be an improvement upon the former heading of Reduction of Debt. The heading proposed will, to my mind, be as puzzling as the former one. We are told that in a normal year in which ordinary revenue and expenditure balanced, the Government of India instead of raising a loan of three crores for public works would be able to reduce the three crores by the unappropriated balance, say, a crore of the famine grant. Could not the same result be obtained by investing the unappropriated balance in a separate fund which may be called the Famine Fund, and appropriating a certain definite portion, say, one crore, in aid of public works if they are of a protective, i.e. famine, character ? It seems to me that in the Budget Estimate for the coming year, a rather sanguine view has been taken of our sources of revenue. These sources do not appear to me to be so elastic as they are taken to be. I would call the attention of Your Excellency to the rate of increase of revenue during the last three years. The first year was a year of drought; in the second year the pressure of famine had considerably diminished, but the Province had not recovered its normal condition, the third year was a year of plenty, the arrears of revenue were to a great extent realised, and the Province showed a large increase of revenue. I find from the last Punjab Administration Report that the increase during that year was due partly to a rise in the income from fluctuating land revenue occasioned by favourable seasons and good canal working, and partly to large receipts on account of nazarana and sales of land on the Chenab Canal. In the second year, there was an increase of about eighteen lacs, and in the third year, as compared with the previous year, there was an increase of about twelve lacs. If the large receipts on account of nazarana and sales of land in the third year be taken away from these twelve lacs, the increase shown would be considerably diminished. I am inclined to think, my Lord, that the realisations of the third year were abnormal, and that the Budget Estimate ought not to have been based on the collections of this year. In 1897 there was only an increase of eighteen lacs as compared with the previous year, and this increase might be taken as a standard; but then it must be considered that the produce of the land would be greatly diminished after a second famine within a period of three years. The mortality of the agricultural cattle will be considerable; those which were spared at the first famine will not be spared at the second, and an adequate supply of fresh cattle will be difficult to be obtained in the coming year, large tracts of land will be lying waste, and revenue realisations are sure to be affected. What I have said with regard to the Punjab applies, mutatis mutandis to other Provinces affected with famine. My Lord, what has been observed by the Hon. Mr Bose in regard to the Revenue Settlement in his Province deserves careful consideration by the Government of India. I am bound to admit that in my Province the Government has been very liberal, and no one can reasonably complain of heavy assessment. I am sure that in this the Hon. Mr Ibbetson will bear me out. I would, however, point out, in the interest of both landlord and tenants, that it is desir able that the Revenue Settlement should be of at least thirty years' duration. I am strongly of opinion that when a district is properly surveyed, rights recorded, and lands classified, it should not be disturbed again with the view of increasing the revenue demand at the expiry of the settlement period unless sufficient reasons, such as extension of cultivation and appreciable rise in prices of food-grain, are shown. APPENDIX I PROPOSAL OF A PERMANENT SETTLEMENT IN NORTHERN INDIA THE enquiry made by Colonel Baird Smith into the causes of the famine of 1860 led to a proposal to extend the Permanent Settlement of the land revenue into all parts of India. The history of the controversy on this proposal, which went on for twentytwo years, is one of the most remarkable episodes in the history of British administration in India. The brief narrative and the extracts given below are from Parliamentary Returns 431, 431—I., 164, and 174. Colonel Baird Smith's proposals were circulated by Lord Canning's Government to the Governments of the different Provinces in 1861 for opinion. The Madras Government replied in its No. 241, dated 8th February 1862. In this remarkable letter, which is given in full in Appendix K, the Madras Government explained that the Ryotwari Settlement of Madras was meant to be a Permanent Settlement, "the leading characteristic of ryotwari tenure is the permanency of the assessment." The Bombay Government replied in its No. 1627, dated 23rd April 1862, embodying a minute recorded by the Governor of Bombay, and minutes by Messrs Reeves and Frere. The Minute of the Governor of Bombay is given in Appendix L. While disapproving of a Permanent Settlement for Bombay, the Governor looked forward to increase in land revenue mainly from "increased prices" of the produce of the land. The Government of the Central Provinces declared itself in favour of a Permanent Settlement in its letter No. 532, dated 22nd July 1862, given in full in Appendix J. In Northern India the Lieutenant of Bengal was in favour of extending the Permanent Settlement; the Lieutenant-overnor of the Punjab was against it; and the Lieutenant-Governor of the N. W. Provinces was in its favour with due caution and reservations. The following paragraphs from the Minute recorded by the Lieutenant-Governor of the N.W. Provinces contain his general views on the subject: 7. I do not, in the least, doubt that the gradual and cautious concessions of a guarantee of permanency to the settlement of the land revenue in the NorthWestern Provinces, generally, will be productive of all the advantages which Colonel Baird Smith and Mr Muir, in even greater detail, have depicted. Judging by the effect of settlements for long periods, it may be safely anticipated that the limitation of the Government demand in perpetuity will, in much larger degree, lead The wealth to the investment of capital in the land. of the agricultural classes will be increased. The prosperity of the country and the strength of the community will be augmented. Land will command a much higher price. The prospective loss which the Government will incur by relinquishing its share of the profits, arising from extended cultivation and improved productiveness, will be partly, if not wholly, compensated by the indirect returns which would be derived from the increased wealth and prosperity of the country at large. 8. Nor should the minor advantages of freeing the people from the vexation and exaction which are inseparable from a periodical settlement of the land revenue; of saving the large expenditure which each revision of settlement entails upon the Government; and of removing the temptation which the approach of each such revision holds out to land proprietors of temporarily deteriorating their property, be disregarded. These are all burthens which bear, with more or less severity, on the Government and on the people, and if they can be got rid of without lasting detriment to the revenues of the State, few will be found to offer any opposition. "9. It must also be admitted, I think, that the settlement of the Government demand in perpetuity will be politically wise. It is true that in Behar, and also in some of the districts of the Benares Province (notably Ghazeepore), which are permanently settled, the rebellion of 1857-58 was not less general, or less determined, than in other parts of these pro K |