'Memorandum respecting British interests in the Persian Gulf' [‎49v] (64/126)

the Anglo-Russian Convention is likely to
exercise, sooner or later, upon the question of
railway construction in Persia.
“ As you are aware, the Convention provides
that neither of the Contracting Powers shall,
without previous arrangement between them,
oppose the grant of Concessions supported by the
other within the limits of the neutral zone, where
equality of commercial opportunity is likewise
recognized to the subjects of third Powers.
“ It may, indeed, safely be surmised that other
Powers will not be slow to appreciate the changed
situation, and to seek to turn it to advantage.
“ Although, the Russo-Persian Railway Con
vention has still some years to run, the question
of future railway construction in Persia, and the
pledges made to His Majesty’s Government by
the two late Shahs must not be lost sight of, and
a timely decision should be taken as to what
Concessions it would be most conducive to the
interests of British policy to obtain for railway
construction in Southern Persia.
“ In these circumstances, it seems advisable that
His Majesty’s Government should take into early
consideration the question of a possible attempt
to extend the Bagdad Railway into Southern
Persia, with a view to determining whether a
Concession of this nature to other Powers should
be opposed, or whether it should be forestalled
by timely action on the part of His Majesty’s
Government, who, by securing prior rights of
construction, might render an extension of the
Bagdad Railway under foreign auspices economi
cally undesirable.
“ Sir E. Grey is unwilling that the history of
the Bagdad Railway Concession, which at one
time could have been secured to British enter
prise, should find a counterpart in Persia.
Moreover, the extension of the Bagdad Railway,
as a foreign undertaking, in the direction of the
Indian frontier, would, on strategic grounds,
appear to be inadmissible ; the grant of such a
Concession would compel the opposition of His
Majesty’s Government, and a sharp diplomatic
conflict would ensue, whereas by the exercise
of foresight such a crisis might be averted
altogether.
“ Turning now to the question of what specific
action His Majesty’s Government should take to
the end in view, it appears to Sir E. Grey that a
British Concession for a railway from Bunder