¹⁷⁵ As was explained by Mr. Waterfield before the Select Committee on East India (Civil Servants), H.C. Return 327 of 1890, Q. 1905–17, it was first instituted in 1824 and was arrived at as follows: In December of each year a calculation was made at the India Office of the cost of sending a rupee to India, based on the market price of silver in London, and of the cost of bringing a rupee from India, based on the price of bills on London in Calcutta. A mean between the two was struck and taken as the adjusting rate for the coming official year between the India Office and the British Treasury in regard to such transactions or payments undertaken by one Government as the agent of the other. It was fixed anew for each and formed a fair average rate, although it was sometimes above and sometimes below the market rate of exchange. ¹⁷⁶ _Ibid._, Q. 1925–26, ¹⁷⁷ Cf. F.S. 1887–8, pp. 39–40. This cost was as follows: ──────────────────────────────────────────────────────────────────── 1874–75 Rs. 6,400,000 1885–86 Rs. 4,00,000 1884–85 Rs. 18,43,000 1886–87 Rs. 5,15,000 ──────────────────────────────────────────────────────────────────── ¹⁷⁸ Cf. _Report of the Indian Currency Committee_, 1893, App. I, pp. 185–90 and p. 202, for memorials of the European Civil Servants. ¹⁷⁹ Cf. Col. Hughes-Hallett, M.P., _The Depreciation of the Rupee: its Effect on the Anglo-Indian Official—the Wrong and the Remedy_, London, 1887, p. 14. “the ignorant folk who think India would be benefited by lowering present salaries are seemingly unable to comprehend that such a step would render existence on this reduced pay simply impossible, and that recourse would of necessity be had to other methods of raising money.” Such, no doubt, was the case in the earlier days of the East India Company, when the Civil Servants fattened on pickings because their pay was small,¹⁸⁰ and it was to put a stop to their extortions that their salaries were raised to what appears an extraordinary level. That such former instances of extortions should have been held out as monitions showed too well how discontented the Civil Service was owing to its losses through exchange. ¹⁸⁰ The connection between the rapacious conduct of the early European Civil Servants and the smallness of their salaries was well brought out by Clive in his speech dated March 30, 1772, during the course of the debate in the House of Commons on the East India Judicature Bill, _Hansard_, Vol. XVII, pp. 334–39.