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expediemy of transforring the telegraph line to the rail-
way and the fact that the Chinese Telegraphs have become a
national undertaking make it desirable to arrive at a clear
widerstanding on the subject with the Eastern Extension
Telegraph Company and the Chinese Government:
but fully as
I appreciate the distaste of His Excellancy's Govortment
for the contimance of the present conditions and their
desire, in the financial situation of the Colony, to profit
by what in nomal circumstances would be a natural source
of revenue, I am unable to avoid the conclusion that the
solution advanced by His Excellency would not constitute
more than an unilateral abrogation of existing arrangemente engagements
whose operation extende beyond the limits of British terri-
tory, and would certainly lead to measures of retaliation
against the Company by the Chinese Government,
So far as I can see all we can reasombly claim
as against the Chinese is that the terminal station should
be removed to the frontier. The moro delicate question of
the office in Hongkong is one upon which the Chinese Coverty-
ment are likely to take a firm stem, and it is improbable
that without disproportionate pressure they could be
induced
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