The increase of the military establishments required in India, and which I have now estimated beyond those of 1802-3, are two regiments of native cavalry, and seven regiments of native infantry, in Bengal; one regiment of native cavalry, and four regiments of native infantry, on the establishment of Fort St. George; and one regiment of native infantry on the establishment of Bombay.

In the general distribution of the armies in India, which was made subsequently to the treaties of peace, concluded at the end of the year 1803, it was settled, that the army of Bengal should supply the troops required for the subsidiary force to serve with Scindeah, (being six battalions) and the subsidiary force to serve with the Ranah of Gohud, (being three battalions) as well as troops for the Company's territories under the presidency of Bengal, including the acquisitions in Bundlecund, those made from Scindeah in the Doab and in Hindustan, and the province of Cuttack.

By the same distribution, the government of Fort St. George was to supply, as it had formerly done, the troops to serve with the Nizam; and all those required for the southern parts of the Peninsula, including the garrisons and provinces on the coast of Malabar, (with the excep tion of Goa) and one regiment of cavalry for the Peishwah; --and the government of Bombay was to supply six battalions for the subsidiary force to serve with the Peishwah, three battalions to serve with Guickwar, a garrison for Bombay, a garrison for Goa, and troops to occupy the ter ritories ceded by the Peishwah and the Guick war in Guzeraf, and in the neighbourhood of Surat.

The establishments in the year 1802-3 having been formed on the lowest scale, compatible with tranquillity and security, and with a view to external peace, it stands to reason, that they could not supply the additional troops required from them, without some additions. The establishment of Bengal required an addition of six battalions to serve with Scindeah, and three to serve with the Ranah of Gohud. The smallest number that could be required for the protection to be given to the cities of Delhi and Agra, to the person of the king, and to the territories in the Doad, in Hindustan, and in Cuttack, is two regiments of native cavalry, and fice battalions of native infantry; which numbers complete the augmentation (viz. fourteen battalions) made to the Bengal army since 1802-3.

By

By the late arrangements made in India with Scindeah, it appears that the subsidiary troops for that chieftain, and for the Ranah of Gohud, will not be required for those services; and if it had been intended to make a more favourable statement of the finances in India, than their situation warrants, it would have been possible to strike off from the estimate of increased military charges, (amounting, as I have already shewn, to upwards of 60 lacks of rupees,) the expence of four regiments of native infantry, at least: but it is apprehended, that the service of a portion of these troops will be required in Bundlecund for some time; and, at all events, that the number of two regiments of native cavalry, and five battalions of native infantry, is scarcely sufficient to perform the additional services which will be required from the Bengal army, in consequence of the additions made to the territories under the Bengal government, by the treaties of peace concluded at the end of the year 1803.

In consequence of the distribution made in the year 1804, the duties of the provinces, on the coast of Malabar, which, in 1802-3, had been performed by the army of Bombay, fell to the lot of the army of Fort St. George. These duties had always required eight battalions; and when, in consequence of the distribution which I have already noticed, it had become necessary to remove the Bombay troops from those provinces to the northward, an augmentation of the army of Fort St. George, to the amount of four regiments, became necessary. The regiment of cavalry to be supplied to the Peishwah, also required that a regiment should be added to the establishment of Fort St. George.

The duties which fell upon the Bombay army by the distribution of 1804, required for the subsidiary force with the Peishwah six battalions, for the subsidiary force with the Guick war three battalions, and garrisons for Bombay, Goa, Broach, Surat, and troops to occupy the territories of Guzerat and in the neighbourhood of Surat, ceded by the Peishwah, and the Guickwar, and conquered from Scindeah; the detailed number for each of which services it is not necessary to mention.

It will be observed from this statement, that the additional services required from the armies of Fort St. George and Bombay, in the year 1804, and at the present moment, beyond those required in the year 1802-3, exclusive of the garrison for Goa, are one regiment of cavalry, and six battalions

4

talions for the Peishwah, three battalions for the Guickwar, and troops for the conquered and ceded territories in the Guzerat. Accordingly, the addition made to the military establishments, the expences of which are included in the estimate of 60 lacks, are one regiment of cavalry and four regiments of native infantry for Fort St. George, and one regiment for Bombay; making, in the whole, ten battalions.

No reductions of these establishments can, in my judgment, be made with safety.

The total of charges, therefore, for the future peace estab lishment, including the charges of 1802-3, and adding the civil and military charges occasioned by treaties of subsidy, and by the consequences of the Mahratta war, will stand thus:

Charges of 1802-3

Additional civil charges, rendered necessary

£10,656,834

by treaties of subsidy, peace, &c.

