Vol. VI, No. 3.] The Rupee and Indian Prices. 115 



[N.8.] 



The years 1891-92 and 1896-97 were exceptionally bad years 

 for rice, while the years 1897-98 and 1898-99 were exceptionally 

 good. The figures in Col. Ill would appear to indicate a slight 

 increase in the area under rice throughout British India. But 

 the export has increased considerably, as we see from Col. V, 

 and the figures in Col. VI, net balance of output, exhibit a 

 more or less stationary character. If we take the average of the 

 first five years and compare it with the average of the last five 

 years we have an increase of 26 per cent, in ten years. But 

 this is taking into account the exceptionally bad year 1891-92. 

 If we compare the average of the four years 1892-93 to 1895-96 

 with the average of the four years 1902-03 to 1905-06 we have 

 a decrease of more than 3*2 per cent. Now the census figures 

 shew that for the ten years 1891-92 to 1901-02 the population in- 

 creased by 7 millions, or about 2| per cent. Between 1891-92 

 and 1905-06 the increase in population is probably not less than 

 ten millions, or 3|- per cent. We thus see that while the popula- 

 tion has increased appreciably, the output, after deducting ex- 

 port, has fallen off. The census figures do not really give us an 

 adequate idea of the price effect of the difference, because there 

 is a good deal of internal evidence to shew that the consumption 

 of rice is increasing amongst the poorer classes. 



But the volume of the export is, as we have seen, relatively 

 insignificant, and can have but little effect in directly raising 

 the prices in Indian markets by diminishing the supply. It is 

 when gold prices are rising, as they have done since 1902, J that 

 the export, however small in volume, exerts a powerful in- 

 fluence on the price of the residue. Our chief object in 

 presenting the figures in the form we have done is to bring into 

 prominence the fact that in spite of the stimulus afforded by an 

 increasing export to an increase of cultivation, the area under 

 rice has increased but little, and the balance of output given 

 in Col. VI shews no appreciable increase in spite of an increase 

 of about 3|% in the population. This is really a most signifi- 

 cant fact, because it indicates that when this stimulus was 

 absent, the increase in the area under cultivation must have 

 failed to respond to the vast increase in population prior to the 

 period we are now considering. 



But the objection may be raised that we are confining 

 ourselves to a single crop, and that, while the net output of 

 rice has not appreciably increased, the output of other crops 

 has more than made up for the difference. Xow we have no 

 reliable figures for output for the other crops (except wheat), 

 and we have no space to go into detailed figures for areas, but, 

 by way of anticipating this objection, we have added Col. VII 

 to our figures, which shews the area year by year under all the 



1 The Economist Index number shews a rise of 30% in gold prices 

 between December 1902 and May 1907. 



