File 6391/1928 'Persia and the Persian Gulf: method of counteracting Soviet activities on Persia and the Persian Gulf' [‎24r] (48/157)

[This Document is the P roperty of His Britannic Majesty’s Government.
PERSIA. i
1
V '
March 18, 1929.
CONFIDENTIAL
2665 i
Section 8.
c 1405/119/34]
fo. 1C; ' C ^J
V.IM -- - * - —“
Sir R. Clive to Sir Austen Chamberlain.—(Received March 18.)
(No. 103.)
^ Tehran, February 21, 1929.
WITH reference to your despatch No. 590 of the 15th December last on the
subject of Russian activities in Southern Persia and the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. , I have the
honour to transmit herewith copy of a despatch which I have received from
the Political Resident A senior ranking political representative (equivalent to a Consul General) from the diplomatic corps of the Government of India or one of its subordinate provincial governments, in charge of a Political Residency. giving his views on the matter as requested.
2. I entirely concur in the tenor of Sir F rederick Johnston’s observations which
appear to me to put the facts in their true perspective. I would, however, point out
| that accentuated Russian competition in South Persia has undoubtedly damaged the
trade in British piece-goods, particularly printed and plain dyed cottons, twills and
drills. Arrivals oi white shirtings of Russian manufacture are also expected. On the
other hand, there are many lines, such as mohairs, Sicilians, poplins, &c., in which
Russian goods do not attempt to compete with our own and other lines in which they
have failed to make any appreciable progress.
Copies of this despatch are being sent to the Department of Overseas Trade, His
Majesty’s consul-general, Bushire, and His Majesty’s consul, Shiraz.
I have, &c.
R. H. CLIVE.
Enclosure in No. 1.
Consul-General Sir F. Johnston to Sir R. Clive.
(No. 17.)
Bushire, February 6, 1929.
1 HAVE the honour to acknowledge the receipt of your despatch No. 1 of the
3rd January, 1929, on the subject of Soviet activities in South Persia.
2. As reports were being sent direct to you by the various consulates without
the intervention of this office, it has not been necessary to collate or consolidate these
reports and the interests of the Resident have so far been confined to the Arab ports
and to Bushire itself. In the latter place little local information is obtainable as to
goods landed, all of which make their way up country.
As regards the Arab ports, of the three Russian ships which have called at the
Gulf, not one went to the Arab ports.
3. bo far as I am aware, the Soviet commercial activities are mainly concerned
with two classes of commodities, sugar and coloured piece-goods, the latter of which
forms possibly one-third of the total piece-goods trade in Persia. This Soviet trade
had at one time the advantage, described in paragraph 5 (2) of Mr. Consul Chick’s
despatch, of paying in Tehran customs duties on goods landed in the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran.
ports, but this privilege has now, I understand, been withdrawn and the trade competes
with that of other nations under equal terms so far as Persian treatment is concerned.
These goods are, for commercial or political purposes, sold at a rate considerably lower J
than the goods of other nations.
4. It is obvious that so far as Persia is concerned this procedure is all to her
benefit. She has no native industries which might be affected by a policy of dumping,
and as she has to buy her sugar and printed piece-goods from outside, will obviously
take them from the cheapest market. Until then the trade is accompanied by
propaganda work which the Persian Government considers dangerous to itself, no
assistance may be expected from Persia.
5. It is indeed difficult to see exactly what action is possible in Persia. For.
commercial propaganda work to thrive it must be constant, and the Soviet Government
must continue to bear the large losses it is incurring. It is not a case of a specialised
trade with Persia being driven out of existence by a competitor who can retain the
market and subsequently manipulate prices. The piece-goods and sugar trades are
independent of the Persian market and, even if temporarilv driven out, will return the
[744 s—8]