EXTRA EXPENDITURE, HOW IT MAY BE MET. 63

course of events, if not of the policy of cabinets. Understandings as to objects to be pursued may be valuable, but men are apt to ask what specific thing do you propose to do? Fortunately the question, in this instance, admits of a complete answer. The answer which can be given is, that the British should join the French Government, in guaranteeing the expenditure which may be requisite beyond the funds available to the Company out of their own resources, the French Government expressing their readiness to join in giving guarantees in aid of other works intended to improve the means of communication in the countries lying between the Mediterranean and India, on an agreement being arrived at in each particular instance, between the Cabinets of St. James's and of the Tuileries. An extra expenditure beyond the funds available to the Company out of their own resources in the case of the Suez Canal, is supposed by some to be likely to amount to 6,000,000l., but probably it would not be so much. The total probable outlay on the Canal from first to last has been estimated at

10,000,000l. A good deal has been already ex

pended, and a large sum may be looked on as being now either in hand or ready to be paid on being called for.

There may be considered to be at present a revenue payable to the Company from the employment of their fleet of lighters. When the Canal is opened for ships drawing twenty-five feet depth of water, there will, without doubt, be a very large revenue from the tolls, as well as from the vessels which the Company may themselves employ. Independently of any question as to present revenue, the Company might legitimately borrow money and pay interest as our Indian railways do out of a Government guarantee, until they can earn enough to meet the full amount out of their yearly revenues on their completion. If we are of opinion that it is equally legitimate for our Government to guarantee a loan to the requisite extent, along with the French, as it was for our Indian authorities some years since to give guarantees for public works to the extent of between 50,000,000l. and 60,000,000l., there can be no

FRENCH INTERESTS IN THE CANAL.

65

further difficulty about the matter. The fact is that, in all probability, the French and British Governments never could be called on to pay anything whatever, as there would be a revenue arising from the Canal, applicable to paying the yearly interest on the money lent.

We gave a guarantee to the Red Sea Telegraph Company, but after all it would, to some extent, be a novel proceeding to guarantee a line of canal running through a foreign country. The circumstances, however, are novel, and it has simply to be considered whether it is worth while for civilised nations to apply their resources in this manner; and whether, if it is worth while, we ought to take a part in the proceedings adopted, proportionate, or in some degree proportionate, to the magnitude of our interests involved, or whether we shall leave to others the completion of the Canal, as we have left its commencement.

The French Government deem their interests to be involved in the making of the Canal, just as if it passed through French territory, and will not let it fail for want of funds. In

fact it is plain enough that the French Government cannot do better than follow the example we held forth to the world as to what may be brought about, by guaranteeing public works in India. We are bound, therefore, seriously to consider, whether the circumstance of this Canal not being in our territory constitutes an objection against giving a guarantee jointly with France.

If we were to co-operate with the French Government with regard to the Suez Canal, it might be proposed to them to join us in guaranteeing the Company formed for constructing the Euphrates Railway, from the Mediterranean coast to the Persian Gulf. This line would cost, it is estimated, 8,000,000l. Probably 10,000,000l. would be more nearly the sum, by reason of the rise in the wages of labour, and other circumstances. The construction of this line has been thought, rather erroneously, a matter of paramount moment to our Indian interests, because of the Suez Canal being likely to be chiefly in French hands; but every confidence may at all events be

SULTAN'S GUARANTEE CAN BE GUARANTEED. 67

entertained, that the opening of the Euphrates line would be most useful and convenient; as also that it would afford a security against contingencies which might arise in the event of our being too dependent on the transit through Egypt, if Egypt were to be in the hands of a hostile power. No grave practical difficulty in arranging the details of a guarantee could well occur, for the Sultan is or was ready to give his guarantee, and all that need be done is to guarantee his guarantee, leaving the funds for paying the dividends on the shares and debentures to be supplied from the first, as was some time since arranged between the Turkish authorities and the Company formed to execute the works. The reason why the works are not likely to be executed, if some such course is not adopted, is, that the willingness to pledge the national Turkish credit to the extent to which it was proposed to be pledged has not, up to the present moment, caused the necessary capital to be forthcoming. Two details in the terms originally agreed on between the Sultan and the Company