PUBLIC RECORD OFFICE
Reference -
C.O. 885
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-
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5 PUBLIC RECORD OFFICE, LONDON
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The maintenance of the alternative line for use during failures of the Madras-Penang cable is absolutely essential, and in its capacity as an alternative line it brings in no additional revenue whatever. Its maintenance simply represents an insurance expen- diture, and if the transit rate accepted for the use of the original short line only were extended to the alternative line, the Indian Government would receive no return what ever for the vastly increased expenditure entailed by the altered proportions of services rendered.
7. Further, the Company having the entire control of the westward traffic has the power of diverting the whole of that traffic to the original southern route, and if the Indian transit rate were enhanced on the alternative route, there is no doubt that the westward traffic would be so diverted, the enhanced transit rate would only be levinblo during interruptions of the other cable, while no reduction could be made in the cost of maintaining it in a thoroughly efficient state.
8. On the other hand, the enhancement of the transit rate on the alternative line would unfairly weight the traffic sorved by the new International line from Siam and by any extensions that may in the future be developed in that direction. The Com- pany's object naturally is to secure as large a share of the total traffic as possible, and from their point of view the adoption of differential rates is manifestly desirable; but we are bound to consider the question from a broader standpoint, and, while we fully recognise the claim which an undertaking like that of the Eastern Extension Company has to generous treatment, it is our duty to safeguard our communications in all direc- tions and to prevent any one route being starved to the undue advantage of another. We have no hesitation in maintaining that our treatment of the Company in the past has been liberal in the extreme, and we have no desire to treat it otherwise than liberally in the future.
It will, we trust, be clear from what we have written that the adoption of differen- tial transit rates is out of the question, even if we had only to consider the claims of the Eastern Extension Company: but beyond this we have transit traffic from the Indo-European lines' and from Siam to deal with; our international transit routes vary from about 300 to about 3,000 miles in length; if the principle of differential rates were once admitted, we should be compelled to extend them to all, and we should have no less than seven distinct transit rates resulting in a complication of the tariff to an extent that would be intolerable.
9. It remains now to consider whether the uniform rate at present in force is or is not equitable. It is asserted by the Australian Governments that the Indiau transit rate is excessive (1) in equity, and (2) in policy, and the assertion is supported by a comparison between the Indian transit rates and the rates charged in India for inland messages.
10. To deal with the first point. we think that we can satisfy your Lordship that the Indian transit rate is moderate in equity-(1) in regard to the work done. (2) in regard to the rates charged by the Eastern Extension Company, and (3) in regard to the inland message rates in India. As to the first point, we invite your Lordship's attention to our Despatch, dated 21st July 1876, in which, while offering the rate of 75 contimes, which was accepted and is still in force, we showed that we might fairly have claimed 1 franc. As to the second point, it must be remembered that in addition to the alternative line to Rangoon on the east, we have to maintain alternative lines to Karachi on the west, to provide against interruption through failure of the Eastern Company's cables, and to serve the Indo-European route; we have therefore to maintain on account of this system the following lines of international wires:-
Miles.
Miles.
Bombay to Madras (mean distance of two routes) Karachi to Bombay
830
844
Total to serve the Madras-Penang cable Bombay to Elephant Point
1,674
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Allahabad to Karachi
2,516 1,188
3,704
5,378
Total to serve the Rangoon-Penang cable
Grand Total
12:3
exclusive of the Siam International line, which may be omitted for the purposes of the present calculation. The length of cables maintained by the Eastern Extension Com- pany in connexion with this service are-
Madras to Port Darwin Penang to Rangoon
Total
Miles.
4,000
900
4.900
11. It is impossible to make an exact comparison of the fair relative charge for the use of a cable system with that for the use of a land line system; but where the establish- ment and maintenance of land lines offer no particular difficulties and involve no unusual expenditure, one mile of cable has, we believe, hitherto been accepted as equal to three of land line in determining tariffs; in exceptional localities and tropical coun- tries like India these proportions are obviously too favourable to the cables. They may be accepted, however, for ordinary lines, but for those which are placed in aď- mittedly difficult parts of the country, such as from Calcutta to Rangoon, the charges should bear a proportion of not less than 2 for the land line to 3 for the cable. On this very liberal basis the rates charged should bear the proportions arrived at, as follows:-
Indian Land Lines.
Total length as in preceding paragraph Add for doubling the Calcutta-Rangoon line
Miles. 5,378 1,100
Total
6.478
Eastern Extension Company's Cables, Total length as in preceding paragraph Add for trebling the whole distance
Total
-
4,900 9.800
14.700
or as I to 2 nearly.
Even if we omit the lines maintained for the Indo-European Telegraph Company's service, which are an essential portion of the system, and take into account only the communications kept up for the Eastern Extension Company's traffic to Bombay, the proportions become 1 to rather less than 4.
12. The Indian rate is 75 centimes a word; 2 times this amount would be 169 francs; 4 times the Indian rate would be 3375 francs. The actual charge made by the Eastern Extension Company is 8-65 francs, including the terminal rate for Australia. What that terminal rate is we are not aware; it certainly ought not to exceed 1.65 franc, and this leaves the Company with a rate of 7 francs, or nearly ten times the rate charged by India, and yet the Indian rate is denounced as excessive.
13. We now turn to the comparison of our transit rate with our rates for inland messages. It is asserted that in comparison with our inland rates, our transit rate is excessive; even if this were so, the fact of our adopting an excessively low rate to encourage our own internal traffic and for the benefit of our own taxpayers would be no argument for claiming that the same benefits ought to be extended to outsiders; but we think we can convince your Lordship that it is not the case.
Transit messages
are treated with exceptional care, and the utmost possible speed is secured for them. An inland" urgent message approaches this class most nearly, and is charged for at the rate of four annas (=50 centimes) a word; but these inland telegrams consist almost entirely of words in plain English, while transit messages are almost invariably made of unconnected code words. It is estimated-and we do not think that any
up telegraph administration will dispute the estimate that it is at least four times as difficult to tranemit code messages as it is to transmit messages in plain language ; and if we charged in strict proportion to work done, a transit rate of 2:00 francs would more nearly correspond with an inland “ urgent" rate of 4 annas.
• The cost of the cable recently laid from Jask to Busbire was 1507, per mile. The average cost of first class iand line in India is about half that sum, and the maintenance expenditure is far greater in the latter.
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