ENEMY GOODS IN INDIA. (Hansard, 16 March 1916)

§ LORD SYDENHAM

My Lords, I rise to ask the Under-Secretary of State for India what measures are being taken to stop the import of goods of enemy origin into India. I have received several letters from India complaining rather bitterly of the introduction of goods of enemy manufacture into that country. One of my correspondents, who claims to speak for a large number of British firms and who writes from Bombay, says— A friend of mine has actually been obliged to go home on account of German competition, although all goods are supposed to come from neutral countries, such as Sweden, Holland, and Norway. This German trade has very much increased since last year. Another writer from the Punjab states— There is not the slightest doubt that German-made goods are coming into India, and will continue unless steps are taken by the Government to stop this trade. 417 He goes on to say— If every one convinced of the urgency of the matter would make himself heard, a public opinion would develop which would have weight. That is a process which has been found necessary in this country in connection with many measures that have been required.

This question of enemy imports has been raised by the Lahore Chamber of Commerce; and more recently I saw in the newspapers that the Madras Chamber of Commerce had made a strong protest to the Government of India on the subject. The Madras Chamber dealt with goods of part enemy origin, and pointed out that goods of which 25 per cent. of value was of enemy character were being freely admitted into Bombay and Rangoon. This they spoke of as— disagreeably analogous to a policy of inflicting on Germany only 75 per cent. of defeat on the battlefield. I do not know whether this 25 per cent. rule is the declared policy of the Government of India, but it appears to me to be rather a complicated rule to work in actual practice. I quite understand that it must be very difficult to discriminate against enemy goods when they come through neutral countries; but, on the other hand, their origin must be known to the importers, and it could hardly fail to be known to the Customs authorities who are in the habit of handling these goods in time of peace. I am told that Ceylon is comparatively free from enemy imports, and that the reason for this is that the Customs authorities are more strict there than they are in India.

The extent to which German influence has penetrated into the great bazaars of India is not recognised as much as it should be. The modus operandi is this. The Germans carefully copy goods and articles which are in common use by numbers of the Indian population. Then their agents go into the bazaars and get into close personal contact with the Indian producer, and they eventually convert the Indian producer into a middle-man for the dissemination of their goods. The result of that is bad for India, because it tends to eliminate the Indian craftsman; it also tends to spread cheap and inferior articles throughout the whole country. I have raised this Question to-day because if this trade is allowed to continue in time of war, it will be very difficult to compete 418 with it when the war is over. I am afraid that there has been a good deal of laxity in India with regard to enemy trading. I am afraid also that the handling of the internment of aliens question was ineffectively managed at first. Now it seems that, if my information is correct, a large amount of enemy goods is actually being permitted to enter India. The powers possessed by the Government of India in this respect are very great, and if only a little of the vigour with which the Common-wealth Government of Australia have handled these enemy questions had been displayed in India it would have been very much better for the people and for the country.

§ THE UNDER-SECRETARY OF STATE FOR INDIA (LORD ISLINGTON)

My Lords, the subject which my noble friend has raised is, I am sure your Lordships will agree, one of great importance, and I am the last person to find fault with a Question of this character being put to me in my capacity as representing the India Office. My noble friend told us broadly that a great deal of goods of enemy manufacture were finding their way into India, and he also alluded to the fact that certain Chambers of Commerce had passed resolutions in that connection. He did not, however, specify any instances in regard to this importation, and I would say that it would be of use if specific instances were brought forward so that they could be investigated in the proper quarter. Speaking on behalf of the India Office and of His Majesty's Government I can state that they are most desirous of preventing, as far as possible, the importation into India of goods of enemy origin or manufacture.

As regards the conditions that are laid down in India, I may say that directly on the outbreak of war imports from enemy countries ceased entirely, and very soon after the outbreak of war both direct and indirect enemy imports were prohibited by law. The principal measure in this connection dates as far back as December, 1914, and it is in every respect identical with the regulations laid down in regard to this country. A British Consular certificate of origin is insisted upon in respect of goods shipped from countries through which enemy goods might be likely to find their way. This system has, of course, undergone certain alteration since it was first introduced in the latter part of the year 1914. There has been established a 419 modification to this extent—it was alluded to by my noble friend—that not more than 25 per cent. of enemy origin manufacture is allowed in imported articles reaching ports in India. That is a regulation that is in force in this country, and it is, I think I am correct in saying, enforced throughout the Empire. It is not for me this afternoon to discuss the particular merits of that regulation. It has been laid down, I presume, by the Board of Trade in conjunction with the Foreign Office, and, as I say, it is universal throughout the Empire.

There must be, as my noble friend has admitted, a certain difficulty from time to time in detecting what are actually goods of enemy origin. Whether it is a question of regulating and limiting enemy origin to a proportion of the manufactured article imported, or whether it be not, it must be extremely difficult, with all the devices to hand of disguising the original manufacture, for any Consular officer to say in some cases whether the article in question is one that has been manufactured in a neutral country or one that found its origin either in part or wholly in an enemy country. But it is laid down that our Consular officers at the different ports in the neutral countries which are adjacent to enemy countries or through which it is likely that enemy goods would pass in their transit outwards should grant in every case to the exporter a certificate containing full details before the export is allowed to leave the neutral port. When it arrives in India under those conditions it also undergoes a close scrutiny on the part of the Customs authorities. They examine the goods at their discretion even when covered by the necessary certificate, especially when any suspicion attaches thereto; and such goods, if suspected to be of enemy origin, are not allowed to the consignee. I am also able to state that a Bill will shortly he introduced in the Legislative Council for the purpose of validating the seizure of suspected goods, and this will still further strengthen the arm of the law.

I hope from what I have said that my noble friend will realise that the real responsibility in this case, though he and I am sure your Lordships will admit the difficulties of detection arid discrimination, 420 lies with the Consular officers in the neutral country. You have the additional scrutiny in India to which I have referred, and I have every reason confidently to state that the Customs authorities at the ports in India arc giving the closest scrutiny to the consignments as they arrive. The law in regard to the other neutral countries, those which lie away from enemy countries, is that no certificates are imposed, but in those cases the goods that arrive in India are most carefully scrutinised by the Customs authorities. Still further strength will be added to this power of checking enemy goods by the recent publication of a statutory black list. All firms that are upon that black list will no longer be allowed to be the recipients of trade of this character.

I have little more to say, because although my noble friend spoke broadly of a large influx of enemy importation into India he did not give me the opportunity of really grappling with the question by putting forward specific cases. All I would say is this, that if any cases do come under his observation and he will refer them to me I can assure him they will receive early and close attention. I realise that in bringing forward questions of this character he does so entirely in the public interest, and far from regarding it as an embarrassment to myself in having such a Question put, I thank the noble Lord for putting it. I should still further thank him if he could give specific cases, because then we should be in a position to investigate and deal with them, and to carry out both in the spirit and in the letter exactly what the noble Lord desires and we desire—namely, the checking as far as possible of manufactures of enemy origin entering India.