REGISTERED No. L. 3131
The Gazette of India
EXTRAORDINARY
PUBLISHED BY AUTHORITY
NEW DELHI, SATURDAY, AUGUST % 1947
GOVERNMENT OF INDIA FINANCE DEPARTMENT
NOTIFICATION
New Delhi, the 2nd August 1947
REPORT OFTHECENTRALBOARD OF DIREC- TORS OF THE RESERVE BANK OF INDIA FOR THE YEAR 1ST JULY 1916—30TH JUNE 1947
No. F.6(33)-F.I/47.—In accordance with Section 14 of the Reserve Bank of India Act, 1934, the Central Board of Direc- tors presents to the Shareholders this Annual Report and the Accounts of the Bank for the thirteenth accounting period beginning on the1stJuly, 1946 and ending on 30th June, 1017.
ANNUAL ACCOUNTS
After payment of expenses ofadministrationRs.As.Ps.
and provision for sunday liabilities a nd con- tingencies the net profit amounts to , .8,02,27,3091511
MeetingsoftheCentralBoard and its Committee.—During theyearunder report, six meeting of the Central Board were held, of which three were in Bombay, two in Delhi and in Madras The Committee of the Central Board met fifty-two times in Bombay, and once each in Delhi and Madras,
Ofthisa m o u ntthe sum of . . .. 17,50,000 0 0
willbeutilisedfor payment toshareholdersof a dividend at the rate of percent per annum being the cumulative rate fixed by the Central
theReserveBank of India Act 1934 Under
the Reserve Bank of India ( L i m i t a t i on of
Dividend) Ordinance of1943(reprintedas
appendixAto the report fortheninthaccount-
year ended 30th June, 1943) which con-
to be in force the rate at which the
Local Boards. --As stated above, there WAS one Local Board election during the year in Eastern (Calcutta) Area in Novem- ber 1946, preliminary to the election of Directors for that Area. Mr. B. M. Birla, Dr. N. N. Law, Rai Moongtulall Tapuriah Bahadur, Mr. A. K. Ghose and Mr. K. P. Goenka were returned unopposed. Khan Bahadur Habibur Rahman Choudhury, Mr. Alee Leslie Cameron and MR. Debes Chandra Ghosh were nominated by the Central Board to be members of that Local Board, and all the members assumed office on 18th December, 1946.
dividend on t he share capital oftheReserve BANKmaybepaidbytheBank to share- holders as limited to a maximum of 4PERCENT. The additional dividend payable is therefore limited to per cent p er annum equivalent to 2,60,000 0 0
leaving a surplus of 7,82,27,3091511
Distribution of Shares between the varioun areas.—The fol- lowing table indicates the trends in the distribution of the Bank's shares as between the different areas :
'for payment to the Central Government in accordance with the said section as m o d i f i ed by the Ordinance
Distribution of Shares as on
1st
Auditors. —The accounts of theBankhavebeenaudited
April
31st December 1935 1936
30th June 1946
30th June 1947 byMessers.S. B. Billimoria & Co. of Bombay, Mr. P. K. Ghosh Calcutta and Messrs. SastriandShahof Madras who were lected as auditors of the Bankbythe shareholders at their
2,36,32 1,24,629
Bombay Calcutta Delhi
79,220
51,042
Rangoon
1,40,000 1,45,000 1,15,000 70,000 30,000
1,89,838 1,31,423 07,314 61,217 20,208 8,788
2,36,629 1,26,318 78,955 49,660 8,438 heldatMadrason5thAugust,1946in accordance th Secton 50(1) of the "Reserve "Rank of India, Act, 1934, hepresentauditors, being eligible, offer themselves for appointment.
TOTAL
5,00,000 5,00,000 5,00,000 5,00,000
Constitution oftheCentralBoard.—In accordance with
subsection 1(a) Of S e c t i on 8 of t he A c t, on the r e c o m m e n-
d a t i on of the C e n t r al B o a r d, the C e n t r al G o v e r n-
mentbyanotificationdated16thJuly,1946,appointed
Number of Shareholders as on
M.G. Mehkri to be a Deputy Governor of the Bank in the
1st
31st vacancy caused by the death of Mr. Wajahat Hussain, C.I.E
December
1935 1936
The Directors representing the Eastern (Calcutta) Area
30th 30th June June 1946 1947
ealBoardweredueto retire on31stDecember,1946 under
Bombay
28,000
17,308 10,590 10,589 6,610
Delhi Madras Rangoon
23,000 14,000 3,157
22,342 15,571 16,744 9,702 1,914
535
17,362 10,457 10,317 0,392 503 -section 4- of Section of the ACT, andanelection of the mbers of that Board was held November 1946. Subse- ently at a meeting oftheelectedmembersofthe local ard held Calcuttaon18th December 1940, Mr. B. M. isandMr.K.P. Goonka were electedundersub-section
TOTAL
92,047 66,273 45,692 45,031
Section9oftheActasDirectorsof the Central Board to resent the shareholders of the Eastern (Calcutta) Area rister.
Average number of shares held by each shareholder
5.4
PoBYAW,ANelectedDirector representing the Burma
7.5
10.9
11,1
AreaRESIGNEDon 5thSeptember,1946hisofficeas
(665)
ftftfl T HE GAZETTE OP INDIA! EXTRAORDINARY, AXTGtTST 2, 1947Th1* V*TI> ijvH'" rov^nr shTV>d a fii-"t-h.™r d*"!'*!^ In +h"" B U T T I I. t hi " R / W VP • R i nV of T ^ dH ( A r m n d m ^ nO A.ivfc, 1 ^ d7
w^s n^sifid in Mi^ch 1Qi7, n^ovidin"1 for t hi deletion of "11 rcf'MVY'io'i5' t'O BMrrni ii f ie Tt"m^"-T7i Bank of Tidiq Act, 10^4. The "ReRerve Bank's offic° in Rnntroo-' formally iieased to funnHou \n that oountr" from 1st A^T-'I 1047.
to*-*! -vi-nSir nf ^hv^h-iH^i f'-o'n ^s 3! T r n ' i^ of shirks on the MilfW and D^lhi r ^ s ^ rs showM declines of 1382 shares and 265 shares resn^ctlvniv.
Publication nf durrrwi/ Tt-vort.—Tin BnnVi "Rnnort on Currency and "Finance fof t,h" v^ar ended 31st March, 1047 is to hi iwie-d shortly. Th1* "R^nort duals with t h" economic and financial conditions ii t.h^ conntrv, the Govprnm^|(: fi^finr!Oc> and, in a n"w ohantir nrM^d this v"ar, also wi+h some of the important <•< unomiii and financinl d^vploTmients nbro"d, in gveate" detail than this Report whif^i In intended nrimnrily to review the Bank't wo^niin dnr' ^ the ^ccniintir\nr venr.
fn the last viir's R*v>nrt, mention was made of the in-
troduction bv the Government of Tn'h'a of hnif and quarter riinoe noiii minted in rmri nicV'^T i,nd also of the discon- t i n u o us if th° issue from Tnn^ 1046 of the quaternary mnee coin, wi+h a VIPW+.0 in+fTtniint fhn nioVl nmrao. As the Tndiqn Coiu'V0' A^t of 1006. however, did not permit the minting of ooius higher than oifrht rmna nieces in a metal ot^ier than silver, Government introduced in the Oentrat Assembly on 17th February, 1047 a "Rill to amend that Act- so as to authorise thorn to isciue all ooiriR Inoiudinct tho ruwee in miv Tn°tftl, The "Rill -was nasRod on 10th Anril, 1947 and recAivad the rJovemor-n^nerai's a1 m diameter.
J5"7iMWlwfi'o' of TtinJ) Denomination JVo^^.-^ATJtiiloationH
for the fTfhnn"e of hi"h dpTiominB+io^i not^rt domonptiped under +he H'"}i Dii "o^vnotloi "RanV Notoi fD^manoti^Rtion) Ordin^nne of l ? 'h .Tinuirv, 104ft, continnod to bo received d'ifincr the mnior nart' of tho venr under review and were deflit with hv the Oovernmrint of India, the Eeeerve Bank of Tndin epfertine exchnnBeR in meih CHHCB as were apnroved bv Government. Arranwrnent^ were also made with the Britiflh Consular Authorities in foreicm eountrieg and Central "Ranks in countries like the TTnit^d Rtstes, Canada and South Africa for the exchange of holding, if nny, of hicrh denomination notes heionginsr to T)ergons residinc in thote countries. In view of the amnie time already ffiven to a.U hrma-firfe holders of blffh denominntion notes to exchange thoir holdings, tho Oovernment of Tndia announced in a VTPMB note on 2ftth February, 1047 that no further claim would be received after that date. Out of H. total of RR., 143.97 ororea of hisrh deno- mination notes in ciTmilntion on 11th January, 1046, notes of the value of Its. 134.90 or^res were exchanged up to the ond of the accounting ye"r under review.
