The Government of India concurred in this view, and thought that the annual payment by Tibetans in Tibet, even though China should provide the money, would be preferable from the point of view of local political effect, to payment of a lump sum by China direct. The course, therefore, which was preferred was, that a notification should first be made by them to the Tibetans under Article VI. of the Convention, to the effect that we desired payment at Gyantse of the first instalment; and that His Majesty’s Minister at Peking should then inform the Chinese Government that His Majesty’s Government could not recognize the right of intervention on their part, as they had not adhered to the Convention.
A notification was accordingly given to the Tibetan Government that Rs. 100,000, the first instalment of the indemnity, was due on January 1, 1906, and should be paid at Gyantse. They replied in January, 1906, that the revenue of Tibet was not great, and that the Chinese Resident had stated that the payment of the indemnity was to be the subject of discussion with China, in which Tang at Calcutta was to act. Thus, said the Government of India, as a result of the action of the Chinese, the Treaty had been broken by the Tibetans, for no payment of the indemnity had been made on the date fixed. They proposed, therefore, to inform the Tibetan Government that they held them responsible for the payment of the indemnity under the terms of the Treaty.
Mr. Morley, who had succeeded Mr. Brodrick, approved of the proposal, but added that this would not preclude our accepting payment eventually from the Chinese Government if agreement with them as to the Tibet Convention should be arrived at; and in a later telegram he said that “direct payment by China could not be refused by us after the Adhesion Convention had been concluded.”
The principle that the Chinese should pay instead of the Tibetans was therefore practically conceded. But another point arose. The Chinese had said they wished to pay the amount of 25 lakhs of rupees (Rs. 25,00,000) in three annual instalments, but by the Treaty the payment was to be paid in annual instalments of 1 lakh each. The suggestion that the whole indemnity should be paid in three instalments the Government of India thought a Chinese device, having for its object the weakening of our position in Tibet. The Treaty obligation was clear. And the Indian Government preferred, as requested by the Tibetans themselves at the time of signing the Treaty, to receive annual payments of 1 lakh each at Gyantse, both for political effect and because money was required for recurring rent expenditure there.
Mr. Morley felt much hesitation in accepting the views of the Government of India on this point. While recognizing that certain advantages had been supposed by some to arise from the political point of view in maintaining our hold over the Tibetans for the full period of twenty-five years, he was of opinion that such advantages would be altogether outweighed by our relief from the necessity of enforcing a direct annual tribute for so long a period.
Shortly after, on April 27, the Chinese signed the Convention which has been described at the beginning of this Chapter, and the Chinese Government were informed that we agreed to accept the offer to pay the whole of the indemnity in three instalments, and that the first instalment would be accepted from the Sha-pé either by cheque, handed to the British Commercial Agent at Gyantse, or by cheque to the Government of India, drawn on the Hong Kong and Shanghai Bank.
The Chinese had made good their first point, and we had receded from yet another stage which we had reached in 1904. Their next point had now to be made—to get us to accept payment in India instead of in Tibet. The Tibetan Sha-pé being in Calcutta at the time, we did not raise any difficulty about accepting payment of the first instalment there. But when the question of the payment of the second instalment arose, the Government of India pointed out that under the Treaty it should be paid at such place as the British Government might indicate, whether in Tibet or in the British districts of Darjiling or Jalpaiguri. Permission had been given to pay the first instalment at Calcutta, as the Tibetan Councillor happened to be there at the time, but the Government of India wished that the second instalment should be handed over by a Tibetan official to our Trade Agent at Gyantse. But the Secretary of State telegraphed that it would be in accordance with the present policy of His Majesty’s Government to acquiesce in the wish of the Chinese Government, and payment by telegraphic transfer was agreed to. The third instalment was also received in Calcutta. So the Chinese obtained their second point also.
The third point which they tried to make in their policy of excluding the Tibetans, was to get us to receive the indemnity direct from them instead of from the Tibetans. They suggested that they should pay the second instalment “by telegraphic transfer without the intervention of the Tibetans.” But the Government of India recommended that deviation from the procedure laid down in the Treaty should not be permitted, as their proposal seemed to them a further indication of the Chinese desire to exclude the Tibetans from relations with us.
His Majesty’s Government, however, considered that the formality of payment through a Tibetan representative was “a comparatively immaterial point,” and that if China was to make further pretensions we should not be prejudiced by the concession.
Later on, however, as the Chinese had been obstructive in other matters, and the second instalment had not yet been paid, both Mr. Morley and Sir Edward Grey adopted the proposal of the Government of India that payment to the Trade Agent through a Tibetan official at Gyantse should be required, and arrangements recently conceded by His Majesty’s Government for payment direct by the Chinese should be cancelled. But this was not eventually insisted on, and payments were received by the Government of India through the Hong Kong and Shanghai Bank.