Local trade is conducted either at the permanent bazaars of great towns, at weekly markets held in certain villages, at annual gatherings primarily held for religious purposes, or by means of travelling brokers and agents. The cultivator himself, Local trade. who is the chief producer and also the chief customer, knows little of the great towns, and expects the dealer to come to his own door. Each village has at least one resident trader, who usually combines in his own person the functions of money-lender, grain dealer and cloth seller. The simple system of rural economy is entirely based upon the dealings of this man, whom it is the fashion sometimes to decry as a usurer, but who is really the one thrifty person among an improvident population. Abolish the money-lender, and the general body of cultivators would have nothing to depend upon but the harvest of a single year. The money-lender deals chiefly in grain and in specie. In those districts where the staples of export are largely grown, the cultivators commonly sell their crops to travelling brokers, who re-sell to larger dealers, and so on until the commodities reach the hands of the agents of the great shipping houses. The wholesale trade thus rests ultimately with a comparatively small number of persons, who have agencies, or rather corresponding firms, at the great central marts. Buying and selling in their aspects most characteristic of India are to be seen, not at these great towns, nor even at the weekly markets, but at the fairs which are held periodically at certain spots in most districts. Religion is always the original pretext of these gatherings or melás, at some of which nothing is done beyond bathing in the river, or performing various superstitious ceremonies. But in the majority of cases religion has become a mere excuse for secular business. Crowds of petty traders attend, bringing all those miscellaneous articles that can be packed into a pedlar’s wallet; and the neighbouring villagers look forward to the occasion to satisfy alike their curiosity and their household wants.
The control of the revenues of India is vested by act of parliament in the secretary of state for India in council. Subject to his control the government of India enjoys a certain discretionary power, but no new expenditure may be incurred without Finance. his sanction. There is a special member for finance in the governor-general’s council, and all important matters are brought before the council. The central government keeps in its own hands certain revenues, such as salt, the post-office, telegraphs, railways, army and Indian Marine, in addition to the districts of Coorg, Ajmere and the North-West Frontier province. The other provinces raise and administer their own revenues, subject to the central control; they are allowed a certain proportion of the revenue to meet their own administrative charges, and so have an interest in economical expenditure. The apportionment of the revenues is settled afresh every five years. In 1893 the Indian mints were closed to the free coinage of silver, and in 1899 the British sovereign was made legal tender at the rate of 1s. 4d. per rupee; so that since that year the finances of India have been practically upon a gold basis. The principal heads of revenue are land, opium, salt, stamps, excise, customs, assessed taxes, forests, registration and tributes from native states; and the chief heads of expenditure are charges of collection, interest, post-office, telegraph and mint, civil departments, famine relief and insurance, railways, irrigation, other public works and army. The point most frequently criticized in the finances of India is the “home charges” which amount on an average to about 18½ millions a year. Of this total about 9½ millions are for interest on railways and other public works, 5 millions for pensions and furlough pay for civil and military officers, 2½ millions for stores and 1½ millions miscellaneous. These charges constitute the home expenditure on revenue account, but there are also other remittances from India on capital account which bring up the total disbursements in England to an annual average of about 21¼ millions.
Public Works.
Public works in India fall under three categories—railways, irrigation, and roads and buildings. The railways are managed in various ways, the other two classes of works are carried out through the agency of separate departments in Madras and Bombay, and of officers of the government of India public works department, either under local or central control, in other provinces.
Railways in India serve different purposes—the ordinary purpose of trade and passenger communication, and also the special purposes pf the safeguarding the internal and external peace of the country, and of protecting Railways. special districts against famine by facilitating the movement of grain. For this reason the interest on capital expended on all the lines cannot be judged by a purely commercial standard. They are administered in three separate ways—as guaranteed, state or assisted lines. In the early days of railway enterprise the agency of private companies guaranteed by the state was exclusively employed, and nearly all the great trunk lines were made under this system, but the leases of the last three of these lines, the Great Indian Peninsula, the Bombay Baroda and Central India, and the Madras companies, fell in respectively in 1900, 1905 and 1907. In 1870 a new policy of railway development by the direct agency of the state was inaugurated; and in 1880 the system of encouraging private enterprise by state assistance was again resorted to. Both agencies are now employed side by side. The administration of railways was formerly under a secretary in the public works department; but since 1905 it has been placed in charge of a railway board, consisting of a president and two members, which is connected with, though not subordinate to, the department of commerce and industry. In 1908 the total length of railways open in India was 30,578, m., which carried 330 million passengers and 64 million tons of goods, and yielded a net profit exceeding 4%.
Facilities for irrigation (q.v.) vary widely, and irrigation works differ both in extent and in character. The main distinction arises from the fact that the rivers of northern India are fed by the Himalayan snows, and, therefore, afford Irrigation. a supply of water which surpasses in constancy and volume any of the rivers of the south. In Bombay and Madras almost all the irrigation systems, except in the deltas of the chief rivers, are dependent on reservoirs or “tanks,” which collect the rainfall of the adjacent hills. In Sind and the Punjab there are many canals which act merely as distributaries of the overflow of the great rivers at the time of inundation; but where the utility of the canals has been increased by permanent head-works the supply of water is perennial and practically inexhaustible, thus contrasting favourably with the less certain protection given by tanks. The Irrigation Commission of 1901 advised an expenditure of 30 millions sterling, spread over a term of twenty years, and irrigating 6½ million acres in addition to the 47 millions already irrigated at that time; but it was estimated that that programme would practically exhaust the irrigable land in India, and that some of the later works would be merely protective against the danger of famine, and would not be financially productive.
In addition to the provision and maintenance of roads and the construction of public buildings, the department of public works also provides all works of a public nature, such as water-supply, sanitation, embankments, lighthouses, ferries and bridges, Buildings and roads. which require technical skill. Road-making is an ordinary form of relief work in times of famine. In the famine of 1896-1897, for instance, 579 m. of new roads were made in the Central Provinces alone, and 819 m. were repaired. One of the finest roads in the world is the Grand Trunk Road which stretches across India from Calcutta to Peshawar, and which is metalled most of the way with kankar, a hard limestone outgrowth. The great buildings of ancient India are described under the names of the different cities which contain them.
The post-office of India is under the control of a director-general, in subordination to the department of commerce and industry; and this officer has under him a postmaster-general or deputy postmaster-general in each province. In 1906 the district post, Post Office. originally provided for local convenience and maintained by a local cess, was amalgamated with the imperial post. The mileage over which mails are carried by railway has been constantly increasing with the development of the railway system, but a far larger number are still carried by runners and boats. The total number of letters, &c., carried by the post exceeds 800 millions, and the service yields a small profit to the state. In connexion with the post-office there are inland money order and savings-bank businesses; and in addition the value-payable system, by which the post-office undertakes to recover from the addressee the value of an article sent by post and to remit the amount to the sender, has found great popularity.
Excluding the Indo European telegraph wire, the whole telegraph system of India forms an imperial charge, administered through a Telegraphs. director-general. The total length of line is about 69,000 m., and the net profits of the service approximately pay for new expenditure on capital account.