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                                                        Records of Bahrain

                                CONFIDENTIAL.                    Political Agoncy,
                                 Ho. C/393.               Bahrain, tho 21st March, 1946.
                                 From
                                        Major T. Hickinbothorn, C.I.E., O.B.E.,
                                                      Political Agent, Bahrain.
                                 To
                                        The non'ble tho Political Residont
                                              in tho Persian Gulf, Bushiro.
                                Sir,
                                        I have tho honour to enolose u copy of the Bahrain
                                State Budget for the year 1364 A.H. which corresponds to
                                1945 A.D. and a briof note on tho aforesaid budget by the
                                Adviser to the Bahrain Government.
                                2.      It would seem that tho Advisor has budgeted simply
                                and solely to save a cortain sum of money and has made his
                                estimates accordingly without due regard to the urgent
                                needs of the Stato and the necessity for forward planning
                                 to meet post war conditions,   The budget is an uninspiring
                                document.
                                        The "note" which is correctly described as brief
                                 throws but little light on tho roasons for the reduction
                                 In tho estimates and for tho lncroasos forecast in the
                                oxponditure. What otands out above everything else is
                                 the extra-ordinary fact that the state haw-succeeded in
                                saving no less than Rs. 13,92.000 during the 5th year of
                                 tho world war and this in spite of very considerable
                                increases in expenditure. Almost as astounding is tho
                                Adviser's forecast for a saving of Rs. 10,00,000 on the
                                working of the present year,    With the sum which has
                                bocome available for transfer to the Reserve Fund as a
                                result of last yeur's credit balance tho amount now to
                                the credit of the Bahrain Government in British and Indian
                                Government stock has reached tho satisfactory figure of
                                Rs. 1,01,18,947.
                                       I feel strongly that the policy of saving at the
                                expense of the well-being of tho population and the material
                                progress of the state which has been followed in the last
                                throe Bahrain Government budgets is neither reasonable nor
                                correct. It is true that owing to war conditions materials
                                for building and other purposes have not boon available, but
                                unfortunately it is equally true that there is a tendency
                                to cloak inertia with the excuse thut progress io impossible
                                owing to war conditions. Not only can progress bo made at
                                the present time but plans can be thought out for post-war
                                expansion and estimates can bo worked out for improvements
                                which will be profitable to tho people and financially
                                advantageous to the State. Unfortunatoly I see no sign of
                                any desire on the part of the Dahrain Government to improve
                                living and working conditions in the country rather they
                                Incline moro and more to tho unhealthy accumulation of a
    I                           large reserve.
                                3.     On the "Receipt" side of the Budget tho principal
                                item io of course tho "Royalty" from oil exported by tho
                                Bahrein PflhmUnm cospsny £nd I am in agreement «ith t.»c _
                                Adviser that thero is no reason to suppose that there will
                                bo any diminution in revonuo from thio souroe, T^flajuYJ-flof
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