Before Roy Moxham wrote his book, The Great Hedge of India,in 2001, not too many people had heard of the great hedge or the inland customs line. Even after his book, a sufficient number of people don’t know about this bizarre hedge and its antecedents. The customs line, and the related hedge, started with the East India Company, but continued after 1858. The reason was high tax on salt in Madras, Bengal, and Bombay presidencies, especially Bengal. But, there were parts of India that were not part of British India, such as princely states. Therefore, in addition to “illegal” salt production in salt pans, salt would be smuggled into British India from elsewhere, similar to the current phenomena in states with prohibition on liquor. Hence, an inland customs line was gradually constructed, cutting across Punjab, United Provinces, and Central Provinces, to borders of Orissa. There were customs barriers and customs posts. However, even with guards, how does one enforce something like this? Guards are humans, amenable to bribery. Today, corruption is curbed by using information technology (IT) to reduce the human interface. Back then, it was done through a hedge interface, constructing a hedge made out of Indian plum, babool, karonda, and plants like that.
Allan Octavian Hume is one of the founders of Indian National Congress. As commissioner of inland customs between 1867 and 1870, he is the one who perfected the hedge, and made it an impenetrable barrier. At its peak, more than 14,000 people manned the customs line and the hedge. Gradually, as British territory expanded westwards, trade within the country freed and salt taxes standardised, the hedge withered away and remained a distant memory, until Moxham tracked it down and found its remnants near Etawah. Towards the end of the book, Moxham writes, “I had long ago accepted that the reason no one knew of the hedge was precisely because it had largely disappeared. If it had been better preserved it would have become a tourist attraction.” On that stretch near Etawah, a road had been built over it. But, Moxham still found traces.
Pre-independence, there were several statutes on salt—Transport of Salt Act (1879), Indian Salt Act (1882), Madras Salt Act (1884), Bombay Salt Act (1890), Indian Salt Duties Act (1908), and so on. Protests against taxes on salt are powerful images of the struggle for independence. Post-independence, salt was delicensed in the second half of the 1990s and this removed references to salt in central excise and Salt Act (1944). This 1944 statute unified pre-independence salt legislation and had special provisions on salt, incorporating licensing while grandfathering rights of existing salt factories and salt works. But, taxes on salt were scrapped in 1947. However, since administrative machinery for salt still existed, government needed revenue for running this machinery. With salt figuring as Entry No 58 in the Union List of Seventh Schedule, at that time at least, Salt Cess Act (1953) was understandable. In 1978, we even had a High Level Salt Enquiry Committee, which, incidentally, recommended a removal of the cess. In 2016, this cess was scrapped. Roads of reform and GST (salt has 0% GST) have thus been built over the legacy of salt.
However, if you look hard enough, like Moxham, you will find vestigial traces. Department for Promotion of Industry and Internal Trade’s Annual Report has a section on salt industry. India is the third largest producer of salt in the world (after China and USA) and the second largest producer of iodised salt (after China)—95% of production originates in private sector, 3.5% in cooperative sector. One reason why the Annual Report has a section on salt is because of the Salt Commissioner’s Office. “The total area under salt production is about 6.47 lakh acre (Patta land, State Govt. land, Port land, Salt Department land). Out of this 59,946 acres land belongs to Salt Department for manufacture of Salt.” Salt Commissioner’s Office has headquarters in Jaipur, appropriately titled “Lavan Bhawan”. There are regional offices in Chennai, Mumbai, Ahmedabad, and Jaipur, with some field offices too. What do they do? Standards are domain of the Food Safety and Standards Authority of India (FSSAI). Code on Social Security and Welfare has subsumed welfare measures. Planning is history. All that remains, is exploitation of land owned by Salt Departments, either by leasing out this land for salt production, or through monetising it. Recently, there has been discussion about monetising Mumbai’s salt pan land in Ghatkopar, Wadala, Chembur, Bhandup, Trombay, Virar, and Bhayandar.
“The 26 Quality Control Laboratories of the Salt Commissioner’s Office, along with the staff could be transferred to the Public Health Division of the Ministry of Health and Family Welfare. Of the lands under the control of the Office of the Salt Commissioner, those which are now leased for salt production (about 45,000 acres) can be transferred to the States along with the responsibility for leasing of these lands. The States could be allowed to retain the lease rentals. The remaining lands can be vested in the Ministry of Urban Development which can take action or the disposal of these lands. The Office of the Salt Commissioner, along with all the field offices could then be closed down.” This quote is from the 10th Report (July 2000) of Expenditure Reforms Commission, which also estimated 800 jobs would become “surplus”. Most people don’t know there is an all-India Central service known as Indian Salt Service, with both Groups A and B.
(The author is Chairman, Economic Advisory Council to the PM. Views are personal)