O-owrril V!nonr)yfl7fi PonJitioni.—-"Our-in" this second Tioat-wnr year, rooonver^ion +r> a neaoe economy coritinii^d tv bf* the maior ni"Tnona'o rn'ohlem, tho men of tran^Hon. M1" rather slow i ud halting, Th" nro-o"nuoation of Oovprvim"nt with oonRtitutional ohanrtes also rjivo un air of nnrnqiity to some o+"its measures in th" nconomif 4i)h"rr>, etinepianv t>1nn"ii"c The nersistin'Z maladiuitments in the ^ ar-ions Rectors of Ihe country's oconomv continued, and nroduotion notnaTlv dec- lined in the more imnoHant indnsitiips, fhn mnii fnotors accounting for this, besiden thp widrmnTflnrl disordfrs in the country, Irainv the yfrfnii xion-nvnilsihiiitT of canitnT (roods, the freqUPTit strikes and labour unrrit H'id the unnertaintv of Government's -nolicv in rewrd to various imnortnnt con- trols. Acute shortages of eRSnntinl ''nnqiimnr i/oorlfl eontinnurl resultincrin risintr nrioes and costs of liviritr nnd thu nrpvnntion of n further inflationary rise in nrif>ns T"r"wentpf1 itself as the primary nrobiom. Government continued to withdraw exeeRR purchasing power in the handn of tho community hv con- tinuing to enconracre the small savintrs Tnovem^-ni ; and the reduction in TWPUOP requvrnfnentR enabled them to release for civilian nroduntion and (vwmnm-ntion in^Ter sTcnnHes of essential raw matprinis and consumer jrnods. Tho imnori oontroi was relnxed for a time with n Hen" to fiuvmintinp1 thr flow of goods from foreign cOMn+rieq. nnd th" i>rocerlure foi the Issuo of ivnnort lic^noei nd for dcah'Tin- with nonh"" -ti'on for the imnort of oam'tql (r^ods wo^ lo^isidofTh'^ qimi^iflod With the expirv of the Defence of Tndia Act on 30th ^mitnm bor, 1946, a majority of the wnr-timo controls incindin" th Hoarding and Profiteering fTV^vontioTi^ Or^ininco of 104? and the Consume'1 Ooods (Control and "Distribution^ Order ( 1944 were allowed in lnnpo. GovernmeTit set irn in "PVbriiRT 1947 the Commodities "Prices Board, whinh is to Irecn uudr reviewthe movemonis of commodity nricpsi nnd ndvii" Hovori men! in roaard to nrico levels for controlled commodities ar, also on the question whether other commodities also phou be brought imdcr control. BoBides the risinp nrice levs the food -situation continued to canse grave anxiety ; tl failure of some of the principal food crops rendered the ciou try's overall position nrpoarious and the threatened or?sis w only tided over, partlv bv drastic, reduction in Tntion RCR and partly tbrouph imnortR towards the cost of which Rvhsid amounting to nearly "Rs 20 OTOTOS had bp^r "rant"d Vv C vernment in the rpvised budget for 1040-47. In order cover the annual pstimnt^d deficit in food prnjns of 4 ir million tons, the "Grow More "Food Tnmnflicm " which 1 been working since 104? i^ to be con+im"-d for the unrt t Voars, bv the end of which ^olf-onfTficif n^ in the rmti"T food on the basis of the existinnrlovi-lsiDrjjnmilntion nnd nitii is expected to be pchipved Action i>il < n I11" Govr ment in pursuance of thpir nlnn of -ni^t-wf • • onomir d- vel ment moluded the acquisition of (I/- "HTriduaifiTi ^ rc Factory at Bangalore a" n nucleus for buiiduvr 1111 an oraft Industry for Tndia. the conatujr'tinn ,,f nn Amm'in Siilphnte "fiVtorvfitSindri in Bilvr <"-l'rn"lpd tr, rirod annnnlly about 350 000 1on" • f tl>K T^hwhlr- fortiVr/r-r nixl initiation of n Mpoejnl TToiisin" Sch'-me for con1 miners Centre, payinfir n Rubskl-*- of 20°' ,,r H10 cost oPihnhoi subiect to n mnvimum of Rs ^00 -,".,• hm^r- Jr >f(.-r"n 1046, a hill for the eMtfihhVhrnpnt up an Trdup+i"i>d TJ'ITI- Corporation was introduced /i" mii1in<-tl h" rli^ Vm- Member in his budget speech for 1940.47 [t is >iTiei recognised that the proviF-ion of e-edit 'foi- mfdimn Termination of Joint Monetary Jrranqements with Bvrma.-— Early in 7945, when the South EuRt Asia Command nsRumcd •charge of the liberated areas in Burma, currency affairs in Burma were placed in charge of the "British Military Adminis- tration in Burma. The Rangoon office of the Reserve Bank of Tndia, which had temporarily moved to Tndia in 1942, was reopened in Rangoon on 20th Autrnst, 1045 and was appointed bankers to the Military Administration. The resTXynsibility for the management of the currency, however, uontinued to be with the Military Administration, the Bank carrying out certain administrative funotions in respect of the note issue. Following tho termination of the military recime on 31st January, 1946, the Government of Burma took over responsibility for the note issue in Burma, the Reserve Bank continuing to act as Government's agent in currency matters and as banker to (Tovermnent and other bankfl. The curren- cies of India and Burma, however, continued to be linked together as before the war under the Tndia and Burma (Burma Monetary Arrange me ntp) Order, 1937. In June 1046, the Government of Burma decided to sever thin currency link and to establish an independent currency to b^ managed hv n Currency Board in London with effect from 1st April, 1947. Authority was taken by an Order-in-Council in August 194fi to amend the Tndia and Burma (Burma Monetary Armn"e- ments) Order, 1937, with a view to tamrinatintr the ioint monetary arrangements with Tndia on six months' notice. This notice, served on the Governor-General on 1st October, 1946, expired on 3]st March, 1947, and with it I he currency
' lont-'-twm cflnitnl requiremnnts of indu^r^ fulls outside normal activities of commercial bnnl- ^ vhiV in nnrfftiTi^' ; the usual methods op capital issue nrr- not ^vhollv nr-ie^ii or suitable. The wo-nosed Corporal iott ^ "x>iocted i' , fhiHlneuntt. Tt will hnvr c n hw capita) of P^ -"S emiw ( subscribed by the Contml Goyernmont, (he Ttr-^rrvi- B"u
I'tiE d A Z "H Ot INDIA M*tlAoal>t^Aiiy, At.Gt$T? 2, 1941 - flfifl
W I —- r_
|
olioot irom 2otn itfaron, 19J17 under the Imports and iixporta Gunoroi Aoc, i a i /.
Daring tne yoar, commercial and flnanoial relations were resumed witn tne lollowmg ex-enemy countries: Siam, Indo- Cnina, jdungary, AadDna and i?oia,ad.
liiduti iicnedoled .Bouk^ JusjimuicB Companies, Investment Trades aad ooner JIAAUIUJ,! HUtLtuoxond. x'.ad mi&rdd wux De guarantjed by tne Goncra! tioveminenD aa to tne repayment ox tne principal and tne payment oi dividend not exceeding 2^ per uenc pdr annuxa. xne corporation ia expootod to mane long-terni loand to industrial uaderGaiinigd, repayaoid wicnin a p^rjod not, exodedinj &o y^Ma, add \\riu ditto uuddrwritd tne isdad ox anarej a nd doodnoaLdd, daojdot oo ojrcaiii oondniiona. tnd x-'Janaiog AdvidOiy iij
('o/ninjJ,itjj friend.—As ivgard^ price raovdindiios, tno J£oo-
Ine total valua oi tnd toreign sea-borne trade of India (private mdronandidoj for tne nine moiitna ended Marou Iy47 amoonOdd co xtd. *6J 8 orored ad aganiSL Ks. d9i-" croiea lor tae corredpondin^ period onddd iviaron 194ti, reoording an expdndion 01 xt^. &j-o orure^. Tne value oi lniportd went up oy Jo per oono irom lit. 176'Z orored to Ai. 2Jt"U orore*, ad a radon, ui tna liDerat import policy porsuoj oy Gjverninent during tne early part ox tne year. Jtixporta reooideU a moderate improvement irum K8. i i J " tt orored to Ha. 2to~6 orores or an nioreaae ox L6 per cent. Xno balanoe ol trade waa very fliignHy lavooraole Dy ±4a. O'" ororea aa againtst tna surpiod ox xta. 60'4 ororya tlurmg tne corresponding period ia tnd previous year, ±ne nguiea available lor tne six rnontnn enddd iJdodmiJdr Irf4
Mjoahange.—In the rupee-sterling exchange markeb, banks' nonno Advuor's gonerai index n a m o er oi wnoiedaio pnods (baad—Wdt)K endod iiftn AugiiHC., Li)6d — \.\jO) roue iroin ^ / U 'l Li J u ly liMto to Z6J' J in ivl1 itfAo, xonowing cne roia-sa- Lion oi in^dt ox t nj coiuroj-i. J'IIC i i u ^ i m a ni rmo vvaa recorded under tud titod}) ' Ouioi ^Vi CM; KM ui jii.ij.jjro , and. end mi a n n um under " jvianuLdOQut'od Afiioieci ', luni^o uaring end e a ny a nd peaK xJeciom or MO w,ir i\;ien tih' muijer eo4o LO J ^ / "i in jjiaron lU4/j WXUUJ ' iviaiiLLCtiOLarud Aracie-) ' Jtuao ironj. ^t>ii"o co z / i ' ti between July iw±u and may IUJ /. ±ne group indtax ior ' All Primary ouinniodmes ' IOSU iiom J,lo' i JUI July idM co jiiJa"2 in xii^y j.a*/, iiiauny ad it roaun, ot tm advanoo in ine ' Agri- uuii/Uiai tjODiinuaj.tiOEi ' group n-oni 606'6 in J u ly Co i&6'1 in ivlay. 1'nd ' i'odd JJIUCJC IOLWO—vWxtji oiuled Mia AugddD, liMii^i-Oij) MUOWVJJ: a anttip rind ^itujn ^46'*; in J o iy Lo ^ u o '8 in Ajju'ii iDdt/y, m tjpiio 01 a a o a^ ciap)aidy l i om Unjyerninent 111 Jci^peoc 01 inipoiiASd iood^iiuud, wans tiie indax n a u i j dr ot ' iiiaa^bi'ial i^aiV wlauoridLa emovved a ridd irom Ztto' 1 ja J u ly ly^to to J JZ O ia May i*it/. Lue swdp r^ie iii ^noas in una Uuii'dd oLtiiec), ma gonaiaJ ^rovaJ^noe 01 a selltira' market aoioad, itnu mo rojiaxauoii 01 export rega.a ions mainly aooo(iu(jBij lur tnu nue in TUL& laar. two ^roapa,
Ualancc of Tram. -TIIG movemcntH in the foreign sea"
W& THK GAZETTE Of INDIA EXTRAORDINARY, AUGUST % 1947between the ''transferable" accounts of Argentina, Canada, the (Jiuted States sterling aoooaats aad tnose of Belgium, Holland, Portugal and Brazil.
other oontres. With restricted supplies, the Bombay market once again resumed the bullish trend, whioli wais later assisted by the hignor prices at which London brokers were willing to soil aa Irom December and the announcement by tue Government of India of then1 deoisiou to suspend with elfdot from ticn March, 1947 the issue of licences for private imports of bullion, -frioon linotuvibed widely both w&yti but Ltie undurtonn of thy mirbet remained Urm., the ready quotations of both silver and gold closing for tliu j"ar higher tnau at t h. ond of June 1040.
The signing of the Anglo-LJ.b. Loan Agreement iu July Idifi and tne edtablisa.ni=)nD ul trio International Monetary Fund wero among ttxo year's drtveiopjidnts navin^ a signi- ficant bearing on tne wording of tne praaoat exohang<^ ountroi system in India. Tne Foreign Kxonanga tiugulauon Aot, wfliok oaina into force on 2<5tn iVlaroii, 194/, conferred wide powers on the Central Government and the Reserve Bank m respoot of transactions in foreign oxohange and securitn\-,, import and export of bullion and currency notob. Thu now Act whioh supersedes the Dofcnoe of India Rules oontei.-s powers to rosGriot the freedom of transfer between India and other countries even in tho sterling area, if neoensary, tnougu, through notiiioations issued by the Bank on 1-Ji.o day dno Aot caine into operation, retention of tne general percussion for payments wittun the sterling urea had bwu announoed.
Wanotion for travel way given on a more liberal scale, thougn tno litnit previously lixed for business travel remained. Faculties for the grant ol foreign exchange to .studerux were increased and extended to students of all agos and not only to poso-graduates taking tootuiicai or HcionUuo courses. A more liberal allowance lor powcmal reasons was also found possible, the limit of £ 7.~> per annum having, however, lo be maintained for countries the supply of wuone oummcim was unduly difficult.
