250 PROVISION OF BORROWING FACILITIES. 



alone is real progress to be looked for in providing the agricul- 

 tural classes with capital upon reasonable terms. Yet it is 

 impossible to avoid the conclusion that the proposed bank will 

 virtually be a Government institution. Government will provide, 

 in the first instance at least, a large part of the capital (for it 

 is apparent that much of the working capital will be obtained from 

 the sum advanced by Government for the liquidation of the existing 

 debts of the ryots) ; Government will, at any rate, in the last 

 resort, undertake the collection of debts due to the bank ; and the 

 bank is to receive special privileges, and be placed by law in a 

 position which, in my opinion, could be justified only on the 

 assumption that it is to work on behalf of Government for political 

 or social objects rather than to be conducted on ordinary business 

 principles. 



4. The scheme, as laid before me, consists of two parts, the 

 liquidation of the existing debts of the ryots, and the substitution 

 of the banks for the sowkars in future loan transactions of the 

 agricultural classes. 



5. As regards the first, I find it difficult, owing to the deficiency 

 of detailed estimates, to judge of the financial soundness of 

 the scheme. I observe, however, that it is conjectured that 

 about half the ryots of Purandhar are in debt, yet not so 

 completely insolvent as to make any attempt to relieve them 

 hopeless ; and that the debts of this moiety might be liquidated for 

 about 6J lakhs of rupees. I find, too, that the total revenue of the 

 fully-assessed lands of Purandhar is about 86,000 rupees ; but, in 

 as much a? the solvent ryots are those with the larger and more 

 valuable holdings, it may be assumed that the assessment on the 

 lands of that portion of the landholders with whom the scheme 

 proposes to deal will reach 50,000 rupees. The total value of the 

 net produce of these lands would, on the "half assets" principle, 

 be about one lakh of rupees ; in other words, it would not be safe to 

 assume that in a series of years these ryots could pay in liquidation 

 of debt more than an annual sum equal to their assessment. But 

 it must be borne in mind that the interest on the liquidation 

 advances, independently of the sinking fund at 3 per cent., would 

 amount, at 9 per cent, on 6J lakhs, to 58,500 rupees per annum, a 

 sum which, from the figures given above the ryot could not 

 possibly pay. Even supposing that the interest were fixed at only 



