Mr. Francis considered the India debt as not less than thirty-one millions sterling, and the annual deficiency to be 2,055,9571. although there was a territorial reye nue of fourteen millions. Even on the sales in England from which the dividends were discharged, there appeared to be a loss of 418,5401. Then what was called the stock account exhibited at one view the true state of the affairs of the company; and what was the true state of this account? All they took credit for was 6,181,000l. and yet even this was fallacious; for out of this amount was not deducted the capital, which in every mercantile statement must be considered, and when that was subtracted, there was, in truth, a balance against. them of from three to four millions. Again, they claimed upon government 4,460,000l. which was a manifest excess on the just demand of 2,000,000l. In a very short time there would be become due from the company in England 17,500,000l. and what were the measures to be taken to meet this exigency he was totally at a loss to conjecture. Such was the melancholy view he was obliged to take of these concerns; but while he lamented the situation of affairs, he highly approved of the nomination of a noble lord (Lord Minto) to the high office of governor-general, and he trusted that, under his management, some alleviation of these serious calamities might be obtained.

Lord Castlereagh explained.

Sir Arthur Wellesley said, Sir, before I proceed to consider the financial state of India, which is more properly the subject for discussion this night, I shall advert to the political subjects which have been referred to by other gen tlemen.

The honourable gentleman opposite (Mr. Francis) has asked, what right Scindeah had to the fortress of Gwalior, and the territory of Gohud, which have been ceded to him by the late treaty concluded by Sir George Barlow? The honourable gentleman must recollect that, subsequently to the treaty of peace concluded by Mr. Hastings with Mahdajee Scindeah (the predecessor of Dowlut Rao Scin deab), that chieftain attacked the Ranah of Gohud, and deprived him of all his territories. he family of Scindeah had remained in possession of those territories, and of the fortress of Gwalior, from that time, until the war which commenced

4 C 2

commenced in 1803; when the fort of Gwalior was taken, and the country of Gohud fell into the possession of one of the detachments under the orders of the commander in chief, Lord Lake.

Under the ninth article of the treaty of peace which I was the instrument of concluding with Dowlut Rao Scindeah, at the end of the year 1803, the territory of Gohud and the fortress of Gwalior were to remain in the possession, and at the disposal of the British government. This will be obvious to any man who reads that article, or the conferences in the negociations of the treaty, which are published; and indeed the operation of the ninth article upon this territory was acknowledged by Scindeah's ministers. The governor-general, Lord Wellesley, however, having adverted to the situation in which Scindeah was placed by the treaty of peace in relation to other powers in India, and particularly in relation to his rival Holkar, had deemed it proper to take into consideration the expedi ency of restoring to Scindeah the territory of Gohud and the fort of Gwalior. I was of opinion, that Gohud and Gwalior ought to be restored to that chief; and I believe that the instructions to the resident with Seindeal upon this subject have been laid before the House of Commons.

The reason for which the cession was not made until the conclusion of the late treaty by Sir George Barlow, is referable to the state of Scindeal's councils from the middle of the year 1804 until a late period in 1805.

The cession was a matter of favour from the British government to Scindeah, and was to be so considered. The committee will observe, that it is so considered by Sir George Barlow. But Scindeah's councils were so badly composed, and their conduct was so suspicious, from the period before mentioned, that no concession could be made to Scindeah, without incurring the risk of having it attributed to motives, which never ought to influence the conduct of the British government in India. For this reason the cession was not made by Lord Wellesley.

The honourable gentleman seems to think the fortress of Gwalior important, as a defence of the company's territories in that quarter. The fortress of Gwalior would defend and cover nothing, excepting itself: the company's territories are not to be defended by fortresses, but by armies in the field. Fortresses are useful as points of support, and as magazines

magazines to these armies; and in this point of view Gwalior would be useful, if the object of the company was, or was likely to be, the invasion of Scindeah's territories in Malwah. But it is of no use with a view to the defence of the company's territories, unless garrisoned by a large body of troops, which body of troops would be more profitably employed in the field.

Upon the whole, the committee will observe, that I consider Sir George Barlow's treaty with Scindeah to have been consistent with the spirit of that which I was the instrument of concluding at the close of the year 1803; and that the late governor-general, Lord Wellesley, intended to have carried into execution that part of its stipulations which refers to Gwalior and Golud.

Upon a former night I explained to the House, that I did not consider it to be a treaty of peace, as, in point of fact, we had never been at war with Scindeah since 1803. It is a treaty to amend and explain some articles of the former treaty of peace; and I conceive, that every article of it deserves approbation.

