The struggle was over then, but now a new one arose. The stupendous exertions required to suppress the mutiny had created great confusion. Order, in another sense, had to be restored. The mutinous Sepoys, the rebellious rajahs and their followers, had been exterminated or quelled. Now it became of the last consequence to revive public confidence, to bring back order and solidity to the finances of the country, to re-establish the principles of government, and to reorganise the army. This gigantic task Lord Canning, aided by the Home Government, had to undertake and accomplish; a task not so exciting as that of suppressing a mutiny backed by insurrection, but perhaps even more laborious and exhausting, because more tedious.
A very few figures will serve to prove the magnitude of the financial undertaking. Just before the mutiny the Indian Budget showed a small surplus—contrary to the rule, which was that it should show a deficit. But the mutiny, as a matter of course, rapidly restored, in an aggravated form, the normal state of the finances. With a revenue of nearly £32,000,000, the Budget of 1857-8 showed a deficit of nearly £9,000,000, which in the next year rose at a bound to nearly £15,000,000, making a total deficit in two years of £24,000,000. The revenue, by dint of taxation, had actually increased during the first year of the mutiny; a fact that testified to the wonderful elasticity of the resources of India. The great deficit was provided for by loans, nearly one-half of which were raised in India itself, showing that public confidence in British power and good fortune had not been impaired, although the debt rose in two years to £81,500,000, and in three to £95,000,000. The question for Lord Canning and the Home Government to solve was, how to balance revenue and expenditure. In order to effect this, Sir Charles Wood determined to present India with a Chancellor of the Exchequer. In England, as all know, the Chancellor who has to meet the expenditure has also to provide the ways and means, and has, of course, considerable power and influence in the Government which decides on the policy, and, as a consequence, the expenses to be incurred. But in India the department that provided the money had no connection with the department that spent it. There were consequently carelessness, extravagance, and confused accounts. The first remedy, then, was to send out Mr. James Wilson, the well-known economist, a statesman familiar with our mode of keeping accounts, to take charge of the Indian department, with power and authority sufficient to combat and overcome the tendency to delay and obstruct but too common among the servants of both the great branches of the Government. Mr. Wilson went, restored order to the finances, and died in his duty; a great loss to India and to England. In addition to the gain we looked for by the adoption of a sound system worked out with vigilant superintendence, the Indian Government was obliged to have recourse to extra taxation. These labours began as soon as the insurrection was suppressed; and within five years of the end of these great troubles not only had the revenue increased, but the expenditure was appreciably diminished, and the Government of India was even able to reduce taxation and secure a small surplus.
The army presented difficulties as great as the finances. No sooner was one mutiny at an end than Government was threatened with another. We have already recorded the transfer of authority from the Company to the Crown. Under that Act the army became, of course, the Queen's army. Here, however, arose a serious difficulty. There were nearly 20,000 European soldiers who had enlisted to serve, not the Queen, but the Company. Technically, no doubt, they had all along been servants of the Queen, whose agent the Company was. But soldiers do not understand these refined distinctions; and when the men were simply told that they would in future be Queen's soldiers, they first murmured and then mutinied. The act of mutiny is always indefensible. In this case, however, it admits of some excuse; for, as the men said, the Government had no right to transfer them from one service to another, "like cattle." It was true: they had no moral and only a barely legal right. If, instead of dealing with the soldiers as if they were cattle, the Government had told them of the transfer, and given them a small bounty, the men would have been pleased with the consideration displayed; as it was, every one sympathised with the men who were punished, and even the Queen's troops betrayed a strong inclination to take their part, and gave unmistakable signs of their anger. And, after all, the Government had to do with an ill grace what it should have done at first with a good grace. And at great cost; for a bounty of £2 sterling per man would have amounted to only £40,000; whereas the course adopted—that of giving every man the option of taking his discharge—cost nearly a million; and many of the men, when brought home, re-enlisted.
CAPTURE OF TANTIA TOPEE. (See p. [283].)
