80 



(d) The amount of remittances to England on account of 

 railways is 5^ million sterling, equivalent to 8 millions Rx. 

 at the average rate of exchange. Now, there cannot be the 

 slightest doubt that the gain to the country caused by the 

 immense development of traffic greatly outweighs the interest 

 payable on the railway capital, as well as the disadvantage 

 arising from the slightly enhanced cost at which, on account 

 of remittances to England, the productions of other countries 

 have to be obtained by India. During the last ten years 

 the number of passengers carried by railways in India has 

 increased from 43 to 104 millions ; the number of live stock has 

 increased from three-quarters of a million to nearly a million ; 

 and the quantity of goods carried from 8| to 2^| million tons. 

 The cost of carriage of this quantity of goods alone is 1 3 millions 

 Ex., and as the cost of transport of goods by railway is about 

 one-fourth of the cost of transport by ordinary carts, the saving 

 under this head may be calculated at nearly 40 millions Ex., 

 supposing it to be at all possible that there could have been so 

 much merchandize to carry with the old means of conveyance. 

 This great reduction in the cost of transport is an immense 

 gain to the country and benefits all parties, the producers by 

 securing to them a higher value for their commodities and the 

 importers by enabling them to obtain the imported articles on 

 easier terms. In the internal trade, the gain is enjoyed wholly 

 by this country ; and in foreign trade it is shared between this 

 country and the country with which the trade is carried on. 

 Thus, if the exchange value of Indian goods be lowered 2 per 

 cent, on account of remittances to England of interest on 

 railway capital, and the saving in cost of carriage and consequent 

 increase of exchange value of the labour of the Indian producer 

 be enhanced 10 per cent., there is on the whole a net gain of 8 

 per cent, to the country owing to the investment of foreign capital 

 in railways. The figures taken are purely hypothetical and have 

 been used merely for purposes of illustration, but such as they 

 are, they probably understate and not overstate the gain. 



(e) Similar considerations apply also to remittances to 

 England necessitated by the outlay on productive irrigation 

 works. The capital laid out on the works amounted at the end 

 of 1889-90 to 32i millions Ex., and the net revenue from the 

 works was 4 per cent, on the outlay. The irrigation works in 

 the Cauvery, Kistna and Godavari deltas and in Sindh yield 

 returns of more than 1 per cent. ; and the great canals in 

 Upper India, where they have been completed, yield a return 

 of 4^ per cent. There would be no loss whatever on this 

 account, but on the contrary a large gain, were it not for the 



