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an advanced Cobdenite he would prove' a hard nut for the Colonial Premiers to crack' (sic) in the matter of Imperial Preference; and when it was subsequently pointed out in the House of Commons that Lord Inchcape, then Sir James Mackay, was about the most unsuitable person in the world to represent' India, seeing that every known politician of Indian birth is a Protectionist and nearly every Anglo-Indian is a Tariff Reformer, the Government evaded the difficulty by declaring categorically that Sir James had not professed to represent' anyone but the Secretary of State for India! However that may be, there is no doubt whatever that his supposed 'representation of India had carried weight with those who were una'cquainted with the true facts of the case.
Then, again, two other very eminent members of the Com mission-Sir Edgar Vincent and Mr. Tom Garnett-are chiefly known for their extreme hostility to Indian views on fiscal questions. Sir Edgar Vincent is a prominent Cobden Club pamphleteer. He has been twice defeated as a Cobdenite in Parliamentary contests-once at Exeter as a Unionist Free Trader, and once in Essex as a Radical Free Trader. But some of his writings published by the Cobden Club have obtained a wide circulation by the aid of that powerful organisation, and he has spoken and written with especial vehemence against Indian Imperial Preference. And Mr. Tom Garnett, in 1895, as the Chairman of the ‘Joint Committee of Employers and Operatives on the Indian Cotton Duties,' was the leader of the powerful and successful agitation that forced on Sir Henry Fowler (afterwards Lord Wolverhampton) and Lord George Hamilton the existing fiscal system in India, that imposes import duties on Lancashire cotton-goods, as well as the hated excise duties on the products of Indian cotton-mills.
But, when all this is well understood, some innocent-minded folk may still ask : 'Why should Mr. Asquith and Mr. Harcourt be so desperately anxious to exclude India from the purview of the Commission? They cannot be altogether ignorant of the infinite importance of the Indian trade, not merely to Lancashire and South-West Scotland, but also to every industrial and commercial centre in the United Kingdom. If we supinely allow that trade to slip from our hands—and already immense inroads are being made upon it by the protected and subsidised traders of Japan and Germany and the other Protectionist foreigners-not only will Lancashire and Cheshire and Lanarkshire be ruined, but Yorkshire and the Midlands and all our manufacturing districts will suffer to almost an equal extent. Is all this nothing to the Asquith Ministry?' And the answer is, that all this is as nothing, when compared with the danger of Tariff Reform-which is absolutely
assured as soon a's ever the nuances of the Indian trade are understood by the industrial communities of the North.
The Government have awakened to the fact that India is destined to be the pivot of Tariff Reform. Long ago they admitted that every known statesman and economist of Indian birth is ardently Protectionist, and denounces so-called 'Free Trade'as the ruin of every Indian industry, and they have discovered that, with the enlarged councils and the other reforms of Lord Morley, it is impossible much longer, with even that small pretence at decency which satisfies modern Radicalism, to impose on India their obsolete Cobdenite bigotry. On the other hand, they are well aware that no British House of Commons will ever allow them to concede to India the right of protecting Indian industries against Britain, for that would be not only a most unfriendly act towards the Mother Country, but would undoubtedly produce widespread starvation in Lancashire and the cotton districts, and fatally injure almost every British industry. Some extreme Radicals, like Sir Henry Cotton and Mr. Lees-Smith, M.P., have not hesitated to commit themselves to the absurdity of advocating Protection for India with Free Trade for Britain ; but the majority of those Liberals who have any knowledge of or authority on Indian matters, such as Lord Morley, Lord Crewe, and Mr. Montagu, M.P., are well aware of the absolute impossibility of such a policy. And, on the other hand, they see that the vast bulk of Anglo-Indian opinion-headed by such experienced men as Lord Lansdowne, Lord Curzon, Lord Minto, Lord Ampthill, all exViceroys, and numerous retired Indian officials—holds that Imperial Preference, fostering both British and Indian industries, and removing the causes of friction between