As to the actual employment of Indians, nowhere has the principle been more carefully applied that Europeans—a term which in this connection must be taken to include Americans—are only to be employed when and so long as no Indian can be found competent to perform the particular work required. The proportion of Europeans to Indians works out to-day approximately as 1 to 230, but this figure is in itself somewhat misleading. Out of the total of 197 Europeans, no fewer than seventy-five are the highly skilled mechanics who are still absolutely indispensable as supervisors at the steel-smelting furnaces and the rolling-mills. Work of this kind requires a powerful physique, long experience, and plenty of pluck. One has only to look at the muscular, hard-bitten Americans and Englishmen who stand round the furnaces to see that they represent a type of humanity which in India is still extremely rare. The Company have tried eighteen Indians, carefully selected, but only three have stayed. The up-country races, physically more promising, lack the training. It will take, it is believed, twenty-five years to bring on Indians who can be trusted to replace Europeans in these arduous jobs.

Nevertheless, in the steel-smelting furnaces there are only forty European supervisors to 2000 Indian workmen, and in the rolling-mills only thirty-five to 2200. In other departments much more rapid progress has been achieved, and the results are already remarkable. Indians do excellent work as machinists, cranemen, electricians, etc., and even in the rolling-mills they do all the manual work. The best of them make reliable gangers and foremen. In the blast furnaces there are only eight Europeans to 1600 Indians, in the mechanical department only six to 3000, and in the traffic department only one to 1500. In two other important departments it has been already found possible to place an Indian in full charge. One of these is the electrical department, which requires unquestionably high scientific capacity. Another is the coke ovens, on which 2000 Indians are employed under the sole charge of an Indian who seemed to me to represent an almost new and very interesting type—a young Bengalee of good family, nephew to Sir Krishna Gupta, who was recently a member of the Secretary of State's Council in Whitehall. He had studied at Harvard, had worked afterwards right through the mill, and had acquired the habit of organised command, which is still rare amongst Indians. If Jamsheedpur may be not inaptly regarded as a microcosm of India, in which the capacity of Indians for self-government in a wider sense than any merely political experiment connotes is being subjected to the closest and most severe test, it assuredly holds forth high promise for the future.

Yet at the very time when the future of Indian industries seemed to be at last almost assured, and largely thanks to Indian enterprise, it was gravely compromised by the miserable breakdown of the most important of all the services on which the very life of industry depends. The Indian railways proved altogether incapable of meeting the new demands made upon them. Even in the essential matter of coal supplies, though the output of the Indian coal mines suffices for present requirements, huge dumps of coal accumulated round the mines and could not be moved owing to the lack of rolling-stock and to the general inadequacy of the existing railway system. The breakdown may have been due in the first place to the rapid deterioration of rolling-stock and permanent way that could not be made good during the war, and has not been made good yet, but the real causes must be traced much farther back to the parsimonious and short-sighted railway policy of the Government of India for years past. Apart from the economic consequences, it is particularly unfortunate, even from the political point of view, that such a revelation of inefficiency should have occurred in a field which has been hitherto most jealously preserved for British enterprise, and just in the very sphere of Western activity which has appealed most strongly to Indians of all classes.

