Foreign Relations of the United States: Diplomatic Papers, 1943, The Near East and Africa, Volume IV

891.00/1979: Telegram

The Chargé in the United Kingdom (Matthews) to the Secretary of State

London, January 7, 1943—11 p.m.
[Received January 8—6:29 a.m.]

282. Foreign Office’s comments on questions affecting Iran, mentioned in Embassy’s 7114, December 15, 8 p.m.⁴ have just been received in memorandum form with a covering letter dated January 6 signed by Mr. Eden.⁵ Mr. Eden’s letter reads as follows:

“I hope that this memorandum will clear up any minor misunderstandings which may have arisen between our two Governments on Persian problems. I believe that on the main issues we are both in substantial agreement.

There is one further point, not dealt with in the memorandum, which I should like to bring to your personal notice. It is implied in the State Department’s comments that, although our two Governments see more or less eye to eye, nevertheless Sir Reader Bullard⁶ is carrying out a policy of his own, which is not in accordance with our views, but creates unnecessary difficulties with the Persians. I hope that the State Department will dismiss this possibility completely from their minds. I am convinced that Bullard is loyally carrying out the policy of His Majesty’s Government to the best of his ability, and I have the fullest confidence in him. It is true that he has sometimes had to take action of a nature displeasing to the Persians, who thereupon are apt to run around to Mr. Dreyfus to complain. But on these occasions he has acted with the full approval of His Majesty’s Government and as I believe in the interests of the United Nations. If, as I hope, the United States representative in Persia is able to cooperate more actively in future in maintaining the interests of the United Nations, I think we shall encounter far less difficulty than hitherto in our dealings with the Persian authorities.”

The memorandum which is dated January 4 reads as follows:

“The United States Embassy’s memorandum of the 14th December,⁷ communicating the observations of the State Department on recent developments in Persia, has been considered in the Foreign Office with the greatest care and sympathy. It is believed that the policy of His Majesty’s Government towards Persia corresponds very closely with that of the United States Government. At the same time it is felt that a full and frank exchange of views on this subject will be of great value, lest misunderstanding should arise on points such as those enumerated in the latter part of the memorandum under reply.

2. In the first place, the Foreign Office wish to confirm their entire agreement with the views expressed in the Embassy’s memorandum as regards the increasing importance of the United States Government’s interests in Persia. Indeed, the growing interest which the United States Government have shown in Persian affairs has been very welcome to His Majesty’s Government, who, as the State Department point out, took the lead in suggesting that United States advisers should be sent to Persia to strengthen the internal administration of the country. His Majesty’s Government therefore fully understand and share the anxiety of the United States Government that these advisers should be enabled to carry out their work under favorable conditions, and are confident that their work will prove of the greatest value in reorganizing the finances of Persia and in putting the administration on a sound and efficient basis. His Majesty’s Government also recognize that the arrangement whereby the military authorities of the United States are to take over the operation of Persian ports, railways and roads greatly increases the interest of the United States Government in the maintenance of law and order throughout the country.

3. His Majesty’s Government also confirm that it has for long been their desire that the United States Government and the United States authorities in Persia should cooperate more actively in settling the questions arising from time to time. Until recently the task of maintaining the interests of the United Nations at Tehran has fallen almost exclusively on the British Legation. It is hoped that it may henceforward be possible for the United States representative at Tehran to take an equally active part in helping to solve important problems of common concern to the Allied Governments, and it is believed that the task of the two Legations may be greatly eased by the steadying influence which will be exercised on the Persian authorities through the United States advisers.

4. As the State Department are aware, it has been the policy of His Majesty’s Government not to occupy Tehran by military forces, but to allow the Persian Government to continue to administer the country with as little interference as possible. In order to encourage a spirit of collaboration in the Persian authorities, His Majesty’s Government took the initiative in the negotiations which culminated last January in the signature of the Anglo-Soviet-Persian treaty of alliance.⁸ By this treaty Persia acquired the status of a non-belligerent. This policy has on the whole been successful hitherto, the degree of collaboration afforded by the Persian authorities has in general proved sufficient, but on three problems of major importance it has been necessary, in the interests of the United Nations war effort, to bring strong pressure to bear upon the Persian Government and to contemplate measures which have, as it appears, led the Persian Government to put forward complaints to the Government of the United States.

