The Problem Of The Rupee

Excerpt: 'It is alleged sometimes that India does not want gold coins. I feel considerable difficulty in believing that gold coins of suitable size would not be convenient in a country with the climate and other circumstances of India. The allegation is suspiciously like the old allegation that the “Englishman prefers gold coins to paper,” which had no other foundation than the fact that the law prohibited the issue of notes for less than £5 in England and Wales, while in Scotland, Ireland, and almost all other English-speaking countries notes for £1 or less were allowed and circulated freely. It seems much more likely that silver owes its position in India to the decision which the Company made before the system of standard gold and token silver was accidentally evolved in 1816 in England, and long before it was understood: and that the position has been maintained not because Indians dislike gold, but because Europeans like it so well that they cannot bear to part with any of it.'