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which the traders belong. A perusal of Sir John Jordan's despatches of the 3rd and the 12th January has confirmed us in this opinion, and we now proceed to set forth for your Lordship's consideration a more detailed statement of our views.
5. We desire to state at the outset that we are not unmindful of the difficulties which recent events in China have created, and that we look back with appreciation to the patience and perseverance with which Sir John Jordan has hitherto endeavoured to secure the observance of treaty engagements and just treatment for the Government and traders of India.
6. We take as our starting point the situation with which we had to deal in the correspondence ending with our telegram dated the 25th July, 1913, regarding the proposed revision of the agreement of 1911, to which we now invite your Lordship's attention. The position then was that, owing to the persistent had faith of the Chinese Government and to the impossibility of securing the observance of their treaty obligations, our opium trade with China had come to an abrupt and premature end, leaving about 21,000 cheats lying uncleared in the treaty ports. The Chinese Govern- ment were anxious that the fact of the cessation of our trade should be formally recognised, and that we should bind ourselves never to export opium to China again. In consenting to co-operate in the revision of the agreement our one paramount interest was the protection of the owners of those stocks, which had been legitimately imported under the 1911 agreement but had not yet entered into consumption in China. We considered it desirable, therefore, to make use of the fact that under that agreement we had the right to export opium to China till the end of 1917, and, in barter of that right, to obtain a formal recognition of China's responsibility as regards the stocks. It was with this object that we suggested, in our telegram of the 25th July, the manner in which the agreement should be revised, and it was with much satisfaction that we learned that our suggestion had received the entire approval of His Majesty's Govern- ment, and that, in the Foreign Office despatch No. 287 dated the 29th September, 1913, the British Minister at Peking had been instructed to inform the Chinese Government that an essential condition, preliminary to any recognition that the opium trade was at an end, should be "an unequivocal and prominent declaration with adequate guarantees that China accepts liability for the complete and early disposal of the stocks." We observed also that this condition had been duly communicated in Mr. Alston's memorandum of the 3rd November, 1913, to the Wai-chiao Pu. We were entirely unprepared, therefore, for the line taken in the Foreign Office despatch No. 352, dated the 5th December, 1913, which spoke of making a virtue of necessity, and discussed, with no apparent disfavour, the removal of this liability from the Chinese Government. We will now, with your Lordship's permission, examine the reasona which, so far as they are known to us, have been advanced for the weakening of the attitude previously adopted
7. It is represented that the presence of the opium stocks at Shanghai and elsewhere has impressed the Chinese reformers with a deep sense of wrong, and that they resent the way in which their efforts to secure the extinction of the opium habit in China and the suppression of native cultivation are hampered by the fact that foreign opium continues to be sold under the protection of a treaty with a foreign Power. The implication, we understand, is that humanitarian reasons call on India to add one more to the sacrifices which she has already made for the moral regeneration of China. On this point we would respectfully invite attention to the opinion of Sir John Jordan, who, in paragraph 2 of his despatch No. 2, dated the 3rd January, 1914, has expressed a doubt as to whether the re-exportation of the stocks would really facilitate the effective suppression of opium in China or hasten, to any appreciable extent, the attainment of the object for which the previous sacrifices have been made. We completely share this doubt, and would add that the withdrawal of the stocks would accelerate the removal of the only remaining lever which the British Government possess for co-operating in the extinction of opium smoking in China. Our conclusion, then, is that even if India were in a position to repurchase the stocks, the sacrifice would be likely to prove ineffective, if not actually harmful to China.