THE (U^ETTE OJJ' INDIA EXTBAOKDINAKI', iUOtJST % 1947 66U-res on 31 at May J 04-6, the amount tendered tor oonver- 21 into the 3 por cent Loan, 1980, or Later and the 2J per it Lotto, 1970, totalled Us. 247-27 ei-ores .and Rs. 14-00 ret* roMpeotiVoiy. Of tho balance ot Ks, II 04 crores to repaid in cash, the value ol securities surrendered foi mym"nt upto HOth June 1947, oamu to Us. 4-3,r> eroro^. a result of the conversion operations the saving (t> tho vorntnenl oi [ndiu, by way of reduction in interest charges d be ol the order ol Rs. I • 3o orores per annum.
-he H per cent Defence Bonds, 1946, 1**11 due for repayment 1st August 1940, aud notice of redemption WAS given by o Central (government on 3rd July 194ft. Of the total tstanding of Ks. (35'14 orores as on .'{Let July 1940, Rs. :. 0.J • 83 crores were repaid upto 30th June J947, the balance tstandiug on that date being Ks. 1-31 crores.
predsoit) ox iujiiey aeeKmg investnieiil, and tlic accommo- dation granted Oy a niiinoar of banns for apuoulaCivo purpoaep tended to bring about " ns" iji security pruee. Tnm Ivd 10. tho exptwtunou that a pro^ruiwiveiy cheaper money pouey would bo pursued which m its turn induced large-scale speculative puronaaew made with a view to reaping capital gains, But from the second week of August onwarus a decluie .set in, with the realisation that tho levels ot prioeB reaonod were auon as oktveminoiit might be unwilling or unable to .sustain and tnia tiend was aeoelerated by auoljt factors as the outbreak of communal disturbances in mid- August and tne general unoertauny of tnc political situation which followed the disturbances. While this was ttie im- mediate cause of the deoline, tho levels that seourity pncea had attained wero tiio result of a combination ot mnationary faotors and indicated a. vulnerable poaiwon. Ownig to the general lack ol oonh'dence ongenttej-ed by the political situation, investment demand wan Jao&ing and tftere was some witndrawal of funds from baniis necessitating the sale of aeountios by ttie latter to repiemdn the cash re- serves. Although tuis lack ot oontidence was lnaiuiy the product of political developments and coald not be counter- acted actively tnrou^n monetary factors, tho Jtieserve liatik supported tue marjtet on a substa itial wcale to nelp maintani security prices and stabilise the banking and hnancia.1 structure g^jidraliy at levois waich tnero was a resouaoie prospect ol holding. Tiuw produoed a sboaclying niduenoe on tne money market and tae banking syatem; and ttu tno olose of the yoar a bettor tono odfcie to De m evidence.
Ou 2nd September 1940 I,wo provincial G-overuiuentt-i, uioly Madras and tho United I'rovinoes, simultaneously atod medium-dated loans of tho face value of Ks. 4 crores d K". 2-50 croros respectively at a uniform inane price ot '.. lOd-K-0 for every Ks. 101) nominal, bearing intercut at i. 2£ per eent per annum and repayable at par on list ptooiboL IDttl, While the United .Provinces hoan was oraubdoribod, the Madras Loan, (to which the provincial ivernmerit subscribed Its. 25 lakhs from the funds under control) was fully subscribed only after the transfer of bions from the United Provinces Loan aud after a cajl on •dorwriters for the balance not covered, by public sub- ri2)tion. lifputnatinn of tikrtin-g Debt.- -The transactions in reopeet, tho repatriation of sterling stocks during the year related, during the previous year, to the repayment of tho re- tnated atookw not surrendered earlier. The total amount us repatriated during the year amounted to £.'{,337,002 ainst whioh rupee counterparts aggregating Rs. 4,22,7J 4 TO oreabed. Conversion of Promissory Noti* into Stock (Jurtijicale.i and bsidiury (J-rneml Ledger Accounts.—The scheme for the nvorsiou of Promissory Notes into ^jtook (Jertitiuales d vice versa (both ire" oi charge) introduced during 1942 nbmued bo be iii operation during the year. Tile amount oonversioji and rcoouror-uou oamo respectively to Us. 38'72 ires, and Rs. 22-9,5 urores during Hie year, while the aggro - te lijjurwH lor tlic entire perujd beginning with 1st March ±2 up to the ond of June 191-7 amounted to Rs. .{.Mr 02 >rt)s Mhii its, 95'77 eranvs respectively. Institutional roHlor.s conbinucd to avail l.homnelvos ol the I'aeility ov- uled by the Bank siuco 1942 for holding their securities Subsidiary Uenoral Ledger Accounts, and at the end of iroh 1947, -A I-SO por eont of the total rupee debt was held sue}) Accounts.
ttfO THEl GA2DTTE) 01! INDIA EXTftAOfel>lNAB¥, AUGUST 2, 19^7*
(In HJUUHSIICIH of rupuess)
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, ifalnilOl-'H W LtJl 1 fJi>
--j."o,s:-
country, tin,' Euonomn- Advi^erV lades receding to 28".}.0 during this montn. i'nc dectme was accentuated by otbei irtc-bur,-, such as tlie wid ^jjiumi -
- | - J 9 , 1 5 , U (.
3,,"ji,HI,illi
it.
+,i:l,il4,U0 iri.Kijii
Kfiaci-vo K n u l t. . '\-Llvam iJd ui iijilm . Bills (liwi'onnttvL in
I n d ia
Contrary io >.lie irend noticed duving tli" jxisL fow year:
The group of lixed yield induntrial Heeuiitien moved in line witn the general index, rising from 200• 5 in June J04(i to 204'0 m August but rer-oding i horenfter to m, low level ot 171-5 in. May ti)+7.
The table given below compares the > position oi scheduled banks as on 2Hth June, 1946 aad 27th June,
Ml*
TTTB GAZETTE OF "TNTDTA EXTHAOHDTNAKY, ATTGTJ8T 2, 1947 "71separate ourr"nov for Burmn fr 0 riovni-nment nf Bnriw feised to ap'->"ar on the liabilities side of the bilnueo she^t Th>- d(j-
i ^ o s r i ts of b a n ks f l u c t u a t ed w i d e ly b n t w e nn R ,^ 1 11 • O ft ( T O T - AS • I T IS b a n k e rs in t h is l i st w as 78 an I r> r ^ s n s e t i v o ly ai t he
• r o r oa t h r o u c t h o ut t he V C TT u n d er r e v i e w. T he r > e r o o n t n i ;e of
• " o ll a nd H t o r l i ' v; s e c i r - i t i es to t o t al n o t es i s s u ed f o il to 9 31 24
072 T HE GAZETTE OP TNDTA EXTTUO-RTVTKHTtY, AJJGTTST 2, 1947January, 1947 and practically concluded its deliberations b\ SOhh Tinuirv, 1017. Thi final n m h ' i; wat held on Rlh FSbr'i
1946 from 1st October, 1946 to 24th March. 1947, then und a special ordinance till 19th April, 1947 and finailv under t Capital Issues (Continuance of Control) Aot, 1947, whir became effeotlve from 10th \pril, 1947, and which is i remain in force for a period of three vears. Originally intend; as an anti-inflati "iry measure, the control is now sougl to be exercised with a view to neourinf; ' a balanood inves ment of the country's resources in industry, apfrioulture an the social som'rwi'.
Thirinfj the eloven months ending with May 1947, sanotic was given to 612 companies for an issue of Rs. 355- lfi croc tho total number of companies permitted to issue capital ai the amount sanctioned since the inception of the control May I94fl hcint? 5.OM and Rs. 881-28 erores respootivel The following table gives the f"roup-wisc distribution of oo sents.
(Tn nrorfifj of pupens)
Anlnitnt^
•pTumhor
of r'umpxuieJi
'2,n9.H
Th/1 Ranking Compan!'") (Rt'strirtion of Branches) Ad, Trltfi —Pending the enactment of the Banking Companies "Bill, th" Banking Companies (Restriction of Branches) Aft, 1046. was passo 1 as an interim measure for controlling branoh- hanking. As stated above, the Select Oomniitteo on the Banking Companies Rill could not meet until 21st Novomber, 1946 and in tho meantime it was observed th#t a number of banks were opening branches, mostly at pHtoos whore adequate banking facilities were already available, and were thus fore- stalling the provisions of the Bill relating to the control over branch-banking. Tn several cases it wns found that the new branches worked lo the detriment of the interests of the de- positors ljy incurring h n vv cipitalised expenditure out of proporlion to the resource of the banks, payment of high rat^s of interest on d e n t i l s, indulging i i spoo lative aotivitiofi to make up for thr high cost, ernployment of untrained managers otc. AH these developments were fraught with danger to the'bankin^ sti^ucturo or i he country, the Central Government introduced a Bill on 4th November, 1946 to restrict the opening and the change of location of branches of banking companies. Tlv- Bill which is based on clause 18(6) of the Bankincr Comnanies Bill, 1046, received the assent of the Governor-General on 22nd November, HMO and became operative from that date.
40R T
. . . ..
7?T
".flTS
1) .1 (HF, Tn^nitrial A.tn'loultnval . F i n M ' i f i u il Tfade iirirl Tnitisport Of>(jnr Servk'Prf Totn.1 N'on-Tnrluitrial G-raail Totril (Tudirntri'iil and TSTon-Tnrlustiifi
TTTK GAZETTTC OF IlsiDlA EXTRAORDINARY, AUGUST 2, 1947 673'vision of Monetary Re-earcL to ciyanwe the ccMecoion, alysis and study of the, data lolatin^* so t a: cuU-iVy's alance of Trade, the invisible ^ i~o ia i- -. Litoriiiiijii*.! ocounts, etc. As a p ^ i, il'CJi JJU.I u C n ^ - jj 3 J .1J./A ' Trade, no accJAite eo^iii .te^ n,r>3 A. ...In -.io i*i x'tyEtrd t / W~ visible items catering iat^ tj*. -j^ line-1 Ot j.\"ymj,.ii;3 -i-n-
r t i c s, a p r a c t i c al si t rt u a os to >J •" a . - io i ,i b x. x a ' U i . x a i s . i t i lo
orgx.imtioa a ai o > i l ad o j i> , oj 3 Ji ou „ ui o* 11- rm tuioa o'l tiie vari^i-5 ite ,x ..i.roivoi. la oi LT "J oe fuippsd vith tlie knowledge >. i .lie '^i ;s' >i-Ji7in ana chnique adopted ta iorciga IAJIUII J.OJ i4 t.io t,o j^ii-iiion id study of IiiteiM^uiuiial A^ ^ant-a, ^ "< J of our o ^ 'CTJ, e Ofig. Director of iloneL^y .., .^,u^\ aiiO tao i>tcitiiu-ci&:i ive been deputed to the [L*iiu~>d J-Ju^l 3J of A-aax^j., s < chau • return they may initiate ana conduct fclie n-j-\3Sary our- •ys for drawing up reliable estuiaEbb lur t ^j hj/eral iteni> >mprising India's Balance oi Payments, xuc Dxvis on so continued to carry on itd i-outin" duties ->fpn paring the viouj R^poruS m tdd^aon ^o KS fhare of tb work in pro- ucing the monthly bulletin.