Of all the Western inventions which we have brought to India, the railway is certainly the most popular, perhaps because the modern love of travel has developed largely out of the ancient practice, still continued, of pilgrimages en masse to popular shrines, near and far. During the great days when the worship of Juganath reaches its climax and half a million pilgrims pour into Puri from all parts of India, the terminus of the branch-line from the Calcutta-Madras railway is busier than Epsom Downs station on Derby Day. A big Indian railway station—the Howrah terminus in Calcutta, the Victoria Terminus in Bombay, the Central Station in Delhi—is in itself at all times a microcosm of India. It is never empty, never silent by day or by night. It is always alive, always crowded, always full of Indian sounds and smells. It is a camping ground not only for those who are actually going to travel but also for those who merely come to give their friends a send-off or to greet them on arrival. No Indian of any position can be allowed to depart or to arrive without a party of friends to garland him with flowers, generally the crude yellow "temple" marigolds. The ordinary Indian to whom time is of little value cares nothing for time-tables. He goes to the station when he feels moved to do so, and waits there patiently for the next train that will take him to his destination or bring the friends he wants to meet. He does not in the least mind waiting for two, three, or four hours—sometimes in more remote parts of the country for the best part of twelve or even of twenty-four hours. Only the Europeans and a few Western-educated Indians who have learnt business habits ever think of "catching" a train. So the Indian railway station has a constant and generally dense floating population that squat in the day-time in separate groups, men, women, and children together, according to their caste, hugging the slender bundles which constitute their luggage, chattering and arguing, shouting and quarrelling, as their mood may be, but on the whole wonderfully good-humoured and patient. At night they stretch themselves out full length on the ground, drawing their scanty garments well over their heads and leaving their legs and feet exposed, or, if the air is chilly and they possess a blanket, rolling themselves up in it tightly like so many shrouded corpses in long and serried rows, till the shriek of an incoming train arouses them. Then, whether it be their train or not, there is a din of yelling voices, a frenzied rush up and down the platform, and, even before those who want to get out have had time to alight, a headlong scramble for places—as often as not in the wrong carriages and always apparently in those that are already crammed full, as the Indian is essentially gregarious—and out again with fearful shouts and shrill cries if a bundle has gone astray, or an agitated mother has mislaid her child, or a traveller discovers at the last moment that it is not after all the train he wants. In nine cases out of ten there is really no need for such frantic hurry. Even express trains take their time about it whenever they do stop, and ordinary trains have a reputation for slowness and unpunctuality to which they seldom fail to live up. But, as if to make up for the long hours of patient waiting, the struggling and the shouting go on crescendo till the train is at last under way again. For, besides the actual passengers coming and going, the platforms are alive with hawkers of all sorts who minister to their clamorous needs—sellers of newspapers and of cigarettes and of the betel-nut which dyes the chewer's mouth red, of sweetmeats and refreshments suited to the different castes and creeds, Mahomedan water-carriers from whom alone their co-religionists will take water to fill their drinking-vessels, and Brahman water-carriers who can in like manner alone pour out water for Hindus of all castes. And all have their own peculiar cries, discordant but insistent.

Who that has passed at night through one of the great junctions on the Upper Indian railways, say Saharampur or Umballa or Delhi, can ever forget such sounds and sights of pandemonium? Or who would care to miss during the daylight hours the open window on to the kaleidoscopic scenes of Indian life at every halt? Here a turbaned Rajput chief with his whiskers fiercely twirled back under his ears descends from the train to be greeted and garlanded by a throng of expectant retainers who look as if they had stepped straight out of an old Moghul picture. Or a fat and prosperous Mahomedan zemindar in a gold-embroidered velvet coat and patent-leather boots struts along the platform convoying his fluttering household of heavily veiled ladies, all a-twitter with excitement, to the purdah carriage specially reserved for them. Or a band of mendicant ascetics, their almost naked bodies smeared all over with fresh ashes and the trident of Shiva painted on their foreheads, return with well-filled begging-bowls from some favourite shrine. Or an excited crowd, all wearing the little white Gandhi cap, rend the air with shouts of Mahatma Gandhi-ki jai! in honour of some travelling apostle of "Non-co-operation." And all over India the swarm of humbler travellers, who lend their own note of varied colour even to the smallest way-side stations, seems to increase every year, whether one crosses the vast drab plains of Upper India or climbs the steep face of the Western Ghats on to the sun-scorched plateau of the Deccan, or is unmercifully jolted through the gentler and more verdant landscapes of Southern India.

One change, however, since pre-war days none can fail to mark. Travelling is far less comfortable. Trains are fewer and far more crowded. The rolling-stock is war-worn and dilapidated, for it could not be renewed during the war, as, although a great deal of railway material can be produced in Indian workshops, some absolutely essential parts have always been imported from England—as many Indians believe for the purpose of subordinating Indian railways to the industrial interests of Great Britain. Even the permanent way has deteriorated. But the mere discomfort inflicted upon travellers is a small matter, and it is chiefly on grounds of racial feeling that Indians are beginning to cry out against the many outward and visible forms of discrimination in favour of European travellers. What the most moderate and thoughtful Indians are concerned about is the futility of talking of the development of Indian industries and the starting of new ones when railroads and rolling-stock can no longer handle even the existing traffic or move the essential raw materials. The problem brought to the front by the grave crisis through which the Indian railway system is now passing is neither new nor accidental. It is the outcome of antiquated methods of railway administration and finance, of which it was possible to disguise the defects so long as they were not subjected to any searching strain. The war provided that strain, and the system showed, it must be admitted, wonderful endurance under it so long as the war lasted. But since the end of the war it has betrayed such grave symptoms of imminent collapse that Government have been compelled to appoint an independent Committee of Inquiry, with a fair proportion of Indian members on it, which with a man like Sir William Acworth as Chairman will, it may be hoped, not be content merely to pass judgment upon it, but will be able also to point to a better way in the future. The evidence produced before the Committee furnishes ample material for a scathing indictment of the system.

