§ Sir G. WILLSasked the Parliamentary Secretary to the Overseas Trade Department why the Government propose to exclude India from the operations of the new export credits scheme; and whether this decision can be reconsidered?
§ Sir P. LLOYD-GREAMEI should be very sorry if the exclusion of India from the new export credits scheme gave rise to any misunderstanding in India or that anything I may have said should be regarded as a reflection on the merchant community in India. I can at once assure my hon. Friend that the exclusion is due solely to the situation arising out of recent economic conditions. The falling-off in the demand for Indian produce, due to the general depression in trade and in especial to the economic dis-organisation of Central and Eastern Europe, has brought about temporarily an adverse balance of trade for India. The exchange value of the rupee fell very rapidly last year, and the situation has been aggravated by a falling-off in the internal demand for commodities and the drop in prices. There has consequently been a serious accumulation of stocks in Indian ports and at the distributing centres up-country. In these circumstances, His Majesty's Government do not think it desirable to include India at present in the export credits scheme, but the situation will be carefully watched, and should a demand arise which cannot be sufficiently met through the ordinary machinery for financing trade, I shall be very glad to consider the matter again at a later stage.