ABSORPTION OF GOLD (both coin and bullion) IN INDIA (In lakhs of Rupees.) 1. Production (6) 2. Imports 4. Net imports (i.e, 5. Net addition to stock (i.e., 1+4) 0. Balance held in mint and Gov- 7. Increase (+) or 8. Net absorption 61,86 1,01,19 1,58,81 2,77,15 3,72,61 4,66,83 51,74 61,19 88,311,52,24 2,58,04 3,55,68 4,38,32 4,63,62 Note. The quinquennial average figures are inserted only for comparative purposes. The progressive total of additions to stock (item 9) and net progressive absorption (item 10) are calculated on the annual figures and are not based on these averages. Item 9 is the sum of the yearly figures in item 5 and item 10 the sum of the yearly figures in Item 8. (a) Excludes gold imported and exported on behalt of the Bank of England, (4) Figures are for calendar year ending 31st December. agency system was in the main acquitted of responsibility for the existing conditions though certain defects inherent in that system such as undue conservatism and lack of initiative were held to have to some extent contributory to them. The Board's conclusion as regards the stabilisation of the rupee at 18. 6d. was that coming as this did, at a time of falling prices, The Indian Tariff Board, 1927. Textile Industry. The Special Tariff Board, which was appointed in June 1926 to investigate the causes of the depression in the cotton textile industry and to report whether the industry was in need of protection submitted its report in Januray, 1927, but it was not published until June. The Board found that the depression in the mill industry which commenced in 1923 had affected Bombay much more acutely it had rendered the problem presented by the constitution of strong sub-committees to deal exceeded 74 per cent. and the average count with the various branches of the Association's spun was not below 34s. than any other centre, and that throughout India, the mills with spinning departments only had, with very few exceptions, been affected to a greater extent than mills with both spinning and weaving departments. Causes of the Depression. -The suggested causes of the depression were examined under four heads, (i) world factors, (ii) external competition, (iii) causes affecting the Indian cotton texile industry as a whole and (iv) causes special to Bombay. The two world factors which, in the opinion of the Board, had materially contributed to the depression were the altered relations between agrarian and general prices from 1920 onwards and the course of the prices of American cotton from that year. Under the head "external competition", the most important findings, based on an exhaustive examination of the statistices of Japansee imports of yarn and piece-goods into India during the post-war period and of their character, were that Japanese yarn of 32s counts and above and Japanese cloth of counts of 30s and above were being sold in India at prices which were practically equal to the cost of maufacture alone in India, without any allowance for profit or depreciation. In these circumstances, the Board held that the competition of Japanese yarn and cloth must be regarded as an important cause of the depression in the mill industry in India. It stigmatised this competition as unfair on the ground that the conditions of labour in Japan were inferior to those in India in respect of the length of the working day and the employment of women and juveniles at night. The advantage derived from the double shift working rendered possible by the employment of women and children at night, which is prohibited by the Indian Factory Act, was placed at 4 per cent, on the actual cost of manufacture both of yarn and cloth, an advantage which would be considerably increased if a reasonable return on capital were included in the cost of production. The depreciation of the Japanese exchange from 1924 onwards had stimulated exports from Japan to India whilst it lasted but Japan had ceased to enjoy any special advantage in this respect nor could it be established that Japanese goods were being dumped in India. Amongst the causes of depression which has been suggested as applicable to India as a whole, the Board found that overcapitalisation of miles could not be included though it had undoubtedly contributed to accentuate the depression in Bombay as had the high dividends paid and the consequent failure to husband resources during the boom period. The use of inefficient machinery was also ruled out as a cause of depression. The managing disparity between prices and wages in the industry somewhat more acute. Of the causes of the depression which had been suggested as special to Bombay, the Board found that the loss of the export trade in yarn with China and the increasing competition of mills in Ahmedabad and other centres were th most important. In the five years before the war, the exports of yarn from Bombay represented 53 per cent. of the total Bombay mill production. In the five years ending 1923-24, they were only 24 per cent. and in 1924-25, they had fallen to 11 per cent. The loss of the trade with China in yarn which had not been compensated appreciably by an increase in the extent of piece-goods meant that the Bombay mills had to find an outlet in the home market for the equivalent of 300 million yards of cloth at a time when they were faced with the competition of an additional 400 million yards of cloth manufactured in mills in India outside Bombay. The costs of production in Bombay and other centres were carefully examined and the conclusion reached was that Bombay was under substantial disadvantages as compared with centres in respect of cost of fuel and power, cost of water and higher local taxation. These disadvantages, however, were rather more than set off by advantages in regard to cost of stores of insurance and of office expenses. By far the greatest disability under which the Bombay industry labcured in its competition with mills in