CO129-330 - Public Offices - 1905 — Page 342

335

Sir,

4

Inclosure 5 in No. 1.

Government of Burmah to Government of India.

Rangoon, June 29, 1904. I AM directed to acknowledge the receipt of your letter dated the 16th March, 1904, in which the Government of India commend to the consideration of the Lieutenant- Governor the question of a light railway frou Bhamo to Têngyüeh (Mumein) and ask for a further report on the proposal.

In the

2. As bearing upon this subject, I am to forward copies of inclosed papers. first of these papers Mr. Litton, His Majesty's Consul for Têngyüeh, argues very strongly in favour of a railway line from Bhamo to Têngylteh; in the second, Mr. Wilkinson, His Majesty's Consul-General for Yunnan, gives his reasons for advising that we should prefer to concentrate our energies on the continuation of the Mandalay-Lashio line via Kunlong to Talifu; and in the third paper, which was compiled under the orders of the Lieutenant-Governor in November last, before the other two papers were written, Mr. Warry, Adviser on Chinese Affairs to the Burmah Government, reviews the history of the surveys that have been undertaken for the purpose of railway extension from Burmah into Yunnan. Although in the reference under reply the Lieutenant-Governor's opinion is asked on the question of the Têngyüeh Railway only, it will be obvious from these papers that it will not be possible to deal satisfactorily with that question without a simultaneous consideration of the larger alternative also. The two initial propositions that may be regarded as established by these papers are, (i) that the line from Bhamo to Têngyüch (with a possible extension to Yungchang) will be a local line only, and that it could not be carried beyond Têngyüeh or Yungchang except at prohibitive cost; and (ii) that the only practicable line that has so far been discovered for a through line from Burmal to China is from Kunlong up the Namting Valley and by Yunchou to Talifu, whence the line could be extended to Yünnan, or preferably and more profitably to Szechuan. The Lieutenant-Governor proposes to address himself in the first place to the consideration of the question whether the remote possibility of the construction of the latter line should influence in any way the decision as to the need for, and the usefulness ol, the former,

3. As the Bbamo-Têngyüeh line is admittedly a local one, and as at least half the trade, which would use this railway, comes from Hsia Kuan, the commercial emporium at the southern end of the Tali Lake, it would appear at first sight that Mr. Wilkinson is justified in urging that we should not dissipate our energies by building a railway from Bbanio to Têugyüeh, but should seek first to complete the iine from Lashio to Kunlong, and to continue it to Talifu and thence to Yunnan-fu or to Szechuan. Such a line would obviously dominate and partially supersede the Têngyüeh line, and would deprive it of half its usefulness. But the value of this argument depends cutirely upon the degree of the probability that, within any reasonable distance of time, the Talifu line will be cou- structed. If it is found that this line is too large, and too expensive, and too difficult a scheme for any prudent Company to undertake, the argument falls to the ground, and the important question to answer is whether such a live is financially practicable, and within a measurable distance of construction in the near future. After a careful exami- nation of all the papers, in which he has been assisted by personal discussion with Mr. Litton, Sir Hugh Barnes has arrived at the conclusion that this question must be answered in the negative. A line from Kunlong to Talifu being a trunk line, and a continuation of the Burmah railways, would have to be built on the mètre gauge, which is the standard gauge in Burmah. The distance for a railway from Lashio to Talifu would scarcely be less than 500 miles, and the cost, judging from the expenditure on the Mandalay- Lashio line, would certainly be at least 10 crores of rupees, or 7,500,0001, a sum that, according to Mr. Litton, amounts to about three times the total annual value of the whole external trade of Yunnan, including opium. Until the line reaches the neighbow- hood of Tali it would pass through a very barren and sparsely inhabited part of Yunnan. There would therefore be little local traffic. The trade available at Heia Kuan alone would be insufficient to make so long and expensive a railway pay, and an extension of the line into the heart of Szechuan could only be achieved at enormous cost. Considering the difficulty which, the Lieutenant-Governor understands, has been experienced in raising money to work concessions for such very promising railways as Shanghai to Nauking and Hong Kong to Canton, it is in the highest degree improbable that British capital would be forthcoming for a line with such doubtful prospects as that to Talifu, and

5

taking all the circumstances into consideration, the Lieutenant-Governor is constrained to agree with the view stated by the Government of India in their despatch dated the 21st August, 1902, that for the present this line is outside the pale of practical politics. It follows that to postpone for it the proposed line from Bhamo to Têngyüel would be to postpone the latter indefinitely.

