This Document is the Property of He Dellannin Meloe
OPIUM.
CONFIDENTIAL.
[10668]
No. 1.
March 22.]
SECTION 2,
63
Peking, March 22, 1911.
Sir J. Jordan to Sir Edward Grey.~(Received March 22.) (No. 80.) (Telegraphic.) R.
OPIUM. Following is roughly present state of negotiations: Chinese Government agree to accept in substance proposals contained in clause 1 (d), (e), and (f) of memorandum of the 1st November, as modified in my despatch No. 441 of the 6th November, regarding removal of restrictions and taxation on wholesale trade, provided that we agree, on our part, to insertion of a clause giving them free hand to regulate smoking of opium and retail trade in drug.
The latter concession seems unexceptionable, and has always been granted in practice.
Chinese Government are, I think, willing to accept 330 taels as increased consoli- dated duty, and will [group omitted: ? propose] equivalent excise tax calculated on ad valorem basis on native opium. They propose that increase of duty should take effect from date of withdrawal of restrictions. The two crucial difficulties are (1) pro- hibition by provinces, (2) existing stocks at treaty ports.
As regards (1), they consider that our proposal that Indian opium shall not be conveyed under transit pass into any province which has suppressed cultivation and import of native opium as insufficient to meet provincial agitation. They demand not only stoppage of transit pass trade to such a province, but cessation of Indian import into any treaty port in such a province. They would, however, except Canton and Shanghai as two largest distributing centres.
2. Chinese Government persist in refusal to admit 18,000 chests in stock in addition to fixed amount of 30,600 chests. They are, they say, negotiating for progressive decrease, and not increase, and insistence on this point will, they [group undecypherable] insinuate, wreck whole agreement.
After repeated pressure Chinese delegate to-day offered to admit 5,000 chests to make up shortage in last year's authorised import.
Would Indian Government agree to reduce remaining 13,000 chests spread over next three years [group undecypherable] imports if China admits the whole 18,000 chests? Unless some such concession is made I see no hope of agreement.
Above results, meagre and unsatisfactory as they are, have only been obtained after endless discussion.
It would be quite useless to put forward proposals contained in Indian Government's telegram of the 17th March.
(Repeated to India.)
[1930 y--2]
May
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