"ملف 19/176 II (C 40) الموارد المالية للبحرين" [و‎‎٥‎٦] (٥٢٨/١٢٤)

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Bolitical Agent while stating that it was the intention of the
State to raise the customs duty from 5^ to 7^, asked that the
State should be granted tariff autonomy, and this request I
supported# It is, however, a somewhat serious modification
of our treaty rights, and I did not adrance at the time detailed
arguments in support of it and the Government of India did not
approve of the proposal. The State, however, have now made
a further request, namely, that they should be permitted to
enhance the customs duty on luxury articles to 10/& instead of
7^ and to 15^ on tobacco and liquor. It is estimated that the ,
I
additional revenue from these sources will produce about
Rs.48,000, while, as mentioned above, economies in the Police
will produce another Hs.20,000, making Ks.68,000 in all.
Further Shaikh Isa's health has been exceedingly bad of late
and Doctor Dame of the American Mission told me that he thought
there was little likelihood of his living much longer. He has
an allowance of Rs. 5,000 per mensem, i.e.Rs. 60,000 per annum,
and if this also can be saved there will then be some prospect
of balancing the budget in the near future. On the other hand
it is clear that without the increase in the tariff for which
%
permission is now sought there is no possibility of doing so, and
the State will have to live on its reserves until these are
exhausted. It will be a race between the return of better
times and the exhaustion of the reserves, and having regard to
the fact that Bahrain depends entirely on a luxury trade, namely,
the sale of pearls, which will probably revive but slowly,
there is little doubt which will occur first. 1
4. How I would venture to ask whether the question of the *
grant to this small Principality of tariff autonomy could not be
re-considered. The government of India in their telegram Ho.
715 of the 5th March 1932 recommended a flat rate of increase on
all articles. To this t/ie Shaikh and the financial Adviser are
both strongly opposed. At the present time a large portion of the
population are on the brink of starvation and there is a great
deal of unemployment and tnything which might ooneeiTably
_ ..... i&Ctf&Rpn*