This European mutiny had a very important political consequence. At first, after the abolition of the Company, the Home Government seemed disposed to increase rather than diminish, much less abolish, the army raised for local service in India. Many were of opinion that we should have a separate army for service in India, China, the Cape, Australia, New Zealand, and the islands we hold in the Indian Ocean. The mutiny of the Company's Europeans, mild though it was, turned the scale in favour of abolishing them altogether. The consequence was an Act that amalgamated the Company's European troops with the Queen's army, and thus the European infantry became regiments of the line. In order to prevent that abstraction of officers from their regiments to do staff duty, civil as well as military, so common under the Company's régime, a Staff Corps was organised, admission to which was obtained by undergoing an examination. For a long time, of course, it was difficult to pronounce any opinion on the working of these extensive changes, but on the whole it was thought that they worked well.
The result of the mutiny was to bring about an enormous increase in the number of European troops in India. The number of Europeans, including officers of native regiments, was, before the mutiny, only 45,522; the number of native troops was 249,153, giving a total of 294,675. But at the end of 1859 there were in India no fewer than 110,320 Europeans—an enormous drain upon our resources in men. There were of native troops 207,765, one-half of whom were new levies, enlisted during the fight. So that of regular soldiers there were 318,085, and if we add to these the Military Police, a thoroughly military body, there was a total of 407,914.
Here, then, was the field for reduction, and a fine rich field it was. By dint of great resolution and an unsparing pen in 1864 there were 30,000 fewer European, and perhaps 100,000 fewer native troops. Still it was a subject of serious reflection to statesmen that India should require and receive from us 70,000 or 80,000 British soldiers to hold a land that we once held with 50,000 at the outside. It was obvious that from this point of view our Indian Empire weakened our force and diminished our weight in Europe; and that so long as we felt it needful to keep 80,000 soldiers in India, we could not again take that part in European questions which we had taken up to that time. As to the native army, which, after all, we could not do without, it was composed mainly of Sikhs and Punjabees, and it was believed to be organised on sounder principles than the rotten Bengal machine which exploded in 1857. But there were not wanting those who anticipated a Sikh mutiny.
One other great change must not be forgotten. In 1858-9 Lord Canning made a royal progress throughout the North-West, even into the farthest Punjab. He held durbars, and rewarded the faithful native princes, some with gifts of honour, some with fair speeches, others with more solid gifts of territory. During this progress he hinted here and there at the coming change of policy—the concession of the right of adoption to all the princes of India. At a later period this momentous concession was made in a formal shape. What did it mean? It meant the renunciation of the policy of annexation, nothing more nor less, and it gave assurance that the native States would in future be maintained as a part of our internal policy. Lord Dalhousie had made annexation a system. He had annexed four kingdoms and five territories. It is assumed that, had he remained to carry out his policy, India would have been one homogeneous military monarchy. This is doubtful; but it is not doubtful, it is certain, that when he retired the whole fabric fell with a crash. The mutiny and insurrection rooted up the fundamental principle of the Dalhousie system of foreign policy. The native States allowed to survive broke the force of the revolt. The Cis-Sutlej States enabled Sir John Lawrence to retake Delhi. Bikaneer and Bhawlpore and Jeypore were stumbling-blocks in the way of the enemy. The loyalty of Scindia, Holkar, and the Nizam saved Bombay and Madras from the fate of the North-West. Rewah served to curb Kour Singh. The minor rajahs and ranees, in many places, furnished material support and aid. It is to Lord Canning's credit that he perceived not only the changed position of affairs, but the mode in which that change might tend to consolidate the supremacy of the Crown. A diplomatist of less acumen would have guaranteed the States as independent powers. Lord Canning took from them the last vestige of independence; called them openly feudatory princes; compelled the proudest to retire backwards from the chair of the Viceroy, and then guaranteed their rights as barons of the empire. The concession was accepted with delight. The concession was the right to adopt an heir when they had no issue, a privilege that secured the continuance of the State as an entity. Thus we have gone back to the period before Lord Dalhousie ruled, or rather we have adopted, with considerable emphasis, a new principle—that native States are desirable. The working of this principle is the more easy in India because there the princes have never claimed independence in the European sense. They have always been taught to look up to a paramount power, and the British Viceroy, far more effectually than the Great Mogul ever played that part, is, indeed, a paramount lord.