Ahmedabad and other centres in India was its high cost of labour. Remedial Measures. The remedial measures suggested by the Board were discussed under four heads (i) internal economies, (ii) improvements in organisation, (ii) changes in the tariff and (iv) State aid other than changes in the tariff. The Board held that the most important direction in which internal economies could be effected was by increasing the efficiency of labour, a method which it regarded as greatly to be preferred to a reduction in wages. It made very detailed recommendations as to the ways in which greater labour efficiency could be secured. Other suggestions put foward under this head were that a single hedge contract would lead to economies in the purchase of the raw material, that the charge for water used by the mills in Bombay should be reduced and that the "town duty" of one rupee per bale levied on all cotton consumed in the Bombay mills should be reduced to eight annas. The Board then turned its attention to the organisation of the industry and made suggestions for increasing the efficiency of the Bombay Millowners' Association by the activities. Improvements in the personnel of the firms of managing agents were recommended. The writing down of the capital in the Bombay mill industry was held to be a matter requiring immediate attention. The most important recommendation under this head was that Bombay should utilise to the full its natural advantages in the matter of climate and situation for the production of goods of higher counts and that the difficulties in the way of its doing so presented by the lack of suitable raw material in India should be overcome temporarily by the greater use of American and African cotton. A great expansion in the Bombay mill production of bleached, coloured and dyed and printed goods was suggested as one remedy for the depression. To this end, the Board recommended the establishment by a combination of mills of a large factory for combined printing, bleaching and dyeing in or near Bombay. It further suggested greater attention to the development of the export trade of Bombay and Mr. Noyce held that this scheme would do nothin to help those mills which had no weaving departrents or to solve the greatest problem before the ombay mill industry that of meeting the increasing competition of other centres. He also considered that the administrative difficulties in working it would prove insuperable. In his view, the maximum amount of protection which could be justified was that which would offset the actual advantage per pound of yarn or per pound of cloth manufactured which was derived from double shift working in Japan. He, therefore, recommended the imposition of a differential duty of 4 per cent. on all cotton manufactures imported into India from Japan this duty to continue until the end of the financial year 1929-30. pointed out that that the first essential to such a satisfactory scheme for a combined bleaching, development was that adequate information should be collected regarding conditions in certain large markets in the Near and Far East, and that the industry should be in a position to utilise it. In regard to changes in the tariff, the Board was unanimous in holding that no justification for an export duty on cotton could be established and that the concession of free entry enjoyed by cotton mill machinery and mill stores prior to 1921 should again be granted. It was further agreed that a moderate measure of protection, in addition to that afforded by the existing revenue duty of 5 per cent, on yarn and 11 per cent on cloth, could be justified for such period as labour conditions in Japan remained inferior to those in India. The President, Mr. F. Noyce, differed from his colleagues, Raja Hari Kishan Kaul and Mr. N. S. Subba Rao as to the form in which this protection should be given. The two latter held that a differential duty against Japan was undesirable as was also an all round increase the duty of yarn, owing to its effect on the hand loom industry. Their view was that protection to the cotton mill industry should be given in the form of an addition to the exisitng duty on all cotton manufactures other than yarn. The addition they recommended was 4 per cent. and in discussing the form in which state aid could be given other than by changes in the tariff they proposed that the proceeds of the additional duty should be utilised in providing a stimulus to the production of goods of higher quality by the grant of a bounty on the spinning of higher counts of yarn. They, therefore, recommended that a bounty of one anna per pound, or its equivalent, should be given on all yarn of 32s and higher counts, based on the production of an average of 15 per cent. of the total spindleage in mills in British India. The operation of the bounty would be limited to four years, at the end of which period the operation of the new Japanese Factory Law would have removed the effect of the unfair competition from that country. It would also be limited to the production of 15 per cent. of the spindleage in any one mill and would not be given unless the total spindleage employed on the production of higher counts Although the Board failed to agree in regard to the bounty scheme, it was unanimous in its views on other forms of State aid to the industry. It suggested assistance from Government if dyeing and printing plant could be put forward by the Bombay mill industry, the establishment of Trade Commissioners at Basra and Mombasa and a rapid survey of the potentialites of the markets in other countries by a small mission consisting of an official and a nominee of the Bombay Millowners' Association. It suggested that the Bombay mill industry should have its own representative in its principal export markets and that an expenditure incurred by the Bombay Millowners' Association in this respect should be supplemented for four years