These three problems are:

(1) The provision of local currency for the United Nations forces in Persia;

(2) The wheat problem, and

(3) Security measures against Axis agents in Persia.

6. [sic] In the United States Embassy’s memorandum under reply, it is stated that considerations of self-interest in no way motivate the policy of the United States, but that this policy is concerned only with the furtherance of the war effort of the United Nations and with the laying of a basis for satisfactory and lasting peace time conditions in Persia, as well as in the rest of the world. His Majesty’s Government readily accept this assurance, and they must request the United States Government in return to accept a corresponding assurance on their behalf. In dealing with the three problems mentioned above, and in all their dealings with the Persian authorities, His Majesty’s Government have not been moved in any way by consideration of self-interest but have been concerned with the furtherance of the war effort of the United Nations.

7. The difficulties raised by the Persian Government in connection with the supply of rials to the British forces in Persia were, in fact, difficulties which had to be surmounted by some means or other in the interests of the war effort. Without rials it would have been impossible for the Allied forces in Persia to pay for local purchases and local labor. It was absolutely essential that rials should be forthcoming. Otherwise, the trans-Persian lines of communication for supplies of war material to the Soviet Union would have broken down. After difficult negotiations, a solution appeared to have been reached through the conclusion of an Anglo-Persian financial agreement on the 26th May,⁹ and it was therefore all the more deplorable that the Persian authorities, despite the clear terms of this agreement, should again have sought only a few months later to withhold the necessary currency from the Allied forces. The State Department are aware how, mainly as the result of the common front displayed on this occasion by the Allied representatives at Tehran, it proved possible to solve these difficulties without having recourse to forcible measures, and it may be hoped that, with the forthcoming arrival at Tehran of the United States Financial Mission, a further Persian threat to withhold the currency essential to the United Nations need no longer be apprehended.

8. Again, as regards the wheat problem, the policy of His Majesty’s Government has been directed solely towards furthering the essential war interests of the United Nations, with due regard also to the minimum requirements of the Persian people. It has been based upon two governing considerations. The first is that, quite apart from the shortage of shipping, the clearance capacity of Persian ports and transport routes is strictly limited, so that every ton of wheat imported into Persia for Persian consumption involves a reduction in the quantity of vital war supplies sent to the Soviet Union by the trans-Persian routes. The second point is that Persia in normal times grows sufficient cereals for her own use, and the 1942 harvest is believed to have fallen very little short of a normal harvest, so that there must exist in the country sufficient stocks of cereals to last nearly until the harvest of 1943. It will be recalled that, during the period between the military operations in August 1941 and the summer of 1942, some 50,000 tons of wheat were imported from British and United States sources to satisfy in the exceptional circumstances then existing the needs of the Persian civil population. But the Persian Government, almost immediately after the harvest of 1942, complained that there was already a serious shortage and requested that further wheat should be imported for their use. It was evident that they were reluctant to take drastic and unpopular measures against hoarders, speculators and profiteers, and thought it easier to appeal to the Allies to solve their difficulties for them by arranging further imports. This attitude was clearly inadmissible. It would have meant a reduction in the supplies sent across Persia to the Soviet Union, for reasons which could not have been justified to the Soviet Government. His Majesty’s Government agree that it is in itself desirable that steps should be taken to save the Persian people from want, but it is clearly necessary to insist upon the Persian authorities making the best use of the food supplies available within Persia, and the only wheat imports to which His Majesty’s Government have hitherto agreed during the present season are the 25,000 tons of wheat which are being imported to replace the Persian-grown cereals required by the Soviet occupying forces.

9. Security measures against Axis agents have also been the cause of serious difficulties with the Persian Government. For many years past German influence in Persia has been very extensive, and it was largely owing to the presence of Germans and German agents in key positions throughout the country that it became necessary for British and Soviet forces to undertake the military occupation of certain areas in August 1942 [1941]. At the present moment, there are still some Germans in hiding in the unoccupied districts of Persia, there are still German agents who are active throughout the country, and there is still a considerable amount of pro-German sympathy in influential Persian circles. His Majesty’s Government regard it as absolutely essential to take such steps against German agents as may be required to safeguard the Allied troops and communications in Persia. Some Germans and some German agents have already been arrested, others have been allowed to escape by the Persian police or are said to be untraceable. But proof has been obtained of a widespread conspiracy organized by the Germans with the help of a number of influential Persians, involving definite plans for sabotage against Allied communications, and risings against the Allies in the event of a German invasion of Persia. It is clear that drastic action is justifiable and necessary against those implicated in such matters though such action has hitherto been confined to a minimum.