them, is the reasonable and just solution of the Indian fiscal problem. Some solution is urgently demanded, and the Government know full well that it cannot be long delayed, now that every single Indian member of the Viceroy's Legislative Council, appointed under Lord Morley's Act, insists upon it. More than two years ago the late Sir Edward Fitzgerald Law—the famous Indian Finance Minister who signed Lord Curzon's despatch on Preferential Tariffs, and wrote the elaborate minute on which it was foundedin the preface of a little book (dedicated to Mr. Chamberlain) advocating Imperial Preference for India, while he admitted it was too much for India to expect absolute fiscal freedom, declared that:
If she fights for it, she will obtain some measure of that freedom which to-day is denied to her by all the protectionist countries of the world. These countries are delighted to accept from India, free of duty, those raw products which either fail altogether within their own territories, or are produced in insufficient quantities for their reg rements; but whilst accepting such articles as raw jute, raw hides, oil-seeds, and uncleaned rice free of duty, they levy prohibitory import duties on India's jute manufactures, tanned hides, oils, and cleaned rice. They thus achieve their object of maintaining a cheap supply of raw materials for their own industries, whilst successfully obstructing industrial development in India. It is their natural desire to keep the peoples of India in the position of hewers of wood and drawers of water for their manufacturers. Ought such a situation to be tolerated when we hold the remedy in our own hands? Can we expect the people of India to accept it with equanimity? Do we not, by our present attitude, justify the Swadeshi movement, and wilfully add fuel to the flame of political unrest?
Mr. Bonar Law, in an illuminating speech on the whole question of Indian Imperial Preference, delivered before the East India Association in the Caxton Hall, on the 5th of May 1907, after noting the immense stimulus that Indian Preference would afford to our own British industries, declared plainly his strong conviction that, ' of all the parts of the British Empire, the one which will benefit the most, and benefit most rapidly, will be the British Indian Empire.'
And it was also Mr. Bonar Law who, in his numerous Lancashire speeches on this question, clearly explained the two great and cardinal reasons why the Cobdenite system of so-called Free Trade has utterly failed in India, and has now become impossible there. The first reason is that Cobdenism has hopelessly strangled all the nascent industries of the country-and the reawakened national life of India under Lord Morley's reforms will not stand this any longer. And the second reason is that Cobdenism renders absolutely necessary in India that odious and inquisitorial system of excise duties on the products of Indian mills and factories, which is more detested by the people than any other form of taxation.
To see that Mr. Bonar Law is absolutely right, it is only needful to understand what this excise system really means-a system that is unknown in any other country in the world, that we should not dare to impose on any one of our self-governing Colonies, and that our own British manufacturers and operatives would spurn with the greatest indignation.
When it was imposed in 1895 by Lord Elgin, at the bidding of Mr. Tom Garnett and his friends, it was absolutely necessary because of the laws of Free Trade, for the following reasons :
(1) Indian finance cannot possibly do without import and export duties. For, as the present Finance Minister explained two years ago, when imposing import duties on the cigarettes manufactured by Bristol and Liverpool working-men, the only alternatives under Free Trade are to impose increased taxation on the pinches of salt and the miserable little patches of paddyland of the poor raiyat.
(2) But the Draconian law of the Cobden Club-laughed at by all the rest of the world, but a stern reality for India--is, that you
a must not put a tax on the goods of the protected and subsidised Japanese or Germans, or on your own monopolies sold to them, unless you at the same time put an equivalent tax on both British and Indian goods.
(3) So, as the Indian revenues need, inter alia, duty on the imports of foreign cotton goods of 31 per cent. ad valorem, Free Trade insists that the same 3} per cent. shall be charged not only on the imports of all Lancashire and Scottish cotton goods, but also as an excise duty on the products of the Indian cotton-mills.
