and approved lines. If adopted, he believed they would be the first step towards bringing back prosperity to India. No doles would then be either needed or asked for. (Cheers.)

The House then divided, when the numbers were :

AGRICULTURAL BANKS FOR INDIA.

On Friday March 18, 1898, in connexion with the East India Association, Sir W. Weddderburn, M. P., delivered at Westminster Town Hall the following lecture upon " Agricultural Banks in India."

Speaking a few days ago, in the debate on the Address, regarding the distressed condition of the Indian peasantry, Lord George Hamilton made the following declaration in the House of Commons: "As regards legislation, the Government are only waiting for a quilt time to consider a number of proposals for the purpose of freeing the people as far as possible from the influence of the money-lenders. I hope we shall be able to set up some system of local banks for the assistance of the Natives." This announcement has not a very positive ring about it, but I welcome it as bringing the question of agricultural banks once more within the sphere of practical politics.

AN EARLIER PAPER.

It was in the year 1883 that, under the auspices of Mr. John Bright, at Exeter Hall, I read before "The East India Association" a paper entitled "The Poona Rayat's Bank," in which I set forth a scheme of an experimental or pioneer bank for the benefit of the struggling peasantry. The argument was stated as follows at the opening of the paper: "Though land banks have prospered in other countries, they are new to India. We have therefore felt, in approaching the present undertaking, that the first thing to be done is to acquire a certain amount of local and special experience by observing the actual working of such an institution in India. And this it is proposed to do by starting an experimental bank, under good local management, upon a limited scale and within a limited area. For various reasons the Poona district has been selected for the experiment; and the

J

system followed will be that which has been found most successful in practice elsewhere, modifications being gradually introduced as experience may suggest. When trustworthy facts and figures have thus been collected, we shall know what rocks and shoals are most to be avoided, and we shall be in a position to decide in what direction, if any, a business of this kind can be safely and profitably, extended." I then gave a brief sketch of the Deccan rayat's position, showing how he was crushed and demoralised by his load of debt. Next, I noticed what had een done in Europe, Australia, and Egypt in the matter of agricultural banks: and then I showed how it was proposed to apply similar principles in the case of the Poona experiment. I may summarise the matter by saying (1) that the scheme was based upon the methods of the credit system, as tested by experience in every civilised country in the world: in Germany alone there are more than 2,000 of these popular banks at work; (2) that these methods were adapted to local circumstances in the Deccan, and were accepted by debtor and creditor alike: there was to be a settlement of old debts, with a cheap and simple mode of recovery from the crop of the year; and (3) that the scheme was approved by every authority in India, including the Viceroy in Council and by all public opinion both in India and in this country. It will thus be seen that as long ago as 1883 I was praying for immediate action by means of practical experiment. I have been urging immediate action ever since. But unfortunately, instead of action, there has only been talk and correspondence-interminable controversy on speculative questions, but nothing has been done.

EXPERIMENTS LONG OVERDUE.

What I have to say now is mainly a repetition of what I have advocated all these years; to show what has been attempted, and why it has failed; and then to submit

the proposition that there has been sufficient academic discussion, and that practical experiment should be no longer delayed.

At the Exeter Hall meeting Mr. Bright opened the proceedings with the following weighty remarks:-"These small cultivators in India, if they borrow money from the Native bankers of the district, pay a rate of interest which in England we should feel to be altogether destructive to any industry. Twelve per cent. is, indeed, a moderate rate; some pay 24, and some undertake or engage to pay as much, perhaps, as 30 or 36 per cent. It is opvious that capital employed in agriculture in any country must be absolutely unprofitable to the cultivator if he has to pay a rate of interest even of the middle sum, or 24 per cent. The scheme before us purposes to offer to the Indian cultivator a reasonable loan on reasonable interest, and to improve the mode of the latter's annual collection, so as to avoid going through the courts and ruining a man who finds he is behind in the regular payment of his interest. The Native bankers who lend money at these extreme rates of interest are themselves sensible that it would be an advantage to them if the rate of interest were lower, the security better, and if the interest would be collected in some manner which would cause less suffering to the borrower and to the tenant. They are, therefore, willing to contribute to a large extent funds which shall enable some banking system to be established which shall give this great relief to the Native population of India. . . . . The political prospect in India would be greatly improved if such a scheme as this could succeed, because if you have a vast population in a state of constant distress, they must be in a state of constant discontent. . . . . If it were possible, by some large and widely-extended scheme of this kind, to bring comfort into the homes of the cultivators, there can be no doubt that, with better prospects in their families, their would be a greater degree of contentment, and they would

look with more satisfaction to the Government which controls their affairs." Mr. Bright was followed by Sir James Caird, one of the highest authorities on all land questions, who had recently returned from India, where he had on the Famine Commission. He entirely approved of the experiment being made in the Deccan, and held that the scheme, by facilitating the digging of wells would operate as an important preservative against famine. Other. experienced speakers followed, and the debate was strongly favourable to the scheme; and next day the fimes, Daily News, Standard and other London papers gave their approval to the proposal. A short time afterwards, at the invitation of the directors, I read a paper before the Manchester Chamber of Commerce, with Mr. G. Lord, the Chairman of the Chamber of Commerce, in the chair, on "Government Concessions to Agricultural Banks in India." A resolution in cordial support of the scheme was moved, carried unanimously, and forwarded to Her Majesty's Secretary of State for India. Subsequently I had an interview with Sir Nathaniel Rothschild, M.P. (now Lord Rothschild), who had already expressed himself interested in the subject. He informed me that if the terms agreed to by the India Office were satisfactory he would favourably consider the scheme, and he did not think there would be difficulty in raising the necessary capital.

THE GENESIS OF THE SCHEME.

It is now necessary briefly to indicate the genesis of the scheme in India, and to show the support which it received both from the public and from the Government in that country. The idea of agricultural banks was first mooted in Bombay as early as 1860, when Lord Elphinstone's Government passed a resolution in favour of loan banks which should advance money to the rayats on fair terms. It was not, however, till 1882 that the project took practical shape at Poona. After much