EXPENDITURE ON THE NEW CAPITAL AT Delhi. The capital expenditure incurred, or estimated to be incurred, during the three financial years under review, on permanent works at Delhi, is as follows: Rs. 99,06,184 The total actual capital expenditure incurred up to 31st March, 1926, was Rs.11,98,05,293. OTHER CAPITAL EXPENDITURE. Provision has also been made for the following items of expenditure of the Central Government charged outside the Revenue account: CLASSIFICATION OF PUBLIC DEBT. Immediately prior to 1921-22 the debt of India was classified as (1) Railway Debt, (2) Irrigation Debt, (3) Initial Expenditure on the New Capital at Delhi, (4) Bombay Development Scheme, (5) Ordinary Debt, and (6) Treasury Bills and Short-term loans. In the table below items (3) and (4) are included under Ordinary Debt. With effect from 1921-22, the classification has been re-cast, and is now as follows: (1) Debt debited to Commercial Departments, subdivided into (a) Railways, (b) Posts and Telegraphs, (c) Irrigation, (d) Forests, (e) Salt (f) Industries (g) Vizagapatam Port, (h) the Punjab Hydro Electric Scheme and (i) Security Printing Press. (2) Ordinary debt, and (3) Floating Debt, i.e., Treasury Bills and Short-term Loans. * The portion of the Public Debt shown as incurred for Commercial Departments is determined with reference to the actual capital outlay in those departments provided from Government resources, irrespective of whether it has been financed by loans raised by Government or otherwise, e.g., by appropriations from revenue, deposits or miscellaneous funds. The funds devoted to capital expenditure in any year normally exceed the money raised by loan for the purpose. When this is the case, the adoption of the method explained above for calculating the amount of debt utilised for Commercial Departments results in the increase of the amount of this category of debt and affords pro tanto relief to the ordinary (or unproductive) debt, corresponding roughly to the extent to which funds raised otherwise than by borrowing are devoted to capital outlay on commercial undertakings. The operation is reversed in any year in which, owing to unfavourable financial conditions, funds obtained by loans are used in the ordinary disbursements of Government. In the following table, which includes the public debt of the Central and the Provincial Governments, the sterling and rupee debts of India have been combined at the rate of Rs. 10= £1. As regards Budget provision for reduction or avoidance of debt see page 29. + Figures for 31/3/27 are provisional. The floating debt includes the Treasury Bills held on account of the Paper Currency Reserve, of which the amounts outstanding were as follows: MISCELLANEOUS LIABILITIES AND ASSETS. Apart from debt items dealt with in the foregoing pages there. are other obligations of Government. Those classified as Unfunded Debt are interest bearing obligations relating to funds deposited with Government for various purposes; they include Service Funds, Savings Bank deposits and Post Office Cash Certificates, &c., amounting on 31st March, 1927, to Rs. 107 crores. Other deposits with Government include Departmental, Judicial and Local Fund deposits. On the 31st March 1927, also, the Government of India had lent Rs. 11,45 lakhs (net) to Indian States, Corporations, Agriculturists, etc. Other assets included the Gold Standard Reserve, consisting of gold in London £1,730,134, sterling securities of an estimated value of £38,269,683, and £183 in cash; the cash balances in India, Rs.27,873 lakhs and the Treasury balances in England, £3,122,140.* The figures in the final sentence are actuals, and hence differ from the "Revised Estimate" figures in the following statement. V.-GENERAL STATEMENT OF THE RECEIPTS AND DISBURSEMENTS AND BALANCES OF THE GOVERNMENT OF INDIA, IN INDIA AND IN ENGLAND. The following table shows the opening balances, receipts, disbursements and closing balances, estimated or actual, of the Government of India in 1925-26, 1926-27, and 1927-28. (a) Of this amount, Rs. 31,860 represents the funds of the Gold Standard Reserve. VI.-GOLD STANDARD RESERVE. In accordance with the recommendation made by Sir Henry Fowler's Committee, it was decided that, with effect from 1st April, 1900, the net profit from the coinage of rupees should not be treated as Revenue, but should be held as a special reserve, now called the Gold Standard Reserve. The principal objects for which the Reserve is maintained are (1) to provide funds from which the Secretary of State for India can finance his requirements at times when remittance of funds from India through the usual market channels cannot conveniently be arranged, and (2) to furnish resources against which, in normal times, sterling drafts may, if necessity arises, be sold by the Government of India to remitters in India, with a view to preventing a depreciation of the exchange. The earlier history of the Reserve is described in the Explanatory Memorandum for 1922-23. [Command Paper 1766 of 1922.] In 1921-22 and 1922-23 the assets of the Gold Standard Reserve in excess of £40,000,000, on the basis of current market prices, were appropriated in reduction of the outstanding fiduciary currency; but from 1923-24, the corresponding assets have been appropriated to revenue. Statistics, etc., regarding the Gold Standard Reserve. The total receipts from profit on coinage, interest and discount, and profit by exchange up to 31st March, 1927, were as follows: Of this sum, £1,123,655 has been used for capital expenditure on railways; the remainder, out of which £2,866,217 has been transferred to the Paper Currency Reserve in reduction of created Rupee securities and £6,471,738 has been transferred to Revenue, has been credited to the Reserve. The following table shows the disposal of the sums paid to the Reserve up to 31st March, 1927, and the composition of the Reserve on that date: |