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THE HONG KONG CONUNDRUM The peaceful surrender of Hong Kong to China on the midnight of 30 June 1997 after almost one hundred and fifty-six years of colonial rule was unique in the annals of history. Rarely before had one power surrendered a rich prize to another. The credit for finding a solution to the peaceful reunification of Hong Kong, a capital enclave, with mainland China, a socialist country, through the formula of ‘one country, two systems’ goes to Deng Xiaoping, China’s most pragmatic leader. Deng, however, breathed his last before Hong Kong’s merger with the mainland. The book attempts to encapsulate the history of Hong Kong ever since the territory was acquired by Great Britain through what the Chinese call ‘the unequal treaties’, the evolution of the colonial administration in Hong Kong, its emergence as a commercial centre and financial hub, the protracted Sino-British negotiation leading to the signing of the Joint Declaration and the Basic Law, the democracy debate in Hong Kong, the ethnic Indians in Hong Kong and the pangs of transition. Rup Narayan Das obtained Ph.D in Chinese studies from the School of International Studies, Jawaharlal Nehru University. Currently, he is a senior fellow of Indian Council of Social Science Research affiliated to the Indian Institute of Public Administration, New Delhi after his retirement from as joint secretary in the Lok Sabha secretariat of Indian Parliament in July 2019. His research papers have been published in journals like the Harvard Asia Quarterly, Global Asia, China Report, International Studies (Sage), Strategic Analyses and Journal of Defence Studies, China Brief of Jamestown Foundation, Washington, China-India Brief of Singapore National University. He is a columnist with Rediffnews and book reviewer with Business Standard. He has been awarded Taiwan Fellowship for the year 2022. THE HONG KONG CONUNDRUM Pangs of TransiTion RUP NARAYAN DAS KNOWLEDGE WORLD KW Publishers Pvt Ltd New Delhi iii First published 2023 by Routledge 4 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 605 Third Avenue, New York, NY 10158 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2023 KW Publishers The right of Rup Narayan Das to be identiﬁed as author of this work has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identiﬁcation and explanation without intent to infringe. Print edition not for sale in South Asia (India, Sri Lanka, Nepal, Bangladesh, Pakistan or Bhutan) British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library ISBN: 9781032429359 (hbk) ISBN: 9781032429366 (pbk) ISBN: 9781003364986 (ebk) DOI: 10.4324/9781003364986 Typeset in Sabon by KW Publishers, Delhi Dedicated to the memory of Professor Late Gargi Dutt and Late V.P. Dutt Contents Preface ix List of Abbreviations xiii 1. Opium Trade and Unequal Treaties: The Birth of Hong Kong 1 2. Evolution of Colonial Administration in Hong Kong 39 3. Rise of Hong Kong as a Commercial and Trading Centre 62 4. The Joint Declaration, Basic Law, and ‘One Country, Two Systems’ 85 5. Political Participation and Democratization 111 6. The Nationality Issue and Hong Kong Indians 136 7. Pangs of Transition 159 8. Congential Irreconliability 173 9. Postscript 184 Annexure I 188 Annexure II 193 THE HONG KONG CONUNDRUM: PaNGs Of TRaNsiTiON Annex I 193 Annex II 214 Annex III 217 Memoranda 221 Bibliography 224 viii Preface The peaceful surrender of Hong Kong to China on the midnight of 30 June 1997 after almost one hundred and fifty six years of colonial rule was a unique event in the annals of world history. Rarely before had one power surrendered a rich treasure to another. Even those who favoured the status had to admit that the hand over was a remarkable diplomatic achievement despite the challenges ahead. The credit for finding a solution to the peaceful reunification of Hong Kong, a capitalist enclave, with mainland China, a socialist country, through the formula of ‘one country, two systems’ goes to Deng Xiaoping, China’s most pragmatic leader. Deng, however, breathed his last before Hong Kong’s merger with the mainland. Thus, the future of Hong Kong under the People’s Republic of China had aroused considerable interest among Sinologists the world over. The hiatus between promises and performance of the system of ‘one country, two systems’, has been laid bare within less than past 25 years of Hong Kong’s reversion to China. The book attempts to focus attention on the viability of ‘one country, two systems’ within the contours and parameters of the Basic Law of Hong Kong and the constitution of the People’s Republic of China in the context of political and economic compulsions. The publication of the book coincide at a time when Hong Kong’s reversion to China completes 25 years on 1st July 2022, moving ix