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agreement the number of chests of opium to be imported into China from India during each of the seven years during which the agreement was to run was clearly specified and defined as between the two Governments.
7. Since the signing of the agreement of the 8th May, 1911, the Government of India have continued their previous practice of holding periodical auction sales at Calcutta of their Bengal opium, but they have introduced a change of procedure consisting of a discrimination between the opium intended for importation into China and the opium intended for other markets. The chests of opium sold for importation into. China are now numbered consecutively and marked with a red stamp, and each chest is accompanied by an official "certificate." The commercial result of this change of practice has been that the chests so numbered and marked and certificated have acquired a special market value far exceeding the market value of the chests intended for other markets, and this notwithstanding that the quality and quantity of the opium is the same in all chests.
LG
8. Since the signing of the said agreement the Government of India have also introduced a change of procedure as regard their regulations for the exportation of Malwa" opium from Bombay. Prior to that agreement no restrictions were placed upon shipments of opium from that port beyond a customs duty of 600 rupees per chest. Since the agreement the customs duty has been doubled, and the Government of India have prohibited export of any chest of opium to China unless such chest is accompanied by an official "permit." These permits are by direction of the Government of India put up for sale by auction in Bombay, and prices as high as 3,000 rupees have ordinarily been bid for each "permit," over and above the value of the opium packed in the case to which such "permit" related. The whole of the large sums realised in this way by the sale of "perinits" has gone to the State as profit.
9. Since May 1911 the trade has been continually harassed by illegal restrictions imposed by the provincial authorities in China in contravention of treaties, but now the market has become wholly demoralised by the sudden action, without notice or warning of any kind, of the Chinese Central Government in notifying the total prohibition of trade in Indian opium in defiance of the agreement of the 8th May, 1911. The result of this action has been such a depreciation of value of the stocks of opium held by your memoralists and the friends they represent as to cause them very serious loss, and in the case of the less wealthy, to threaten them with absolute ruin.
10. Notwithstanding the disastrous position of the market, as described in the last paragraph, the Government of India is still holding auction sales of Bengal opium and of permits in respect of Malwa opium, and, as your memorialists are informed and believe, propose to continue to hold such sales, thus seriously aggravating the demoralisation of the market, increasing the losses of your memorialists and of their friends, and leading inevitably to a serious financial crisis without, so far as your memorialists can discover, achieving any corresponding benefit to the State. The latest Government auction sale was an auction of "permits held on the 11th instant at Bombay, and resulted in a further very heavy fall in the price of the commodity both in Bombay and in Calcutta.
11. Your memorialists respectfully submit that a continuation of these auction sales is under the circumstances most unfair to them and their friends, inasmuch as it places them in the dilemma of having either to undertake the heavy risk of carrying congested stocks by supporting the market value with their bids or of facing a position of complete paralysis of the trade by abstaining from bidding-thus causing values to fall still lower. Your memorialists submit that this is a dilemina from the consequences of which they are entitled to be relieved, in view of the circumstances that their marked and numbered chests of Bengal opium were sold at auction in Calcutta, and that their " permits were sold at auction in Bombay by the Government on the express representation that the chests so sold or covered by such permits" were importable into China.
12. Your memorialists cannot doubt that it is within the competence of the British Government to secure from the Chinese Government the honest observance of her treaty obligations under the agreement of the 8th May, 1911, and the very least which, as your memorialists venture very respectfully to submit, the Government of India can do is, in their own interests as well as in the interests of your memorialists, to abstain from holding further auction sales at Calcutta and Bombay, and to reduce Government sales of opium for export to ports other than China to 7,000 chests per souum until such time as the difficulties which have occurred between the two Governments have been adjusted.
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Your memorialists therefore pray that your Lordship may be pleased to issue such directions and to take such action as may be necessary for the purpose of securing an immediate discontinuance of the usual periodical auction sales by the Government of India at Calcutta and Bombay, and the reduction of auction sales of opium at Calcutta for markets other than China to 7,000 chests per annum.
And your memorialists shall ever pray, &c.
E. D. SASSOON AND Co. DAVID SASSOON AND Co. (Limited).
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