293. Memorandum From the Director for the Near East and South Asia Region of the Office of International Security Affairs, Department of Defense (Newcomer) to the Assistant Secretary of Defense for International Security Affairs (Warnke)1
SUBJECT
- Discussions with Shah of Iran
The Shah told President Johnson last night at dinner2 that he plans to raise two military supply topics at their 1230 meeting today: (1) additional U.S. advisors/maintenance personnel to help Iran’s armed forces assimilate advanced equipment being purchased from the U.S. and (2) the Peace Ruby air control and warning system which is to be constructed along the Persian Gulf. The Shah may also discuss his desire to buy fast [Page 524] gunboats with surface-to-surface missiles and/or his plan to purchase a national integrated communications system.
- 1.
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U.S. Advisors. The Shah wants to take delivery on two more squadrons of F–4 interceptors as quickly as possible. ARMISH/MAAG has developed a training plan which should permit the Iranian Air Force to operate and maintain these aircraft by 1971. The Shah wants these aircraft earlier, has investigated contract maintenance (by McDonnell) but finds it extremely expensive ($10–12 million per year).
The Shah therefore concludes that we could save him this $10–12 million per year by adding about 200 U.S. airmen to our advisory mission to maintain the new aircraft. We are seeking to discourage this corruption of the role of the advisory mission (and the concomitant acceleration of Iran’s procurement program), citing Vietnam requirements and our general cutbacks in U.S. personnel overseas. This point is adequately covered in the President’s talking paper.
- 2.
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Peace Ruby. This four-station addition to the limited air control and warning system, built by the UK and the US, was purchased by Iran in 1966 to extend radar coverage and communication along Iran’s Persian Gulf coast. Since that time, the delivery schedule has slipped nearly two years (1970 to 1972) owing to unforeseen path testing difficulties and unrealistic production leadtime estimates, and costs have increased sharply ($21.3 to $37.8 million) as a result of faulty initial estimates, system changes and equipment price increases.
Iran has indicated that it plans to shift the program from a government-to-government arrangement to a direct contact with a US manufacturer. This would eliminate the time required for competitive bidding and restore the original schedule, but it would cost Iran a bit more than the USAF contract. We have no objection to this shift and have made certain changes in our joint credit arrangements to permit Iran to go this route if it desires.
- 3.
- PG–84 with missiles. The Shah is pressing to buy four of our new PG–84 (165, 240T) fast patrol boats with a General Dynamics-developed surface-to-surface configuration of the Tartar missile as its principal armament. We have sought to discourage this sale, at least for this year, noting that the missile has not been mated to the PG–84 by the US Navy, that the West German Tartar program is still in the development stage, and that we are not yet convinced that missile boats represent Iran’s best defense against the Iraqi Komar threat (aircraft may well prove the most effective and least expensive response).
- 4.
- National Military Communications System (NIMCOMS). Iran presently has no effective national communications system. We have studied the situation for Iran and have made several recommendations as to an integrated military system. None of these has been accepted.
With the Shah’s agreement, Page electronics is now surveying at its own expense Iran’s needs in depth and drawing up a program proposal. When this study is completed, Iran is expected to choose a contractor to build the system. If an American firm is chosen, we would expect to fund NIMCOMS under the credit sales program in future years, subject to Congressional approval.
The White House Staff has asked that you and Mr. Schwartz be available to answer questions that may arise during the President’s 1230–1400 meeting with the Shah today. We have passed your telephone number at the Madison to Mr. Sanders at the White House for his use, if necessary. Mr. Schwartz and Mr. Reed of my staff plan to stand by in their offices.