Page:Indian Journal of Economics Volume 2.djvu/613

 898 The conclusion to which I am led is that the principal source of 'nds for financing public works as yet untapped is the class () investor: and there- fore that firsfly steps should be taken to offer him suitable securities, not all uniform, but for various terms, and at different rates of interest and issue prices; and secondly necessary measures should be taken, as by popular advertisement, to emphasise the con- venience and security of such investments, and thus to inere&se the number of class ()investors. When considering the kinds of securities to be offered I would give first place to leaus to be issued by Provincial Governments. The present practice is 'for all borrowing for public works to be done by the Government of Indim which lends to the Provinei&l Governments the funds major irrigation (ertain provincial required for works and some governments' have have the public, iut the fit to grant it. privilege of borrowing directly Government of India has construction of other purposes. long desired to from the not seen The chief reason for this desire is that a province which wants to make rapid progress with economic development finds itself hampered at every turn by want of funds. The Government of India, when only willing to pay a low rate of interest has naturally only been able to borrow & restricted amount in India each year, and only a slightly larger sum in London--usually not more than twenty ereres in the year for all purposes for the while of India. The Government of India has, therefore, been forced severely to restrict its loans to the Provincial Govern- ment. It reviews their programs of. works and decides which are the most urgent; and thus & province anxious to go ahead may only get one-half or one-third of what it could use. From the economic point of view provincial borrow-