File 930/1912 'Mohammerah - Khoremabad Railway' [‎101r] (208/396)

VERY CONFIDENTIAL.
Report to the Board of Trade by Mr. H. W. Maclean,
Special Commissioner of the Commercial Intelligence
Committee to Persia, on certain matters connected
with Persian Trade.
Russian trade, pressed forward by the Russian Government for political
purposes, has encroached on Persian markets hitherto supplied by the
British Empire. Commercial interests are less important than political
interests in Persia, therefore British commerce will conrinue to recede under
pressure of Russian political needs unless the British Government finds cause
to intervene.
Many ways of strengthening our commercial position in Persia have been
proposed. I think our most pressing needs are—better roads, with greater
security for wayfarers and merchandise, and an organised transport service ;
a stronger Consular Office in Teheran; reform of Persian commercial law.
Trade, industry, and enterprise in Persia struggle to expand under
corrupt administration of vague and ill-defined laws. The people are
exceedingly poor, and the market for most commodities very limited; the
standard of commercial morality amongst Persians is low, and is certainly
not improving; the means of communication within the country are
primitive, and many districts are unsafe for traveller or merchandise. In
fact Persia does not offer convenient scope for great trading enterprises, and
foreign traders settling in it have seldom secured brilliant profits. It must
not be imagined, therefore, that the trade of the British Empire with Persia
is so robust as to be able to defy all attacks upon it. So far, it has been
seriously assailed from only one quarter—the Russian Empire, which has
secured to its commerce advantages in Persia not enjoyed by other
commerce.
The Russian Government has secured to its subjects a certain immunity
from foreign competition in Khorassan and the Caspian provinces of Persia
by refusing transit to foreign imports over the Batoum-Tiflis route. It has
promoted, and to a great extent financed, the construction of a carriage road
from Enzeli to Teheran, and has made preparation to construct similar roads
from Julfa through Tabriz to Kazvin, and from Kazvin to Hamadan. It
has subventioned a line of merchant steamers between the Black Sea and
the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. . It holds, for some years to come, a veto on railway
construction or anything of the nature of a rail or tramway (except urban)
in Persia, and has obtained from the' Persian Government an undertaking
not to impose taxes, or tolls, on roads (except carriage roads) which may be
constructed in future, thus practically denuding that Government of power
to encourage improvement of trade routes in the mountainous regions of
Southern Persia, where carriage roads are hardly practicable.
It allows drawback of duty on a number of commodities suited to the
Persian market, and as regards sugar and certain printed and dyed cotton
tissues these drawbacks appear to involve distinct bounty. Import to
Russia of certain Persian products, such as raw cotton, rice, and fruits, is
encouraged by partial exemption from the protective duties levied in Russia
on the same products from other countries. It has established and controls
a Bank in Teheran, with branches at Meshed, Resht, and Tabriz ; and this
Bank has been utilised to push Russian trade with Persia, by means of large
advances to traders dealing in Russian commodities, and such favourable
terms and prices as seem incompatible with business profits and suggest a
form of bounty on trade, through the Bank, with Russia. It has secured,
under the recent Customs Convention of 1902, favourable rates of duty in
Persia on the commodities of greatest interest to Russian commerce.
It has increased the number of its consulates and consular staff in Persia.
I think trade routes are, on the whole, safer for merchandise and w r ayfarer.
33611. 50.—10/04. Pk. 103. E. & S.