Ext 5001/41 'PERSIA – INTERNAL (Miscellaneous despatches).' [‎107v] (214/248)

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friends. Lhe standing instructions to the Soviet authorities in Persia are, they
say, not to interfere in the internal affairs of Persia, hut this does not prevent
their blocking the appointment to a Cabinet post of M. Taddayvun, whom the
Prime Minister much wishes to appoint, putting the strongest pressure
(including refusal to allow wheat supplies to pass from the Russian zone to
f eh ran) in order to secure grain and other food supplies from the Persian
Government, or squeezing the Persian Government to sign two high^
disadvantageous agreements—one financial, the other about the use of tn3*
armament factories. 1 he last-minute help from the Soviet Ambassador
undoubtedly contributed largely to the solution of the currency crisis—a crisis
which would not have arisen if the Soviet Government had adopted the same
financial policy as ourselves from the beginning. I he Soviet authorities now
need to obtain large sums in rials from the Government, but they are apparently
unwilling to offer the terms embodied in our financial agreement, but have put
foiwaid a draft which, though wrapped up in the form Qf a clearing agreement,
in fact binds Persia to give unlimited rial credits to Russia, subject "to a six-
monthly settlement by which the balance due to Persia would be paid in
Moscow : (1) as to 40 per cent, in gold, which could he transferred to Persia, but
at the risk of the Persian Government; and (2) as to the rest in dollars, which
would in practice be frozen until after the war, since they could only be spent
in America, and then only if the Persian Government had no other dollars at its
disposal. The Soviet Government are also pressing the Persian Government to
sign a contract for the operation of the Persian armament factories. After a year
of somewhat dog-in-the-manger policy towards His Majesty’s Government they
want to get the factories into full production by the middle of 1943. The Persian
Government are very reluctant to sign, as they consider (with some reason) that the
terms are very onerous, and fear that the inevitable influx of Soviet specialists,
and possibly workmen, will have a disturbing political influence. It appears that
the Persian Government are to pay the expenses—salaries and wages, cost of
extia machinery provided by the Soviet Government, &c., while the Soviet
Government will pay for the arms delivered (less specified deductions for any
delay) in iinls obtained, presumably, under the proposed financial agreement His
Majesty’s Minister communicated to the Soviet Ambassador information obtained
about subversive movements affecting Russian as well as British interests. It
was hoped that the Soviet authorities might be induced to arrest an important
Persian suspect hostile to them at the time of the arrest of General Zahidi But
although the Soviet Ambassador seemed gratified to secure the valuable informa
tion conveyed to him, he has received no instructions from his Government about '
the suggested arrest, and we have, therefore, been obliged, as usual to act alone
Internal Affairs.
28. The whole of Persia is suffering from the paralysis which political
crises m the capital always spread throughout the country. The Kermanshah
area m particular has suffered, and it has so far proved impossible to secure a
Governor-General who would be likely to instil energy into the Administration.
It is m Pars, however, that the effect of weakness in the Central Government has
been most clearly shown. Puffed up by flattery from German agents and also
there is good reason to believe, by encouragement from General Zahidi’
n !rv ^ iec ^ i° secure recognition by the Persian Government as head of
f, . le Qashgai a fantastic claim. The Prime Minister has consistently resisted
this claim and indeed, has refused to discuss matters unless Nasir comes to
lehran, where his life would be protected by a Government guarantee and his
chaims would be discussed. The Governor-General and the G.O.C., Pars
I rince tirouz for long refused on various pretexts to take action against Nasir’
,. en tne d to disarm the Qashgai on their migration south, with no result
but disgrace to Persian arms and the loss of sixty rifles and three machine guns.
the situation is (letter now it is not due to the Persian army, but to the series
of shocks administered to Nasir by the Allied victories, the discovery, which must
be obvious to him, of some of his intrigues with the Axis, and the arrest and
removal of Zahidi Nasir is still manoeuvring to secure the best possible terms
his position rSian Government ’ but each message suggests a slight weakening of
29. The Persians lament the danger from Russia, but there is no indication
whatsoever that any of them realise that the best.defence is a good Administration
and a contented people. Corruption is almost universal: bon Iranien vole
de race. Ol the American advisers struggling in this morass, Mr. Sheridan in