File 4345/1912 'Trans-Persian Railway' [‎110r] (224/330)

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It was in the hope of elucidating the views of Sir Edward Grey that communications
were addressed to the Foreign Office on the 4th and 18th ultimo. Sir Louis Mallet’s
confidential letter of the 23rd November recapitulates reservations already mentioned,
but fails to afford the British group any particular indications as to the attitude they
are to assume in the arrangements which must now be discussed with their French and
Russian associates.
The texts of the two documents forming enclosures “ A” and “ C” to Sir William
Garstin’s letter of the 4th November were put forward in order to invite suggestions in
regard to tariff and other questions, and it was hoped, if the texts of these two documents
proved unacceptable to Sir Edward Grey, that he would see his way to indicating such
modifications and additions to the texts as would meet with his approval, so that the British
group might lay these amended documents before the Socidte d’Etudes for consultation
as to the procedure to be followed.
As to the text of enclosure “ A ” above mentioned, we would point out that in the
course of the informal exchange of views which have from time to time taken place,
the British group have been led to understand that there would be objection to the
main line passing through Kerman—this objection possibly not applying with the
same force to a branch. Consequently the Societe d’Etudes may be obliged to
contemplate an alignment nearer the sea, conceivably even following the littoral for a
short distance. In these circumstances it would seem unreasonable to debar the
Trans-Persian Bailway from access to the sea.
We understand that His Majesty’s Government are concerned at the general terms
in which application has been made for maritime facilities in the draft note to the
Persian Government. The British group would therefore suggest the insertion in
the text of a clause providing that the points where such maritime facilities are
granted in the south must be subject to agreement between the Persian and British
Governments.
It is hoped that this modification in the draft note will enable His Majesty’s
Government to lend the “societe” their diplomatic support on the point in question,
which will then be suggested to the Russian and French groups.
In the question of branch lines the British group have no desire to claim any
“virtual monopoly of railway enterprise ” in Southern Persia, such as Sir Edward Grey
appears to apprehend. All they desire is to safeguard their own interests, and to such
an end they put forward suggestions by which they considered those interests would
best be served.
They would be glad to learn the nature of such alternative measures as Sir Edward
Grey may have in mind that may accord with the policy of His Majesty s Government,
and at the same time secure to the Trans-Persian Railway reasonable facilities for
obtaining traffic by means of branch lines, without which a main line cannot be
expected to prove commercially remunerative.
As the text of enclosure “ 0” in its present form appears to the Foreign Office
inexplicit, the British group would be prepared to propose to their Russian and French
associates the insertion of a clause to the effect that nothing in the proposed agreement
(enclosure “ C ”) should be hereafter interpreted as admitting the imposition of
differential rates in the respective spheres, or justifying the application of any measures
of discrimination in regard to traffic facilities. _
In the present circumstances, however, the British group do not considei themselves
justified in asking Mr. Harrison to proceed to Persia with MM. Bizot and Raffalovich to
negotiate on behalf of the Societe d’Etudes with the Persian Government.^
It is hoped, however, that Sir Louis Mallet’s letter^ of the 23rd ultimo may form
the basis for further discussion before definite communication is ^ made^ by the British
group to their French and Russian associates in the Societe d Etudes, whose
representatives are expected in London on the 12th December, to confer on t re
business of the “ societe.”
I have, &c.
W. E. GARSTIN.