In respect to the treaty with Holkar, I do not conceive that there can be any objection to it. The honourable gentleman (Mr. Francis) has asked, whether Sir George Barlow was not obliged to conclude that treaty by the financial distresses of the government. Approving, generally, of the treaty, and not knowing the instructions from home under which Sir George Barlow acted, I do not conceive it necessary to look for the cause of his concluding that treaty, in any necessity arising from the state of the finances. The honourable gentleman knows well, that when war has been carried on for three years in India, it is not very easy to procure money on loan: and I certainly do not mean to extenuate the financial difficulties and distresses which existed in the year 1895, as represented by the noble lord(Lord Morpeth) and by the papers on the table. These difficulties certainly existed; but in possession of such a revenue as is enjoyed by the British government in India at the present moment, and in command of such large resources, I do not conceive that any temporary embarrassment, or dif ficulties of a pecuniary nature, could exist to such a degree, as to induce Sir George Barlow to conclude a treaty of which he himself did not approve, and of which he should not think his superiors in England would approve. I have already said, that I was not disposed to dispute the financial statements made by the noble lord (Mor

peth)

peth) as exhibited in the papers upon the table; but it must be recollected, that these statements refer to a period of most extensive warfare, which was carried on in all parts of India at the same time, and for which the preparations and exertions made were on a scale superior to any ever made upon any former occasion. There was not an officer in command of any detachment, who could prove, to the satisfaction of government, that any addition to the means already in his power would increase his capability of performing service, who did not immediately receive orders to make the increase which he required; and it will be found, that the service performed was proportionate to the expence incurred. With this recollection in our minds, it will not appear that a surplus charge, amounting, upon an average, to about two millions sterling, is very large for such a pe riod, and for such exertions.

The subjects which require explanation in the state of the finances of India, are the deficiency of the revenues, in comparison with the charges (including the interest of the debts), and the great magnitude of the debts. My wish is, to shew, 1st, the real situation in which the finances of India will be in time of peace; 2d, the real state of the Indian deb in April 1805 (at the close of Lord Wellesley's government), and in April 1806; and, 3dly, to compare the debt with the assets, and shew in what manner it has been incurred.

It appears by the account, No. 2, presented on the 3d of June, 1806, page 94, that the revenues of India, for the year 1805-6, were estimated at

The charges at

The supplies to Prince of Wales's island,
Bencoolen, and St. Helena

Making a total of charge of .

And leaving a deficiency to be provided for by loan, of

£14,279,533

14,645,844

1,823,040

199,806

266,800

16,935,4900

2,655,957

It must be observed, however, of this estimate, first, that the revenues are not stated to be so high as they really are; and secondly, that the charges are for a period of war, in, which it must be acknowledged that they would be higher than in a period of peace. If this be the fact, it

cannot

cannot be supposed to be a very unsatisfactory state of af fairs, that the charges of a great empire, such as the British empire in India undoubtedly is, should exceed the revenues and resources by two millions seven hundred thousand pounds sterling in one year, in a period of very extensive warfare. This will be observed more forcibly, if the financial state of Great Britain, or of any other country in Europe, is adverted to.

But the duration of war ought not to be calculated upon; intelligence of peace has already been received, and the finances in India must be viewed in reference to the state of affairs which must exist in consequence of the restoration of tranquillity.

In endeavouring to form an opinion of the financial state of India, in a period of peace, it is necessary to ascertain what will be the revenues in peace, and what the charges.

In the year 1802-3, the company were in possession of all the territories which they possess at present, excepting the territories acquired by the treaties with the Guickwar, and by the treaties of Bassein, and of peace concluded with the Mahrattas in December 1803. The produce of that year will form the fairest datum from which an estimate may be formed of the probable future resource. An average of any number of years cannot be taken; because, in 1801, the provinces in Oude were not in the company's possession; because, in 1805-4, there existed a drought in all parts of India, which affected particularly the produce and revenues of the ceded provinces in Oude, and in some degree those of the provinces ceded by the Nizam on the Toombudra and Kistna rivers, and those in the Carnatic ; and because, in 1804-5, the revenues of the ceded provinces in Oude must have been affected by the incursion of Holkar's armies.

The amount of the revenues in 1802-3 will afford an estimate of what they will be in future in time of peace; although there is reason to believe, that they will considerably exceed that amount.

The revenues in India in the year 1802-3, as appears by the accounts before parliament,

were

£13,461,537

To this sum, in forming an estimate of the future probable resource of the government in India, must be added the new subsidies, and the revenues of the territories gained by the company since the year 1802-3, of which I will read An estimate":

ESTIMATE