The Division of Statistics continued to compile uhe jJanii's onthly Statistical Summary upio November 19*3. Tnere- 'ter, with the amalgamation of the publication in a,much llarged form with the newly started Reserve x.'aiat o** >r>i'lta ulletin in January, 1947 the Divivlo-n lias hs-m responsible r compiling the statistical pord')\ of the BaiiSuin. Uneck- g of the yield sheets, prepaa 15 a qu U'fcjrly note oa ta-> war- ne chaagej in iaamtri"! s'laro v^iiie-o a,aJ 3 ippl/i ig stitis- 3al data to other departments of the Ban* 7 -ery month. Li tii3 coaaecuiju, fcas DivisxJxi h- 1 OD coa- ct the Ce ltrai and Provinoixl (J-jvorafiioiiis a w?ll as rtain Chambers 01 Commerca to aaquiiat taem with the ork underfcakexi by us and to secaro iiiSr cooperation. le preliminary worV in connectiO'i r ju nqu ry no -ho imily budgets of the Bank employees. But as tae returns ere called for on a voluntary basis Jae response v/as very oor and even among the returns received many proved to e fictitious. Attempts are also being m a le to investigate ito the applicability of sampling nio^iiods in the iitid of >ank inspection. The studies n^ade by the Division during he yeat were (1) classificar j < of scheduled banks as per >alance sheet pattern, (2) wai-tinio variation of cemmodity prices, (3) life of one rupee notes and (4) sampling methods or estimating the rural indebtedness of the LonJbay Pro- vince. The Director was deputed to attend the Indian Agricultural Economic C'cnference and the Indian Science Congress. The Statistician wa& deputed to attend the joint session of the Indian Academy oi feciciices and National Academy of Sciences.
The Division of Rural Economics is now, engaged, among other things, in the preliminary work of sampling pr- pa- rat ory to embarking upon a survey of rural indebtedness in the Bombay Province on the basis of the information con- tained in the documents presented to the Debt Adjustment Boards or to the Civil Courts which, by a recent legislation, have been directed to take over the work of scaling down agricultural debt originally entrusted to these Boards. In this connection, the Director of Rural Economics, along with an officer of the Division, visited the Debt Adjustment Board at Pandharpur with a View to ga.nmg an idea of the dimen- sions of the task and also to obtain first hand information about the working of the Boards. This was followed by the col- Tection, of certain essential basic data for sampling by our own men who were deputedforthe purpose to some of the existing Bo j-ds, one .Board each being selected from the several eco- no-andly LOiaogencQus regions iato viiica the province was di/i 1J 1. T^3 laud, 13 now being subjected to tae necessary st.it., „ c ,' c i^ybh foL- sanipling by tkd statistician attacJied tj L^o ^i/ioi^i. TX'A3 D'S iMon has c^i.cue ting oa its o\,n (I) a survey ofagri- cuLiiivd tests m i, bciooted \iiiage and ("J) a comprehensive and tii r j n ^. r^ralev^dii suxve_) ot atuiuablc taluka in the Bombay P ^ L u e. in View of the iuiicivnt diificulties of tae taoV, t ie cos survey wouiu be in tne nature of an experi- a"exii xl m^asuro, tuc object of the ruial credit survey is a ciihcal review of the origin, growth and the present position of the co-opcrativ e movement in the background of the actual needs of the rural community and the alternative sources of credit. The jjhision has undertaken the preparation of Review of the Uo-operative Movement in India for 1945-46. The wcik on tld& is being given priority to enable its early publication. The Division has been occupied besides with the preparation of btudies on several subjects of importance to the rural economy such as the marketing of agricultural products, rural int,urance, war-time developments in the agricultural economy and agricultural co-operation, post-war plans of provincial governments, rural indebtedness, problems ot rural credit, and the world food shortage. Among the studies completed in the Division may be mentioned a note on " Some Financial Aspects of the Stabilisation of Agricul- tural Prices in India ", which deals with the relevant recom- mendationb of the Prices Sub-Committee of the Policy Convnittee on Agriculture, Forestry and Fisheries. The Biiectcr of Rural iiiconomics attended the meetings of (i) the JIarL.pl ing Sub-Committee, one held at Delhi on 10 Ji and 11th July. 19 46 and the other at Simla on 4th to 7th Sept. (ii/ uh'3 T d< Po iv ' Co ,. _,w ' hold .ho D- Ihi o {19.h a .d 2uth S pt, 1945 (Hi) the Seventh Annual Conference of the Indian Society of Agricultural Economics and (iv) the 29th Session of Indian Economics Conference, both held at Karachi to-* wards the close of the year 1946, (v) the All-India Co-operative Cocfbrence held at Madras on 10th and 11th May, 194/ and (oi) ohe Fifteenth Registrars Conference held at Madras from 12 th to 14th May, 1947.
Sterlirg Assets.—The sterling assets of the Reserve Bank registered a decline by Rs. 128-25 crores during the account ing year as against a net increase of Rs. 271-93 crores in thu previous twelve months. Tin's reversal of the rising trend TTIJOII v. as in evidence for some years was partly brought al out by the disappearance of factors such aa Government'.' war c qjenditure and purchases of stores on account of Allied Governments, and partly bj larger imports particularly of food grains and fertilisers, stores and equipment on Govern- ment account. This also presumably reflects, as stated by the Finance Member in his budget speech for 1947-48, some rep 11 nation of British capital from India. The total hold- inj'b in the Issue and Banking Departments as on 30th June, I'JCI amounted to £1174-61 million or Rs. 1566-15 crores, which J re maintained in the form of cash and investments in short term Lritish Government securities renewed from time to time. The sterling balances constitute about the entire foreign exchange reserve of this country, accumulated at the C3st of great '.••''• : . •] . 'rifice borne by India, in order to assist the . n..< . •.-••„: .. and her allies during the war, in addition to what was considered her own fair share of the war effoit. India looks forward to an early settlement of these balances on which she depends fc*r the purchase of capital equipment required for her development schemes and for meeting any deficit in her balance of payments. In pursuance of the assurance given by the Finance Member in the Legislative Assembly that t.he negotiations for the settle- ment of the sterling balances would be started as early as possible, and the commitment of the United Kingdom to an earfy settlement , preliminary talks of an exploratory nature were conducted between the officers of the Finance Depart- ment and the Reserve Bank on the one hand and those of th o British Treasury and the Bank of England on the other. These discussions were to have taken place on a more formal basis in June but had to be postponed in view of constitu- tional developments.
Empire Dollar Pool.—The Government of India's position vis-a-vis the Empire Dollar Pool and tjie Post-war Dollar Fund, and certain aspects of the import policy of the Govern-
674 THE GAZETTE OF INDIA EXTEAOTtDTNARY, AUOUBT 2, 1947transferred to fh"> Fund. Of the mp^e subscirytion, certain amount was credited to the Fund's account with 11 Reserve Bank, the Iml^vee being i niAl in the form of no1 negotiable, nmi imWr>-1-bf firing promissory noies crnv"riib on dnmnml into rirn< e4 by crceMing tho IIIM- vnlne to tl Fund's neeouit On reviving tlif* members' subscription the Fund announced iti readiness to commence operaiio. from 1st March, 19tt,
ment were explainer! in a communique issued by Government on 7th October, 10t0. Since the beginning of the war unto 31st March, 1P40, Indi^i earned dollars adffreantinc Rs. 405 o n r n, whlli shi it^nt dn-'ng the nmn p -riod Rs Q40 eroros, leaving a net surnhis of Rs, 114 crores, nft^r taking into aooount "Rs. 51 crores representing the oxers'? of total expendi- ture over earning in other hard currency countries, viz., Canada, Swoden, Switzerland and Portugal. Taking into aocount the unfavourable balance with hard curronoy countries to the extent of Rs. 22 crores during the period Ar>ril 1046 to March 1017, India's net earnings of the cur- rencies of these countries during the period September 1939 to March 1047 amounted to Rs. 92 orores. With tho altered conditions brought about bv the termination of the war, Government have also modified their imnort and exchange oontrol noh'oies intrndu"inri; a measure of flexibility in the ad- ministration of thos" controls, in ordor that eurrenoy consi- derations raav not hinder the procurement of oanital equip- ment required for the economic development of the oountrv.
In view of India's largo contribution to the Empire Dollar Pool and her willingness to agree to give reciprocal aid to the "United States, a separato Fund known aa the Post-war Dollar Fund was set up, to which a mini of $20 million, was credited for the year 1943-44 representing a peroontago of India's dollar earning on trade account in that year and a similar sum was credited for the subsequent year on tho same basis. This contribution was to be utilised after tho conclusion of hostilities with Japan for restocking and capital expenditure in the United States. The extent of India's purohasos was not limited bv tho amount in the Fund, for sho had the right to draw on the Pml for all capital good's tho import of which was considered legitimate. As against the total amount in the Fund of THE GAZETTK OF INDIA EXTEAOKDTNA.RY, AUGUST 2, 1947 675
IS. 6 i't i r X ' . h i r n h t ra Cfi. Jwala Bank ID. Xi ,'ik of Mvor1* 07. Knrnini InduHtrial Bunk :'J), B i l t o f N - ™ ir 68. Knmbnkon>imBimk *M. R 'ik a-V Union *S9. Lik-ihmi Commercial Bank '"!!. D u- illv P ir mrition (Rnnk) GO. Lixmi Brink 2^, H ' l' ] P=.ntn) Bjnk 01. Lloyds B-\nk i i. B ' l T it B >nk "-• "VInbnluTTni Bink *'2:>. Li'i ,rith.i Lik limi Rnuk 03. M Toantjlr Bnnk of India 33. C ib i+l-H CimaiTfiilBink o i- NiulnrB'mk 27. r< ti [tt i N itionil Bunk fi5- Nwnnj? B'\nk of Jndlft J l l l mT Bunk 6fi. Nat* B ' nk '21. r n in B mkinc Oor"or fl7- National B i.uk of India 'JO, Uuiiri Ta.lu trial and Bu (>8. Nitioml B"ink of Lnlioro
int '^vnrlicite 09- National City Bunk of Ne-w
31.
