Supposing, then, that the
Government should be able to carry out its project of a 1s. 6d. rate,
the blessings previously showered on the producers will be trebled; so, of
course, will be the gain to the Exchequer; and the account will then in
round figures stand thus:--gain to the Exchequer on home remittances,
L4,500,000; loss to the producers, L21,000,000; or, in other words, the
levy of an export tax of 21 per cent. on all the productions of India,[66]
and a total annual loss to India considered as a whole of L16,500,000
sterling. This seems pretty well for a beginning, but it is really a very
small part of the results that may with certainty be anticipated from the
measure, which, as Sir David Barbour says, will have far-reaching effects.
Of this, as we shall see, there can be no doubt whatever. Of the direct
loss we can form a rough calculation; the indirect losses are indeed
incalculable. But let me proceed.

We have seen that, at the least, the Government proposes to impose, and
will impose if it can force up the exchange, an export tax (or what is
practically an export tax) of 7 per cent., which is to be ultimately
raised to 21 per cent. And we have now to follow out the effects of this
on the producers, the people generally, and the financial prospects of the
State.

The producers in India of articles for foreign export either, as the
planters generally do, send their produce for sale to London, or, as the
main body of producers do, sell them to merchants who export the goods.
Both these classes of producers are of course much benefited by a low rate
of exchange--the former when they sell in gold and remit money to India to
pay for the up-keep of their estates, and the latter when they find that
the merchant can afford to pay more rupees than they could when exchange
was higher. If then, to put the case in a more precise way, the Government
succeeds in forcing up the gold value of the rupee, and the merchant is
thereby compelled to turn his sovereign into 15 rupees instead of 16
rupees, it is obvious that to make the same profit as before he must give
the seller of produce one rupee less. Now let me take the business with
which, as a planter, I am most familiar. I have roughly estimated the
total value of the coffee annually produced in Mysore at L870,000, and if,
for the sake of even numbers, we knock off L70,000, a 7 per cent. export
duty on this will amount to L56,000, and if the Government could raise, as