17. It appears to me very important that some standard should be recognized by which the tension of the duty might be tested from year to year. The real standard in the last resort is no doubt the average price in China. I would submit that the average prices, say, for the two preceding years should be taken, a liberal deduction allowed for cost, profits, and carriage, and the remainder fixed as the standard. If this remainder fell materially below the existing duty, it would be for consideration whether the duty might not be lowered; if it rose materially above it, say by 15 or 20 per cent., there would be a fair case for considering the propriety of enhancement.
18. In estimating the cost of transit and insurance, it is to be remembered that the means and security of transport have lately been greatly increased by the railway.
19. Say, for illustration, that the average price in China is Rs. 1500, then take the aggregate of items to be deducted at Rs. 700;[1] that would leave Rs. 800 as the standard, which would be more than 20 per cent, above the existing duty of Rs. 600; and if the China market showed steadiness or tendency to rise, would point to the opportunity for a certain enhancement, say to Rs. 700.
20. If the price in China were Rs. 1300, then, after deducting Rs. 700, the remainder would be Rs. 600, showing that the existing rate was adequate.
21. If it fell to Rs. 1200, that would leave as margin for duty only Rs. 500, indicating the necessity for reduction.
22. In this manner a standard of the nature supposed might be worked.
23. The only objection to this arrangement under existing circumstances is the derangement to which the Malwa market is liable, from the unforeseen action of the Bengal Government in the quantity of opium it brings to market. By increasing its supply of "provision" opium,[2] it has repeatedly caused a glut in the Chinese market, a collapse of prices in India, and extensive bankruptcy and misery in Malwa. The uncertainty so produced has gone a great way towards stimulating the spirit of unsound speculation and gambling which characterizes the trade, and has ruined many a firm in Western India.
24. It is true that the Government now recognize the sounder principle of keeping within a fixed limit, and profess to be content with bringing a moderate quantity to market, and thus maintaining a fair and steady price. But are we sure that this principle will always be soundly worked? I fear not. In 1865 it was admitted, on the cogent arguments of Sir C. Beadon, that 45,000 chests was
- ↑
Rs. Cost of production and manufacture 500 Transit and charges to Bombay, with profits of middle-men 100 Profits of speculators, freight to China, and margin, say 100 Total 700 - ↑
Annual average of
chests brought to
market in Calcutta.1854-56 49,600 1856-58 41,000 1858-60 28,000 1860-61 21,000 1861-63 28,000 1863-64 42,500 1864-65 54,500 1865-66 56,000