APPENDIX
SCHEDULED BANKS
31. Cimilli Bijikinc; Cjrnoriition 7^. JSTotlirrlnndH India Commercial 3^1. O lmill. TJniiin R ^nk Bank N.V. in. U;m-"toii- N.tion.l D ' B- 7 3, W e t h (,r l i n,l fl Trading Society ," n T w • w v ^ 74. N w B m k o f l n d ia 38. D ,vk_w -a N , np B.nkmg- Co. 7fj_ ^w p ^^ B mt of I n d i ft .,!' n M ',') R t fi r 70. N,, .klmli Union Bmk 'in" 5L V i, ", V "• Orient U B mk of Gommoroe i n f f" ni rT i- •. 7 S- O'idh Oommeroial Bank 40. RT >h mgn JJ mk of In-lm * 79 p l U| O p n t T ll B a nk At ICV SO. PionourBink 41. a i l n l i i B T ik s i. P r i b h a t B a nk i-'i. :".lriu 11 iyi B ink - 82. Pi-itap Bank H, H ibib Bitik *83. ProHidouny Indaatrial Bark 44. Hm I B mk 84. Punjab
Kiikuia; (J)rpjr.ition 88. (Soutb India Bank
H. fTin^hlvBink *89. South Indian Bank 40. Tn 5 iri -A B mk of In din (10. Taajoro Pnrmanent Fund i"). T>I )I m R mk 91. Trxdera' B mk
• 1 1. T x ii I EI Ov "• HI r; B mk * 9 2. T r a v x n o o ro B u nk 1. Ajodhiu, Bunk 9. Bank of B-irods 2. All-Jiabad Bank 10. Bank of Bohnr 3. Amorioan Exprewf Oo. Inc. 11. Bank of Biknnf r 4. An lhr.i Bunk 12. Bark of China 5. Awouiutod B mkinft Corpora- 13. B ink of Oommn-ce
tion of IiidiH 14. B ink of Uommunio".tioiifl
*6. Amtr ilia Bank 15. B_mk of Hin hiHt.an
" J. E i li i l m n i ni tl B mk 91. Tririurn Modern Bank T)i. I i ll l l i rj nlil i B mk 91. Union S i nk of India • i l. l i i li ii'i il 13 iuk of vVuturnfl^. Uaitod Cnmmercial Bank 7. B uifo N wional Ultrumarino 16. Bunk of India 8. Bank of A^nin 17. B mk of Jflipur
ffilii 9fi. United Industrial Bank S.T. J i li me Pn'in n 'rnial Bank 07. Universal Bank of India
•Included ii the yooond uchedule diirinf; tJic year ended Juno 1047
EESEBVE BANK OF INDIA
ISSUE DEPARTMENT
LIABILITIES
ASSETS
Notoa held in the Banking A. O->H Ciin nnd Bullion :—
Departrnont. . . . 41,70,42,845 0 0 (n) T£"M ITI India . . 44,41,44,701 1 3 Notea in oiruulfition . . 12,23,flt.99,132 8 0 (fi) H^ld outside India . Nil
Total notes issued . . . 12,65,31,41,977 8 0 R tori inn .Securities • • • 11,35,32,80,317 1 4
TotfllofA .
ll,7(i,74,34,018 2 7 B, Tlupso Coin • • • 27,72,94.017 15 11
Oovnrmnent of India Rupee
SifiritiOH . . .. "7.84.13,341 S 6
IiiLoT-ml Uilli of T^^oh'in^e and
o( hor ComuiBroial Paper. , Nil
Total Liabilities Rs. 12,05.31,41,977 8 0 ; Total Aaiit^ Ra. . 12,6(5,31,41,977 8 0
Ratio of fjfcal of A. uJ Li^bihtiai ; 93-237 per oant.
BANTHNO DEPARTMENT
LlABIXITIBS
AaSETS
5,00,00,000 0 0 Notna .
Capital paid up RoaorveFund fl.00,00,000 0 0 Ilupoo Coin Deposits:—
41,70,42,84S 0 0 8,77,017 0 0 1,35,260 3 5 (a) Government
Subsidiary Coin Bills Purchased and Disoountod : —
(1) Central Government of India . 3,00,70,40,470 10 0 (n) Tnlernal Nil (2) Other Government Acoounts . 17,90,57,040 2 5 (fi) Extprnal . .. . Nil (b) Banka . . . .. 88,90,79,H01 9 7 (c) Government Treasury BIUB . . . 2,43,50,132 8 5 (ri Others
30.90,40,06,111 fi Balimrm hold abroad* 4,30,82,011,002 13 2 Bills Payable O tW Liabilities
1,02,26,(555 4 3 LOIII-J und Advances to Governments . , 5,11,00,000 0 0 7,01,70,320 14 11 Other Loans and Advanoos . . .. 2,95,000 0 0
Ir.v"stmonta OthnrAssota
00,93,83.048 4 0 1,21,33,964 7 7
Total Liablities Ba. . 6,48,41,29,207 4 7 Total Assets IU . 5,48,41,29,267 4 7
•Inoludes Cash and Short-term Securities.
676 T HE GAZETTE OF INDIA EXTBAOKDINARY, AUGUST 2, 1947REPORT OF THE AUDITORS
To THE S H A B E H O L D E ES Off THE RESSBVE BANK OF INDIA.
We, the undersigned Auditors of the Reserve .Bank of India, do, hereby report to the {Shareholders upon the Balance Sheet and Aooount" of the Bank as at 30th June, 1947.
We have examined the above Balance Sheet with the Accounts, Certificateb and Vouchers relating thereto of the Central Office and of the Offices at Calcutta, Bombay, Madras and with the Returns euibruittod and eeriiued bj the Managers of the otlier Offices and Branches, which Returns are incorporated in the above Balance Sheet, and repoit tlmt where vvo have culled for ex- planations and information from the Central Board such information and explanations have been given ana have been s tit,- factory. Jn our opinion, tho Balance Sheet is a full and fair Balance Hhect containing the particulars proscribe!L by, and in which the asseiw ha' e. been valued in accordance with, the Reserve Bank of India Act, 1934, and the Regulations fount d there- under and is properly drawn up ao as to exhibit a true and correct view of the state of tho Bank's affaim according (o the heat of our information and the explanations given to us, and as shown by the Books of the Bank.
S. B. BniiMOBiA & Co., ~\
P. K. GHOSH, > Auditors.
SASTBI & SHAH, J
Dated the 16th July 1947.
PBOBTT AND LOSS ACCOUNT FOR THB YEAR ENDED 30TH JUNE 1947
R". A. P.
INOJMB
I n t e r e s t, D i s c o u n t, E x c h a n g e, C o m m i s s i o n, e t c, . . . . . . . . . . . .. 1 0 , 1 2 , 4 3 , 5 11 15 11
1 0 , 1 2 , 4 3 , 5 11 15 11
ElPJENDITTTBS
1 , 0 9 , 9 4 , 3 18 1 3
2 2 , 5 00 0 0
• • 14,311 3 6
10,90.598 7 7 2,83,587 1 J
. . 3,22,107 3 11
84,200 0 0 E s t a b l i s h m e nt D i r e c t o r s' a nd L o c al B o a rd M e m b e r s' f e es a nd e x p o n s ee . . . .. . . . . .. 8 6 , 8 46 14 0 A u d i t o r s' f e el B e n t, T a x e s, I n s u r a n c e, L i g h t i n g, e t c. . . . . . . . . . . . . . .. 4 , 0 7 , " 13 18 1 L aw c h a r g es Postage a nd Telegraph charges . . . . . . . . . . . . . . .. 1,34,081 4 8 Ramittanoe of Treasure Stationery, e tc Seourity Printing—(Cheque, Note Forms, et0.) . . . . . . . .. . .. 38,20,058 13 2 Dapreoiation und Repmra to Bank's property Agency charges . . . . . . . .. . .. • • • 28,91,081 6 7 Contribution* to rtaff a nd superannuation funds Miscellaneous oxpeusea, .
. . . . . . . . . - •• • 8,98,749 11 2
Miscellaneous p
N et available balance . 8,02,27,309 10 11
10,12,43,511 1C 11
17,50,000 0 0
• • Nil Amount set aside for payment of dividend at the rate of 3 }% per annum Amount transferred to the Reserve F u nd Surplus available for payment of an additional dividend at tho rate of i per onnt Surplus payable to the Central aovornment
• • ^,30,000 U u . . . • 7,82,27,309 15 11
Balance earned forward . . . Nil
8,02,27,300 15 11
RESERVE FtTND ACCOUNT
0..I0 00,000 0 0 BybJanoeon30tbJun0lBi7 By transfer from Proat and LOBB Aooount
_ _ .„ __
Total RB. . fi.00,00,000 0 0
K. P. H. MBNON,
C. T), DERHMUKH, Governor.
Chief Aocouutaut (Offg-)
C. E. TEKVOB, ~)
>Deputy Governors.
M. G. MBHKEI, J
K. G. AMBBaAOKAE, Secy.
PUBLISHED BT THB MANAO*B OF PUBUCAHOMH, DMLUL. JITDIA.