10. The foregoing general observations are intended to cover the main aspects of British and United States policy in Persia, and although emphasis has naturally been laid upon these points which have caused most difficulty and on which differences of outlook are most likely to arise, the Foreign Office believe that on the whole the views of the two Governments are very closely in agreement as regards the major issues. There remain the four questions referred to at the end of the United States Embassy’s memorandum under reply.

(1) It is true that the signature of the Anglo-United States-Persian agreement for wheat¹⁰ was delayed because it was desired to ensure, in connection with the wheat agreement, a satisfactory long term settlement of the currency dispute. As stated above, rials are absolutely essential for the United Nations forces in Persia. His Majesty’s Government felt therefore that it was essential to insist on some new currency arrangement, whereby the Majlis would no longer create difficulties on every occasion when they were asked to provide the necessary rials. As soon as a satisfactory solution on these lines was reached, there was, so far as His Majesty’s Government are aware, no further question of delaying the signature of the wheat agreement in order to impose on the Persian Government more difficult conditions. And, as distinct from the agreement, His Majesty’s Government have at all times and irrespective of their disputes with the Persian Government, sought to accelerate the despatch of the wheat which was urgently needed owing, primarily, to the Soviet requisitions in Northern Persia.

(2) General Zahidi, the Governor General of Isfahan, was arrested because he was implicated in the serious conspiracy referred to above. Careful consideration was first given to the question whether the Persian Government should be consulted in advance, but it was decided that to adopt this course would involve the risk of leakage, and would in addition be most embarrassing to the Persian Government themselves. The information at the disposal of His Majesty’s Government indicates that the effect locally of General Zahidi’s arrest has been very salutary.

(3) The sole reason for the despatch of a battalion of British troops to Tehran during the recent rioting was to protect Allied property and military stores.

(4) The Foreign Office were surprised by these reports from the United States Minister at Tehran, which implied that the despatch of certain consignments of foodstuffs to Tehran was being delayed by the British authorities for political reasons. This, as in the case of the wheat shipments, would certainly have been opposed to the views and intentions of His Majesty’s Government. They therefore telegraphed to Sir Reader Bullard, who has explained that there is of course no foundation whatever for any suggestion that the despatch of this flour and barley to Persia had been deliberately delayed in order to put pressure on the Persian Government. On the contrary, the British Legation had done everything possible to hasten its despatch. (Such delay as occurred seems in fact to have been due partly to an unexpected fall in the level of the Karun River while the barges conveying the grain were on their way to Ahwaz, but mainly to the physical difficulty of moving it from Shaiba to Margil, thence by water to Ahwaz, and thence by rail to Tehran). Nor did Sir Reader Bullard speak to the Shah¹¹ or the Persian Prime Minister¹² on the lines mentioned, or threaten them in any way with the possibility that supplies already arranged might be withheld. It is hoped that it may be made clear to the United States Minister at Tehran that he has been misinformed on these points.”

Matthews

4. Foreign Relations, 1942, vol. iv, p. 220.
5. Anthony Eden, British Secretary of State for Foreign Affairs.
6. British Minister in Iran.
7. See telegram No. 6280, December 11, 9 p.m., 1942, to the Ambassador in the United Kingdom, Foreign Relations, 1942, vol. iv, p. 214.
8. Signed at Tehran, January 29, 1942; for correspondence concerning this treaty, see Foreign Relations, 1942, vol. iv, pp. 268 ff.; for text of the treaty, see Department of State Bulletin, March 21, 1942, p. 249.
9. For correspondence relating to this agreement, see Foreign Relations, 1942, vol. iv, pp. 300 ff.
10. Signed at Tehran December 4, 1942; for correspondence concerning this agreement, see Foreign Relations, 1942, vol. iv, pp. 155 ff.; for text, see Department of State Executive Agreement Series No. 292, or 56 Stat. (pt. 2) 1835.
11. Mohammad Reza Shah Pahlavi.
12. Ahmad Qavam.