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RATIO:'lllALIZATION IN INDIAN BUSL"iESS ENTERPRISE 259
economic conditions such as has been the mother of bank
fusions in Germany, U. S. A. and Great Britain as well
as Japan has not failed to produce its effects in the Indian
atmcsphere. The merging of the three Banks in the
Imperial Bank of India (1920) marks a most important
event in the rationalization movement in Asia.
It should be observed that the Imperial Bank,
although intimately associated with Government finance
according to its charter, is not, as generally believed even
in expert circles in Eur-America, a bank of issue. It is
not a note-bank, but a fundamentally commercial creditinstitution
like any other •• private .. bank. The concentration
movement as embodied in this merger
represents rationalization in ordinary banking business.
And although •• semi-statal •• in a certain sense.
the centralization achieved here is economically of
the same class as is another bank-merger in post-war
India. as embodied in the Central Bank of India Ltd.
which made its debut (1923) by taking over the
Tala Industrial Bank established in 1918.
The example of this rationalization in a purely Indian
concern, the Central Bank of India, has not as yet borne
much fruit in practical banking as conducted by Indian
businessmen. But the existence of some eight
hundred •• cottage •• banks, so to say, generally known
as "loan offices" on the Bengal side, has long been
calling for amalgamations like those, for instance, in Italy.
where· since the currencv . reform . of 1926 some 435 deposit
banks have I!ither liquidated or been merged. But the
investigations of the Indian Banking Enquiry Committee
(1929-31) as well as: the experiences of actual trade and
industry are well calculated to inspire several bank-fusions