Remittance by means of what are termed council bills is a feature peculiar to the Indian system, and is not, so far as I know, to be paralleled elsewhere. It arises partly from the historical circumstance that the government of India is the successor of a trading company, partly from the necessity under which the government lies of making very large annual remittances to England.

The home charges, that is, the payments which the government of India must make in England, for interest on debt, pensions, payments to the War Office, government stores (not chargeable to capital), etc., amount to £19 million or £20 million annually. But the amount which it is necessary to remit, apart from extraordinary remittances to be dealt with later, is usually less than this; for the amount of new capital raised by government in England usually exceeds their capital expenditure in this country on repayments and on railway materials, etc. Thus the amount which it is necessary to remit to England annually is from £15 million to £18 million. Rupees to this amount, being part of the revenue from taxation, etc., accumulate in the Indian treasuries. This value is remitted to England by selling for sterling in London bills which can be cashed in rupees in Calcutta. Thus the government of India pays out rupees in Calcutta when the bills are presented, and the secretary of state's balances at the Bank of England are swelled by a corresponding amount.