Why did the British not introduce the sterling in India?

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Just speculating here, but moving sterling from Britain to India would have been rather expensive back in the day. Also, minting sterling in India would have been risky to the currency back home since in those days currencies were based on the gold standard and Indian mints could easily have diluted the metals and thereby the home currency. also, it sounds like (I don't really know) India already had a currency that was easily interchangeable based on the Gold standard...unlike today's fiat floating currencies that always change.

Upvote:2

India got under complete British control only after 1860. India had used rupees in various forms for 1000+ years and it would have been difficult to get people use to different currency altogether.

When first British merchants arrived in Surat, Mughal court ordered them to melt down British sovereign gold coins and get them converted to Mughal currency. The reason being only emperor was officially allowed to mint money (and reading of kutaba in his name). Any one else minting money was in directly defiance of Mughal (Shivaji did this against Aurangjeb in 1680ish). Thus East India Company themselves minted coin in name of mughal emperor for quite some time (til 1840)

Upvote:6

The reason why is that India was on a silver standard and England was on a gold standard in which pounds were denominated. To convert India to pounds sterling, you would have had to convert the whole country to a gold standard first, which was discussed occasionally, but was more or less impractical because India had no central bank like England did. To quote from the Calcutta Magazine and Register (1831):

We think therefore that the Sicca Rupee should be selected for general currency in British India. If indeed the unit of English money were now silver as it was in 1815, we should have no hesitation in recommending a complete assimilation of the currencies of the two countries. This in the case supposed would be feasible by establishing in India, as the unit of denomination, the double-shilling sterling, or 1/16th of the pound sterling. The slight derangement which the Bengal circulation would experience would be more than compensated by an Identity of the currencies of Great Britain and India鈥擜s however, the unit of pecuniary denomination in England is gold, the desired assimilation is not now practicable ; and therefore there would be no compensating advantage, which would justify the disturbance of the currency which here measures the state debt and fixed Revenue.

Upvote:10

From the wikipedia

Following the Indian Mutiny in 1857, the British government took direct control of British India. Since 1851, gold sovereigns were produced en masse at the Royal Mint in Sydney, New South Wales. In an 1864 attempt to make the British gold sovereign the "imperial coin", the treasuries in Bombay and Calcutta were instructed to receive gold sovereigns; however, these gold sovereigns never left the vaults. As the British government gave up hope of replacing the rupee in India with the pound sterling, it realised for the same reason it could not replace the silver dollar in the Straits Settlements with the Indian rupee (as the British East India Company had desired).

There are some sources listed in the wikipedia article that I have cited above. If this is true then it seems that they did attempt but failed.

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