CO129-373 - Public Offices - 1910 — Page 121

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and that, although a tendency towards improvement in the goods traffic is recognised, the above figures prove conclusively that some substantial obstacle still prevents the public from utilising the railway for the carriage of merchandise to any large extent. The inability of the railway to compete with the water-borne traffic is attributed Such merchandise as is to the heavier incidence of li-kin on rail-borne goods. brought to the railway for transportation pays transit dues or li-kin according to the tariff published last year. On the other hand, it is asserted that merchants are able to obtain substantial reductions of the dues laid down by regulation when they use the waterways, Rail-borne merchandise is thus penalised, and the results of the year's working show that the arrangements made in February 1909 have had little or no beneficial effect. In other words, it has been proved, after a year's trial, that not only are the dues levied on rail-borne goods not less than those on water-borne goods, but that in practice they are actually greater.

I feel sure that the Chinese Government will recognise that, in justice to the railway, a remedy for this unfair discrimination should be found, and I accordingly have the honour to recall your Highness's attention to the proposal which was originally suggested, namely, that all passes covering goods in transit, whether by rail or water, should be made identic and interchangeable. It seems clear that such a measure would not affect the provincial revenue returns, and I trust that the Chinese Government will take this proposal into their serious consideration, and will delay no longer in giving it a trial.

I avail, &c.

W. G. MAX MÜLLER.

[This Document is the Property of His Britannic Majesty's Government.]

CHINA RAILWAYS.

CONFIDENTIAL.

[30179]

(No. 316.) Sir,

No. 1.

Sir Edward Grey to Mr. Maa Müller.

CO 30221

Reg 3 OCT 10)

[August 27.]

SECTION 1.

Foreign Office, August 27, 1910. I REFERRED your telegram No. 124 of the 22nd ultimo, in regard to the Bhamo-Tengyuch Railway, to the India Office for their observations, and am now in receipt of their reply, a copy of which I enclose herewith.*

Lord Morley observes that the scheme contemplated was that indicated in the letter from the India Office of the 6th August, 1908, the substance of which was communicated to you in my telegram No. 108 of the 11th August of that year. He would, however, have no objection to an arrangement under which each Government would construct the portion in its own territory, provided that the construction of the line is actually undertaken within a reasonable time; but he cannot agree that the Chinese section of the line shall be constructed by the Chinese Government with funds to be supplied by the Indian Government, as is contemplated in the arrangement explained in your telegram above referred to.

He is of opinion that if the Chinese Government is unable itself to construct the Chinese portion of the line within a reasonable period, it should be pressed to give a concession to a company to carry out the work.

I request that you will inform the Chinese Government accordingly, and, if necessary, press them to give a concession to a company for the construction of the Chinese section of the line in accordance with Lord Morley's suggestion.

I am, &c.

• India Office, August 18, 1910.

[2875 dd--1]

E. GREY.

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