Page:Indian Journal of Economics Volume 2.djvu/585

 EOONOMIC DFLOPMENT must be regarded as th chief function of Govern- ment after the maintenance of peace and justice. Such works can, in general, only be carried out by Govern- -merit, or absolutely betterment strengthen with its assistance: the/r provision is essential not only for the eomom/c of the people of this oountry, but also to India in her international position as s loyal partner in the British Empire. The purpose of this paper is to examine the financial resources which may be made available for coonernie development,- and to suggest a oonsistent polioy of dovelolling them so that they larger funds. ment of. finsnoial and describe. may yield year It is a polioy resources which I by year inoressingly o! the sesdy develop- shall advooate Government requires the increase of both oapital and ince. Larger annual revenues are needed for the extension of education nd for greatly increasing the staffs o ho departments of agriculture. The important point is that no great epansion of revenue can be expected until the country has been further developed by public works and hind improvements of all kinds. It is exactly the same as in any inertial or industrial undertaking--the investment of more oapital brings additional income. In the ease of public works the income tsks8 the form not only of direct revenue, t is .the actual gross receipts of railways, charges for water of irrigation canals, and so forth, but also of indirect revenue. The latter is rsslised through taxation, the social income (i.e., the local portion of the national dividend) having been so increased by the public works, such as .roads, bridges, railways, etc., that higher taxation is paid with less burden than was caused by the taxes existing before the public' works were oonstruotsd Hence the State can freely invest ospita in so called non. reproduotice