INDIAN WHEAT PRODUCTION

Lyttelton Times, Volume LXV, Issue 7839, 20 April 1886, Page 6

INDIAN WHEAT PRODUCTION

We give below an extract from Mr H. Kains-Jackson’s weekly review of the corntrade. He writes under date of Feb. 15. It will be seen that he brings out some facts of a rather startling nature regarding the comparative position of the Indian and American wheat exports. The imports of wheat into the English market from America and Russia show an extraordinary falling-off as compared with the same period of the previous year, while the imports from India show a no less extraordinary increase. He refers this to a financial rather than to an agricultural reason. This financial reason is, we presume, the fall in the value of silver as compared with gold, which has taken place of late years. In India the State is virtually the landlord, deriving something like 45 per cent of its net revenue from rents. It is, in fact, the nearest approabh to the nationalisation of land which any country can show at present. The rent is payable in rupees, a silver coin, and the rents are fixed for a long period. At the time the leases were granted, about ten rupees were worth an English sovereign, but since then the exchange value of the rupee has fallen about 20 per cent. The Indian Government makes immense annual remittances to England, amounting to many millions sterling, for what are called " home charges,” and while it receives its revenues from the land in silver, it has to pay its home liabilities in gold, and the loss in exchange is therefore enormous. But the Indian ryot, or State tenant, is necessarily a gainer, so long as his present lease extends. He pays the same number of rupees as before, but reckoning his rent in gold, he only pays about 16s where he formerly paid 20s. The Indian wheat grower, therefore, enjoys a substantial reduction of rent. Prices in India, no doubt conform themselves to the altered value of silver, but it does not affect the value of a bag of wheat in the English market. The ryot not being himself an exporter does not feel the benefit directly, but it is bound to affect him indirectly. England being the chief market for Indian wheat, it takes a smaller quantity of that product to cover the rental payable in rupees, than would have been the case had the rupee retained its former value; and this appears to us one important reason why the Indian producer makes headway against low prices better than those of any other country.

“ We are already past Valentine’s day, dividing February into the part which looks towards winter and the part which looks towards spring. The weather has been rigorous in the south, Arctic in the north of England. The roads to some of the Durham and Yorkshire market towns have been so blocked by enow drifts, that a way has been tunnelled rather than cleared for farmers and their carts. Twenty degrees of frost have been registered south of the Thames, and though Thursday night brought a decided thaw, the frost-nip of the previous days was quite severe enough to send up prices if value had had the least natural tendency to advance. Spring corn, indeed, was held with more firmness than before; but the weakness of the wheat trade was not changed, nor the depression of the markets alleviated. The thaw is powerless to depress them further, as they are already at a minimum of activity. The situation is most serious. Home production, American production, even Russian production is becoming discouraged by the persistency of low values. Only India seems really able to ship grain at present prices, and even in the case of India a financial and not an agricultural reason is at the bottom of the fact. The dependence of England upon India for wheat is looked upon by many persons as a great advantage as compared with dependence on the United States, a foreign and possibly a hostile power. ; “ But for fear of paradox we might rejoin that this notion is really so obvious that it cannot be true. The United States might, theoretically, be at war with the United Kingdom, but practically that undesirable issue may be left to dimmer and remoter futures than even Mr Gladstone dreams of. If we were at war with any other power our fleets could safely convoy large supplies of grain across the open seaway of the Atlantic ocean. The passage takes a month with vessels of small power ; in of prices warranting it steamers could bring grain in a fortnight. But in case of war our dependence on India would be very serious. A blocked canal would make a delay of months, compelling ships to go round by the Cape. There is the Gibraltar Strait to be freed as well, and it may be plainly asserted that a war with any European power would be likely to cause great panic and excitement ■with respect to Indian wheat supplies “That our dependence on India is increasing very remarkably is shown by details of January imports. In January, 1885, the position was as follows :

Wheat received. From America ... 2,560,000 cwt, India... ... 681,000 „ Russia ... ~ Australia ... 379,000 „ Germany ... 140,000 „ During the month of January, 1886, the figures have been surprisingly different — India ... 1,452,000 cwt. Russia ... 614,000 ~ America ... 520,000 ~ Germany ... 278,000 „ Australia ... 134,000 ~ America has gone down to third place, and India stands- first, with figures almost equalising those of the four other powers combined.'”