The outbreak of war prevented the Government from implementing the Chamberlain Commission's recommendations and the currency situation in India soon became very different. British war expenditure and a boom in exports created a tremendous demand for rupees; in one year the country was able to absorb twice the world's annual output of silver. The high world price for silver boosted the cost of the rupee until the value of the silver in the token coin outstripped its face value. After twenty years of stability at is 4d, it rose to is 8d. The shortage of silver threatened the convertibility of the expanded note issue but it also became a question of what it was to be convertible into–for the pound sterling had been turned into the Bradbury note and divorced from the gold sovereign in the ultimate departure from the time-honoured ordering of things.

The Indian Exchange and Currency Committee, under the chairmanship of Sir Henry Babington Smith, was appointed in May 1919 to examine the working of the monetary system under the new conditions and make policy recommendations to obtain stability and safeguard the exchange. The rupee ignored the Committee's deliberations and rose to isi0d, then 2s reaching 2s 4d in December 1919. However, when Keynes appeared before them as a witness on 25 July, it was still at is 8d.

Keynes's evidence reflects the experience of the four and a half years that he had just spent in the Treasury.