'No. 1. Memorandum: American Advisers for Persia' [‎2r] (3/6)

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The total debt to Russia in 1919 was approximately 6,000,000L ; but this the
Soviet Government has agreed to cancel.*
There remains Persia’s indebtedness to Great Britain for various loans and advances
made from 1903 onwards, namely :—
Loan of 1903 ...
Floating advances
£
300,000
3,700,000
Public Loan, 1911
4,000,000
1,250,000
Total
5,250,000
to which must be added certain claims for arms, munitions, &c., supplied by His
Majesty’s Government, and the claims of British subjects for compensation for losses
sustained in Persia through the negligence or culpability of the Persian Government.
(c.) It has already been stated in an earlier part of this memorandum that an
independent Persia is a'fundamental axiom of Great Britain’s policy in the East.
The geographical position of the country is alone sufficient to demonstrate this
proposition.
On the east Persia is a close neighbour of the Indian Empire and it is only natural
that with the many millions of Moslem subjects of the King Emperor in India, His
Majesty’s Government should desire the friendliest relations with the greatest surviving
Shiah State whose ancient literature and culture still exercise no inconsiderable
influence in other Mahommedan countries. Strategically the position of Persia, midway
between Afghanistan and Mesopotamia, in both of which countries Great Britain is
intimately concerned, invests her with an importance out of all proportion to her
intrinsic strength.
On the south the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. has for more than a century been the scene of
active British influence and a predominant British trade. Piracy has been suppressed,
the slave trade has been abolished, the waters have been lighted and buoyed, and order
has been observed by the exertions of Great Britain who is in close treaty relations
with all the chieftains and sheikhs on the Arab coast of the Gulf.
On the north-eastern or Persian shore the Sheikh of Mohammerah who, though
ostensibly a Persian subject, is virtually independent, is also in very intimate relations
with the British Government. In that region the wells refineries and workshops of
the Anglo-Persian Oil Company at Maidan-i-Naftun and Abadan are a national asset
of the hrst magnitude. The British Resident and Consul-General at Bushire has for
a century exerted a very potent influence both throughout the Gulf ports and in the
Persian hinterland, where the connections between the British Government and the
Bakhtiari khans, who are the owners of the land upon which the Anglo-Persian Oil
Company’s wells are situated, as well as other tribal chieftains, are very close. Thu
British interests in Southern Persia are of a very definite and special nature, which
has been repeatedly and explicitly laid down by British Ministries of all parties
and has been acknowledged by all the Governments and parties concerned.
Further to the west Mesopotamia and Kurdistan march with the Persian border.
The railway from Baghdad has already reached a point north of Khanikin on the
Persian frontier at Quraitu, and the extension of this line within Persia is a matter
that is now engaging the attention of a British railway syndicate, who have obtained
an option from the Persian Government for the construction of this line from railhead
to Tehran, and other options in the same vicinity.
In Northern Persia, namely the provinces ol Gilan, Mazanderan, Khorasan,
Azerbaijan and Asterabad, to which the Anglo-Persian Oil Company’s concession does
not extend, a combined Anglo-American group is at present negotiating on the basis of
a joint exploitation of the oil deposits which are known to exist in certain regions
within those provinces. His Majesty’s Government are watching these negotiations
with sympathetic interest, and earnestly hope that a satisfactory understanding will be
reached by the two groups interested in the enterprise.
Such is the general political situation. The danger against which both the British
and the United States Governments will have to guard with the utmost vigilance is the
* See article 8 of Kusso-Persian Treaty of February 26, 1921.
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