“After the war,” add the authors, “the need for industrial development will be all the greater unless India is to become a mere dumping-ground for the manufactures of foreign nations which will then be competing all the more keenly for the markets on which their political strength so perceptibly depends. India will certainly consider herself entitled to claim all the help that her Government can give her to enable her to take her place as a manufacturing country; and unless the claim is admitted it will surely turn into an insistent request for a tariff which will penalize imported articles without respect of origin.”
Further on the Report states:
“We are agreed therefore that there must be a definite change of view; and that the Government must admit and shoulder its responsibility for furthering the industrial development of the country. The difficulties by this time are well-known. In the past, and partly as a result of recent swadeshi experiences, India’s capital has not generally been readily available; among some communities at least there is apparent distaste for practical training, and a comparative weakness of mutual trust; skilled labour is lacking, and although labour is plentiful, education is needed to inculcate a higher standard of living and so to secure a continuous supply; there is a dearth of technical institutions; there is also a want of practical information about the commercial potentialities of India’s war products. Though these are serious difficulties, they are not insuperable; but they will be overcome only if the State comes forward boldly as guide and helper. On the other hand, there are good grounds for hope. India has great natural resources, mineral and vegetable. She has furnished supplies of manganese, tungsten, mica, jute, copra, lac, etc., for use in the war. She has abundant coal, even if its geographical distribution is uneven; she has also in her large rivers ample means of creating water-power. There is good reason for believing that she will greatly increase her output of oil. Her forest wealth is immense, and much of it only awaits the introduction of modern means of transportation, a bolder investment of capital, and the employment of extra staff; while the patient and laborious work of conservation that has been steadily proceeding joined with modern scientific methods of improving supplies and increasing output, will yield a rich harvest in the future. We have been assured that Indian capital will be forthcoming once it is realized that it can be invested with security and profit in India; a purpose that will be furthered by the provision of increased facilities for banking and credit. Labor, though abundant, is handicapped by still pursuing uneconomical methods, and its output would be greatly increased by the extended use of machinery. We have no doubt that there is an immense scope for the application of scientific methods. Conditions are ripe for the development of new and for the revival of old industries, and the real enthusiasm for industries which is not confined to the ambitions of a few individuals but rests on the general desire to see Indian capital and labour applied jointly to the good of the country, seem to us the happiest augury.”
The views of educated India about fiscal policy have been very faithfully reproduced in Paragraphs 341 and 342, which also we reproduce almost bodily:
“Connected intimately with the matter of industries is the question of the Indian tariff. This subject was excluded from the deliberations of the Industrial Commission now sitting because it was not desirable at that juncture to raise any question of the modification of India’s fiscal policy; but its exclusion was none the less the object of some legitimate criticism in India. The changes which we propose in the Government of India will still leave the settlement of India’s tariff in the hands of a government amenable to Parliament and the Secretary of State; but inasmuch as the tariff reacts on many matters which will henceforth come more and more under Indian control, we think it well that we should put forward for the information of His Majesty’s Government the views of educated Indians upon this subject. We have no immediate proposals to make; we are anxious merely that any decisions which may hereafter be taken should be taken with full appreciation of educated Indian opinion.
“The theoretical free trader, we believe, hardly exists in India at present. As was shown by the debates in the Indian Legislative Council in March, 1913, educated Indian opinion ardently desires a tariff. It rightly wishes to find another substantial basis than that of the land for Indian revenues, and it turns to a tariff to provide one. Desiring industries which will give him Indian-made clothes to wear and Indian-made articles to use, the educated Indian looks to the example of other countries which have relied on tariffs, and seizes on the admission of even free traders that for the nourishment of nascent industries a tariff is permissible. We do not know whether he pauses to reflect that these industries will be largely financed by foreign capital attracted by the tariff, although we have evidence that he has not learned to appreciate the advantages of foreign capital. But whatever economic fallacy underlies his reasoning, these are his firm beliefs; and though he may be willing to concede the possibility that he is wrong, he will not readily concede that it is our business to decide the matter for him. He believes that as long as we continue to decide for him we shall decide in the interests of England and not according to his wishes; and he points to the debate in the House of Commons on the differentiation of the cotton excise in support of his contention. So long as the people who refuse India protection are interested in manufactures with which India might compete, Indian opinion cannot bring itself to believe that the refusal is disinterested or dictated by care for the best interests of India. This real and keen desire for fiscal autonomy does not mean that educated opinion in India is unmindful of Imperial obligations....”
These admissions should put India’s claims for fiscal autonomy beyond the range of doubt and dispute, but so strange are the ways of modern statesmanship that consistency and logic are not the necessary accompaniments thereof.
The authors have advanced another very strong argument for the economic development of India, viz., “military value,” which makes the case conclusive. This argument has been supplied by the Great War and is so well known that we need not state it in their words.
If India is to prosper and take her legitimate place in the British Commonwealth, and in the great family of Nations of the World, it is absolutely necessary that she should be given complete fiscal freedom to manage her own affairs, develop her own industries and do her own trading. Considering her size and resources, it wounds her self-respect and makes her feel exceedingly mean and small to go begging for alms and charity every time there is a failure of rains and the cry of famine is raised.
For a nation of 315 millions of human beings living in a country which nature has endowed with all its choicest blessings, rich and fertile soil, plenty of water and sun, an abundant supply of metals and coal, willing labor, artistic skill and a power of manipulating for beauty and elegance unexcelled in the world—to exist in pitiful economic dependence is a condition most deplorable and most pathetic. We want no charity, no concessions, no favors, no preference. What we most earnestly beg and ask for is an opportunity.