'Volume II. MEMORANDA REGARDING OTHER EXTERNAL AFFAIRS. 1905.' [‎96v] (197/228)

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authorities as to its effect in improving trade
was not unduly sanguine. It was essential
under the scheme that the initiative should he
taken by the British Government, and that the
Chinese Government should be induced to levy
on opium imported from Yunnan, via Burma,
a lower rate of duty than at present; but any
action which might be taken by the British Gov
ernment in respect of both these matters would
be peculiarly liable to misrepresentation, and
misrht brin^ about a revival of the discussion
regarding the opium policy of the Government
of India. They also referred to the fact that
the completion of the Red River Yalley Rail
way might be expected to have a disastrous
effect on trade generally between Burma and
Yunnan. Again, the fact that any concessions
which might be obtained from China in res
pect of the import duty on Chinese opium
crossing foreign territory could be claimed at
any time by Trance under the most-favoured
nation clause. As the Tongking route would
probably afford a better outlet for the trade
to Yunnan on the completion of the rail
way, the result of negotiating the proposed
concession might ultimately be chiefly advan
tageous to the trade rivals of Great Britain. In
view of these considerations, the Government
of India were of opinion that, although there
was no objection to negotiations being entered
into with the Chinese Government, yet no
pressure should be brought to bear upon them
in order to induce them to accept the scheme,
and no offer should be made to purchase their
consent by granting concessions of any
material value in other directions. They
considered that, in fixing the rates of duty to
be levied, regard should be had to the following
principles, namely, that the total charges on
the drug should be maintaine I at the same level
as at present; that the Chinese Government
should be permitted to retain as large a share
as possible of the total taxation on opium trans
ported through Burma; and that the transit
due should be utilised as an adjusting factor to
regulate prices in the Eastern ports, if neces
sary, and to prevent the diversion of the trade
to any other route. The British Minister at
Peking was accordingly addressed ; but as he
considered that, in view of the weighty objec
tion to the scheme pointed out by the Govern
ment of India, it would be unwise to approach
the Chinese Government on the subject, the
whole project was abandoned.
31. On the 5th October 1905, Mr. Litton
the British Consul at Tengyueh, telegraphed
that an inflammatory brochure stating that
subjects of Foreign Powers habitually violate
Chinese women and children and destroy tombs
had been received at Tengyueh from the Viceroy
of Yunnan for official distribution, but that the
local authorities at Tengyueh had refused to
publish it. Mr. Litton was unable to obtain
f