[This Document is the Property of His Britannic Majesty's Government.]

OPIUM.

CONFIDENTIAL.

[55256]

No. 1.

[December 27.}

SECTION 1.

Sir,

India. Office to Foreign Office.-(Received December 27.)

India Office, December 24, 1912. IN continuation of my letter of the 18th December, I am directed by the Secretary of State for India in Council to forward, for the consideration of Sir Edward Grey, a of a letter from the Government of India, dated the 6th December, 1912, on the copy subject of the Chinese opium trade.

Enclosure in No. 1.

I have, &c.

T. W. HOLDERNESS.

Government of India to the Marquess of Crewe.

My Lord Marquess,

Delhi, December 6, 1912. WE have the honour to state that we have recently received reports from Messrs. David Sassoon and Co. and other opium merchants regarding certain action taken by the Chinese authorities affecting the import and sale of Indian opium. The reports, which are expressed in general terms, are to the effect that presidential orders have been issued forbidding opium smoking and directing the closing down of retail shops; that penal enactments have been made rendering all persons who import, sell, prepare, or smoke opium liable to penal servitude; and that orders have been issued by provincial authorities prohibiting the import of opium from the 1st January, 1913.

2. We consider that these reports, if true, constitute a very serious state of affairs. We are informed by the opium merchants that their representatives at Hong Kong and Shanghai have addressed His Majesty's Minister at Peking on the subject, and we have every confidence that energetic measures will be taken to represent to the Chinese Government the consequences that must ensue from any organised violations of treaty obligations. We admit the right of the Chinese Government, under article 7 of the agreement of May 1911, to suppress the smoking of opium and to regulate the retail trade, provided, of course, that such measures do not violate the other articles of the agreement.

Under article 3, for example, the condition which would exclude Indian opium from a province is that that province should be able to establish by clear evidence that it has effectually suppressed the cultivation and import of native opium. If, while that condition is wanting, a province can stop the dealing in or consumption of Indian opium, the result is clearly to make the whole treaty of no effect.

3. We have no information which would enable us to test the accuracy of the reports which we have received from the opium merchants, but we feel justified in expressing to your Lordship our sense of the seriousness of the position, as it is clear to us from information which we have received that the whole opium trade with China is in a highly excited and nervous state, and that there are indications that the merchants have come to the conclusion that it is useless to add to their present stocks.

We have, &c.

O'MOORE CREAGH. GUY FLEETWOOD WILSON. S H. BUTLER.

R. H. CRADDOCK.

[2736 dd-1]

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