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 30. The following are some of the points which would be for inquiry and discussion: —

31. First.—The principle to be followed in testing the rate of export duty in Western India, or in its periodical adjustment. If Chinese prices be adopted as the basis, then the means for gaining prompt and faithful returns of prices current in the several China markets would come under consideration.

32. Second.—Whether the same system might not be introduced into the Bengal Presidency. It might be tried first experimentally in the Benares Agency, including the opium districts of the NorthWestern Provinces and Oudh. Probably some Calcutta firm would take over the buildings and stock at Ghazeepore, when the purchase, manufacture, and export of the drug were thrown open.

33. Third.—The probable financial effect of such a trial; and further what would be the probable financial result if the same system were extended eventually in entire substitution for the Bengal monopoly. Taking the figures in the margin, the present annual export from all India may be set down at 83,000 chests; and this amount, judging by previous experience, will no doubt steadily expand. A duty, then, of Rs. 700 per chest all round would yield close on six millions sterling. The present gross revenue from opium may perhaps be put down at eight and a half millions, with costs of nearly two millions, leaving to Government something above six and a half millions. But the Financial Secretary informs me that the average for the last five years is only seven millions and a quarter gross, or under five and a half millions net; being less than the income under a general duty of Rs. 700 per chest. A duty of Rs. 700 has already been borne by Bombay, and might perhaps be reverted to without risk, if there were no disturbing action on the part of Bengal; but it is a question whether, under the present system, we could go higher. If, however, on the abolition of the monopoly, Bengal could bear a higher rate, then of course Bombay and Malwa would have no ground to complain if the same rate were applied to Western India.

34. By imposing a uniform duty for the whole of India, the Government would probably have the Chinese market far more under its command than at present by the double system of a pass duty and a monopoly. The pass duty for all India would regulate the prices which the Chinese will always be prepared to give for a commodity they cannot do without, and which practically India alone can supply.

35. In elucidation of the proper rate of duty, the Commission might inquire into the actual cost of production in Malwa and Ahmedabad, and give an opinion on the margin of profit necessary to prevent, in the fluctuations of the market, any serious check to the trade. Although the Native States are said by the Governor General's Agent not to have increased their direct dues on opium, I apprehend that they may have profited their revenues largely in