BEIJING, China (CNN) -- James Miles, of The Economist, has just returned from Lhasa, Tibet. The following is a transcript of an interview he gave to CNN.

James Miles

Q. How easy was it for you to see what you wanted to see?

A. Well remarkably so, given that the authorities are normally extremely sensitive about the presence of foreign journalists when this kind of incident occurs. I was expecting all along that they were going to call me up and tell me to leave Lhasa immediately. I think what restrained them from doing that, one very important factor in this, was the thoughts of the Olympic Games that are going to be staged in Beijing in August. And they have been going out of their way to convince the rest of the world that China is opening up in advance of this. I think they probably didn't want me there but they knew that I was there with official permission, and one thing they've been trying to get across over the last few months is that journalists based in Beijing can now get around the country more freely than they could before. Of course Tibet is a special example. I've been a journalist in China now for 15 years altogether. This is the first time that I've ever got official approval to go to Tibet. And it's remarkable I think that they decided to let me stay there and probably they felt that it was a bit of a gamble. But as the protests went on I think they also probably felt that having me there would help to get across the scale of the ethnically-targeted violence that the Chinese themselves have also been trying to highlight.

Q. What you say you saw corroborates the official version. What exactly did you see?

A. What I saw was calculated targeted violence against an ethnic group, or I should say two ethnic groups, primarily ethnic Han Chinese living in Lhasa, but also members of the Muslim Hui minority in Lhasa. And the Huis in Lhasa control much of the meat industry in the city. Those two groups were singled out by ethnic Tibetans. They marked those businesses that they knew to be Tibetan owned with white traditional scarves. Those businesses were left intact. Almost every single other across a wide swathe of the city, not only in the old Tibetan quarter, but also beyond it in areas dominated by the ethnic Han Chinese. Almost every other business was either burned, looted, destroyed, smashed into, the property therein hauled out into the streets, piled up, burned. It was an extraordinary outpouring of ethnic violence of a most unpleasant nature to watch, which surprised some Tibetans watching it. So they themselves were taken aback at the extent of what they saw. And it was not just targeted against property either. Of course many ethnic Han Chinese and Huis fled as soon as this broke out. But those who were caught in the early stages of it were themselves targeted. Stones thrown at them. At one point, I saw them throwing stones at a boy of maybe around 10 years old perhaps cycling along the street. I in fact walked out in front of them and said stop. It was a remarkable explosion of simmering ethnic grievances in the city.

Q. Did you see other weapons?

A. I saw them carrying traditional Tibetan swords, I didn't actually see them getting them out and intimidating people with them. But clearly the purpose of carrying them was to scare people. And speaking later to ethnic Han Chinese, that was one point that they frequently drew attention to. That these people were armed and very intimidating.

Q. There was an official response to this. In some reporting, info coming from Tibetan exiles, there was keenness to report it as Tiananmen.

A. Well the Chinese response to this was very interesting. Because you would expect at the first sings of any unrest in Lhasa, which is a city on a knife-edge at the best of times. That the response would be immediate and decisive. That they would cordon off whatever section of the city involved, that they would grab the people involved in the unrest. In fact what we saw, and I was watching it at the earliest stages, was complete inaction on the part of the authorities. It seemed as if they were paralyzed by indecision over how to handle this. The rioting rapidly spread from Beijing Road, this main central thoroughfare of Lhasa, into the narrow alleyways of the old Tibetan quarter. But I didn't see any attempt in those early hours by the authorities to intervene. And I suspect again the Olympics were a factor there. That they were very worried that if they did move in decisively at that early stage of the unrest that bloodshed would ensue in their efforts to control it. And what they did instead was let the rioting run its course and it didn't really finish as far as I saw until the middle of the day on the following day on the Saturday, March the 15th. So in effect what they did was sacrifice the livelihoods of many, many ethnic Han Chinese in the city for the sake of letting the rioters vent their anger. And then being able to move in gradually with troops with rifles that they occasionally let off with single shots, apparently warning shots, in order to scare everybody back into their homes and put an end to this.

Q. Would be false to suggest there was heavy-handed security approach?

A. Well this was covering a vast area of the city and I was the only foreign journalist, at least accredited, to ... who was there to witness this. It was impossible to get a total picture. I did hear persistent rumors while I was there during this rioting of isolated clashes between the security forces and rioters. And rumors of occasional bloodshed involved in that. But I can do no more really on the basis of what I saw then say there was a probability that some ethnic Chinese were killed in this violence, and also a probability that some Tibetans, Tibetan rioters themselves were killed by members of the security forces. But it's impossible to get the kind of numbers or real first hand evidences necessary to back that up.

Q. Form any sense of where it would go from here?

A. Well I think they now have a huge problem on their hands. When I left Lhasa yesterday the city was still in a state of effectively Martial Law. They've been bending over backwards this time not to declare martial law as they did in 1989 after the last major outbreak of anti-Chinese unrest in Lhasa. This time they have not used that term and yet the conditions now in Lhasa are pretty much the same as they were in 1989 under martial law. Officials say there are no soldiers, no members of the People's Liberation Army involved in this security operation. And yet I saw numerous, many military vehicles, military looking vehicles with telltale license plates covered up or removed. And also many troops there whose uniforms were distinctly lacking in the usual insignia of either the police or the riot police. So my very, very strong suspicion is that the army is out there and is in control in Lhasa. And removing that security given the way Tibetans are now focusing on the Olympics as a window of opportunity, removing that security now I think would be something they would be very, very cautious about. And yet there are enormous pressures on them to do so. Coming up to the Olympic torch carrying ceremony in Lhasa in June. That is one obvious event they will want the world to see and they will want the world to see that Lhasa is normal. But I think getting to that stage will be enormously tricky given the depth of feeling in Lhasa itself among Tibetans.

