TOWARDS A GOLD STANDARD 469
these processes of bringing about a gold standard seemed quite hopeless. The impossibility of the plan of conversion was quite out of the question. The fall in the value of silver in 1893 was nearly 35 per cent. Even the prospect of the Smith plan did not appear very bright owing to the enormous addition of rupees to the circulation of the country. If it had been adopted in 1878, all the subsequent additions to the currency would have been in gold, with the result that by 1893 the proportion of gold to silver would have been large enough to have endowed the whole currency system with the desired stability in relation to countries on a purely gold basis. In 1893 the mass of silver currency had grown to enormous proportions, so that it looked certain that it would take decades before the stoppage of silver coinage could make the rupee a stable and secure form of currency.
The plans showing a way out of an impasse such as this were legion. One was the issue of heavier rupees.* The second was to make silver limited legal tender and to authorize the Secretary of State to sell in London gold or silver Indian stock to the extent of his gold payments, to be liquidated by the Government of India by the issue of unlimited legal-tender notes called “bons.”† The third was that England and India should, as between them, adopt a bimetallic standard on a new basis,‡ or to admit the rupee as full legal tender in the United Kingdom.§ The fourth was to regulate the opening and closing of Mints to coinage on the basis of deviations of actual exchange rates from the rate of exchange fixed at the opening of each year for the Council drafts of the Secretary of State. Under this scheme, so long as the actual rate did not exceed the fixed rate by less than 5 per cent., the free coinage of silver was to be suspended.¶ The fifth was to provide that on the one hand the Secretary of State should fix a minimum rate for his drafts, and that the Government of India on the other should levy a duty on all imports of silver equal to the difference between the daily official quotations of bar silver in London and the price of silver corresponding to the rate fixed for the Council drafts.‡‡ The sixth was to introduce a bimetallic coin, to be called the Imperial
- By Aston and also by R. West, I.C.C, 1893. App. III, pp. 281 and 325.
† By Atkins, ibid., p. 282.
‡ By Chapman, ibid., p. 282.
§ By Woodhouse, ibid., p. 33.
¶ By Graham, ibid., p. 305.
‡‡ By M. Schilizz, ibid., p. 319.