by the grant of an equal amount from Government up to a maximum of Rs. 25,000 annually. The question of assisting the industry by sibsidising shipping freights was held to be one for investi also was gation by the Trade Commissioners and the Commercial Mission. No justification considered to exist for the grant of export bounties or the abolition of company super tax. Finally, the Board rejected the claim for special treatment of the hosiery industry and also that put forward by certain mills using imported yarn for the abolition of the duty on yarn of counts above 40s or for a rebate of the duty on such yarn. Decision of the Government of India.The Government of India dealt with the recommendations of the Board so far as these related to changes in the Tariff in a Resolution of the Commerce Department dated June 7th, 1927. They accepted Mr. Noyce's view that the pro posed bounty scheme was impracticable and held that its rejection removed the principal reason advanced by the majority of the Board for a general increase in the import duty on cotton-piece goods. They further held that the advantages to Japan resulting from labour conditions, which they placed at 10 per cent. if a reasonable return on capital were included in the cost of production, was more than covered by the existing revenue duty of 11 per cent. on cloth and that in these circumstances no additional duty on this account could be justified. The existing duty of 5 per cent, on yarn did not fully cover the Japanese advantage, but an additional duty was undesirable in view of its prejudicial The recomeffect on the handloom industry. mendations of the Board in regard to the duty on machinery and mill stores were accepted in principle, but the Government of India held that differentiation between industries was undesir able. They, therefore, decided that the duty on all machinery and on certain mill stores should be remitted. The decision of the Government of India led to a strong protest from a conference of representatives of the cotton mill industry which met at Bombay in June, and by a deputation of mülowners which was subsequently received by the Viceroy at Simla. The representations thus made led to a reconsideration of the whole question by the Government of India and on August 16th, 1927, they announced that they had come to the conclusion that the cotton spinning industry could fairly claim additional assistance and that they had decided to bring before the Legislature a Bill providing that, up to the 31st March 1930, the duty on cotton yarn, Irrespective of the country of origin, should be one and half annas per pound or 5 cent. ad valorem whichever was higher. Thiser meant that the specific duty would be leviable on all small Commercial Mission should be deputed to explore the potentialities of certain export markets. Dr. D. B. Meek, the Director-General of Commercial Intelligence, and Mr. T. Maloney, the Secretary of the Bombay Millowners' Association, have been deputed to undertake the investigation. Miscellaneous Inquiries. The Indian Tariff Board proper was engaged during the year on a number of miscellaneous enquiries. It took evidence in regard to railway waggons and underframes and their component parts, wire and wire nails, bolts and nuts, steel castings, machine belting, printing paper, ply wood and tea chests and matches. The only report published during the year was that on the duties on printing paper. The question referred to the Board was the interpretation of the entry in the Tariff schedule imposing a protective duty of one cuna per pound on printing paper containing less than 65 per cent of mechanical wood pulp. The Government of India had ruled that the percentage of mechanical pulp should be calculated on the total weight of the paper and not merely on the fibre content. The effect imported yarn, unless its value exceeded of this ruling was to bring within the scope of Rs. 1-14-0 per pound, in which case it would the duty large quantitites of imported news continue to be 5 per cent. ad valorem. In order print which there appeared reason to believe it to minimise the burden imposed on the handloom had been the intention of the Legislature to industry by the revised duty, the duty on arti-exclude when the Bamboo Paper Industry ficial silk which was being used in increasing quantities by handloom weavers and in cotton mills would be reduced from 15 to 7 per cent. The Government also decided to extend the list of mill stores exempted from duty. Two Acts embodying these decisions were passed at the September session of the Imperial Legislature. The Government of India have accepted the recommendation of the Tariff Board that a (Protection Act) of 1925 was passed. The Tariff Board reported in favour of excluding from the protective duty printing paper containing no mechanical wood pulp or in which the mechanical wood pulp amounts to less than 65 per cent of the fibre content. Their recommendation was accepted by the Government of India and embodied in an Act passed at the September session of the Legislature. COPYRIGHT. were There is no provision of law in British India modifications of them in their applications, for the registration of Copyright. Protection translations and musical compositions. In the for Copyright accrues under the Indian Copy-case of works first published in British India right Act under which there is now no regis the sole right to produce, reproduce, perform of tration of rights, but the printer has to supply publish a translation is, subject to an imporcoples of these work as stated in that Act and tant proviso, to subsist only for ten years from in the Printing Presses and Books Act XXV the first publication of the work. The proof 1867. The Indian Copyright Act made such visions of the Act as to mechanical instrumodifications in the Imperial Copyright Act ments for producing musical sounds of 1911 as appeared to be