Partition and The 55 crore issue

At one of our frequent get-togethers, the topic of discussion was the Rs 55 crore controversy in 1947, which India was holding back from Pakistan, which M. K. Gandhi insisted on paying up, and which consequently was one of the reasons given for his assassination. None of us however had much knowledge on the topic (shows how shallow the History they teach you in school is!). There were other questions we talked about as well – such as why 55 crores; and if Pakistan was to get 55 crores at Partition, how much was India entitled to? Questions galore, not many answers… So thats when I decided what my next topic of "research" was going to be… and was it interesting – and tough!
I was surprised that there wasn’t much information available online… The public libraries were going to be the best bet. The book Freedom at midnight by Larry Collins and Dominique LaPierre was the best source (though considered to be heavily biased in favour of Lord Mountbatten and Nehru) – while online, the most helpful information I got was from, the archives of the Deccan Herald  and the archives of the UNO.
Some things I learnt related to the topics I was researching…
* The amount due to Pakistan was not Rs. 55 crores, but Rs. 75 crores. The first installment of Rs. 20 crores had been paid; but then, the Pakistani army invaded Kashmir which had acceded to India at the time, and the Indian government refused to hand over the balance of Rs. 55 crores, asking for the Kashmir issue to be resolved first, since any money given to Pakistan would probably be used for military purchases and used against India. Gandhi was against this decision and argued that this meant going back on an agreement made in earnest and not a good beginning for relations between two newborn countries, and undertook a fast to insist on paying the agreed upon money.
The second answer I was looking for was the terms of Partition – If Pakistan was getting Rs. 75 crores, what was India supposed to get? It took a long time finding this information, but it was an interesting search for sure.
* Of all monetary and liquid assets, Pakistan got 17.5% while India’s share was 82.5%. Liquid assets included printed currency stocks, coins, postal and revenue stamps, gold reserves and assets of the Reserve Bank of India. This was accounted for so meticulously that there is even a record of proportional division of Rs 75 – petty cash from a district commissioner in an inaccessible part of Nagaland!
* Of all movable and non-liquid assets, there was to be a division in the ratio 80-20 between India and Pakistan. These assets included items like all the contents inside governement premises  – down to tables, chairs, stationery, even stocks of lightbulbs, ink pots, brooms and blotting paper. Even books in government libraries were divided between the 2 countries.
* Railway rolling stock and goverment vehicles were divided in proportion to the rail track and roadway mileage inherited by each country.
To answer the original question of "If Pakistan was to get Rs 75 crores, what was India’s share?" – The answer is – 470 crore Rupees
These rules of division – or "The terms of Alimony" as they were sometimes called – brought about some amazingly insane and incredible incidents. The book  Freedom at midnight documents these…
* The Police Superintendent in Lahore divided everything equally between a Hindu deputy and a Muslim deputy – leggings, turbans, lathis, rifles etc. The last items were the instruments of the police band. These were split up too – a flute for Pakistan, a drum for India, a trumpet for Pakistan, cymbals for India, till there was only 1 item left – a trombone. Before his eyes, the deputies, who had been comrades for years and devoted to each other, got into a fist fight to gain the trombone for his country.
* Sets of the Encyclopedia Britannica in the Punjab Government library were religiously divided, alternate volumes going to each dominion. Dictionaries were ripped apart, A-K going to India while the rest went to Pakistan. Where only 1 copy was available for any book, librarians were supposed to allot that book based on which country had a greater interest in it. As a result, librarians actually came to blows over which country had a greater interest in Alice in Wonderland  or Wuthering Heights.
* Wine cellars would stay with India, as Pakistan would be an Islamic state where alcohol was haraam. However, Pakistan was to be monetarily compensated for its share of the value of the wine.
* There was only one government press that printed currency notes and India refused to hand that over. So Pakistan began its existence with Indian currency notes rubber stamped "Pakistan" over "India".
* The Viceroy of India had 2 sets of Royal carriages, one set trimmed in gold, the other with silver. Who would get which set was decided by Mountbattens Aide-de-camp by the toss of a coin, with India getting the gold trimmed set. After the harnesses, whips, spurs, uniforms etc were divided, the only item left was a ceremonial horn, used on special occasions. Splitting that into two would have made it useless, and giving it to any one dominion would have caused a fight. In the end, the ADC took it for himself as a souvenir.
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18 Responses to Partition and The 55 crore issue

  1. Niranjan says:

    you have made a very good research in this matter. But question still remains, did Mr. Gandhi forced GOI to release the payment of Rs.55 cr.??? those people who r biased towards Mr. Gandhi they try to prove that Mr. Gandhi fasted for peace in Delhi, but is it true???

  2. DCS says:

    I wont be surprised if the authors you quote, actually added a “bit of fiction” to history.

  3. Ravindr S. Vadke says:

    The amount of Rs. 470 Cr doesn’t match with the (RECURRING Entry in Bharat’s annual budgets since 1948) of Outstanding Debt to Pakistan as @ Rs 300 Cr.

  4. Ravindran vadke says:

    Really liked your blog. Have to talk to you. Can you connect with me on

  5. Sai says:

    Very very very useful information. Keep posting.

  6. Pritesh Joshi says:

    If india has given 55 crore to pakistan and india took 470 crore than why still pakistan economy is just lower than that of india?

  7. Whatever happened in division of assets , that surely was not the issue pleaded by Pakistan in 1948 debating Kashmir, as an expat kashmiri charlie has written in a local paper. It is true first govt. order was written in a hotel room on the back of tissue paper in Karachi. Give credit where it is due.

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  10. Prasad Karkare says:

    Nice information.
    Thanks for sharing.
    Can you please confirm and provide reference of the balance Rs. 55 crore paid to pakistan ?

    Thanks a lot.

    Prasad Karkare

  11. Prakash says:

    From Indian side H M Patel was head of the steering committee, who contributed to get each and every thing to India and some times even he fight for broken piece of pen or chair. We have to remember his contribution in ascertaining maximum asset for India.

  12. Sapana says:

    Thank you so much for such a wonderful information… I was always in search of the fact related to 55crors to pakistan now git satisfactory anwer ….

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