Council of State Debates Tuesday 29th September 1931 Official Report

The course of the exchange value of sterling and of the rupee is uncertain while no one can yet foretell what will be the reactions in the world to England going of the Gold Standard. [...] Finance headings.—Owing to the cancellation of treasury bills in the Currency Reserve and the utilisation of sterling securities in the Reserves for meeting the requirements of the Secretary of State the receipts under Currency and Interest show a falling off of 34 lakhs. [...] The emergence of a revenue deficit in our budget and in the budgets of the Provincial Governments and the replacement of treasury bills in the Currency Reserve by treasury bills in the hands of the public as a result of cancelling redundant currency have not only increased the amount of our borrowings by treasury bills but also have been the cause of higher discount rates. [...] The saving of 56 lakhs (representing one half year's interest on the outstanding amount of the War Loan liability) realised from the acceptance of His Majesty's Goernment's proposal on the principle of the Hoover plan has been partly countebalanced by the increase of 40 lakhs on interest on the sterling loan of £10 millions raised early in the year. [...] They have in fact to face three things--a drop in the yield of the current taxes a drop in the revenues from commercial departments and a deterioration under the Finance headings The first is met mainly by increasing the rates of the taxes ; and the last two by retrenchments.