CHART I: Discount Rates in India CHART II: Fall of the Rupee-Sterling Exchange CHART III: Relative Values and Relative Production of Gold and Silver CHART IV: Prices and Wages in India and England, 1873–93 CHART V: Monthly Fluctuations of The Rupee-Sterling Exchange CHART VI: Comparative Price Levels, Indian and Foreign, 1893–1922 [pg 1] *THE PROBLEM OF THE RUPEE* CHAPTER I *FROM A DOUBLE STANDARD TO A SILVER STANDARD* Trade is an important apparatus in a society based on private property and pursuit of individual gain; without it, it would be difficult for its members to distribute the specialised products of their labour. Surely a lottery or an administrative device would be incompatible with its nature. Indeed, if it is to preserve its character, the only mode for the necessary distribution of the products of separate industry is that of private trading. But a trading society is unavoidably a pecuniary society, a society which of necessity carries on its transactions in terms of money. In fact, the distribution is not primarily an exchange of products against products, but products against money. In such a society, money therefore necessarily becomes the pivot on which everything revolves. With money as the focusing-point of all human efforts, interests, desires and ambitions, a trading society is bound to function in a régime of price where successes and failures are results of nice calculations of price-outlay as against price-product.