Which of the following are the constituents of the ‘Home Charges’, which were an important constituent of Drain of Wealth from India?

1. Dividend to the shareholders of the East India Company

2. Interest on public debt, raised abroad by the East India Company

3. Expenses of the India Office establishment in London.

4. Interest on foreign capital investments

Select the correct answer using the code given below:

Home Charges refer to the expenditure incurred in England by the Secretary of State on behalf of India. Before the Revolt of 1857, Home Charges varied from 10% to 13% of the average revenues of India. After the Revolt of 1857, the proportion shot up to 24% in the period 1897-1901. During 1921-22, the Home Charges sharply increased to 40% of the total revenue of the Central Government. The main constituents of Home Charges were:

• Dividend to the shareholders of the East India Company: The Charter Act of 1833 provided for an annual dividend to be paid to the shareholders of the Company out of the Indian revenues till 1874. In 1874, loan was raised to redeem the stock at a premium of 100%.
• Interest on public debt raised abroad: The East India Company had piled up a huge public debt (mostly incurred by the aggressive wars waged by the Company) to dislodge Indian rulers from their principalities. Part of the debt was raised for productive purposes, i.e., for construction of railways, irrigation facilities and public works.
• Civil and Military Charges: These included payments towards pensions and furloughs of the British officers in the civil and military departments in India, expenses on India Office establishment in London, payments to the British war office etc. All these charges were solely due to India’s subjection to foreign rule.
• Store Purchases in England: The Secretary of State and Government of India purchased stores for the Military, Civil and Marine Departments in the English market.