This is due to the fact that the Government Treasuries, the Presidency Banks, and possibly other banks and large merchants, use the notes as a convenient method of avoiding the custody of large quantities of silver during the slack season when rupees are not wanted.
When, therefore, we are considering to what extent the Government could lend at the height of the busy season, we must chiefly pay attention to the sums in the _Reserve_ Treasuries on January 1. But for all general purposes, the rule may be taken as absolute. The Government of India have replied that they prefer this proposal to the conditions demanded by the Treasury, and that they contemplate making inquiries as to Indian opinion on it. The panic of that year for the first time taught the Bank directors wisdom, and converted them to sound principles. With Indian banking this authority cannot be adequately in touch, and it would be much better if trained experience were to be found in India herself. Such a government for a joint stock company is very good if its essential nature be attended to, and very bad if that nature be not attended to.