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is the Property of

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121

Enclosure in No. 1.

Messrs. E. D. and Messrs. D. Sassoon and Co. to Foreign Office.

Sir,

17, St. Helen's Place, London, December 30, 1912. WE have the honour to acknowledge the receipt of your letter of the 24th instant and note that the suggestion to stop sales is being brought to the notice of the Gover ment of India. That real and speedy relief can only be looked for from that quarter becoming more evident, as the efforts of the Foreign Office to induce China to adhere to her obligations have proved absolutely unavailing, and in the meantime China's attitudes has become more aggressive, as is evidenced by the following information just to hand by cable from Hong Kong, viz.

"Canton papers have published the regulations drawn up by the commissioner of police, and approved by the tutu, for the total suppression smoking. These will be enforced on the 1st January, and offenders will be published according to the new Penal Code."

We further learn from another telegram that :-

**

The presidential manifesto is very unsatisfactory. While laying stress upon the stoppage of cultivation, it does not instruct the provinces to adhere to the circul instructions of the 15th June last year as promised."

We observe that while referring to the suggested stoppage of the sale of certificate opium you make no mention of Malwa We beg leave to point out that this is a important omission, as there is no new market for revanahs, the premium for which has dropped, according to our latest advices, to 385 rupees, and will soon disappear altogether, causing further confusion. The bulk of the revanahs sold at the last Government auction were taken by speculators and not by the regular merchants, and it becomes more than ever necessary to consider the immediate suspension of Malwa well as of Bengal opium,

We note that you do not agree with the figures wired from Bombay and embodied in our letter of the 6th December, as regards the actual requirements of uncertificate Indian opium outside China. As time presses, we do not propose to deal with the point at any length here, but beg to point out that the stock of Bengal opium in Government godowne in Calcutta sold, but not taken delivery of, amounting to some 5,000 chests, is sufficient evidence that at any rate this large quantity is not required, as it has not gone into consumption. When this is coupled with the excessive shipments to Macao, used solely for smuggling purposes, it will be seen that the Bonbay estimate, given in our letter of the 6th instant, cannot be very far wrong. In any case, we beg to urge that the Government of India be pressed to take undelivered Calcutta stocks into consideration when dealing with the question of reducing the quantity to be sold. If it is merely a matter of revenue which deters the Indian Government from at once reducing the quantity, may we beg to suggest that any such reduction would mean enhanced prices, and that the revenue should, in consequence, receive about the same return, but for a smaller quantity of opium.

When the undelivered stocks are absorbed it will be of course open to the Governa ment of India to increase the quantity to be sold to such an extent as the market requires, but we earnestly beg that immediate steps may be taken to give effect to the petition presented on the 17th instant, as delay is only making the position more and more critical.

We have, &c.

E. D. SASSOON AND CO. (For David Sassoon and Co., Limited),

D. GIBBONS, Manager.

OPIUM.

CONFIDENTIAL.

[55895]

Sir,

No. 1.

Foreign Office to India Office.

[January 2.]

SECTION 1.

Foreign Office, January 2, 1913. I AM directed by the Secretary of State for Foreign Affairs to acknowledge the receipt of your letter of the 31st ultimo, forwarding copies of three telegrams, A, B, and C, from the Government of India of the 30th ultimo regarding the opium trade. I am to inform you, in reply, that Sir E. Grey considers that the assumption contained in telegram A is correct, and to add that he regrets that the Chinese Government cannot by diplomatic means be brought to fulfil their treaty obligations in this respect. There would remain the possibility of recourse to forcible measures, but Sir E. Grey feels sure that the Marquess of Crewe will agree with him that such measures would not in this case be advisable.

I am to enclose copies of telegrams which have been exchanged with Sir J. Jordan on this subject.*

I am, &c.

W. LANGLEY.

* Sir J. Jordan (No. 1, Telegraphic), January 1; to ditto (No. 3, Telegraphic), January 2, 1913.

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