Note 105 — Chapter VII

The volume of bills, drawn in India on London and outstanding, is not, of course, a correct measure of the extent to which India is being financed abroad. A bill may be used to finance the foreign purchaser just as much as the Indian seller. For example, a dealer in cotton in India might be paid by a 3 m/s Bank credit supplied by the buyer, a Continental spinner; this spinner might get the cotton within a fortnight of the acceptance of the bill, which would, therefore, be really financing his cotton factory.