possible to have completed the trade agreement between the United Kingdom and Burma and to have effected the necessary legislation. I think it only fair, however, to give due warning that for the full arrangements for the working of such an agreement to come into operation it may be necessary to ask for some further extension.

§ Mr. Wedgwood Benn
I make no comment on the fact that a matter of this importance is taken in the middle of the night. The Under-Secretary of State said quite clearly that the Burma and India agreements come together. The India agreement, which he calls an agreement, was one certified by the Viceroy, and I cannot help making the comment that ever since the time of Mr. Montagu it has been a fixed rule that the Indian tariff should be fixed by India and not by parties in this country. This is the first time that a tariff has been fixed by certification, and I do not know what Mr. Baldwin or any other of the Conservative Prime Ministers who have loyally observed this rule would have said had they known that new Indian tariffs were to be fixed on these circumstances. Is it intended to arrive at an arrangement with the Legislative Assembly in Burma or is it intended to adopt the same methods as those adopted in India? If the tariffs of India are to be fixed by order of the India Office, then the hope of India to achieve an autonomous status is very seriously postponed. Will an attempt be 385 made in this new tariff agreement with Burma to do it by agreement with the elected representatives of the Burmese people?

§ Lieut.-Colonel Muirhead
The right hon. Gentleman is asking rather a hypothetical question as to what action may be taken if certain things eventuate in connection with a possible United Kingdom-Burma agreement. In point of fact, I may remind him that the new Constitution of Burma differs in important respects from that still enjoyed by India at the Centre and does not provide for certification.

§ Mr. Benn
So that if the Assembly does not agree he will have to impose the old duties on Burma imports into this country and go without an agreement?

§ Lieut.-Colonel Muirhead
Those things are hypothetical. I cannot be expected to say what procedure would be followed in some months' time when an agreement may have been arrived at.