Commonwealth Development

Part of the debate – in the House of Commons at 12:00 am on 30 November 1956.

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Photo of Lord John Hope Lord John Hope , Edinburgh Pentlands 12:00, 30 November 1956

That is a perfect example of what I meant by independence. That is a matter for the Australian Government entirely, but I have no doubt that my hon. Friend's intervention will be noted and I will do my best to see that it is. Further than that, of course, I cannot go.

What I was going to say about investment in Australia is this. In 1952, 1954 and 1956, out of a total face value of paid-up capital and issued shares in Australian companies or investments of £202 million, £233 million, and £274 million, respectively—in Australian pounds—the sums contributed by the United Kingdom were respectively £137 million, £160 million and £186 million. That represents about 68 per cent. of the total investment. The next greatest investing country in Australia—the United States—was responsible for 18 per cent. of the total investment.

These figures take no account of the reserves of the Australian subsidiary companies controlled by oversea parent companies, or of adjustments necessary to allow for the difference between the movement in the face value of capital and debentures and the actual amount of paid or received profit, or of undistributed profits of Australian subsidiaries accruing to the oversea parent companies.

In New Zealand, there is a project for the Murupura pulp and paper scheme, for which the New Zealand Government raised a £10 million loan in the London market in 1953; a general purposes loan for the same amount in 1954, and another £5 million in 1956. By virtue of that scheme the forest resources of the North Island of New Zealand will be exploited, and paper mills will be constructed which, when in full production, are expected to represent the biggest single industrial scheme ever projected in that country.

I now turn to India. In November, 1955, Associated Electrical Industries Limited were appointed consultants to the Government of India for the establishment of a heavy electrical manufacturing industry in that country. The appointment was for fifteen years. The company will advise the Government of India on the design and construction of factories and the ordering of plant, and on training schemes for Indian engineers. The agreement with the Government of India will provide for financial participation by the company by way of loans which, by 1970, will amount to about £2 million.

Then, a consortium of British firms forming the Indian Steelworks Construction Company, and known as I.S.C.O.N. have secured a contract with the Government of India for the construction of a steel works with a capacity of between 1 million and 1¼ million tons at Durgapur, and the entire civil engineering work will be carried out by I.S.C.O.N. The total cost of the scheme is £102 million, of which about £56 million has been incurred in the United Kingdom. To assist in the financing of the sterling costs the United Kingdom Government have agreed to make available to the Government of India a credit of up to £15 million, with British banks giving credit facilities of £11½ million.

In Pakistan, the achievement centres round the gas industry. Oil was found in the 1880s north of Sui, in Baluchistan, but commercial production proved impossible for a very long time. It was after the 1939–1945 war that Pakistan Petroleum Limited came on the scene—a company in which the Burmah Oil Company holds 70 per cent. of the capital. That company restarted aerial and ground surveys in 1950, and, after heavy expenditure on survey work, gas was struck in commercial quantities in October, 1952.

After a tremendous amount of work in a fearful climate, a 320-mile long pipeline was laid across the country. In order to supply gas to consumers in Karachi another company was incorporated in February, 1954. So the story went on. The fact is that about three-quarters of the money which has gone into the Sui scheme was subscribed in one form or another by the United Kingdom. Besides this expensive financial backing, Britain made a contribution of technical knowledge and provided most of the equipment for the pipeline, including the pipes themselves. The pipeline was finished early in April, 1955, three months ahead of schedule, and the work was carried out under very trying climatic conditions.

As the House knows, United Kingdom investment in the Federation of Rhodesia and Nyasaland has been on a very substantial scale since the war. No records are available of the very large amount of ordinary private investments, but loans raised on the London market by the Federation and the territorial Governments between 1946 and 1955 amounted to over £60 million. In addition to this, the Colonial Development Corporation, of which we have heard so much today, has invested about £7 million in the Federation, and has agreed to lend a further £15 million for the Kariba hydro-electric scheme. Under the Colonial and Development Welfare Acts, grants amounting to over £8 million have been made available since 1946 in Northern Rhodesia and Nyasaland. These are just some examples of what has been done. They are no cause whatever for complacency, but, equally, they should be noted and remembered.

I now want to say a word about the machinery which is available for development. The House has already heard much about it, and I certainly want to add my very sincere praise for what has been done by the Colonial Development Corporation. I will say later a little more about what some hon. Members want done about it, but that is one part of the machinery which is available. Then there is the Commonwealth Development Finance Company Limited, or C.D.F.C. Once again we are building up a fearful series of initials which are very much like each other but which stand for entirely different things.

The Commonwealth Development Finance Company was set up in March, 1953, and is a channel for private capital. I do not think I need say any more to define the Company, because it is quite familiar to all hon. Members.