477,520

· Additional military charges

705,000

Total future charges

11,839,354

The revenues, as before stated, will be

14,668,119

Leaving a surplus revenue of

£2,828,765

From this sum must be deducted the interest of the debt, as stated in the account, No. 2, page 93, 1,823,040.; to which sum must be added the interest on the sum to be borrowed to supply the deficiency in the year 1805-6, viz. 2,655,9571., being at 10 per cent, 265,595.; making the total interest of the debt, in 1806, 2,088,6351; and the actual surplus, after providing for every demand, will be 740,130. In calculating this surplus, no credit is taken for any augmentation of revenue beyond 1802-3; although it is certain that some branches, such as salt and opium, must be, and have been already augmented; the revenues of the provinces gained by the peace, will also produce more than they have been estimated at.

The actual debt in India, in April 1805, was, according to account No. 1, page 90, 28,197,498, including arrears of establishments, debts not bearing interest, and demands upon the company of every description.

To this debt must be added the deficiency of resource, as stated in page 93, for the year 1805-6, being 2,655,957; and the total gross debt, on the 30th of April, will be £0,873,4551.

30,873,4551. From this sum ought to be subtracted 3,151,0647. (being the amount in possession of the commissioners for the redemption of the debt, on the 30th of April, 1805,) and the balance will give 27,722,5917. for the net debt of India, on the 30th of April 1806; of which sum, the amount bearing interest, appears to be 24,250,8247.

When this debt, however large, is compared with the assets in India, and with the value of the forts, houses, warehouses, &c. in India, (valued in No. 23, page 78, at 9,994,2087. all necessary for carrying on government, which have cost money, and would cost money to the company's successors, whoever they might be, supposing the transfer of the territory ever to take place), and when to these sums are added the amount of the company's claims upon government for money expended in India, on account of the public, it may fairly be stated, that the actual value of the property of the East India company in India exceeds the amount of their debts.

I am aware of an error in this statement, as in this view of the debts and assets, the amount in the possession of the commissoners of the sinking fund ought to be subtracted from the amount of the quick stock, on the 30th of April, 1804. But there is an error also in the assets. The quick stock is estimated only to April, 1804, and is stated in page 72, to amount to 17,252,5997. But in the calculation of these assets, there is an omission of 12,48,600 pagodas in the cash at Fort St. George. It appears by the paper, No. 19, page 63, that the balance remaining in the different departments at Fort St. George, on the 30th of April, 1804, was 57,19,605 pagodas; whereas credit is given in the account of the assets to the same period, for only 44,71,005 pagodas. The difference between these sums ought to be credited to the assets in April, 1804, viz. 12,48,600, or 500,000/.*

The additional sum in the hands of the commissioners of the sinking fund, on the 30th April, 1805, ought likewise to be added to the assets calculated to that period. The sum stated in page 48 to be in the hands of the commissioners for the reduction of the debt on the 30th April, 18 4, is Ct. Rs. 2,80,00,563 Ct. Rs. 3,15,10,618

On the 30th April, 1805, it is

There is also a small sum of money omitted in the cash at Bombay, but this is not taken into the account.

Difference

Difference to be added to the assets cal

culated up to April, 1805

£.35,10,085

In estimating the assets to April, 1806, it is proper to add to them the sum which will be in the hands of the commissioners of the sinking fund in April, 1806, viz. Interest upon the sum of 3,15,10648 current

rupees, for one year, from April, 1805, to

April, 1806, at eight per cent. is about .25,00,000

To the assets then, as they stood in April,

1804, viz.

must be added the sum at Madras omitted the additional sum stated to be in the hands of the commissioners of the sinking fund, in April, 1805,

the interest upon 31,510,648 rupees, or 3,151,0647. for one year, to April, 1806

£.17,252,399

500,000

351,008

250,000

£.18,353,407

And the total of the assets in April, 1806, will be This view of the debt and assets of different descriptions, however, is taken only as a general one, and not by any means to be relied upon. Measures undoubtedly ought to be taken to reduce the amount of the debt; but if, from circumstances, those means should be impracti cable, this general statement will serve to shew, that in case of the transfer of the territory, upon the conclusion of the charter, there is value in India to the amount of the debt.

But it may be contended, that this statement is no justi fication of the amount of the debt, which, from 1793, when it was 7,362,1901. has increased to be, in April 1806, 27,722,3917.; of which sum 16,669,7451. have been incurred since 1798, under the administration of the late Governor-General, Marquis Wellesley.

In order to understand the mode in which this debt has been incurred, it is necessary to advert to the state of the company's affairs in 1798.