4-15
26
that the Government of India may be informed of the rates of import and transit duty which the Government of Burmah consider suitable.
Copy, with a copy of the letter to which it is a reply, and of its inclosures, forwarded to the Foreign Department, for information, in continuation of the communication from this Department, dated the 27th May, 1964.
Inclosure 16 in No. 1.
Government of Burmah to Government of India.
November 30, 1904.
I AM directed to acknowledge the receipt of your letter, dated the 11th October, 1904, in which certain further inquiries are made in connection with the proposal for the transport of Yunnan opium in bond through Burmah.
2. In reply, I am to submit, for the information of the Government of India, a copy of a note dated the 4th November, 1904, by Mr. Tilly, Chief Collector of Customs, Rangoon, and of a Memorandum, dated the 16th November, by Mr. Litton, Consul at Tengyueh, in which these officers give, in so far as they are able, the information required by the Government of India.
3. With reference to paragraphs 4 and 5 of your letter it will be seen that Mr. Tilly and Mr. Litton are both of opinion that a mere waiver of the prohibition against the import of Chinese opium into Burmah will not in itself be sufficient to divert the trade in Yunnan opium to the Bhamo-Tengyueh route. Mr. Litton points out, in the first place, that so long as Article XI of the Burmab-China Convention of 1894 continues unmodified the Chinese authorities in Yunnan will be entitled to prevent the exportation of Yunuan opium to Burmah, notwithstanding the withdrawal on our part of the prohi bition, and he is of opinion that the Yünnan officials will endeavour to seize such opium unless arrangements are first made as to conditions of export and payment of duty. And again, if no special privileges are secured, the Yunnan opium will be required to pay the provincial dues both in Yünnan and probably in the province to which it is shipped, and as it has left Chinese territory in the course of transit it will, for Customs purposes, be treated as
foreign opium, and will be assessed to the heavy import duty which is levied on such opium. Mr. Litton shows that this accumulative assessment of Provincial and Imperial dues will be prohibitive, and that it is a condition of the trade by the Burruah route that the Chinese Government should treat Yünuan opium imported through Burmah as Chinese, not as foreign opium, and should remit the Customs tax payable in the case of foreign opium. Mr. Tilly also notes that the Syndicate of Chinese merchants in Rangoon are not prepared to commence negotiations for a trade through Burmah until the import duty on re-entry into China has been removed.
4. As to the arrangements to be made with China and the different concessions to be secured, I am to say that the Lieutenant-Governor supports generally Mr. Litton's detailed proposals. The first step is to secure the acceptance by the Chinese Govern- ment of a modification of Article XI of the Convention of 1894 so as to permit of the exportation of Yunnan opium in bond through Burmah. His Honour thinks that advan- tage might be taken of this opportunity to secure as a further provision that opium may be imported from Yunnan by the Government of Burmah for sale and consumption in Burmah. In certain of the more remote parts of Upper Burmah, Yünnanese opium is preferred to Government Indian opium by the opium-consuming population. Hitherto it has been possible to meet the requirements of the licensed shops in these localities from the supplies of confiscated Yunnan opium in the Treasury. The recent reorganization of Excise Preventive Staff has, however, tended to the suppression of the contraband trade. Smaller and less important seizures only are being made, and difficulty is now being experienced in securing the quantity of opium needed for supply to licensed shops. The amount required is comparatively small, but it would be con venient to regularize the purchase by this Government in Yünnan in case the drug is not seized in sufficient quantities on this side of the frontier.
5. His Honour agrees with Mr. Litton that, in order to secure the good-will of the Chinese provincial authorities and their acceptance of the new route, it will be desirable
27
that the opium to be sent by the Tengyueh-Bbamo route should pay the provincial li-kin or dues both in Yünnan and in the province to which it is taken after leaving Rangoon by sea. And it would undoubtedly be a great advantage and convenience if, as Mr. Litton proposes, these dues could be assessed and collected by the Imperial Customs both on export from Yunnan and reimportation into China.
6. In addition to these provincial dues, Mr. Litton suggests a light duty on export and import to be credited to the Chinese Imperial Customs as well as the transit duty to be levied by the Government of India, as indicated in your letter, on the opium in transit through Burmah. On such information as he possesses, Mr. Litton estimates that the cost of transport of Yunnan opium by inland routes to the Canton Province amounts, with the various dues levied in transit, to not less than 200 rupees per picul of 1334 lbs. From his note, and from the figures given by the Chief Collector of Customs, it would seem that the cost by the Tengyuch-Bhamo route, including the provincial dues levied in Yunnan and Canton, but not the proposed Chinese Imperial Customs duties nor the transit duty, will amount approximately to 130 rupees per picul. Whilst, therefore, the opium by the latter route could not compete with that sent inland if an additional duty were levied in any way approaching the high rate of 220 rupees per picul levied by China on foreign opium, the Lieutenant-Governor agrees with Mr. Litton that a light duty of 20 rupees per picul, including both export and reimport duties, might suitably be imposed by the Chinese Maritime Customs, in addition to the transit duty to be imposed in Burmah.
7. The transit duty proposed by Mr. Litton is a duty of 10 rupees per 1 pieuls, or 200 lbs. in the first instance, to be increased later if found desirable. Mr. Tilly suggests a duty of 2 per cent. ad valorem, which at his valuation of 554 rupees per At Mr. Litton's valuation of 200 lbs. would amount to some 14 rupees per 200 lbs.
700 rupees to 900 rupees the duty at Mr. Tilly's rate would be from rupees 17:8 to rupees 22: 8 per 200 lbs.
Certain of the figures included in the total cost of transport by the inland route and by the Tengyueh-Bhamo route are admittedly not too reliable, and are largely of the nature of rough estimates. In so far as can be ascertained, however, the total cost of transport via Bhamo, including the li-kin duties in Yunnan and Canton and the proposed Maritime Custom duty of 20 rupees per picul, will amount, as shown above, to not more than 150 rupees per picul, whereas the cost by the inland route is believed to be not less than 200 rupees per picul. A transit duty of 10 rupees per pical or 15 rupees per 200 lbs., would therefore still leave a sufficient margin of profit by the Burmah route, and the Lieutenant-Governor considers that this duty might suitably be imposed in the first instance. It should be clearly understood that the duty may be varied from time to time, and his Honour does not think that our present information is sufficiently complete and accurate to permit of any declaration as to the maximum rate above which the transit duty will not be increased. More accurate information can be obtained in time as to the provincial taxes levied in China on opium proceeding by the inland route beyond Yunnan-fu, but as from your telegram of the 11th November, 1904, it is understood that the Secretary of State is pressing for an early Report, Sir Hugh Barnes has not thought it desirable to delay this reply until further inquiries
could be made.
Note by the Chief Collector of Customs, Burmah, Rangoon.
I have again consulted the Syndicate of Chinese Merchants. They are prepared within one month of receiving notice, to begin trading in Yunnan opium when the prohibition against transit throughout Burmah is cancelled, provided that Government will at the same time commence negotiations for removal of all the Chinese duties except the li-kin fees. I understand they have powerful friends at the ports of destination who will be able to further their interests.
I have also inquired of the Irrawaddy Flotilla and the British India Steam Naviga- tion Line, and learn that at present their freight charges for opium are as follows:
Bhame to Rangoon
Rangoon to Hong Kong Rangoon to Amoy
Rangoon to Shaughne..
Rupees 14:0: 3 per 100 viss.
per cent, or 40 rupees per ton.
A ton being taken as 20 hundredweights or 50 cubic feet.
31
12
60
65
51
23
17