In one direction at any rate, India can rightly demand that Government should be left an entirely free hand—namely, in regard to the very large orders which have to be placed every year by the great spending departments. It has now been laid down by the Secretary of State that Indian industry should supply the needs of Government in respect of all articles that are, in whole or in part, locally manufactured. But Indian industry would be able to supply much more if the Government of India were in a position to give it more assured support. The case of the Bengal Iron and Steel Company has been quoted to me, which was compelled to close down its steel works and to reduce the number of its iron furnaces in blast from four to two because the promises of support received from Government when the company took over the works proved to be largely and quite inexcusably illusory. For works of this kind cannot be run at present in India unless they can depend upon the hearty support of Government, which, through the Railways and Public Works Department, is the main, and, indeed, the only, consumer on a large scale.
At the present moment, Messrs. Tata are making a truly gigantic endeavour to acclimatize the iron and steel industry in India by the erection of immense works at Sakti in Bengal, where they have within easy reach a practically unlimited supply of the four necessary raw materials iron ore, coking coal, flux, and manganese ore. To utilize these, plant is being set up of a yearly capacity of 120,000 tons of foundry iron, rails, shapes, and merchant bars, and plans have been drawn out for an industrial city of 20,000 inhabitants. The enterprise is entirely in Indian hands with an initial share capital of L1,545,000 administered by an Indian board of directors, who have engaged American experts to organize the works. Government has granted various railway facilities to the company and has placed with them an order for 200,000 tons of rails for periodical delivery. Upon the future of these works will probably depend for many years to come the success of the metallurgical and other kindred industries of India, and it is to be hoped that Government will be allowed to give them all reasonable assistance without interference from home. Another purely Indian enterprise—also under the auspices of Messrs. Tata—is a great scheme for catching the rainfall of the Western Ghats and creating a hydro-electric supply of power which will, amongst other uses, drive most of the Bombay mills.