The creation of new political units in the peninsula122.In British policy elsewhere in the Malay world are the sphere of influence concept remained a cornerstone of diplomacy, serving to limit the commercial or political ambitions of rival powers but avoiding the expense of establishing further outpost of empire.The making of British Malaya, 1874-1919157.The significant of the Pangkor Treaty lies in the fact that it represented a turning point in the formal relationship between British and the Malaya States. Governor Clarke, signing of the Pangkor Treaty January 1874.158.Beginning of 1875, the 1st steps had thus began taken in the development of what came to be called the residential system. It is striking how ill-prepared the British were for the role they had aasumed.To them, the way in which Malay culture was intertwined with its politics was a continual puzzle. As one exasperated official in London sighed in 1878, Malay modes of election, Malay customs as to inheritance and realationship and purity of blood etc. are incomprehensible to us Gullick, the tampin succession, JMBRAS,49,2 1976 p.3172.The cornerstone of the Residential system was the concept of indirect rule, vigorously enunciated by Frank Swettenham in 1876 :

SADKA, the protected malay states 1874-1895, DS596.3 S2To preserve the accepted customs and traditions of the country, to enlist the sympathies and interests of the people in our assistance and to teach them the advantages of good government and enlightened policy -