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(4) Private schools are being gradually brought under Government control. (5) Mass education of adults is also being attempted with encouraging results
so far as literacy is concerned.
(6) The salary of teachers is being raised to give a better inducement to persons to become teachers. In the last two years salaries have gone up by 50 per cent.
(7) There has been a very great increase in primary schools, which are now said to number 3,000 in all, and also in middle and normal schools. There is a college in Urumchi which is being extended and which it is hoped will one day become a university for the province. 153. Rather unexpectedly none, or practically none, of the Sinkiangese go to universities outside Sinkiang, either in China, Russia or elsewhere. I could find no trace of returned students from Russian universities. The probable reason for this is the poverty of the people and the province. Undoubtedly one of the great requirements of Sinkiang is a more highly educated population, especially in various technical spheres, if they are to carry through their own development. I think that very good service could be done to the improve- ment of Indian-Sinkiangese relations if some arrangement could be come to with the Indian Government to provide free university education for a limited number of selected Sinkiangese each year. I am sure that the small expense entailed would be well repaid by the closer and more friendly trade and political relations in the future. This is, moreover, the one way in which it might be possible at present to improve British relations and influence in that area. cannot, of course, say whether the Governor would fall in with such a plan, but the proposal should, I think, be made.
Agriculture.
154. An attempt is being to improve the technique of agriculture and there are a number of agricultural institutions in the province. We were entertained at the one in Tulufan and saw and talked to the director, a young Sinkiangese. The farmers, who were at first hostile and unresponsive, are now enthusiastic about the work and are urging the Government to increase it. The following measures have been taken to encourage and help agriculture :-
(1) The Commercial Bank has granted rural credits of 470,000 dollars in 1939, with a special addition of 14,000 dollars for animal husbandry together with a non-interest-bearing credit of 60.000 dollars.
(2) Certain special taxes have been abolished:-
(a) The slaughter tax.
(b) The travelling merchant's permit tax.
(e) Land taxes in special districts suffering from flood or drought.
(d) Surtax on grass which was attached traditionally to land tax. (e) All other special, extra or surtaxes on land.
(3) Agricultural implements have been imported from Russia, such as harrows, ploughs, &c., and these are hired out to farmers at almost nominal sums. The farmers are now for the first time commencing to buy these. At present about 10,000 such implements are being used in the province.
(4) Cotton seeds and silk-worms have been very widely distributed in large quantities to improve the quality of production. Experiments are being carried out in Tulufan and Shan Shan districts with American cotton. Already some small export of cotton and silk has started, which is a new feature.
(5) Irrigation has been extended, especially in the Ili district, where a canal has been built extending from Bajen Tai to Wei Yuan. This is an old canal, but it had never been operated successfully until recon- structed. The underground irrigation which was first installed by General Ling at Tulufan, 100 years ago, is now also largely used at Hami. This system enables Tulufan, where there is practically no rainfall, to be one of the finest fruit-producing centres in China. (6) The tax on covered mangers for animals has been abolished, and the storage of grass for winter has been encouraged so as to obviate the very serious loss of stock which takes place each winter.
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(7) Attempts are being made to improve the local breeds of cattle, sheep and horses, very largely by local selection, though some stallions have been imported.
(8) Cattle plague, which is a very serious factor in the province, has been tackled and veterinary stations have been set up in various districts. (9) An agricultural training school has been set up in Urumchi with a three-year course in animal husbandry, veterinary science and irri- gation. There are at present some eighty students. In addition, a number of short courses in animal husbandry are given in various centres, lasting a month, the aim of which is to give the farmers and herdsmen some sense of the principles of this science.
155. In addition to the above reforms, a reform of finance and currency has been carried through. In 1938 the Commercial Bank was reorganised as a mixed bank, under the name of the Sinkiang Commercial Bank, with a capital partly private and partly held by the Provincial Government. During the first nine months of 1939 a credit of 17,872,500 dollars was granted to the bank to meet the requirements of commercial and agricultural capitalisation. The reorganisation was financed partly by the Government and partly from the loan raised by the Government from Russia of 5 million roubles, the balance of the loan being used for road construction. The Sinkiang Commercial Bank issues its own notes, but mostly in smaller denominations. The old provincial notes and the so-called Har notes (ie., the notes issued in the district of Harshieh), which were in circulation on the basis of the Liang, have practically all been exchanged into dollars, and as at the end of last year all such notes were declared annulled and of no value.
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156. So far as public health is concerned, some attempt has been made to deal with this by hospital construction and dispensaries. Since the April revolution, hospitals have been established in Urumchi, Ili, Kashgar, Aokashu, Hami, Aoshan, Taichen and Khotan respectively. Two dispensaries have been established, one in Woo-shu and one in Tulufan. In addition, there are two pharmacies in Urumchi and Ili. All hospital services, with the exception of the provision of medicines, are free of charge. In the Urumchi hospital there are 170 beds and in each of the others thirty only. An attempt is being made to establish further dispensaries in other districts. The total expenditure on these health services in 1939 was 415,660 dollars. Three further pharmacies are to be established this year in Aoshan, Kashgar and Aokashu, All the skilled staff are Russian, but an effort is being made to train assistants on an apprenticeship system in the hospitals and pharmacies.
157.
Industrial development is practically non-existent except for electric generating stations on a very small scale in one or two places and, what is perhaps more important, the development of an oil-field to the north-west of Urumchi. I was told by a prominent Chinese friend in Chungking that he had been reliably informed by the officials in Moscow last July that over 400 tons of machinery had already been sent up for the refinery. There was no evidence that it was yet in operation, but I think there is no doubt that a large refinery will be erected before long. There is undoubtedly considerable mineral wealth, but none of it is being worked with the exception of coal, which is being mined by the old-fashioned methods, and a small amount of gold by panning. Some jade is also found in the province.
Gold and jade may not be exported from the province at all. The former is being collected as a backing for currency, and the latter is prized as valuable and so may not be bought and taken out of the province.
158. The second three-year plan is designed to continue the parallel extension of all development and to initiate the construction of some light industries in the main centres. As in the case of agricultural development, this is all to be financed from the provincial resources, as the Governor will not consent to borrowing from outside Sinkiang. The whole development is in the hands of the Government, and all industries will be Government-owned and controlled. It is the intention of the Governor to sacrifice speed of development to the certainty that there will be no exploitation from outside of the province's
resources.
159. To sum up my view of the situation, which is based partly upon ascertained facts and observation and partly upon impressions gained-the Governor is an independent autocrat with the most friendly relations with Russia
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