File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎130r] (264/1150)

3
ersiaus at >,
railway f.^.Versians would be far better advised to spend a fraction of the money in building
i expecy 1 11 *oads, or, better still, on public hygiene, in order to reduce the present infant
On the nortality in the country below the present figure of 80 per cent. I had the impression }
xt te n » "fhat British firms were not at present very greatly interested in the matter. A great (
On the« 1 leal was known in England about Persia, much more, in fact, than in America. He
80 min, lt:: ras, no doubt, aware that two years ago the Persian Government had formally, over
;e, onlviS lP signature of their Prime Minister, promised to pay us our debt of £2 million,
nd for ti 11 They had so far ignored this promise. We had many other matters outstanding, and
bon th jl not believe that until some satisfactory settlement of our affairs was in sight
)uilt and U%: His Majesty’s Government would encourage any large British participation in this
irs thee-^rahway scheme. He said he quite understood this and also shared the view that the
'Omair ^' American firms were most unlikely to lend any money for the purpose so long as the
eys TP ^London money market held aloof.
which?! 12 ' M^Laroehe told me that he originally only came here in the hope of
n the fourth
obtaining orders for the supply of material. He had, however, now wired to Paris
Id h ? ;; to notify French constructing firms that it might be worth their while to tender for
D aie ' . the construction of a part of the line. He had, however, received no reply, and the
P le paredtyp renC } 1 Minister told me yesterday that French industry was really far more
romans) kiq nteres t e d i n supplying the material than in building the railway.
13. Mr. Carrell, when he came to call upon me, was much less communicative
3 a ?y arra «than Mr. Thomas Brown. He expressed no opinion as to whether the Persian
Government were well advised to construct the railway at the present time; he
had;
M m return; mere iy sa i(i that if they wanted a railway and could pay"for it he’ would build one.
he HussianGHe further said that when doing similar work in South America he always required
■e was undouba considerably larger margin of profit than in the United States of America, and
Pff that he would certainly require a larger margin of profit in Persia than in South
ks. He said 1 America. His associates in the Persian enterprise were Messrs. Stewart Macdonnell,
situation ini 0 f London, Batignolles, of Paris, and J. G. White and Co., of New York. He told
ther stopped; me that, if given a free hand, he could build the whole line in six years, but he quite
hich might mi realised that it would probably take from eight to ten. He gave me no details of
vay. Howei his expected profits or of the system of payment which he would require from the
iked if lie hi Persian Government, except to say that his firm would only work on a cash basis. 1
as he had»enquired what part of the work would be undertaken by Messrs. Stewart
1 which he till Macdonnell; he said they would do any port construction work that was necessary,
my where ordii I said what would happen if the idea of a new port at Khor Musa was dropped ?
ofit of about’ He said in that case they would presumably build part of the railway. He said that,
Dund, aftertlunlike the German group, he had no interest in the supply of rolling-stock and
elieved Ute* material. If the matter was left to him, he would simply buy in the cheapest
only to wort: market, but if the Persians wished to make other arrangements for the supply of
dvance 50 peqmaterial, that was their affair. He professed to consider that the construction of a
immediately hue through 100 miles of limestone hills in Luristan was perfectly feasible and
ither terms,d P r esented no great difficulty, and that, from a technical point of view, this part of
idea of tM ^e construction was less difficult than the section from the Caspian to Tehran. I
forming a rijusked what were his views in case the Persian Government, after construction had
tent was, hoff star ted, changed their minds; he said that did not matter to him., because, as his
uated profits, A rou P would only work on a cash basis, they could simply close down at any moment,
^rnment, Wfp asbeb - if He felt any anxiety on the score of opposition from the Lurs; he said
i!s werepreU that he understood that while the Lurs were in opposition to the Persian Govern-
the hands k-mmff they had nothing in particular against foreigners; if they tore up the line
i Hr BroWD’ s | or burnt the sleepers, the loss would fall on the Persians and not on his firm.
14. Finally, like Air. Brown, he enquired whether British financiers would be
to interest themselves in the project. I replied, as I had done to Mr. Brown,
1 w as inU 1 t lat 80 ^ on S as the Persian Government ignored the debt which they had agreed to
L t edtP a f a y us ’ an n so long as the Persian Railways Syndicate received no indemnification
oudry, worb they had done at the request of the Persian Government, I imagined
1S rhA L on cH)n money market would not be very favourably disposed towards
'rculatiofl' : j lnanc i n g any such venture in Persia. He said, “ You can’t stop the British public
in F tbeir m oney ”; I said nobody wished to, but if the issuing house asked the
ii u 1 foreign Office what support they could count on, the Foreign Office, in the present
I^BiiUrcumstances, might very likely reply, if the Persians do not pay and yon get into
aeW ° iild^ trou ^ e ’ n °f count on us to recover your money.
QC<3 ^twas'k 15 - I think it not unlikely that both Mr. Brown and Mr. Carrell may pass on
^ at remar ks to the Persian authorities; I had the distinct impression in my conversa-
premat^’

File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎130r] (264/1150)

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File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎130r] (264/1150)

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