Indian States Finance The extremely complex relations between the Indian
Native States and the Government of India are well illustrated on the financial side by the able report that Mr. J. C. C. Davidson's Committee has produced. Some of the States pay tribute ; others are wholly or partially exempt. Some pay certain taxes and others do not. Some States yield tribute to other States. Military obligations in certain cases take the place of cash contri- butions. In other cases the States receive more from the Indian Government than they give. The Committee recognizes that to impose a uniform contribution to the Federal Government of the future on all States would be impossible, more especially as their association with an Indian Federation must be entered into voluntarily. It has, therefore, worked out an elaborate plan of debits and credits, which each State individually may accept on entering the Federation. The Indian Government would perhaps lose as much as £750,000 a year by the proposed rearrangement. But the gain to India, and to the Empire, if all the States willingly joined in a Federal India, would, of course, be immeasurable.
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