'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.' [‎62v] (129/386)

that the British 'Foreign Office should furnish them with a letter to enable the
£200,000 to he raised privately on the same security—which remained ample—
of the Southern Customs of Persia. To this proposal the Foreign Office
assented, hut'in September the Grand Vizier informed the British Minister at
Tehran that the deficit up to date was now calculated at half a million pounds,
and that the Shah had ordered him to borrow one million pounds, half to meet
the deficit, and half to provide for His Majesty’s visit to Europe in the following
year and for the construction of the Tabriz-Kazvin road, the concession for
which would, owing to the failure of the Persian Road Company, lapse to Russia.
One method of helping Persia to beep out of Russia’s financial grip had already
been suggested to His Majesty’s Government in May 1901. Reports bad been
received that the Shah would possibly sell Seistan Crown lands to the Hash-
mahul-Mulk if he could pay enough, and the Viceroy proposed that if negotia
tions fell through with him it might be desirable to ofier a loan to the Persian
Government upon the security of the Seistan revenues through the Imperial
Bank. This matter was, however, settled otherwise.
16. It w'as clear, then, that the advance by the Imperial Bank of Persia of
£200,000 to which His Majesty’s Government were willing to give their moral
support, was no longer sufficient to prevent the Persian Government from
incurring a fresh Russian loan, and His Majesty’s Government turned to
the Government of India to enquire what were their views about a loan of
£500,C00 to the Imperial Bank of Persia for the Persian Government, on the
security of the Southern Customs, the rate of interest to be 8 per cent, and the
period of repayment ten years. On 1st October 1901, the Viceroy telegraphed
to the Secretary of State that the Government of India were not only willing
to provide £500,000 and could do so without inconvenience, but thought the
present opportunity one of the greatest political importance, w r hich should not
be lost. On the other hand, they could not lend Indian money w ithout adequate
return to Indian interests, and made their offer subject to the following con
ditions :—
(1) The loan to he secured upon the customs of the Gulf ports and
upon the revenues or customs, preferably the former, of Seistau.
(2) The contemplated changes in the Persian Tariff to be submitted to,
and to receive the assent of, the Government of India.
(3) The loan to he accompanied by a plain statement to the Persian
Government that in view T of British interests thus created, in
addition to those already existing, in Southern Persia and Seistan,
His Majesty’s Government could not admit of the creation of any
rival interest in these regions. The Persian Government to give
a simultaneous undertaking not to grant any concession, political,
territorial, commercial or otherwise, to any foreign Power in the
areas referred to without the previous consent of the British
Government.
The substance of these suggestions was finally agreed to by the Secretary
of State for India, who, on 11th Kovember, after further communication with
the Government of India, addressed the Foreign Office, saying that as the
co-operation of the Indian Government was desired in arranging for the
tender of financial support to Persia, he was willing to recognise the principle
recorded in the Report of the Royal Commission on the expenditure of India
(1900) that both Great Britain and India have a large interest in Persia, and was
prepared to provide money for a loan to the Persian Government in the col
lective interest of the British Government on the following conditions
(1) A sum not exceeding £500,000 to be advanced to the Persian
Government in such manner as the Foreign Office may desire
whenever it shall have been notified to the Secretary of State
for India in Council that the Persian Government has accepted
the terms here subjoined.
(2) The loan to be secured upon the revenue of the customs of the
ports of the southern littoral of Persia, including Mohammerah;
but actual control and collection of the revenue are not to he
required except in case of default.