394 
THE TROPICAL 
AGRICULTURIST. [Dec. 1, 1902. 
require him to take sovereigns or half-sovereigns 
much more easily carried, and easily convertible 
in India. I can see no reason for undoing recent 
legislation and I would be sorry to see it asked for." 
To this still another Banker responds : — 
" Banks do import rupees for their own consti- 
tuents and several lacs have been imported 
within the last week or two. When a Bank 
buys a merchant's bill it is payable in the 
currency of the island, notes or gold, which are 
legal tender, not necessarily Indian rupees. A 
Ceylon rupee would do well enough as a 
purely local token. Indian rupees are wanted by 
the trader as well as the Tamil cooly. The 
trader buys rice at small ports in India where 
there is no Treasury or means of changing a 
sovereign for rupees. If the Government wish 
to encourage the trade of the island, they should 
use the best means for so doing, and that is in 
assisting the small trader by supplying him with a 
coin that he can trade with." 
But here again is the opinion of still another 
leading merchant, who is very outspoken: — 
" We are very ready to blame Government 
in all things ; but if the cause of the present 
ocarcity of silver in the island be enquired into, 
it will probably be found that the Banks have 
lately been importing unlimited supplies of 
gold at a profit and plugging Government with 
it in exchange for notes. They then take these 
notes to the Treasury and expect to get silver 
instead of gold in exchange. If the Banks find 
that they cannot supply their constituents with 
sufficient silver, why do they not import it, as 
they did the gold instead of looking to Govern- 
ment to do so for them ? 
"The way for Government to prevent a recur" 
rence of this state of things is to pass an Ordi" 
nance making legal tender consist of a certain 
proportion of gold and a certain proportion of 
silver, according to the ascertained average 
requirements of the community. The Banks 
would then be unable to flood the Treasurer 
with gold as they have lately been doing to their 
own profit, while grudging the expense ©f the 
importation of the silver they require." 
Another Banker writes Since the Govern" 
ment undertook to exchange notes for sovereign^ 
the Banks greatly availed themselves of this mod^ 
of getting funds from India, when it was foun"! 
necessary to import coin, not so much because 
sovereigns are cheaper to import (the difference 
between the cost of importing rupees and sover- 
eigns is slight) but because the gold coin is so 
much easier to handle than is the rupee. Not- 
withstanding this. Banks have quite recently im- 
ported considerable quantities of rupees from 
India. What merchant in Colombo ever receives 
actual coin from the Bank in exchange for bills 
purchased, and if the Bank insisted on paying 
him in coin what would the merchant say ? A 
Ceylon rupee would lead to no complications so 
far as internal circulation is concerned ; but the 
native who trades with small Southern Indian 
Ports where there are no Banks would not require 
them. He wants something which is easily passed 
there, and the only thing which suits his purpose 
is the Indian rupee. Why he should not pay a 
premium for them here is another question. Up 
to the present the Banks have been good enongh 
to import them for his benefit. The Tamil cooly 
also wants Indian Rupees but in smaller quanti- 
ties than the trader does. Had the Government 
before making the sovereign legal tender, appointed 
a small Committee of officials and representatives 
of the Mercantile Community to discuss the ques- 
tion, probably little would have been heard by 
the outside public about the Currency Question. 
Merchants should not overlook the fact that they 
benefit when Banks have a cheap and easy way 
of laying down funds in Ceylon inasmuch as they 
then get a better rate of exchange for their bills." 
A member of the mercantile community, 
of some considerable experience, says : — 
"I think Government is bound to produce rupees 
if that is the currency of the country. The Govern- 
ment of India makes about 6d. profit of every 
rupee she supplies to Ceylon and I certainly think 
she should give tha Ceylon Government a share 
of that. A few years ago, when the value of 
silver was about 1/4, they made nothing, but 
now the value of silver is down to about lOd. 
and they still sell the rupee for 1/4. If this 
question had been brought up when the value of 
silver went down and when the exchange was 
fixed at 1/4, I think the Government of India 
would have acquiesced at once. With regard to 
the coining of rupees in Ceylon I think it would 
be very much better if Ceylon continues to get 
her supply from India and succeeded in getting 
a share of the profit which India gets at 
present — sufficient at least to cover the expenses 
of taking rupees from India to Ceylon. Govern- 
ment might threaten to coin her own rupees in 
order to coerce the Indian Government into 
giving a share of the profits." 
Another merchant takes a decidedly anti-olficial 
view : — 
" The first principle in currency legislation is or 
should be — convenience i.e., to facilitate the 
machinery of circulation whereby the commerce 
of the State is furthered. The stability of the 
rupee having been secured before the gold stand- 
ard was established, the latter was not a neces- 
sary corollary and its imposition would only be 
intelligible on one of two grounds — (a) conveni- 
ence in circulation and (6) a byway to profit for 
the Government. 
" I believe this latter view has been before the 
authorities and inasmuch as it has been proved 
that the gold standard has seriously interfered 
with the smooth running of the country's trade 
and chief industry (See Hatton Bank's recent 
advertisements) —there is, to my mind, no justifi- 
cation for its continuance. To hamper the in- 
dustries of a country for a little immediate profit 
is a proof of narrowness and want of statesman- 
ship which sometimes marks those who are only 
experimentalists in finance — who lose the main 
principle in the attempt to carry out ingenious 
theories. I see no object in a Ceylon Government 
Rupee. We have all the needful machinery for 
the proper production of a silver currency close by. 
— Government largely profits by its own minting 
and the only aim, therefore, should be the weal of 
the State." 
Yet another Banker :— " It is perfectly true that 
the Banks are importing gold to a considerable 
extent, but Government brought in an Ordinance, 
after, presumably, 'due deliberation,' notifying 
that they were prepared to receive sovereigns and 
why should not the Banks act up to the Ordi- 
nance as I may say Government is doing. Gov- 
ernment in the Ordinance have the option of 
issuing gold or silver in exchange for their notes 
and they are exercising this option by issuing 
sovereigns and refusing to issue rupees, 
