The Problem of the Rupee, Its Origin and Its SolutionAmbedkar, B. R. (Bhimrao Ramji)
History
The Problem of the Rupee, Its Origin and Its Solution
Ambedkar, B. R. (Bhimrao Ramji)
Currency question -- India
Sections 19 to 26 (both inclusive), requiring the Mint Masters
to coin all silver brought to their Mints for coinage.²⁵³
(ii) The Indian Paper Currency, 1882.²⁵⁴
(a) Section 11, Clause (_b_), requiring the Paper Currency
Department to issue notes against silver coin made under the
Portuguese Convention Act, 1881.²⁵⁵ [pg 148]
(b) Section 11, Clause (_d_), requiring the Paper Currency
Department to issue notes against silver bullion or foreign
silver coin.²⁵⁶
(c) Section 13. Only the proviso limiting the gold portion of
the Paper Currency Reserve to one fourth of the Total
Reserve.²⁵⁷
²⁵³ These sections also contained provisions for the coinage of all
gold brought to the Mints for the purpose by private persons. The
quantity brought to the Mints was quite trifling, and the gold
coins, i.e. the mohurs struck, were not legal tender. As they
were to be superseded by sovereigns to be coined at the Mints upon
their being subsequently thrown open to the free coinage of gold,
it was thought undesirable that any more of these mohurs should be
coined. Consequently, along with silver, Mints were also closed
to gold.
²⁵⁴ The repeal of these sections of the Act also called for the repeal
of other sections depending upon them, such as Sections 14 and 15
and alterations in Sections 21 and 28, to bring the whole Act in
accord with the policy of a gold standard then inaugurated.
²⁵⁵ The Convention had come to an end and the retention of the clause
was therefore unnecessary.
²⁵⁶ The retention of this clause would have been inconsistent with the
closure of the Mints.
²⁵⁷ As gold was to be the future standard of India, this limitation
was no longer necessary.
These repeals by the Act were supplemented by an executive Notification
No. 2663, announcing in conformity with the suggestion of the Herschell
Committee that the Government Treasuries would receive sovereigns and
half-sovereigns of current weight in payment of public dues at the rate
of 15 rupees and 7 rupees 8 annas respectively.
Since gold was not made general legal tender by any of the above
measures, it was feared that the Government might be embarrassed by the
accumulation in its Treasuries of a stock money which it could not pay
out in discharge of its obligations. To enable Government to rid the
Treasuries of gold, should it accumulate in them to an inconvenient
extent, there followed another Notification, No. 2664, requiring that
the Currency Department should issue, on the requisition of the
Controller-General, currency notes in exchange for gold coin or gold
bullion, at the rate of one Government rupee for 7·53344 grs. troy of
fine gold, or sovereigns or half-sovereigns at the rate of 15 rupees and
7 rupees 8 annas respectively.
Public-domain text, read in full here on John Shaqi.
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