HC Deb 26 February 1946 vol 419 cc1746-7
62. Mr. Peter Freeman

asked the Chancellor of the Exchequer the increase per week in the sterling balances accumulated by the Reserve Bank of India since VJ-Day; whether this increase has been accompanied by or is due to inflationary tendencies in India; whether this country has profited by the increase of these sterling balances; and, in view of India's poverty and prospect of famine, whether these accumulations of sterling balances will now cease altogether.

Mr. Dalton

The average weekly increase for the last 19 weeks of 1945 was£7 million, and for the first seven weeks of 1946,£2 million. This increase represents mainly repayment to the Government of India of their expenditure on Indian Forces outside India. Such expenditure is no more inflationary than any other expenditure by the Government of India. It certainly does not impoverish the people of India nor add to the danger of famine.