amount is now being levied in India over and above what would have been necessary if these changes in the relative value of gold and silver had not taken place. Without going back so far as 1871-72, I may add that in the two years ending with March 1888 the charge thrown upon India on this account has increased by more than 20,000,000 rupees-or in conventional sterling 2,000,000l. It is, at the same time, so impossible to foresee the course of the exchanges that the Government cannot estimate, within a sum which may amount to many millions of rupees, the probable expenditure of the year. Its most careful anticipations are liable at any time to be completely upset by causes absolutely beyond its control. Such a condition of things is not only fatal to financial and to administrative efficiency and progress, but, if it be suffered to continue, it may lead to political consequences of the utmost gravity.

How, apart from the interests of the Government and the taxpayers, the economical interests of Indian producers and traders have been affected by these changes in the relative value of the precious metals, is a question into which I shall not enter. The last few years have been a period of much prosperity in India. Prices in India itself have hitherto hardly been affected, and, looking at what has occurred in Europe, we may believe that India has gained no small advantage from the comparative stability of her silver standard in relation to commodities other than gold. However this may be, there can be no question regarding the serious nature of the difficulties in which the Government is involved. No one can say where this continuous depreciation of silver is to stop, or when we shall see the end of the constantly recurring increase in the liabilities of the Government which follows as the inevitable result.

Recourse has already been had to taxes that are economically objectionable and which place fresh burdens upon the poorer classes, and we are perilously near the time in which we may be called on to adopt measures which may be politically dangerous or inexpedient. We have hitherto never introduced into India any strange and unpopular taxation affecting the masses of the population. If we were to change this policy, and were to impose heavy burdens of a kind hitherto unknown, our position might become very different to what it has been in the past. Our difficulties would be seriously increased if such burdens were to meet charges from which the Indian taxpayer derived no benefit, the nature of which he was unable to understand, and which were the direct result of the existence of a foreign dominion. But the truth is that, for such a state of things as that which exists, no readjustment of Indian taxation could afford a remedy. Even if India were a country like Great Britain, where the public revenues, in case of necessity, can almost at any moment be largely increased, she would find, while her standard of value differed from that of England, and while the gold value of silver continued to fall, no relief from pouring into the bottomless pit of her treasury constantly increasing supplies of silver.

I do not now propose to discuss any of the measures by which it has been suggested that relief might be afforded, but no language that I could use would be too strong to express my sense of the gravity of this question. There is no Indian authority who does not feel that, if it be allowed to drift on in the future as it has drifted in the past, we may some day find ourselves in a position not only of extreme financial difficulty but of political peril.

LECTURE V.

PUBLIC WORKS-THE PUBLIC DEBT-FAMINE INSURANCE.

MR. J. S. MILL ON THE DUTIES OF GOVERNMENTS-FAMINES IN INDIANECESSITY FOR ROADS, RAILWAYS, AND CANALS-ABSENCE OF ROADS UNDER NATIVE GOVERNMENTS-THEIR CONDITION UNDER THE EAST INDIA COMPANY -MEASURES TAKEN BY LORD DALHOUSIE-RAILWAY CONSTRUCTION— CREATION OF PUBLIC WORKS DEPARTMENT-PROGRESS UP TO 1887IRRIGATION WORKS IN NORTHERN INDIA-CANALS OF MOHAMMEDAN SOVEREIGNS-THE GANGES AND OTHER CANALS-THEIR VALUE-IRRIGATION WORKS IN CENTRAL AND SOUTHERN INDIA AND IN SINDH-EXPENDITURE ON RAILWAYS AND IRRIGATION WORKS-THE MANNER OF PROVIDING FUNDS GUARANTEED COMPANIES-POLICY OF BORROWING FOR INVESTMENT IN PUBLIC WORKS-BARRACKS AND HOSPITALS FOR BRITISH TROOPS -THE PUBLIC DEBT-DIVISION INTO ORDINARY AND PUBLIC WORKS DEBT-INCREASE OF DEBT OWING TO THE MUTINIES OF 1857-SUBSEQUENT DECREASE OF ORDINARY DEBT-INVESTMENTS OF THE GOVERNMENT IN RAILWAYS-RAILWAYS CONSTRUCTED BY GUARANTEED COMPANIES-THE FINANCIAL RESULTS OF THE POLICY OF BORROWING FOR PUBLIC WORKS -EXPENDITURE FROM REVENUE ON PUBLIC WORKS-INSURANCE AGAINST FAMINE THE POLICY ADOPTED.

THE duties of the Government in India go far beyond those which we expect from a Government in countries. like our own.

'In the particular circumstances of a given age or nation,' writes Mr. J. S. Mill, evidently with India especially in his mind, there is scarcely anything really important to the general interest which it may not be desirable, or even necessary, that the Government should take upon itself, not because private individuals cannot effectually perform it, but because they will

not.

At some times and places there will be no roads, docks, harbours, canals, works of irrigation, hospitals, schools, colleges, printing presses, unless the Government establishes them; the public being either too poor to command the necessary resources,

or too little advanced in intelligence to appreciate the end, or not sufficiently practised in conjoint action to be capable of the means. This is true, more or less, of all countries inured to despotism, and particularly of those in which there is a very wide distance in civilisation between the people and the Government, as in those which have been conquered and are retained in subjection by a more energetic and more cultivated people.'1

But for our Government, hardly any of these requirements of civilised life would now be supplied in India, and in India there are special reasons which make the duty which thus falls upon the Government extraordinarily urgent.

Lord Macaulay did not speak too strongly when he said that, excepting only the inventions of the alphabet and the printing press, no inventions have done so much. for the moral and intellectual progress of man as those which abridge distance and improve the means of communication.

Roads, railways, and canals, and other works and appliances which facilitate communication are necessary in India, not only for reasons universally applicable, but because they are required to save the people from calamities of which, in Europe at the present time, we have happily little experience. In India, the very existence of the people depends on the regular occurrence of the periodical rains; and when they fail through a wide tract of country, and, still worse, when they fail in successive years, the consequences are terrible. The greater part of India is liable periodically to this danger, but the country is so vast that it never happens that all parts of it suffer at the same time. Improvements in the economical condition of the people, and especially more diversity of occupation,

1 Principles of Political Economy, vol. ii. p. 551.

can alone bring complete safeguards, and render general famine, in its extremest form, through a great tract of country, impossible. But this must be a long and gradual process. Meanwhile, it has been found by experience that although the entire prevention of famines, the most destructive of all calamities, is beyond the power of any Government, we can do much to mitigate them by removing obstacles which hinder commercial intercourse, and which diminish the productiveness of the land. The instruments by which we can do this are roads, railways, and canals. If, to give one illustration, you read the history of the great Indian famine of 1877-78, you will find ample proof of the incalculable value of such works. Without them, millions of people must have been left to perish without the possibility of relief.

It has only been within the last thirty or forty years, and especially since the transfer of the Government from the East India Company to the Crown, that we have at all recognised the duties which thus fall upon us. Before that time, India was, to a great extent, governed on principles that might have commended themselves to a beneficent Oriental ruler rather than to modern Englishmen. Even an enlightened man like Sir Charles Metcalfe could maintain, fifty years ago, that India required no roads; and in fact there were none. No Native prince ever made a road. Before the establishment of our Government there was not a road deserving the name in all India. Under the Native Governments that preceded us (I am quoting from the Indian Famine Commissioners), nothing more was done than to plant trees along each side of the track used as a road, and occasionally to throw up earth on it when it passed through a depression; such