India and Japan
. The success of the Indian and Japanese negotiators in bringing off a cotton -agreement after their efforts had all but broken down is highly satisfactory. What the qlti- mate answer to Japanese competition, will be remains undisclosed, but. nothing better ;than the .quota system, which is the basis of the Indo-Japanese agreement, has so far been suggested. Under the accord reached in Delhi on Wednesday Japan will be entitled to export to India annually for the next three years piece goods to a quantity about 30 per cent, less than in the last year or two, conditionally on her purchasing from India about 50 per cent: nioie raw cotton than in recent mOnthls.. At the same time the Indian tariff will be lowered from 75 to 50 per cent, ad valorem. Conditions in 1932 and 19118 were, of course, abnormal ; it was that that made the agreement necessary. The position now created resem- bles. roughly" that existing in 1929-30. Indian mill- owners will -benefit from the relaxation in' Japanese com- petition, and so, rather less, will Lancashire exporters. And more important than that the possibility of dealing with the menace of Japanese industrial competition by voluntary agreement is opportunely demonstrated.
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