HYPOTHECATION OF GOODS IN INDIA. (Hansard, 30 November 1847)

§ The EARL of ELLENBOROUGH

said, he should not detain their Lordships very long in moving for the papers of which he wished to obtain copies. The returns for which he applied were as follows:— An account of all sums advanced by the Government of India on the hypothecation of goods, in each of the years from 1839 to 1846, both inclusive, with the rate or rates of exchange at which, in each year, such sums have been advanced, and the credit given for the repayment of such advances; also an account of the amount of all bills drawn upon the several Presidencies in India respectively by the Court of Directors of the East India Company in each of the years from 1839 to 1846, both inclusive, with the rate or rates at which such bills were drawn in each year, and the number of days after date or sight at which such bills were made payable; also a copy of the notification issued by the Government of India on the 5th of August, 1843, with respect to the proposed discontinuance of advances on the hypothecation of goods, and of any official report which led to the issue of such notification, and of all correspondence between the Government of India and the Court of Directors relative to such proposed discontinuance of such advances; also copies of all memorials or representations addressed to the Commissioners for the Affairs of India or the Court of Directors, by merchants in England, with respect to such advances, together with the replies thereto, from 1839 to 1846, both inclusive; and also copies of any agreement entered into by any company or companies for constructing railways in India with the Government of India, or the Court of Directors of the East India Company, whereby any amount of interest is guaranteed to such railway company. He believed it would not be denied that some of the early failures of commercial houses connected with India were to be attributed to the practices respecting which he now required information; and he thought it most desirable that the House should have before them any statements calculated to throw light upon the circumstances under which commercial transactions with India were at present practically 367 carried on. From the year 1834, when the existing charter of the East India Company came into operation, down to the present moment, there had been constant complaints from the merchants connected with India of the manner in which the changes then made had operated, and the system on which the transactions of business had, during the last thirteen years, proceeded. The papers for which he had moved would, he hoped, at all events, bring the matter partially before them; but he did think it to be ultimately necessary to examine witnesses, for the purpose of showing the practical injury which the present system had inflicted. Looking at all the circumstances of the case—even before he had an opportunity of looking into the papers—he did not hesitate to say that the subject was one which deserved serious attention from the responsible advisers of the Crown; and he hoped that the matter would not be left solely to the Board of Control, but that Ministers, as a Government, would investigate and consider the whole question: this he entreated them to do, and to look at it in all its bearings. Not long since he had seen in a newspaper a statement to the effect that the Directors of the East India Company had given directions for the transfer from India of certain quantities of bullion, for the purpose of enabling them to meet their engagements in this country. For that statement he believed there was some foundation, and he certainly should regret to see the purpose there referred to carried out to any considerable extent; for in 1832 there had been a similar export of bullion, and, according to the evidence of Mr. Trevelyan, that export had been attended with very injurious effects. It might be very convenient for the Directors to have bullion exported to them from India to meet their engagements here, and, in times of difficulty like the present, such exports might save them the necessity of paying heavy discounts for the use of money, and prevent the lowering of dividends on East India Stock; but such a misfortune could not be felt to any great extent; it could only influence the incomes of a limited number of persons in this country; whereas the export of bullion would materially affect the great body of the people in India. Upon these grounds he did recommend the Government to take the matter into their immediate consideration.