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2.
on of commerce in Article 6 and I could make no apparent impression on him in a long discussion in course of which I made full use of all possible arguments and warned him regarding Article 12 of Burma Convention of 1894. He will refer the matter to the Government. I did not offer to give up inland navigation in favour of coast trade preferring to reserve this for a later meeting. He insisted of course Chinese Government were determined to make "clear cut" and though willing to discuss future arrangements in negotiations for Commercial Treaty would not be prepared to commit themselves in any way now. I can only suggest that you authorise me to seek best [grp.undec: ?changes in] compromise formula which will leave the matter open for later discussion.
7. Minister for Foreign Affairs agreed to clause 2.
8. As regards clause 3 Minister for Foreign Affairs said that our draft (of agreed minutes) required methodical further studying as Chinese Government might wish to impose restrictions on foreigners for reasons of national security in peace time. I presume we cannot well object.
9. As regards clause 4, after some digression, Minister for Foreign Affairs intimated that, while accepting the principle, Chinese Government considered it unnecessary to include the matter in exchange of notes. He will have our draft studied. I think we may have to accept a simple statement of principle in accordance with international practice. I thought it better not to raise the question of assurances regarding court procedure from 1931 mandate at this interview.
10.
As regards clause 5 right to acquire real property, Minister for Foreign Affairs was strongly averse to raising the matter and urged that it be reserved for later treaty negotiations. I was able, however, to make some impression by the argument that with abolition of treaty ports we should be worse off than Powers with declarations attached to treaties of 1928 and I pressed reciprocal rights to acquire real property subject to laws and regulations of the country and on terms no less favourable than those accorded to Nationals of other countries. I mentioned possibility of reservations in the case of India and Burna. Unless instructed to the contrary I shall continue at next interview (which is not yet fixed) on the above lines.
11. Other points discussed are covered for the purposes of record in minutes by me which will follow by next air bag.
O.T.P.