891.51/7–2948: Telegram
The Ambassador in Iran (Wiley) to the Secretary of State
899. Minister Agriculture Busheri has approached Embassy informally requesting that we seek Department and Export-Import [Page 167] Bank preliminary, views re possibility Iran Government borrowing $10,000,000 for purchase agricultural implements and plants to manufacture synthetic ammonia and insecticides. If reaction favorable Minister contemplates negotiation with two or three agricultural implement manufacturers for up to 1,000 tractors for 1948 and undetermined amounts of other implements which would be purchased and distributed by government. Agreement would be made with manufacturers for establishing servicing centers. Plans for synthetic ammonia and insecticide plants are rather vague and in discussing plans Minister had to send out for an assistant to recall name “synthetic ammonia” although he did observe that such plants are the “very latest thing.”
Questioned as to where this program fitted in with seven-year plan which Embassy understood was to be self-financed at least first year, Minister observed this program was for immediate action and anyway he did not see how seven-year plan could be started without foreign borrowing.
In later discussion of foregoing with Ebtehaj Governor Bank Melli he complained that he could not understand confused policy of present government regarding foreign borrowing. He continues to oppose piecemeal approach to development program and commented that if Minister Agriculture obtained this loan every other Ministry would have an “urgent” program. He questions intrinsic desirability of program and feels it should be passed on by board of competent experts.
As noted in joint American and British Embassy report (Embassy dispatch 159, June 231) Embassy does not consider that large-scale importation of agricultural machinery would be desirable. In 1948 dealers are expecting to bring in up to 600 tractors which should be enough considering there are probably not more than 200 in country now. Ministers plan to concentrate on limited number makes and types has merit from servicing standpoint but this could perhaps be achieved without governmental entry into field on large scale. With respect to proposed factories, Ministry’s nebulous plans should receive study competent experts. Although they might be desirable they could hardly be classed as high priority projects.
Embassy suggests reply along following lines: We are reluctant to give serious consideration to present inquiry since we understand legislation will soon be passed setting up planning board and authorizing broad economic development program. Applications for credit under this plan should more properly be directed to International Bank. However, if Iran Government prefers to separate present program from general program and submit to Export Import Bank detailed [Page 168] plans worked out with American suppliers, Iran Government is assured that credit request based on sound plan would receive careful consideration of bank.
Sent Department 899, repeated London 73.
- Not printed.↩