There are altogether only some 35,000 miles of railroad in India to-day, or about as much as before the war in European Russia, the most backward of all European countries, whose population was little more than a third of that of India. The Government of India may claim that this is a magnificent return for the £380,000,000 of capital expenditure that these railways represent to-day in its books, and that the profits which they have yielded for the last twenty years with steadily increasing abundance to the State show the money to have been well invested. But how if these results have been achieved only by a short-sighted and narrow-minded policy which sacrificed the future to the present?

Of the Indian railways some are owned and worked by the State, some are owned by the State and worked by companies, some are owned and worked by companies under contracts with the State. The companies that own and work their own lines are for the most part domiciled in England, and the evidence already taken before the Committee shows how little power is left by the London Boards to the local agents who manage them, and how often the interests of the public and of the country appear to be subordinated to the narrow view taken at home of the companies' own interests. But however flagrant the special shortcomings of the company-owned railways may be, the root of the evil common to all lies in the policy laid down by and for the Government of India, in whom the supreme control has always been vested as a professedly necessary consequence of the financial guarantees given by the State and the right of ultimate purchase reserved to it. That control, which has passed through many different incarnations in the course of the last half-century, has been exercised since 1905 by a Railway Board of three members outside of, but subordinate to, the Government of India. It is represented in the Viceroy's Executive Council by the Member for Commerce and Industry, but its real master and the ultimate authority in all matters of railway policy is and always has been the Finance Member of the Government of India, who in turn has to adapt himself to the exigencies of Whitehall. The Finance Member, who lays down the annual amount that can be allocated to railway expenditure out of revenue, cuts the cloth of the Railway Board in accordance not so much with the needs of the railways themselves as with the requirements of his annual budget. For when the yield of the Indian railways began to constitute an important source of Government revenue, the Finance Member, instead of devoting it to the equipment and expansion of railways, however essential to the future prosperity of the country, was easily prevailed upon to regard it, in part at least, as a convenient lucky-bag to draw upon, especially in difficult times, for meeting the demands of other departments, and especially of the Army Department, always the most insatiable of all. In the same way, however clear a case could be made out from the point of view of the railways for capital expenditure to be met by raising loans at home or in India, the decision was not based so much on the intrinsic merits of such an operation as on the immediate effect it was likely to have on the British or Indian money market in respect of other financial operations with which the Secretary of State was saddled. The result has been that before the war the Indian railways were kept on the shortest possible commons, and that having been inevitably starved during the war, without any reserves to fall back upon, they are clamouring to-day for financial assistance for the mere upkeep of open lines and the renewal of rolling-stock, without which they are threatened with complete paralysis, whilst the Government of India, confronted on the one hand with the categorical imperative of the Esher Committee and the fantastic extravagance of the Army Department since the Afghan war, and on the other with the appalling losses already incurred in consequence of Whitehall's currency and exchange policy, has never been in a worse position to give such assistance.

The keen searchlight of the war has been turned effectively on many weak points in the government and administration of India besides railway policy, and the Indian currency and exchange policy stands out now as one of the most disturbing factors in the economic situation.

India played her part in the war, and played it well, but she was never called upon to bear any crushing share in its financial burdens. The Indian Legislature unanimously and spontaneously granted £100,000,000 in 1917 towards Imperial war expenditure, and another £140,000,000 of Indian money went into the two Indian war loans and issues of Treasury notes. But the increase in India's actual military expenditure during the war was small, as the Imperial Exchequer continued to bear all the extra cost of the Indian forces employed outside India, and the last Indian war budget, 1918-19, showed an excess of only about £23,000,000 over the last pre-war budget, 1913-14—an increase easily met by relatively small additional taxation. Moreover, the Indian export trade, after a temporary set-back on the first outbreak of hostilities, received a tremendous impetus from the pressing demand for Indian produce at rapidly increasing prices, and the lucrative development of many new as well as old industries and of natural resources too long neglected. The balance of trade which before the war had generally been slightly against India then shifted rapidly, and the scale turned heavily in her favour till the end of the war. The total value of the supplies of all sorts, foodstuffs, raw materials, and manufactured products, sent out from India to other parts of the British Empire and to Allied countries has been estimated at some £250,000,000.