8. But, apart from the question as to whether the proposed measure will conduce to the moral benefit of China, we are asked to assent to it as a matter which involves the good name of Britain. We have given our very careful attention to the argumenta contained in paragraph 4 of Sir John Jordan's despatch No. 2. His Majesty's Govern- ment are asked whether they are prepared to face the moral obloquy of being associated any longer with a trade which is conducted under discreditable conditions, which exists practically on sufferance and by means of threats, and which will expose us to certain criticism and reproach for another eighteen months. We beg leave to observe that the
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embarrassment which attaches to the opium trade is no new discovery. If opium were an ordinary article of trade, we do not imagine that India would have been obliged to forego, as she has, a large and lucrative revenue, or that the British Government would have felt obliged to acquiesce in the wholesale violation of their treaty rights. If it be a fact that the conditions under which the trade is now carried on are markedly less satisfactory than formerly, we would reply that this is solely due to the action of those "reformers," both Chinese and foreign, who conceive that a movement which is characterised so largely by breaches of international faith is one that will conduce to the moral uplifting of the Chinese nation. As for the possible charge of moral inconsistency which might be brought against His Majesty's Government for actively urging the ratification of The Hague Convention, while fostering and upholding in China a trade which the mere act of ratification must tend to extinguish, we submit that Sir John Jordan has overlooked the fact that the whole object of that convention, and the reason for the delay which has ensued in its ratification, have been to ensure The Chinese Government have that the participating Powers move pari passt. hitherto professed to do this but have largely failed, and it has always been open to them, by effectively closing a province to native opium, to ensure that Indian opium shall not be sent there. So far as public morality is concerned, we think that the British Government may well be content to be judged by the events of the
past decade.
9. We come, therefore, to the argument that this measure is desirable in order to obtain the good will of the leading classes in China. It is urged that the state of public opinion in China on the matter of the opium stocks causes grave prejudice to British interests. Looked at from this point of view, the proposal may be described as one based on expediency, and was evidently regarded as such in the Foreign Office despatch No. 352, dated the 5th December, 1913, which spoke of the spontaneous withdrawal of the stocks as an act which would give this country a great opportunity, not only of restoring confidence in the Chinese, but of securing fresh markets for British trade."* If it were our concern to examine the soundness of this proposition, we might venture to doubt whether there is sufficient reason to suppose that China will feel any real or lasting gratitude for a measure which she must know has been forced on the British Government by her own activities and by concomitant circum- stances in England. It is, however, our duty to point out to your Lordship that the desirability of wooing the favour of the Chinese public is not an argument which will appeal to the people of India, where public opinion is not less articulate than in China, and is vastly more susceptible to being influenced in directions injurious to the British Empire. In our opinion the knowledge that a burden was being placed on Indian taxpayers for the benefit of British trade would provoke a situation not less grave than that recently evoked by the question of the treatment of Indians in South Africa. We anticipate that every section of public opinion, moderate and extreme, European as well as Indian, would unite in denouncing a policy which, if candidly presented, would be regarded as initiated on the representations of private individuals in England and adopted by the British Government, against the protest of the Government of India, with a view to helping British trade in China at the expense of Indian revenues. The subsidiary argument that the measure now proposed was based on humanitarian motives would not be credited, while the explanation that the act was one of reparation, due to the Indian Government's sins of commission and omission, would, as we shall shortly proceed to show, not be in accordance with facts.
10. As matters are at present, it is not without difficulty that we have been able to satisfy public opinion in this country regarding the loss of revenue which India has sustained by the closing down of the China trade. On more than one occasion during recent years non-official members of our Legislative Council have voiced the demand that the revenues of India should receive compensation for the sacrifices entailed by the The contention is one which is difficult to adoption of a policy dictated from without. meet, and in paragraph 25 of our despatch No. 64 of the 21st February, 1907, Lord Minto's Government strongly endorsed the opinion that, in certain circumstances, India would have a case for compensation. In paragraph 14 of their despatch No. 257, dated the 28th October, 1909, they again pressed the claim of the Indian taxpayer on His Majesty's Government. We have hitherto, indeed, refrained from formulating any definite proposal to this effect, as the policy of progressive restriction, embodied in the Agreement of 1911, aiming at the total extinction of our trade with China, received our consent and co-operation. The view we adopted, and to which public expression was given by his Excellency the Viceroy, in a speech in the Legislative Council on the 29th March, 1910, was, that the sacrifices which had been made were in the interests
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