CO129-331 - Public Offices - 1905 — Page 332

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to reconsider his decision to determine the contract with your Bank and the-

Chartered Bank of India. Australia, and China,

Hong Kong and Shanghai Banking Corporation,

in six months from the 10th June last.

As you are well aware. the circumstances under which the Govern- ment of India were willing, in 1894, to undertake the coinage of British dollars at the low rate of seigniorage of 1 per cent., and without expressly stipulating that the coinage of rupees must take procedence over the coinage of dollars, were wholly exceptional and have now ceased to exist.

Under the altered conditions of the present time, Lord George Hamilton agrees with the Government of India in holding that it would not be advantageous to them to continue the coinage of dollars on those terms, and that they cannot reasonably be expected to subordinate Indian interests to considerations for the trade of the East.

I am, however, to inform you that your apprehensions based on the proposal to close the Calcutta Mint may be dismissed, inasmuch as that proposal has been dropped.

I am to add that the Government of India have lately been asked, at the instance of the Colonial Office, to furnish an estimate of the capability of the Indian Mints to cope with demands for British dollars in the future, having regard to the requirements of the rupee coinage, and also to the requirements of the new Straits dollar.

They estimate that after meeting any but extraordinary Government requirements, their mints can coin annually about 50,000,000 dollars, Straits and British combined. At the present time 600,000 British dollars can be coined weekly, besides meeting the existing demand for 450,000 Straits dollars a week.

They add that demands for British dollars can probably be met in full, notwithstanding the priority to be given to the coinage of rupees and Straits dollars, but you will understand that they are naturally not prepared to give a definite undertaking to this effect.

The Manager, Hong Kong and Shanghai

Banking Company.

The Manager, Chartered Bank of India,

Australia and China.

I have, &c.,

HORACE WALPOLE,

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