INDIAN FORCES

Wairarapa Times-Age, 1 March 1940, Page 5

INDIAN FORCES

CONTRIBUTION BY BRITAIN , TO COSTS ARRANGEMENTS TO RULE DURING WAR. STABILISATION OF GRANTS. (British Official Wireless.) (Received This Day, 9.50 a.m.) RUGBY, February 29. Sir High O’Neill, Under-Secretary for India, told the House of Commons at question time: "It was announced on September 5 that Britain had agreed to recommend to parliament assistance amounting to some £34,000,000 —a quarter of which was to be treated as a loan to India for five years —to meet the capital cost of the modernisation of the forces of India, recommended by the expert committee on India defence.

“It is Britain’s intention that this modernisation should be proceeded with during the war, in so far as strategic priorities and considerations of supply permit. In the conditions brought about by the war Britain has reconsidered the whole field of financial arrangements with India in respect to defence expenditure. The respective Governments propose that the Indian Budget should provide during the war for, first, the normal cost of India’s pre-war forces, whether employed in or outside India and adjusted from time to time In accordance with the trend of prices, and, secondly, the cost of special defence measures undertaken by India in Indian interests during the war. In addition, the contributions recommended by the Garron tribunal will be made towards the extra cost of certain troops while they are employed outside India and defence expenditure over this amount incurred by the Government of India will be met by the British exchequer. The annual grant in aid of military expenditure for India and revenues made in accordance with the recommendations of the Chatfield Committee will be continued and will be established for the duration of the war at the 1939 level of £2,000,000.”