PHTNTBD "r THB MANA"II!B, GOVBRNMBN* OI I U DU P M M, N IW DSLKI, l wu
/
- * 'R)'"eT'v< Bint? of T din to vWnd un its nTVrq \r\ ^Vo« av * Horn.—TVinn" tih°i accounting voar under review, m i^w^i-wi nr^'"T ""n,^ in ""n">Tit, i f i w », SIT.I. oil our etc., n ' n ' ii oF v^fiTin flin')~n'"i\+i'i'n Miil'idim the Government of Tni'i ^m rtiTw T>f/Ti> m'nd bv th-j "Bank. ↩
- for- ward aeniug ratdd ior dwiriing tdiegrapnio crdOdxerd ior ddU- very witnui s ii mjiii/ju GJ id. i> u / i O i. m^uiuaxnuig tna ojQdGing ra*dd ior ready danvdry at id. o Aij6iJi. i.'na neo daied daring cne ydotr 01 atdriing oy tnd xtjjjrvd xlanK amoantdd to t,oj,i±L,Jtii-ll*l ad oo-nparod witn ueo parouaded of x,lLto^J,iid-a-A in t na prdoeaiag year. MljKfLMje OoiUroL.—x'ndre were no onan^dd daring tha year in ona pruioipioa on vvnion ^iljtonaagd d J j t r oi vvad opara- tt»d. X'nd awrung area aydtdm, addordnig to waica payment* to peraond rediduno in otiidr dternnj area oooni/i'ied wore anoiVdd ireeiy, oontniuod; a nd i/randj,oaoaa ^vitn perdoua in ooner oountridd wera duojeot to rodGiuoouiid. i'ne main onangoa in tne (Jmoed Axngdjja regulatioas borne bi'ctUu oi India uuriji^ tne _ytja. wore primarily mnaenood by on.uiyod ni i_K>vt>i.i)mcuij'ii iuiporo ,tmi OAj^ort oaiitroi polioy- -Uai'iujj ww o a ny paiu 01 tnu ^^at", tjuvcrainttiit rel .Xed W16 u^oili' 01 iiDpOit. L-oiK/juid ad ^i,ii a^ exciittn^e regulj.uonri m oiaelc to Oijj.i(j auoUL a ireer rJoiV oi goodd IUGO 11X0 CMjoiiory, A uoivTernai v»j,»oa uioneiai AJicenud 1x0. VIIJL wad introduced HJ oojjieuiooi i u i o, laoiuijaiJJJO t nj impur^ irom a ny uouro« 01 a opocnied mi vi yoodd, i ui'iner, H. itirge variouy 01 yooda was Uioajjai. uncli.'1 wpen Ui^iitirai ijiooaoo ±.\o. VU, peiniii.Dmg t ne inipoit IJI ripeoinuu good;* ii'ee 01 nconoe irom mo i i i i u an hiia^uv douiiiiicd in wid Bteriui^ aroa. Xno lull extents 01 tnia luiajtaijion vwiu Jiot ltlu, nyvvovor, iiU tnu nrdu q a a i i er ol iKi7, WILOU iin^i'iB moaiiy vi )ion-caionuiai jjoodb Udgaa to arrive m very jaiye liiianiiuioti. xiw uupdiaavti ueeu IOX oouuerving tno n u u wu fjujjiijigo redoiuottj ui wie oounwy to deoare t ne supply 01 uc^ujiuy re^uiiuti Cttpnai gooua in mt» taoe oi t ne ooxiuxuued u i a iu uau»t3ii uy uio iaig^ piuonadew 01 iooO. i r om aDiOad uunianUDLL leuoiiBiui'ititiun UJ. tao Lroveinuioni/ a u n h u rt pont'y tiiia juvjrijDii yi ltd le^iuawuud uuriUjL, line oeoond nail OX Gilo ye dr. liu.i.iy J LI xtiar^ji, j j-n, r-uo univeiaai Upon Vieuoral Lioenou 1NO. V±J.J. Vvati bu»pennLU, anU. Mio iteBclve UtiAlia oeaswa idduiu^ uueuWn lut vuv unpOJ t 01 guia a nu auver wmon h au nioroadoa ^ppioLiaoiy utuni^ t ue niau i^uivi'uer ot l y * /. JJuilui^j M4y, UJJUU Ueuoitd ijn,t;iii.is iNo. VAI Waa aupei'dedecl and le^ji^oo uy a ucHii u p on UL'uorai i-iicenotj i\ ^. iA covoiiiig a aniuiii nuuaoor oi uuinuiodiueB. *J> > voiiiinont aiuo oanooiied lortnvvim upeu Ueueitu jjicunooa J.SWM. 1 aiiu in appncauie to nnpoii/b ij.oin c«yion, i^uiLU^ui'w i'oaaeaaiona aua otnur lorei^u aj.eaa ooniiyiiuud w ine iaud ironnwrs 01 India, lux- poiii uoiitioiu la icojjuob ui orHeiiLiui i.iw inaiOiiaia were ad.- nunidbeiea w iw IJIIU OUJBOTJ 01 piuvtdiug ior t ne OJtpanUing neeua in uoiueaijitJ uiauoiJiiea, nioonug wiu edoenuai luiniinum reqiiucniciitB oi UUUUWIOB aujjcuutuLiu uu luuiti lui wiou bup^iieB a nu uoVuKj^jin^ uvw or niuuibciijuiiug 01a uxpuru niar*t«tia. x ne moojuiJivcB uuoiod 101 cuo t)Jtpa,*cu.oii ui. xojd urypd iu tne ooun- iry u^iejiatou ivotriuaveiy un ino pioduoijion ui aonio ol t ne caau i-iupB lur OApurtcJ, a nd iidouajiijaudd i-no roiaXanon ot OJLpuii/ u u u u uu ouiy jjiuiuuuu^ a na m lobpeot o± auon cUTi/ioiea Wiii^n wuioa^uuftU^ 1. t)Ai;ocki wiuonioui'iiiiitiouu. luw rei^uiBibe jK)ttot)-iiiUu powore i^ re^uitvLe cue luioi^u iraue oi ino country ior a penuu Oi inree years were asamaea by Ugverameut wim alieoGing xndian wade Wdre one providion ox faoiliwdd nrduiy, lor tnu midnod 01 oodinddd in duoi'iing witn mji-onj,tiuj radi- aenD la a ooonury otuor tnan Gnat ur \v*iii)n gjodd wdre lnGdiidod or irom wniiin tn^y onguiatdd; a ad ddojddiy ior tna inianod ox tradd ootivedn tuvo nju-dtdrxuig area ojanuaes tarougn ateriuig area inGdrmddiarxed. x'ne liixiia. 01 i^ngianJ aido edtaonsnad a Byatoai 01 "craiuiorcioio audoonta" i<_» lieigium, xlonaxid, Portugal a nd xk'a^n, nnddr waion cnt monetary auouijiitiOd in ciiddd ojoiinidd nommiitdd til Hbernng aooouuGa 01 aoma 01 tndn uaniid as 'Vandieraoie' and undorcooit tnat an trandaotiond padding tiiroagn ↩
- tin; market remiuned very rinn and despite occasional iijl bauks, the r.itu moved up to Huccessivo lugh levels, and, after touching Hs. 117-12-0 on 20th June, tile highost on rocord, ciospid at ti<. 113-8-0 on HOth June. It was also found possible dining tho year to give greater facilities to travellers to and from Burma, refugees return- ing iroiQ India to Burma were permitted to taKe out jewellery freely, and, in order to mset tho needs ot returning Indian nationals from .Burma, tho restriction on tho t-xonange of Burma notes was removed, and the Reserve ±tank under- tooit tne exohange of the Raservo Bank of India Burma notes and 3.M.A. notes witnout limit. The control aars' led to tin; institutiun of legal pruceddinga in November li>4ti and agahi in April 1*)47. forward trading hud to bo autip.mded from 24th November to 8th Uecombei and it has again come to a standstill wince 10th April l'J47, ponding the formulation of a new contract. The question of I'eguldtuig the bullion trade in the province has been taken up by ttie Bombay Government who havo iswued a question- naire, inviting suggestions IVoin persijns and awsociatiouy jntorested in bullion trade. (lovwwmiM Lonni.—^^L'ho mam t'oatures of the loan opera- Consequent on India's membership of tho .Fund and the iixing oi the par value of the rupee, sterling has ceased to be tne sole determinant of the external value ol trie rupne. The Reserve Banit ol India (Second Ainmdaijnfc) Anl, IW47 passed by tno Central As.stmit>ly m April l.ii/, ivpul^t ootions 40 and 41 of the Reserve Hunk of India Ac-t wmcii •bilged the Bank to buy .ind noil Marling witaoul limit at pooitiod rates and replaoed thorn by a section WULCII inquire* •no Bank to buy and soil toreigu oxenango at sued rate.-, and uoh terms aa tne Central Government may determine Iroui ime to time in conformity with its obligations ris a nu»mber ti the Fund. tions ol the Central Government during the year consisted ol trie issue of two uow loans, tho redemption of the 3J- per eeut Undated liupoe Paper and the repayment of the ,i per cont IJefeuoe Bonds l'J4o. Tho new loana moluding tne conversion issuo-i were gennraily well rooaived witu tho exception of the 2i per oent Loan 1954. Tho total borrow- ing, however, did not reaoh the target announced in the budget for 1946-47 owing mauily to oliangea in the market conditions. Qi\ 1st August, Li>4-i the Central Oovcru usnt floated at par a, now m')diuui-datfld loan foi lit. $r> croLos, bearing m- leient at 2^ per cent per annum and repayable at par on 1st August, 1901 ; and on 5th August a special issue of Rs. 20 orores of tins loan was oroated. On loth JNovemoer Government floated another loan for Es. 35 orores at an mnuo pnoo ol Ks. 9J-8-0 for every Ks. 100 nominal, carrying interest n-t 2i pox cunt and ropayablo at par on 15th iSTovom- bor 1954. As tho loan was not fully subscribed, the balance remaining over the public subscription was takon up by Government and was subsequently sold on tap with elfeot from 27th November. The total amount raised during tho accounting yoar through all new Issues and sales ol loans on tap was its. HOS'2 orores. A ohief event aifooting the iinaucial markets was the con- version operation in respeot of the 6\ per cent non-terminable loans (referred to in the previous year's report). Hoidors of these loans were otfored facilities (from liith Auguat 1040 to 14th Ootober, 1940) for the conversion of tneir holdings into two loans namely, the 3 per cent Loan 1986 or later, issued and repayable at pat, and the 2£ por oent Loan 1970 issued at Ks. i)9 for every Es. 100 nominal and repay- able at par. As against the total outstanding:} of Be. 272-90 Bullion Marktt.—With the trend towards relaxation by various countries of the war-time controls over movements ii bullion, the market in Bombay became sensitive in thu •arly part of the year to developments m tne important niluon oentrea abroad, although the insisteuoe uy na,no of •he prinoipal aellurs of bulhoji lor payment m U. S. dolla/s verted a restrictive mlluonoe on transaotione. L'he move- nent of bullion prices which waa till then upward reached , peak level in May lU-tti exceeding that in other centres; ut this waa reversed temporarily in tho hrst half of July 946 with, the partial restoration of commercial movements f bullion across national frontiers. .During tho two ,suc- -jeding months of August and Woptomber, excepting for , temporary setback following the announcement on 1 Ith .ugust of a 50% reduction in the import duty on gold and Iver, prioea again evinced a distinctly upward teudenoy on oil manipulations assisted on the one hand by tne snortago ' stocks relatively to domand and on the other by the raising * the CJ.W. Treasury's price from 71-II cents to 90£ cents r domestic silver on 3lst July I1M6. iiy mid-October a ttotionary tondenoy had set in onco more on large arrivals jm abroad and on expectations of further largo arrivals, elated by a number oi other factors including tne terms ol e new contraot as rovi^ed by the Exchange authorities on •th Meptember, the announcement by the British Govern- 3nt ot their decision to demonetise silver, and thu ~jkot'M apprehension of possible oihoial aotion to cneok the availing speculation. Tneso laotors helped to bring down 3 BomDay silver price below the level ruling in other foreign ltrea by the end of .November, and some of the principal •eign sellers consequently switched over from Bombay to ↩