4. On the other hand, the line from Bhamo to Têngyüeh, being a local line, might reasonably be constructed on the 2 ft. 6 in. gauge, and would therefore be comparatively cheap. As the line is not a very long one, the amount of capital to be raised would also be within manageable limits. There is already a considerable trade by this route, which a railway might reasonably be expected to increase, and if Mr. Litton's estimates are correct, the line would serve a population, including the Yungchang Valley, of some 500,000 souls. There would, therefore, of a certainty be considerable local as well as through traffic. There is also the obvious fact that the construction of a railway to Têngyüeh would establish British influence unassailably throughout West Yünnan, and could scarcely fail to secure to us the whole of the existing trade, and probably most of its future developments. Mr. Litton, it will be seen, goes further, and maintains that this line would be commercially a complete answer not only to a French railway to Mengtse, but even to a French railway to Yunnan-fu itself. His argument, which appears to the Lieutenant-Governor to be quite sound, is this: Hsia Kuan, on the Tali Lake, which is the meeting point of the great trade routes to Thibet, Szechuan, the Yangtse, Yunnan-fu, and Burmal, is the true commercial capital of Yunnan. In this view, it will be seen, Mr. Wilkinson agrees. At present the foreign trade of Hsia Kuan is mainly with Burmah through Têugyüeh, because Burmah and the Irrawaddy are at present the nearest and easiest channels of communication with the outer world. But this trade will be inevitably diverted to Yunnan-fu if the French railway reaches that city, and if nothing is done on our side to counteract its attraction. On the other hand, Hsia Kuan is approximately midway between Bhamo and Yunnan-fu, and it follows that if a railway is made to Têngyueh the route through British territory must retain its superiority, since Têngy üch is nearer to Hsia Kuan than to Yünnan-fu. Moreover, if our railway reaches Têngyüch first, as it should be possible easily with energy to arrange, and if we also improve the road beyond, we shall probably succeed for all time in retaining the whole of the trade of West Yünnan. For these reasons, and for the reasons that are urged in the third para- graph of the Secretary of State's despatch, dated the 18th December, 1903, namely, that in the interests of Burmab, whether commercial or political, it is imperative to forestall the loss and injury that otherwise will certainly result from the completion of the French railway to Yunnan-fu, the Lieutenant-Governor is in favour of the completion of a railway from Bhamo to Têngyüeh as soon as possible, if it is found practicable on further examination to construct it at a reasonable cost. So far as our information goes at present these are grounds for believing that this line can undoubtedly be made without much difficulty, and that it will, in comparison with any other line, be cheap. Mr. Litton's estimates are correct its prospects are not unpromising, and it will certainly place us on more than an equality with the French in the struggle for the trade of the most important commercial town in Yünnan.

If

5. In the next place it is necessary to deal with the line from Bhamo to Têngyüeh on narrower and more technical grounds, and to clear the way it may be stated at the outset that, in the Lieutenant-Governor's opinion, it is not necessary to the commercial value of this line that it should be connected with the Burmah railways at Katha, which is situated 80 miles from Bhamo down the Irrawaddy and on the opposite bank. Such an extension would be very difficult and costly, and it is not needed, since the Irrawaddy Flotilla Company's steamers could deal without difficulty with all the trade which the railway may bring to Bhamo. It may also be pointed out with reference to paragraph 4 of the Secretary of State's despatch, dated the 13th December, 1903, that there is no cart-road from Bhamo to Têngyüeh on which a railway could be constructed, nor any present intention of making one. The existing state of the road is described in the correspondence ending with this Government's letter, dated the 16th instant, to the Foreign Department of the Government of India. There is a cart-road for 17 miles from Bhamo, and thence a good mule road to the frontier at Kulikha. This mule road has lately been pushed on by arrangement with the Chinese through the Taiping Gorge to Mansien, a village opposite Manwyne, and it is under consideration whether the Chinese should not be asked to allow us to complete a similar road to Têngyüeh. The proposed railway to Têngyüeh will, therefore, not be helped by the existing road except so far as the road will be useful as a service road during railway construction.

6. On the other hand, a further investigation of the country to be traversed by the line to Têngyüeh has shown that the line will certainly be much longer and more

[1802 e-2]

C