and

can

compete with India

for the supply of opium to her

own population, while neither

Hong-Kong nor

do so;

and

in meantime

Government opium grown

would

be

or

the Straits can.

If India had a monopoly of

opium outside China, there

would be no reason

why Hong-Kong and

the Straits should get

any portion of any

revenue which

might be found possible

to levy from opium. M. Lister's scheme is apparently further open to the objection contained in my letter No. 2116-85, dated the 20th January 1886, which was enclosed to Your Lordship's Despatch No. 12, dated 11 February 1886.

6. The conditions

which

a scheme

such as

M. Lister's might

be taken into

consideration are in

our opinion the following: -

A. China, Hong-Kong,

and the Straits to relieve Indian Opium

from all taxation, whether on

import, during transit, or at

consumption.

B. The same countries to guarantee

that Persian and other foreign

grown opium, other than Indian

Opium, shall either not be

imported,

or shall be subjected

to a duty of

not less magnitude

than the special duty to which

Indian Opium is subject

in India. This duty to be, if possible, levied in the country which produces the opium.

C...

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