680 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES
as well as in terms of commidities in general. If in 1920 more rupees were wanted to purchase the same amount of silver than in 1913 it meant that the rupee had fallen in value. The Committee blundered because it failed to separate the rupee as a currency and measure of value from the rupee as an ingot of silver. The 2s. gold exchange value of the rupee as a measure of value was never a fact and we are therefore perfectly justified in not taking that limit into account in the solution of our present problem. The only justification if it can be held to be a valid justification, that could be urged in favour of 2s. gold ratio consists in this. Some of those who ask for
1s. 4d. ratio do so because in their opinion it means a return to the pre-war conditions. Now if it is a return to the pre-war conditions that is desired then Government may well say that measured in terms of prices 1s. 4d. in 1924 is not the same thing as 1s. 4d. in 1914. Many people do not seem to realize this. But it is an incontrovertible fact. Both in 1924 as well as in 1914 exchange was 1 s. 4d. But the index number of sale prices in India was 176 in December 1924 while in July
1914 it was only 100. It therefore follows that if we want a return to the pre-war conditions then it will not do to have
1s. 4d. as the exchange value of the rupee. For a return to the pre-war conditions, meaning thereby pre-war price, we must reduce our existing prices by 76% i.e. raising the value of the rupee by 76%. This of course ultimately means a ratio of 2s. But it may well be asked why should we return to the pre-war conditions ? There is no necessity to do that. It must be remembered that old contracts are no longer in force. Most of them have been executed and whatever wrong was done to them in their execution cannot now be remedied. Besides, it must not be forgotten that though the monetary contracts outstanding at any given time are of various ages,—some are a day old, some a month old, some a few years old, some a decade old and some even a century old—yet most are of a very recent date. That being so, we must choose our starting point for a new standard from the level of current business and not from the levels operative before the war. To do otherwise simply because it would give us a low level of prices is to dislocate our trade and industry and thereby jeopardise our prosperity. To raise the value of our money by 76%