Now, consider how this excise duty works. Every cottonfactory in the country is liable to be overhauled by the underlings of the Government, to have its premises searched, its books examined, its operatives molested. Every Indian cotton-factory is compelled to submit monthly returns, showing :
(1) Every ounce of cotton yarn spun.
(5) Details of bleached, or dyed, or printed cloths, if any. And within fifteen days of the close of each month the factories have to pay the excise duty on the cloth made in the previous month, whether sold or not!
The abuses that must arise under such a system are obvious. Can even the most bureaucratic Radical imagine such a system at work in Lancashire or Lanarkshire? Would Mr. Harcourt dare to propose such a system to Canada or Australia, to countervail their much higher customs duties? But if not, what becomes of our vaunted 'trusteeship' of India ?
The Radical says to India, “If you want to get rid of your excise duty on Indian cotton, take off your duties on imported cottons—including those on the dumped Japanese cotton hosiery that has already killed the Bombay manufacture.' Yes, but what about the loss to Indian revenue?
The Tariff Reformer, on the other hand, says to India, ‘You reasonably object to this odious tax-abolish both the import duty on Lancashire and other British cottons and the excise duty on Indian cottons, and recoup your revenues by moderate duties on all the imported manufactures of the protected and subsidised foreigner, and on the exports to those foreign countries of such Indian monopolies as raw jute and lac-and, in return for your remission of the duties on British manufactures, the United Kingdom and the other States of the British Empire will give your produce and your manufactures, such as gunny-bags and so forth, a substantial preference in every British port.' As a matter of fact, a moderate duty on the export of raw jute
a to countries outside the British Empire would at once produce a revenue sufficient to recoup the Indian Exchequer for every rupee on the loss occasioned by the remission of all taxation on British
imports and Indian cottons. As jute is an absolute monopoly, and enormously cheaper than any competing fibre, and as Germany and America and other manufacturing countries must have the raw materials for their flourishing industries, such a duty would not seriously affect the foreign consumption, while it would immensely strengthen and stimulate both the Calcutta and the Dundee jute industry.
Similarly, a moderate duty on the imports into India of foreign cotton and woollen goods and other manufactures, with complete freedom for British and Indian goods, would strengthen the British and Indian industries-while the remission of all taxation on British and Indian cottons (the chief sources of supply) would instantly cheapen the clothing of every one of the 315,000,000 of the Indian peoples.
Radicals sometimes advance the futile objection that Indian Protectionists would not be satisfied with the modified protection of Imperial Preference—but surely, the half-loaf of Preference is better than the no-bread of Cobdenism? And as to the extremely foolish bogey of foreign retaliation, Lord Inchcape's chief argument at the Imperial Conference of 1907, this is what the great Indian Finance Minister, Sir Edward Fitzgerald Law, said of that :
I am aware that many who have not studied the details of Indian trade fear that if India adopted a policy of retaliation her foreign customers would refuse to receive her exported produce, and that India would consequently suffer severely in her all-important export trade; but, if the position be examined in detail, it will be found that India has a practical monopoly of production of certain important raw materials, and that as regards many others, where she has not a monopoly, her production forms such a large percentage of the whole that its exclusion from any market must necessarily enhance prices in that market in a manner most prejudicial to local industrial interests. It must be recognised that the countries which have built up important industries, on the basis of a cheap supply of raw material, cannot afford to see those industries threatened with a failure of that supply.
With such overwhelming advantages for India, and for the Indian trade with the rest of the Empire, that are offered by Imperial Preference, it is perhaps not to be wondered at that Mr. Asquith and Mr. Harcourt so dexterously evaded any impartial inquiry into the subject. And on the 16th of April Mr. Harcourt, replying to questions in the House, refused to hold out any hope of a subsidiary commission to deal with India and the Crown Colonies and Protectorates. But the interests thus obscured and neglected are so immense that they cannot long be suppressed, even by the most skilful Parliamentary legerdemain.