TOWARDS BANKRUPTCY

THE most obvious comment upon the Finance Member’s speech in introducing the Budget for 1922-23 is that the Government of India is apparently making rapid strides towards bankruptcy. There has been a deficit for four years in succession, and the deficit in the ensuing year is estimated to exceed the budgeted deficit of any previous year. In 1918-19, the deficit amounted to six crores; in 1919-20, it mounted up to 24 crores; the final accounts of 1920-21 show a deficit of 26 crores; while in the current year it is estimated at no less than 34 crores. Add to these 90 crores, the budgeted deficit of 31¾ crores for the ensuing year, which, judging from past experience, is almost sure to be exceeded, and you have a total deficit, at the lowest estimate, of 121¾ crores in five years, which works out at an average of more than 24 crores per annum. In reality, the average is misleading in this case, because the deficit is a progressive one, and there is not a likelihood of the earlier figures being reached again. On this point, even the Finance Member is not able to hold out any hope. “I do not think,” he says, “that these deficits are due to better times ahead and that we should consequently be justified in leaving things as they are in the hope that before long our revenue will once more have equalled our expenditure. I see very little prospect of such equilibrium being attained within a measurable period.” After making various assumptions of an optimistic character, he adds:--“I do not think it can be said if things are left as they are, equilibrium will be attainable within a measurable time.” This is, of course, only the plea for enhanced taxation, but the fact that has to be borne in mind is that the question in this case is not whether, if things are left to themselves, there will be an equilibrium, but whether even with the additional revenue realised from taxation, the equilibrium will be maintained.