1960-70; it was issued at a cash price of Rs.88 per cent. and provided for subscriptions in cash and 1926 bonds up to a total of Rs.25 crores (nominal) and in 1927 and 1928 bonds to an unlimited extent. Applications for conversions of 1927 and 1928 bonds were accepted up to 26th June, 1926, and subscriptions in the form of 1926, 1927 and 1928 bonds were taken as equivalent in cash at Rs. 101 per cent., 1024 per cent. and 106 per cent., respectively, of their nominal value. The Rs.25 crores were subscribed in the form of cash and 1926 bonds within a few hours on the opening day, and for the remainder of the period only 1927 and 1928 bonds were admissible in subscription. The total amounts subscribed were approximately, Cash Rs.16,54 lakhs; 1926 Bonds Rs.8,81 lakhs, 1927 Bonds Rs.2,74 lakhs and 1928 Bonds Rs.1,19 lakhs; grand total Rs.29,28 lakhs.

The amount of the permanent and floating public debt of the Government of India (Central Government) outstanding is given in the following table. The figures include debt incurred on behalf of Provincial Governments, the debenture stocks of various railways taken over by the Secretary of State on the transfer of the lines, and the capital value of liabilities undergoing redemption by way of terminable railway annuities.

Reserve.

Excludes Post Office Cash Certificates and includes Treasury bills issued to the Paper Currency *Includes liability for British Government 5 per cent. War Loan, 1929-47, taken over by India.

The classification of the public debt of the Government of India and Provincial Governments combined is given on page 16.

RAILWAYS.

On the 31st of March, 1925, the length of railways in India open for traffic was 38,270 miles, of which 233 miles were opened in the preceding twelve months. The total route mileage under construction at the close of the year was 1,201 miles. (See also App. II. (b) (i) page 34.)

(23231)

B 4

The capital expenditure on railways shown in the Government Accounts for 1924-25 and Estimates for 1925-26 and 1926-27, is as follows:

*The figures in the above table have been arrived at after allowing for adjustment in respect of exchange.

+ Excludes £18,500,000 East Indian Railway Debenture Stock in 1924-25 and £3,500,000 Great Indian Peninsula Railway Debenture Stock in 1925-26, the liability for which was taken over by Government on termination of Companies' contracts, and also £2,575,000 Great Indian Peninsula Railway Stock paid off by the Government in 1925-26.

§ Includes £3,000,000 paid to the Delhi-Umballa-Kalka Railway Company in purchase of their line.

In addition to the above figures, capital expenditure is incurred on branch lines from funds deposited by Branch line Companies or advanced by the Government.

The following table shows the capital outlay on all State lines up to the end of the year and the net return obtained. (See also Appendix II (b) (ii) page 35):

In the Budget for 1926-27 provision has been made of Rs.59'32 lakhs for capital outlay on the Indian Postal and Telegraph Department. The corresponding figures for 1925-1926 were :-Budget Estimate, Rs.213'53 lakhs; Revised Estimate, Rs.228'92 lakhs.

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:

The total actual capital expenditure incurred up to 31st March, 1925, was Rs.10,98,99,109.

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 and (h) 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 avoida ice of debt see page 29.

† Figures for 31/3,26 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.

There are also 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, 1926, to Rs. 94 crores. Other deposits with Government include Departmental, Judicial and Local Fund deposits.

On the 31st March 1926, also, the Government of India had lent Rs.11,49 6 lakhs (net) to Indian States, Corporations, Agriculturists, etc. Other assets included the Gold Standard Reserve, consisting of sterling securities of an estimated value of £39,999,175 and £825 in cash; the cash balances in India, Rs.25,15 lakhs and the Treasury balances in England, £14,908,481.*

The figures in the final sentence are actuals, and hence differ from the "Revised Estimate" figures in the following statement.