'SUMMARY OF THE PRINCIPAL EVENTS AND MEASURES OF THE VICEROYALTY OF HIS EXCELLENCY LORD CURZON OF KEDLESTON, VICEROY AND GOVERNOR-GENERAL OF INDIA IN THE FOREIGN DEPARTMENT. I. JANUARY 1899-APRIL 1904. II. DECEMBER 1904-NOVEMBER 1905. VOLUME IV. PERSIA AND THE PERSIAN GULF.' [‎14r] (32/386)

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therefore, that the transaction should take the form of a purchase from
the Persian Government of the sole right to construct roads, railways, and
other commercial undertakings in Seistan and South-East Persia and in the
region between Mohammerak and Kermanshah. For the present, however,
the Kusso-Persian Railway Agreement barred the way ; and until such time,
therefore, as we could exercise the right of constructing railways, it was
proposed to provide that Persia should pay interest on the purchase money
secured on the Customs of Southern Persia. Lord Curzon welcomed the
suggestion. For so substantial a return, the Government of India were
prepared to lend any sum up to a million pounds sterling. It was suggested,
however, that the area of the monopoly to be of any value must extend across
the entire width of Southern Persia, and not be confined to the extreme east
and west. The Minister was instructed to endeavour to secure the grant of
privileges'of the kind indicated in return fora loan of half a million sterling.
But Si? Arthur Hardinge was opposed to the demand of considerable concessions,
and eventually was authorised to advance the sum without direct return of any
kind. On the 4th April 1903, a sum of £200,000 was placed at the disposal
of the Persian Government. The interest
First British loan, 1903. was g p el , cen t . t] ie security
consisted of the Caspian Sea Fishery dues, the Post and Telegraph revenues,
and the Customs of Pars and the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. . The loan was repayable m
twenty years. But the annual instalments were not fixed, nor was it definitely
agreed that the sum should not he repaid in a shorter period. The transaction
was effected through the Imperial Bank. Something had been gained. It
had been shown that Persia was not yet in complete financial bondage to the
Russian Government; and to enhance the value of the proof, the Grand
Vizier refused to consider a proposal which the Russian Minister hastened to
make of a further Russian loan to discharge the British debt.
Hardly had this sum been advanced, when the Grand Vizier expressed his
desire for further assistance ; and after lengthy discussions, an additional sum of
£100 000 was paid to the Persian Government on the 1st September 1904.
’ ^ It was definitely stipulated that this
Supplementary British loan, 1904. advance should form a part of that made
in the previous year, and that the whole should he repaid, capital and interest,
in twenty etpial annual instalments.
Early in the following year the Shah was again in need of funds, and in
April 11)05, His Majesty’s Minister was authorised to iniorm the Persian
Government that His Majesty’s Government were prepared to facilitate a
further advance bv the Imperial Bank of Persia of £100,000 at 5 per cent on
the security of the customs of Ears and of the Persian Gult, on the sole condi
tion that, in the event of the Karun irrigation project eventual y developing,
its execution should only be entrusted to agents approved by His Majesty s
Government. The Persian Government objected to this condition, and the
proposal was abandoned and the offer withdrawn. In the following July, as
the result of further representations by the Persian Government, negotiations
were a<-ain opened, and an offer was made of an advance ot £150,000 to be
made in the lame manner and on the same terms as regards security and interest
“s the two previous loans, on the understanding that the Persian Govern
ment should 1 airree (1) to accept the interpretation attached by His Majesty s
Government to the expression “ Ears and the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. , as notified m
Sir A Hardinge’s note to the Mushir-ed-Howleh of the 30th August 1904
and (2) that all railway construction in Southern Persta (including Seistan)
should in so far as foreign assistance was required, he carried out under the
auspices of His Majesty’s Government. In October the Persian Minister
in London informed ^dLansdowneJhatHie Grand Vi.ier ^-1-^
receive™ urther^onna 1 instrucJns on the subject from Tehran The hope was
expressed that the advance might he increased to £300,000.
Erenuent reference has been made to the Customs revenues of 1 ersia.
Prior to q 1899 these revenues were regularly farmed by I ersian subjects.
Eiuancial embarrassment soon brought the need for reform of «>e sole s cu i y
which could be offered for a foreign loan. Early in 1898 the Shah