The artificially fixed rupee-sterling exchange rate prescribed by the Hilton-Young Commission (1926) was adopted by the British Government for which one of the following reasons?

.The Core Motive:The Hilton-Young Commission (Royal Commission on Indian Currency and Finance) recommended fixing the exchange rate at 1 shilling 6 pence (1s 6d) per rupee, which was artificially higher than the pre-war natural market rate of 1 shilling 4 pence (1s 4d). The British colonial administration insisted on this overvalued rupee primarily to manage "Home Charges." These were massive, mandatory annual sterling-denominated remittances transferred from India to Britain to cover British administrative costs, military expenses, pensions, and interest on public debt. By fixing the rupee at a higher rate, a single British pound could be purchased with fewer rupees. This dramatically reduced the colonial government's budget pressure when converting Indian tax revenue into sterling to send to London, ensuring that India effortlessly serviced its sterling debt and maintained its creditworthiness in London's financial markets. Why other options are incorrect:(b) Providing support to Indian importers: While an overvalued rupee made foreign goods cheaper (effectively acting as a hidden subsidy for British manufacturing hubs like Lancashire to dump textiles into India), this was a convenient consequence for British businesses—not the primary structural motivation of the British Government. (c) Encouraging export of cotton produce from India: This is the exact opposite of what happened. An artificially strong, overvalued rupee made Indian raw materials and agricultural exports (like cotton) much more expensive and uncompetitive globally, sparking intense protests from Indian industrialists and nationalists (often called the Ratio Controversy). (d) Preventing depreciation of the Rupee in terms of gold: Though the commission also conceptualized moving toward a Gold Bullion Standard (which later paved the way for the establishment of the Reserve Bank of India in 1935), the specific, aggressive choice of the 1s 6d ratio over 1s 4d was purely driven by imperial fiscal remittance advantages, rather than protecting gold parity.