§ Mr. FREWENasked the Under-Secretary for India whether gold coins constitute an important form of currency in India; if so, where and to what amount are they current; whether his attention was drawn to the Simla dispatch of the Government of India to the Bombay Chamber of Commerce, referring to the experiment of 1900 when a million and a quarter sovereigns had been forced into the circulation, and which states as the result that the Treasuries, the Post Office, and the Presidency banks co-operated in special measures for the issue of gold, but the great bulk of these issues promptly came back to the banks and the Treasuries, and the experiment had ultimately to be abandoned; whether the experiment has since been renewed so that gold coins are now an important form of currency, as the Under-Secretary states; and, if so, what sovereigns are to-day estimated to be current outside the Treasuries, the Post office, and the banks?
§ Mr. MONTAGUThe Government of India reported in 1906 that in their opinion the balance of evidence supported the conclusion that the use of sovereigns as currency was increasing; and they have subsequently drawn the Secretary of State's attention to further indications of its extended use. Moreover, since 1906 there have been very considerable net imports of sovereigns into India from abroad, and there has also been a steady flow of sovereigns from and into Government treasuries in India. These are some of the grounds for holding that sovereigns are an important form of currency in India. But the hon. Member will understand that I am not able to state either the exact number or the exact location of the sovereigns now in circulation, and I am unwilling to offer information that is not exact. No communication from the Government of India answering to the description given by the hon. Member appears to have been submitted to the Secretary of State; but, if the date is supplied, it will, no doubt, be possible to trace the letter. No attempt is made in India to force gold into circulation; but gold coins are issued, where practicable, from Government treasuries to persons who wish to receive them in payment for sums due from the Government or in exchange for rupees.
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§ Mr. FREWENasked the Under-Secretary of State for India, whether of the estimated eighteen millions sterling of gold absorbed by India during the past year the Indian currency reserve retained only £1,300,000; and, if so, did the balance of £16,700,000 pass into hoards, or did a considerable portion pass into currency?
§ Mr. MONTAGUThe figures quoted by the hon. Member are very considerably at variance with those supplied by the Government of India to the Secretary of State, which show that the net imports of gold into India in 1910 were as follows:
and that during the year the gold held in India in the paper currency reserve increased by £625,000. I cannot say what portion of the net imports of gold and of the gold issued from the paper currency reserve went into use as currency and what portion was employed for other purposes, such as hoarding. The hon. Member will understand that in India, as elsewhere, a Government inquiry into the number and amount of hoards accumulated by individuals would be extremely difficult.
£ Bullion 7,448,068 Sovereigns and other British coin 7,772,301 Other gold coin 198,794 Total 15,419,163