- uuding Loan, 190o-u&, alter lVLieiuiiy Ks, ivo-l'Z-0, Ks. lOO-lo-O and K.&. lob&O on 2yth July, ^4tu July and 24lh July respectively eamo down to Ka. lOi-0-O, Ks. luo-ll-l) and Ks. 10rt-iJ-0 on i'Otii February 1947, I)uL improved later, then cloaiug ({uotatious tor tue year being Ks. liw-ltt-U, Ka. 101-10-0 and Ks. 102-2-0 respectively. Oi the short- dated loans, the z^ pur oent Loan, 1900, utter rising trom Ks. 101-0-0 on 29tn June 194(i, to Ks. lul-lii-0 during the •middle ol August, gradu ^liy declined to roach a low ol K». 100-JO-O on 16th .February L947, but improved to lis. IO0-12-0 b_y 25th, romannng at that level tiu tne close ot the year, un toe whole, piovinciaJ ioaua and rupee counterparts remained comparatively inactive. Gfooenintentti.ctiri/tc<;Market.—Except for a comparatively jd p -nod ui boom in the earl^ part of tho year, tho gilt- •iotl minJfet ruled easy during tho greater part of the year, -ady conditions, however, ru-emerging towards tho close, _j Economic Advi-ier's index unmoor of (rovorximeut junties (19J7-2S^1OJ) rose from 120-7 in June 1940 to 2-si in August but thereafter almost contmuoudiy docuned a low of H 7-4 in Febriiavy 1947, after wmcti ttiere wa,;, a ^ht rnttj the index standing at 117-U in May. Lho average • ton* months ended Jfay Mil, however, ruled higher at 0'3 as compared with I I9'O for the eleven months ol the •responding period in Liie preceding year. As regards the ' tern of yields at tho end of the year, while those on uhoit- bed securities were generally lower tnan at tho close of •• previous year, the yields on medium and ioug-datod ie^> were ji shade highor^ although it is sjgnlUcant that all us gave a yield bolow 3 por cent. Ithdumriid ti/iarc Mar/cet,.—J_ne trend ol the industrial oliare market oorrespoiided geuoralJy »ich that ot the gilt- edged, though tho extent ot lluotuauoas m tiie tormer uas been largei. L'ho liioonomio Adviser n general index number ol prices oi vanaule yield secuntie.s- ^\'jjil-^6= iv↩
- 19-lti, but receded thereaftei nnd Hlood « Ufa. 1,013-70 i-rores on. 27th Jinn' 11)47, 'L'he proportion i (Jcuiund to total liabilities fell further from O'iJ'4/ per cei on 28th June J94fi, to HH-82 per m it on 27th June KM Time^uabilities itiraetiHed by Xs, ;{4-(,l7 eroies over the pr: vjous^year's figure, lndioatmy gradual ])rogi'e^n towards tl pre-war pattern ot bank deposits. 'LIIIN partly cxplaii the decline in the wlieduled bankb cash in nand^hion lu fallen irom Its. 47-4L! ororos OJI 281 h June ll)40, to 14B. 44. 7 «'oro« on 27tb June 1L>^?, The baianoea jnanitaiued 1 aehodulod banks with Iho lieaoi-ve Bank at tlie end of tl aecoimting year were also lower at its. 97,74 crores con pared with Rs. 103-05 ororea at the end of tho previoi year, the excess over tho statutory mitnmum falling fro Us. 61 • 98 crores to Bs. 67'45 ororcs. Advances rose lurth from Rs, 354.-50 crores on 28th June 1946, to .tts. 413.» orores on 27th Juno 1947. The increase in the volume advances waa mainlj due to expansion of the internal ai external trade ot India consequent on the relaxation for white of trade controls. Tno proportion of advances ai bilin diaoounted to total li.ibnitiert improve i further frt 3b* 09 per cent on 28th June 1940, to 4z- 'Mper cent on 27 June 1947. During the year under review, 26 banks including 2 < operative banks approached the Reserve Bank of India hnanoial aoeormnodatku, the total amouui of loans grant to these banks being Bs. 2*>,94 lakhs as compared w' Ks. 3,30'90 lakhs advanced to twelve banks during t previous year. Money Market.-— Conditions prevailing in the mono\ market in Jiu.ua durmg the year under report refioot a return to tne pre-war pattern ot alternating sin en: and busy NoaHons, which was submerged during the -war under Hood tide ot money supply, 'lue inter-b.inh. call nione^ rnto at Bombay WHICH was emoted .it £ per cent at the end of last year eased to £—£ per eunl mi l^lli July, but with improved trade demand, increased activity on the stock exchanges and the desire oi bauKs to maintain larger oash balances in view ot tne Unoatened strike oi bank employees, the rate hrmed up to $—i per com on 21st August continuing at that lovel till INovemuer when i< tended to ease. However, due to seasonal demand tlie rale steadied at $• jiei eent at which level it continued till the end of the year except for a brief period in March wiienit DM'ilia! yd between £and ^ per cent. During the iasi three months oi the year a larger supply of loanable funds was reported to bo available but as tne banks wero following a cautious pouVy, there was no marked eifeot on I he can. money rate, llie three and six months deposit rated which ruled at £—1 and 1 —-1 i per cent respectively at the beginning oi tlie year eased to ^ ~2 and ^—1 per cent respectively on U th July, continuing at that level tiJl yepcember. On /tli September the three months rate Jirined up to £ per eont ana tended to rise thereafter by trtages till Maroh. l«'nwt it rohO to i—1 per oont on 16th JSIovember, tiien to f—i poi cent on 1st Jb'cbiuary and reached tho maximuiu for tlie yeai' at 1 —1^ per cent on the 14th. it oontmued at that level till 8th JVittroh when it doolined to $—^ per cent but agam improvod to | ^i per cent on ^t)tli lVlarcn, closing at the same level fit tho end oi' the year. The six months rate on the other hand oontinued to be quoted at |—I percent. Till itiJiINaYuinW' and ro.^o theruatt^r to i-—li perouiit. it moved up to 1 - \ per cent on 21st i)eoember and to 1^ — 1^ per tent on Lst February, continuing at tHat level till istJi March when it eased to %—1 per cent. However, rroiii 2Utli March it improved to 1—li per ccm and again to i—i£ per eont on 17th May, remaining at that level till the close of the year. The twelve montha rate ruiod at 1^—1£ per cent throughout the year under review. The total number ot" offices oi the scheduled banks eluding hoad offices, brauciics, pay offices etc. rose furt from 3,^45* o., 30th Juno 1940 to J,obO| on 30th June, 19 an increase of 421f against 430* in the previous year. ' banks newly included m the schedule aooounted tor an ad tion of 78 offices. 07 new offices were opened at places WH wore not previously served either by a scheduled or a n scheduled bank with capital and reserves ot over rls. 50,*. Non-Hchedufod Banks.—The total number of non-schedi banking oompaniett registered ana working in India and s mitting returns under boction 277L ot the Indian Oompa Act was 659 at the end oi 1940 ari compared with 031 at end of 1945. Their total demand and time liabilities creased from E s. 07 - 31 crores at tho en oi 1945 to &i. 7£ croros at tlie end of 1940, the ratio of cash to total .iem and time liabilities declining from 12-0 per cent to b ! cent. Scheduled Banks.—During the year under roview, 7 bantu were uioluded in the second schedule to the KeBcrve Bank ot India Aet wnilc ;t banKs wore excluded from the schedule oi wnicu 2 were amalgamated with othor scheduled bankH3 thus brniguig ttie total number of aoheduled banks at the pud ol ttie year tu 97. (The names marked with an asterisk in the liat ot sciiodujed banlis .appended to this JAoport iudi- 1-ntn the addrtiojin to the yohedule during tho year). The usual inspection beioro inclusion was dispensed with hi the case oi one bank wluoh appeared prima Jacia to satisfy the conditions laid down ni Wcction 42(0) of tne JAeserve -Bank ot" India Act. The other li banks were admitted to the echodule after an investigation ol their aftairs. Applications irom 16 baiika were under consideration at the end of the year- After the establishment ol a separate currency authority by Burma, under the provisions ot the .Reserve iiank oi India (Amendment) Aet, lu47, the names ot tho thiee iiurma bchedulod Bankb vvuio removed irom tho list of schedule bunks. During the ooui'bO of the year, 2 non-scheduled banks • included in the list oi banks approved for concession I for remittances under Appendix i-Ll of the Reserve Ba Scheme of Reluctance iaciuaes introduce i in October 1 2 banks were excluded from the list as they were adm to the second soheduio to the Reserve JSamt ot India and thus became eligible for better remittance i'acil One bank was deieteu Irom the hat as it ceased to ' * .Revised f Provisional. ↩
- "! removed from it as the remittarn !! R'iiMna Vita 1 banks and iali- d of tin vear as comTiro I with Si! and 5 rospe.otivo1 v id o end of the last year. Tin additional facility of nooning account* with the , w v" Bank of Tnrlift, afforded t > the non-scheduled hauler 1b Piffrfft from 15tb TPobmnrv lOtT, was ooniinued dnrine; e year under report anrl apnlieations of 6 non scheduled uks and 2 eo-ooerativu banks were receiv-l during the iv for ouenin? accounts Ms ny;iMist I" , Hsi \em Two >plioatious from the ei in>ntrrw for the week ended 7th February. 1947 and =1ood at R, S8-01 croros at the ond of tho accounting year Apart from the seasonal factor, unsettled political nil economic conditions in the country seem to account for I he fluelintions 'in the deposits. r!1ie improvement nohrvMl luttorl'-, however, ha^ mrtly arisen from thorofund of tfie K V T deposits »nd pmth from the mitiryirt. extended to Hie mn Ift by the R''uf»ivt> R'ink. On the nss"ts side, "Balances Ivld nbroid" Ml h\ R,s. 12S- 2"i crores from Rs. f)f>').07 (loies (o Rs (30- %'1 i ron ^ partly in roaponse to the demand for funds for fiuaucin'i im- ports. T'lvestmentw, however, rosn by Rs 10• lr> ciorc, from Rs. 30*79 crore^ to Rs. f>6-0t irores. WUh'lraival of R°m.itkiTt<*e FanHtiPS to Burma.—As t he •wernment of Burma established an independent Burma irrency to be managed bv a Currency Board from 1st \pril }47, and the Reserve B-mk of fudi i was relieved of its jb'oatious under the fivlia and Burma (Burma Monetary Traii'ieni^nts) Order IO")7, fhn existin * remittance facilities ^tween India and Burmn under the Reserve Bank Scheme itroduood in October 1940 were withdrawn with effect from •I April 1947. Africulturirl Clrctit Dwirtmenf—The activities of the A ^ c u l t u r al Oredit Depart.mcnt received HIP Crircfnl attention of the Board throughout l,h, of the "De- partment were, as in the previous veirs, utilised bv co- oucrative banlw, Re^iatrars of co-oporativc societies ,ind Governmenta, fltitirtical Tahlr? reisitim to Brink? in India.—The oom- innd issue of tho Statistical Tables relating to Banks in id'a atid TJUVTHM fovomi'i t\o yours 1944- and 1045 was ublisb«d durin" the year under review. Tho work of com- ilintr tho issue for the year 1040 i« in protjrenR. Owrritions of th T.q8w Department.