desirable for adapting found unsuitable to Indian conditions. "The its provisions to the circumstances of India. majority of Indian melodies," it was explained The Imperial Act of 1911 was brought intoan Council, "have not been published, i.e., force in India byproclamation in the Gazette written in staff notation, except through the of India on October 30, 1912. Under s. 27 medium of the phonograph. It is impossible of that Act there is limited power for the in many cases to identify the original composer legislature of British possessions to modify or or author, and the melodies are subject to great add to the provisions of the Act in its application variety of notation and tune. To meet these to the possession, and it is under this power conditions s. 5 of the Indian Act follows the that the Indian Act of 1914 was passed. The English Musical Copyright Act of 1902 by portions of the Imperial Act applicable to defining musical work as meaning any British are scheduled to the Indian Act. The combination of melody and harmony, or either Act to which these provisions are scheduled of them, printed, reduced to writing, or other. makes some formal adaptations of them to wise graphically produced or reproduced." Indian law and procedure, and some material Customs Tariff. General import duties are levied for fiscal term as the Chief Customs Authority, or Chief purposes and not for the protection of Indian industries. But the tariff has been modified with a view to admitting free or at favourable rates articles, the cheap import of which was considered necessary in the interests of the country. Thus certain raw materials, manures, agricultural implements and dairy appliances are admitted free. Machinery, printing materials, etc. are assessed at 21 per cent. and iron and steel railway material and ships at 10 per cent. High duties are imposed on tobacco, liquors and matches. Customs Officer on sufficient cause being shown, in any case determines, provided further that the Chief Customs Officer shall not extend the term to a period exceeding 3 years. When any goods, having been charged with Import duty at one Customs port and thence exported to another, are re-exported by sea as aforesaid, drawback shall be allowed on such goods as if they had been so re-exported from the former port: Provided that, in every such case, the goods Re-Imports.-Articles of foreign produc- be identified to the satisfaction of the Officertion on which import duty has been once paid, in-Charge of the Custom House at the port of if subsequently exported, are on re-import final exportation, and that such final exportaexempted from duty on the following condition be made within three years from the date tions:on which they were first imported into British India. The Collector of Customs must be satisfied (1) of the identity of the articles; (2) that no drawback of duty was paid on their export; (3) that the ownership has not changed between the time of re-export and subsequent re-import; (4) that they are private personal property re-imported for personal use, not merchandise for sale; (5) that not more than three years have passed since they were re-exported. Duty is, however, charged on the cost of repairs done to the articles while abroad which should be declared by the person re-importing the articles in a form which will be supplied to him at the time of re-importation. To facilitate identification on re-importation an export certificate giving the necessary particulars should be obtained from the Customs Department at the time of shipment of the articles which should be tendered for examin ation. This concession of free entry on re-importation is not extended for the benefit of Companies or Corporate Bodies. Drawbacks. When any goods, capable of being easily identified which have been imported by sea into any Customs port from any foreign port, and upon which duties of Customs have been paid on importation, are re-exported by sea from such Customs port to any foreign port, or as provisions or stores for use on board a ship proceeding to a foreign port, seveneights of such duties shall, except as otherwise hereinafter provided, be repaid as drawback: Provided that, in every such case, the goods be identified to the satisfaction of the Customs Collector at such Customs port and that the re-export be made within two years from the date of importation, as shown by the records of the Custom House, or within such extended No drawback shall be allowed unless the claim to receive such drawback be made and established at the time of re-export. No such payment of drawback shall be made until the vessel carrying the goods has put out to sea, or unless payment be demanded within six months from the date of entry for shipment. Every person, or his duly authorised agent, claiming drawback on any goods duly exported, shall make and subscribe a declaration that such goods have been actually exported, and have not been re-landed and are not intended to be re-landed at any Customs port; and that such person was at the time of entry outwarde and shipment, and continues to be, entitled to drawback thereon. Merchandise Marks.-Importers into India especially from countries other than the United Kingdom, would do well to make themselves acquainted with the law and regulations relating to merchandise marks. In Appendix II will be found the principal provisions of the Indian Merchandise Marks Act, 1889, and connected Acts and the notifications issued thereunder. The following summary of the regulations in force does not claim to be exhaustive. For those secking more complete information a reference is suggested to the Merchandise Marks Manual which is published under the authority of the Government of India and obtainable of all agents for the sale of Indian Government publications. Infringements or offences may be classified conveniently under four heads :1. Counterfeit trade marks; |