Q. Did you actually see clashes between security forces and Tibetan protesters?

A. Well what I saw and at this stage, the situation around my hotel which was right in the middle of the old Tibetan quarter, was very tense indeed and quite dangerous so it was difficult for me to freely walk around the streets. But what I saw was small groups of Tibetans, and this was on the second day of the protests, throwing stones towards what I assumed to be, and they were slightly out of vision, members of the security forces. I would hear and indeed smell occasional volleys of Tear gas fired back. There clearly was a small scale clash going on between Tibetans and the security forces. But on the second day things had calmed down generally compared with the huge rioting that was going on...on the Friday. And the authorities were responding to these occasional clashes with Tibetans not by moving forward rapidly with either riot police and truncheons and shields, or indeed troops with rifles. But for a long time, just with occasional, with the very occasional round of tear gas, which would send and I could see this, people scattering back into these very, very, narrow and winding alleyways. What I did not hear was repeated bursts of machine gun fire, I didn't have that same sense of an all out onslaught of massive firepower that I sensed here in Beijing when I was covering the crushing of the Tiananmen Square protests in June, 1989. This was a very different kind of operation, a more calculated one, and I think the effort of the authorities this time was to let people let off steam before establishing a very strong presence with troops, with guns, every few yards, all across the Tibetan quarter. It was only when they felt safe I think that there would not be massive bloodshed, that they actually moved in with that decisive force.

Q. At time you left, were Han Chinese moving freely back?

A. There were some on the Saturday morning. On the second day we came back to the shops and I saw them picking through the wreckage, tears in their eyes. They were astonished, as I was, at the lack of any security presence on the previous day. It was only during the night at the end of the first day that this cordon was established around the old Tibetan quarter. But even within it, for several hours afterwards, people were still free to continue looting and setting fires, and the authorities were still standing back. And it was only as things fizzled out towards the middle of the second day that as I say they moved in in great numbers. Ethnic Chinese in Lhasa are now very worried people. Some who had been there for many, many years expressed to me their utter astonishment that this had happened. They had no sense of great ethnic tension being a part of life in Lhasa. Now numerous Hans that I spoke to say that they are so afraid they may leave the city, which may have very damaging consequences for Lhasa's economy, Tibet's economy. Of course one would expect that ethnic Chinese would think twice now about coming into Lhasa for tourism, and that's been a huge part of their economic growth recently. And leaving Lhasa, I was sitting on a plane next to some Chinese businessmen, they say that they would normally come in and out of Lhasa by train. But their fear now is that Tibetans will blow up the railway line. That it is now actually safer to fly out of Tibet than to go by railway. We have no evidence of Terrorist activity by Tibetans, no accusation of that nature so far. But that is a fear that's haunting some ethnic Han Chinese now.

Q. When you were told to leave, what were you told?

A. Well I had an 8-day permit to be in Lhasa. That permit began two days before the rioting, on March 12, and was due to run out on March 19. My official schedule was basically abandoned after a couple days of this. Many of the places on my official itinerary turned out to be hotspots in the middle of this unrest. They left me to my own devices. I was stopped by the police at one point, taken to a police station. They made a few phone calls and then let me go back out on the streets full of troops and police carrying out the security crackdown. They insisted however that when my permit did expire on the 19th that I had to leave. I asked for an extension and they said decisively no.

Q. So you weren't expelled? It just ran out?

A. Well we're in a gray area here. Because in theory China has been opened up to foreign journalists since January 2007, which means no longer, which was the case before, do we have to apply for provincial level government approval every time we leave Beijing for reporting. The official regulations don't mention Tibet. But orally, officials have made it clear that Tibet is an exception to these new Olympic rules and journalists who have made their own way there, unofficially, both before this unrest and during it have been caught or ... and expelled. Or those who have succeeded in making it out without being detected have been criticized by the authorities for doing so. So one could argue that yes I was expelled, if one looks at the regulations they've announced which one could interpret as meaning we have the freedom to be where we like. But in their interpretation, Tibet is an exception and in their view they were being rather liberal towards me by letting run to the end of my official permit.

Q. Is Dalai behind this?

A. Well we didn't see any evidence of any organized activity, at least there was nothing in what I sensed and saw during those couple of days of unrest in Lhasa, there was anything organized behind it. And I've seen organized unrest in China. The Tiananmen Square protests in 1989 involved numerous organizations spontaneously formed by people in Beijing to oppose, or to call for more reform and demand democracy. We didn't see that in Lhasa. There were no organizations there that ... certainly none that labeled themselves as such. These accusations against what they call the Dalai Lama clique, are ritual parts of the political rhetoric in Tibet. There is a constant background rhetoric directed at the Dalai Lama and his supporters in India. So it is not at all surprising that they would repeat that particular accusation in this case. But they haven't come across, haven't produced any evidence of this whatsoever. And I think it's more likely that what we saw was yes inspired by a general desire of Tibetans both inside Tibet and among the Dalai Lama's followers, to take advantage of this Olympic year. But also inspired simply by all these festering grievances on the ground in Lhasa. E-mail to a friend

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