—The balance sheet ol To enoourat^e co-operative banks to mike i/reatet use of the facilities offered under our scheme of "Rediscounts for and Advances to Provincial Oo-op'itativo Bunks" the rebate in tho rate of interest was increased from I p«r cent to \\ per cent in oase of accommodate i a^iinst bills or nromisaorv notes drawn for financing seasonal apriuultural operniions or marketing of crops In rostwnneto a resolution nasscd bv the Sixth All-India ne Bank as on 30th June 1947, together with tho profit nd loss anionnt. has bion Minnlicd soraatMtelytotho sharo- lolders. To facilitnte comparison.the profit and loss aooount irnres for tho precodint; Uvo years havo also been inoorpo- at^d. Co-otjerative OonFereneo held at Lneknow in April 1946, we extended, in consultation with the Government of Tid'a and the Imperial Bank of India, the remittance fncib"tieH available to oo-operativo bunks and societies in British India to similar institutions in Indian States also. The continuous and marked increase in the total of the alnnon sheet of tho TRSUO Pepnrtment, witnessed sinoo tho ntbrcnk of the wnr. waa renlnced during the year by a mdorate rise, tho balance nh^t total havina: inoreasod only •v Us. 11-23 ororos to Tls. I,2fi5'31 crores at the end of the "ear under review or b^ 0-90 ner oont nomnared with 22 >er oentind 8-9 ^>er cent durin'; the years 1944-45 and 194.5-46 espeotJvely. The Ohiof Officer of the Atmoulfc'iral Credit lVnartment was apnoiuted as a membeaof th'3 Agricultural Ore lit Orian- isation Committee set u>i bv the Oovmrn^'i of Bombay. He also attended the Fifteenth Registrars' Conference and the Seventh All-Tndia Co-operaiiye Coifwrenoo hell at Madras in May 1947 Two provincial eo-operativo bnnks were sann^ioned credit limits against bills or promissory notes drawn for financing seasonal atjrioulturnl operations or marketin't of erons st a soocial oonoession rate of 1^ per oent bolow the Bank Rate. One of thorn was also granted accommodation against Gov- ernment RoourMieLS at tho Bf November 194fl. As the biiiy season started, thev rose vqain from T)ecrimbfir 1040 reachin" Us. 1,244-08 crores on 4th March 1047, but declined subsequently. On the assets side, "ftold coin and bullion" continued un- ihaufied nt Tls. 44-42 crores at tho statutory rate of valuation, lamelv, Ks. 21-H-10 r>or tola Pontrary to the trend noticed -inOP the becinnint; of the war, the sterling securities did not e^ister any inoroa-so but remained steady at "Rs. 1,135*33 Department of Banh'n-tj Omrafiorut.—The Department of Banking* Operations continued to dnal with all problems *•©- latiu<4 to scheduled and non-sohedulod binks and to keep a close watoh ovor their aFfairs. Amontj the more important activities of the Denartment mav be mentioned thp in^wction of banks on behalf of the Contrnl Govornmpmt, the "xaraination of their applications in torms of the Bankiu" Comnanics (Restriction of Branches) A t, 1941, the pT-araini+inn of applications for issue of capital forwa-A™ 1 bv (rov^rumint for the Resorvo Bank's opinhn and in s-cneral the tendering of adyioe on banking and financial matters to banks and Goven- ments. A brief account of tho more important work done by the Department is g;iven in the subsequent paragraphs ta against 94-07 nt the close of the previous year. "Rupee ^oin" which inoludes O-overnment of Tndia one rupee notes increased from Rs. ifl-oO croro=: HR at HOt.h June 1940 to Rs. 27-73 ororos at the end of June 1947. The Bank received from the Central Oovernmont Rs.fiororos of "Rupee coin" during the year in torms of aub-seetion (2) of section 3(1 of the Reserve Bunk of Tnrlin \ct "Rupoo securities" remained prn«tically unchanged ni "Rs ri7'94 crore-, through- out the accountincr i^ar under review Wi1h a viow to dioentralisin'T the work of th" Depart- ment and to coy)c efficiently with thn henvy riro^r iram° of bank inspections, a permanent branch of the Dipartmont of Banking Operations was eHtabunhed at Calcutta with effect from 1st October 19tO. It is also pron-md to eUabli.sh shortly branches at Bombay, Madras an 1 Delhi Operationsrfth/ Banhina Dpftarlmrnt—The total of ih" balance bheot of the Bankinsr Department fell from RMfi17- 94 crorcg as at 30th J a m, 194'3 to R«. 548-41 nrores on :tOth June, 1947 or bv 11-25 pur cent as against ^ui increase of 45*09 per cent duriuc; the previous aooountmtr year This fall in tho total of the balanoe sh«et is mainly due to 'i dec- rease i' "Central C-ovemmnnt deposit^" on the linbilities side and, in "Balances h"ld abroad" on the assets side ' Tho d.epwit,s of the Central government f^li bv Rs (10- 73 crores to Rs 390-70 i rnrr-* AVith the introduction of n B inking Lzqinlatlon.—-Et was mentioned in Ihe last year's Report that the Central Tjeg-iMatjve Assembly ndopted a motion on lUh April, 1946 for reference of the BsnkinT Com panics Bill, 1946, to a Select Committee. O^vint- to cons- titutional changes, the Committee could not nvet until 2Ht November, 1946. During its earlier flittin^s between 21s1 and 29th November, 1946, the Committee examined 17 witnesses most of whom represented interests connected with Indian banking Tho Committee met a↩
- facilities bet- en I n in a ↩
- ' ooinion, applicnfions receive ' fron the fxistitvf as well as proposed banking and Insurano. companies for issue of capital. Since the inception of tfv contiol opinion his been furnished on 1.T10 npi)licn1 ions ol 'vhif-h 1 017rel dispose I if 137 upolieations of which fS7 were for nrnMun^ 141 bninchi'^ and 7U for chftn^iii'j; the location of S4- oxish'nsf branch' -' Linn'ic 's have beon granted to open SI l>ran"he-i out "f the 141 branches applied for and for ohannin^ the location of 70 branches out of the 84 branches in respect of which permission wa« sought. the departure in August 1946 to America of Mr J. V Josh O.B.E., Economic Adviser to tho Reserve Bunk of Tndia t tvike up his new appointment us an Executive Director r the Internal ional Monetary Fund, Mr. B. R. Shenoy. Dfrecto of K'irai Economics, was appointed Director-in-Chqrp-e o the Department and continued to discharge his duties i that canacitv in addition t o his duties ns T)irectf)r of Rura Economics Dr B K. Madaii. whose services had been placed on de putation with the Government of India as "Deputy Sccretar to the Tariff Bonrd from the 15th December 1945 relinrmishe. that office on his appointment as Alternate Executive Directr of the International Monetary Fund, and left fox Amoric in August to tnke up the new appointment. Tho Deportment of Research and Statistics commence publication from .Tanuarv 1947 of a monthly economic an financial iournal entitled " The Reserve "Rank of Tndi Bulletin " B'mk Inipfctioni. —Prior t i t he promulgation of the Bank- inn rompanies (Inspection) Ordinance, 1946, fli" inspections of bfinks bv the Reserve Bank wore confined to those c irried out under Section 4'2fft) of ttni Reserve Bank of India Act with the obioet of testint th^ eligibility of balks for inclusion or T-ctention in the second schedule to the ttcscrvf Bank of Tndi't \d The scope of an inspection under the Banking Companies flnspection) Ordinance, 194f>, is ranch wider, covering as it does not onlv a quantitative assessment of n hunk's paid-up capital and reserves, but also a qualitative nsHCWHinent of its raanacrcmeni, policy and methods of business from the point of view of the depositors' interestb. Tt was therefore decided during the vear that all inspcntionH of bunks incorporated in British Tndin, including 1hose for the purpose of testing the olinibilitv of bank', for inclusion or retention in the second schedule to the "Reserve Bank of India Act, should he carried out under the Oi dinancc. The Ordinance does not. howover, applv to banking eumpanie^ incorporated outside British India, and the inspection of such bnnks can nnl^be carried ouf under Section 42(6) of I he Reserve Bank of India Act. During the voar 19 banks were inspected under the Ordinance, (ind 4 under Section 42(6) of the Reserve Bank of India ^ot.' The inspection of one bank was in progress at the end of tho year under review. Reports on 0 out of 10 banks inspected under the Ordinance were forwarded to Government. Action in terms of the Ordinance was taken against two banks : one was prohibited from accepting fresh de tosits at any of its offices, brunches and agencies with offoot from 13th January, 1917 whilo the other was refused admission to the'second uohedule. Tn the case of two banks, no ao'ion under the Ordinance was considered necessary as their affairs were found do be in order. The inspect ion reports on the remaining bankR were under the consideration of Government fit tho end of the year under review. Control of Capital TsiK.es.—The control of capital issues riginallv promulgated on 17th May, 1043 under Rule 94-A i r the Dflfenoe of India Rules was oontinued during the year, trst'underthe Emergency Provisions (Continuance) Ordinance ↩
- of tho issue of storling balances; tho question of dissolution of the Pool formed a part of the negotiations with tho British delegation for tho settlement of sterling balances. The International Monetary Fund and the. International Bank for Raconitrurlirm and Development —The period , under review witne^od the commencement of operations of the International Monotarv Fund and tho International Bank for Reconstruction and Development. With the fixa- tion of 25th June, 1910 as +hn date for thu formil eymminco- ment of the operations of tho International "Bank, the first 2 per cent of the subscriptions of each member bcoame payable by 24th August, 1916. The third I itorim Report of the Select Committee of the Central Legislative Assembly on Brettomvoods submitted on 20th July, 1916 recommended the payment of that portion of the subscription without tho payment of which TndH would commit default to tho Bank but left the question of India's membership of thn Fun 1 and the Bmk to bo decided by tho Legislative Assembly, and, in Ootober 1946, the Assembly, whilo approving tho payment of India's subscription to the Bank, approved also the conti- nued membership of the Fund and the Bank. During the year, 20 per cent of India's subscription to tho bank amount- ing to $80 million was paid, the first instalment of 2 per cent beinginU.S doll ir, and the r Mt iirupooi. In September 1946, the members of tho International Monetary Fund were notified to oommunieato to the Fund, within thirty days, tho par value of their currencies expressed in gold or U.S. dollars and based on the rates of exchange that prevailed sixty days before the Fund Agreement came into efhet. The Government of India invited proposals and comments on the appropriate rate for the rupoe fiom interested bodies and persons, and finally decided that the existing par value which works out to Rs. 330.852 per $100 or 4.145142857 grains of fine gold per rupee should be main- tained. O.i ISth Daoember, 1046, the schedule of par values of the ourroncics of member countries was announced by the Fund. India was called upon to pay its subscription of $400 million by 1st March, J 947. Under the rules of the Fund, the 'gold' subscription had either to be 25 per cent of a country's quota or 10 per oont of its net official holdings of gold and U.S. dollars, whichever was less. As the latter was the lower figure in India's case, gold to tliis value waa The most urgent and serious problem thai will ela the attention of the two States as Boon as they settle do-\ to the real job of governance is that of the ull-pcrvadi corruption that is destroying the vitaLs of public hfci genera and the administrative machine in particular. Unless corrosive influence is countered rapidly ami relentless controls will deteriorate progressively into handicappi ↩
- being underminod by dec cning penury and despair. By Order of the Central Board of Directors, Balance Sheet as at 30th June 1947 ↩