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India—Great Indian Peninsula Railway Company—Question

Volume 202: debated on Thursday 7 July 1870

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said, he wished to ask the Under Secretary of State for India, Whether the Government have agreed to a modification of the terms of their agreement with the Great Indian Peninsula Railway Company; and, if so, what is the nature of the modification?

Sir, the best reply that I can give to the Question of my right hon. Friend is to read an extract from a circular lately issued by the Great Indian Peninsula Company, which correctly describes the recent change of arrangement—

"In consideration of the Company surrendering their right to a reversion of the second moiety of surplus profit (thereby allowing of a perpetual equal division between the Government and the Company of all surplus profit which may be earned in any half-year beyond 5 per cent), the Secretary of State agrees to cancel the whole existing debt against the Company for guaranteed interest advanced, and in future to meet the charge for guaranteed interest without taking account against the Company of any deficiency between the amount thereof and the net earnings of the Railway in each half-year. The Secretary of State in Council further relinquishes the right, which the Government possesses under the contract, of purchasing the Railway at the expiration of the first 25 years—namely, in 1874. The Company, while retaining their right to a moiety of the surplus profit of any half-year, are thus relieved from existing debt, as well as from liability to debt in future on like account, and are secured a minimum term of 29 years from the present time, within which to realize the benefits expected to result from their undertaking."