Miscellaneous Correspondence, Notes, and Newspaper Cuttings Relating to Persia [‎10v] (20/255)

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The present position of the Russians as regards railway construction in Persia
was then discussed in the light of recent information. The Agreement of the
12 th'November, 1890, provides that for a period of ten years the Persian Government
will not itself construct, nor “ permit nor grant a Concession for the construction ot
railways to a Company or other persons ; and after the expiration of the ten years
the renewal of the prolongation shall he immediately discussed between the two
parties.” By a later Agreement of the 14th December, 1899, the Persian Government,
in consideration for a loan of ( 10 , 000,000 fi\, renews “ the previous engagement,”
with the significant proviso “ that for another ten years, excepting the Russian
Government, no other Government will he given a Concession to build railways
in Persia.”
The nature of the Anglo-Persian Agreement as regards railway construction is
explained in Appendix I. The original engagement is embodied in a note of the
16th September, 1888, by the late Shah, addressed to his Poreign Minister, for
communication to the British Minister at Tehran. This note states that “ Whenever
Railway Concessions in the North, Ac., are given to others, immediately a Concession
for a railway from - Tehran to Shuster, or such a one will he given to the English
Company, and positively no Southern railway, without consultation with the
English Government, will he granted to any foreign Company.” In 1900, Mr. Spring
Rice was informed by the Sadr-i-Azam that the present Shah had seen his father’s
note and considered it a binding document; but that there could he no question of
any Railway Concession, either in the INorth or South, for ten years. It is impossible
to reconcile this assurance of the binding character of the note of 1888 with the
specific Russo-Tersian Agreement of 1899. The present position as regards railway
construction appears, therefore, to he unsatisfactory and indeterminate.
Prom the commercial point of view' it is to be remembered that wherever Russia
establishes herself, she imposes tariffs which prohibit or gravely interfere with British
imports. This consideration can be adduced in favour of establishing British interests
in the Karun Valley, as, if Russia obtained control of the Gulf Ports, it vmuld he to
us a severe commercial blow r , as well as a strategic danger.
Lord Lansdowne stated that with a view to putting an end to the chronic
diplomatic contest at Tehran, overtures had been made to the Russian Government for
the partition of Persia into spheres of influence, but these suggestions had been
dedmed. He pointed out that the object of loans such as that made to Persia by'the
Indian Government w r as to establish a lien on portions of the Gulf Coast. By
providing funds for irrigation, for improving navigation in connection with the
Karun River, or for the development of road communication, w T e should establish a
reversionary interest in that region which might be valuable in the event of a break
up of Persia.
Conclusions.
1. It is essential to maintain, and if possible to increase, our influence at
Tehran in order that we may be able to control railway construction in Persia,
which is by far the most important factor in the strategic situation, and also for
commercial reasons.
2. It should be our object, on commercial as well as on strategic grounds, to
maintain the status quo in Persia.
3. It is essential to maintain our existing claims on the coast of the Persian
Gulf without aggression or ostentation.
4. An examination of the country adjacent to the Khor Abdullah should be
made, with a view to ascertain whether the physical difficulties to he overcome in
railway construction are such as to make Koweit essential as the terminus of the
Baghdad Railway, or, if not, what other places are suitable for this purpose.
5. It is important that w r e should have a share in the control of the extension
of the Baghdad Railway to the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. , with a view to ensuring the effective
neutralization of the terminus on the Gulf.
6 . As regards the specific questions raised by Lord Lansdowne (see Appendix);
taken seriatim — * fs.
( 1 .) Such assistance may be inevitable in certain cases ; but is not desirable in
principle. Each case should be considered on its merits.