85 



35. The private remittances to England comprise the savings 

 of Europeans resident in India in the ser- 

 nuSlfofengitd:^" vice of Government and in other capaci- 

 ties, the dividends on Indian investments 

 due to residents in England, and remittances by banks pnd 

 merchants made in the course of commercial dealings. As 

 already stated, it is not possible to make even a rough estimate 

 of these remittances, Calculationf;, based on the recorded 

 values of exports and imports, have been found to yield results 

 which are obviously unreliable, these values not being suffi- 

 ciently accurate for purposes of calculations of this kind. The 

 total value of imports and exports of India is 185 millions Rx, 

 and it is obvious that even so small an error in the values 

 declared by merchants as 2| per cent., may vitiate the result 

 to the extent of 5 millions. Theoretically, the relation that 

 should subsist between exports and imports may be stated as 

 follows : — The value of exports, including bullion of a coun- 

 try, on an average of years sufficiently large to eliminate the 

 temporary fluctuations of trade in one direction or the other, 

 should exactly balance the average value of imports of mer- 

 chandise and treasure, provided, first^ the country has no share 

 in the carrying trade ; secondly^ that it does not levy any duty 

 on exports of merchandise ; and thirdly that it has not lent or 

 borrowed from other countries, and has no money to remit or 

 receive on account of loans or for other purposes. If the 

 country has a share in the carrying trade, the imports will be 

 in excess by the amount of freight earned. The same consid- 

 eration applies also to export duties which will increase the 

 imports by an equivalent amount, for, as the export duty is 

 not included in the customs ^^ house valuation of the exported 

 merchandise, and, as it must be eventually recovered from 

 the foreign countries in which the exported commodities are 

 consumed, it must, pro tanto^ increase the imports. The levy of 

 import duties does not affect the balance of trade, as they are 

 paid or recovered from the people of the country which imports 

 the merchandise. The exports of a borrowing country will 

 fall short of or exceed the imports, according as the money 

 received, by way of loan, during the period for which the 



** The valuation is made under section 30 of the Customs Act VIII of 1878, which is 

 noted below for convenience of reference. 



" For the purposes of the Customs Act, the real value shall be deemed to be — 



[a) the wholesale cash price less trade discount, for which goods of the like kind and 

 quality are sold, or are capable of being sold, at the time and place of importation, or 

 exportation, as the case may be, without anj' abatement or deduction whatever except (in 

 the case of goods imported) of the amount of duties payable on the importation thereof; or 



{b) where such price is not ascertainable, the cost at which goods of the like kind 

 and quality could ^be delivered at such place, without any abatement or deduction except 

 aa aforesaid." 



