The Shah of Iran, who arrives in Washington on June 30, 1958, for a
three-day visit, is scheduled to have substantive talks with you at the
White House on the afternoons of June 30 and July 1.
Of primary importance to him at the present time is the state of his
country’s defenses as a member of the Baghdad Pact and as a country
sharing a long common border with the Soviet Union. He believes that
Iran should have considerably larger indigenous forces with which to
fulfill its commitments under the Pact and to defend itself against
possible Soviet aggression. In my talks with him in late January, I made
an effort to convince him that the deterrent strength of the United
States constituted the primary obstacle to Soviet aggression in the
area. He remained convinced that if he had an opportunity to discuss
military strategy with you, additional United States military assistance
would be provided.
While military matters are his main preoccupation at present, he may also
mention his desire for United States economic assistance over the next
five years, after which time he expects Iran to have sufficient
resources from oil to meet all its needs.
I am enclosing some background information on these subjects in the form
of a brief memorandum. There is also enclosed a briefing paper prepared
by the Joint Chiefs of Staff1 which we were asked to
sent to you.
[Enclosure]2
BACKGROUND INFORMATION ON THE VISIT OF THE SHAH OF IRAN
(June 30–July 2, 1958)
The Role of the Shah
The Shah of Iran will be in Washington June 30 to July 2 on his third
visit to this country. He was last here in early 1955. The Shah is a
loyal friend of the United States and is a firm supporter of the
Free World, but he is much occupied these days with problems of
defense and we hope that his stay in Washington will serve to give
him assurance and new confidence in the extent of the measures we
have taken and can take in his interest.
The Shah is very intelligent and sincere. He has greatly matured in
recent years and is deeply mindful of the important role that he
plays in Iran, where virtually all authority is concentrated in his
hands. He has voluntarily aligned his country with the East through
membership in the Baghdad Pact and his support for Free World
policies, especially in the United Nations. He is now pushing ahead
with a vast economic development program and other reforms designed
to bring lasting political stability and social progress to his
country. The Shah’s primary weakness stems perhaps from his fears,
real and imaginary, for the security of his own position and the
security of his country.
Origin of Visit
During the Secretary’s visit to Tehran in January, 1958, he found the
Shah greatly concerned with his military problems. He was convinced
that Iran’s membership in the Baghdad Pact—unless much larger Pact
forces were created—did not provide adequate guarantees for his
country’s defenses. He strongly favored full United States
membership in the Baghdad Pact and insisted that Iran must have
stronger forces both to carry out its obligations under the Treaty
and to provide for its own protection. The Secretary made an effort
to convince him that the deterrent strength of the United States
constituted the primary obstacle to Soviet aggression in the area,
and that, while Iran should certainly maintain national military
forces as a contribution to mutual defense, it might be a mistake to
build up these forces at the expense of the country’s economic
development and social progress. He reiterated his desire for
extensive
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aid from us in
order to build up his military strength and remained convinced that,
if he had an opportunity to discuss problems of strategy with the
President, additional United States assistance would be provided. It
was under these circumstances that the President authorized the
Secretary to invite the Shah to Washington, where he might have an
opportunity to discuss matters of military strategy with the
President.
Objective of Visit
Our objective during his visit should be to persuade the Shah:
- (a)
- that the support and assurances of further support we have
given the Baghdad Pact will greatly enhance the security of
his country;
- (b)
- that the greatest obstacle to Soviet aggression against
Iran is the deterrent power of the United States; and
- (c)
- that to overemphasize the buildup of separate powers
around the Soviet Bloc may be such a costly undertaking that
it will jeopardize the strength of the Free World and end
with security nowhere and bankruptcy everywhere.
At the same time we should sympathize with the Shah’s very earnest
desire for some additional military help and should indicate to him
what new equipment and training we can provide.
Iran and the Baghdad Pact
To achieve our objective of bolstering the Shah’s morale and his
confidence in our friendship, we should refer to the record of our
firm support of Iran, especially during the dangerous period of the
Azerbaijan crisis in 1945–46 and should reiterate to him that “if
Iran should again be the victim of Soviet aggression, the United
States will not stand idly by.” We should add what we said in
January 1958 at the Ankara meeting of the Baghdad Pact to the effect
that United States forces which came to the support of our friends
in the Pact would be equipped with the most modern weapons.
While for many reasons we have not considered it wise to accept
formal membership in the Baghdad Pact, we have taken other measures
which provide such a degree of support for the Pact and its members
that our relations to the Pact may be worth as much to it as our
actual membership. There are, among other things, the Joint
Resolution on the Middle East,3
our statement of November 29, 1956,4 in which we said we would view with utmost
gravity any threat to the independence of the members of the Pact
and our active membership in the military, economic and
counter-subversion committees of the Pact.
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The Shah’s contention that his obligations under the Pact require a
great enlargement of his forces is based mainly on his
interpretation of a recommendation by the Combined Military Planning
Staff of the Pact that 16 full strength divisions are needed to
defend adequately Iranian territory. The Shah thinks that these must
be Iranian divisions. Our Joint Chiefs of Staff have determined that
10 divisions would be sufficient for Iran since the retaliatory
power of United States forces constitutes the main deterrent to
Soviet aggression and since additional Iranian forces would be a
serious drain on available manpower and resources. The most
effective counter-argument that we can use to persuade the Shah that
we are not neglecting his requirement is that the United States has
already undertaken to modernize existing Iranian forces as rapidly
as Iran can absorb new equipment. In this connection, the Joint
Chiefs of Staff have suggested that we inform the Shah that, as part
of the modernization program, the United States is prepared to
provide 272 M–47 tanks, 14 new reconnaissance aircraft, two
additional mine sweepers and 52 F–86 jet aircraft to replace by 1961
existing LT–6G and F–84G aircraft.
Economic Aid
The Shah will raise with us also his desire for further economic
assistance. He has great confidence that there will be a sharp
increase in Iran’s revenues from oil during the next few years. He
wishes, therefore, to press ahead with his development program and
at the same time take other domestic measures—military and
civil—that require an increase in his budget.
He believes that within 5 years his country will receive
approximately $500 million annually from oil revenues and by 1968 as
much as $1 billion. While the Shah’s hopes may be exaggerated, Iran
now has $210 million in annual oil revenues and prospects are for a
steady increase. The Shah has hailed enthusiastically the recent
conclusion of an oil agreement with Standard of Indiana. He has
asked us to provide as much as $250 million in loans over the next
five years until Iran can support its military, economic and social
programs from its own resources. We have informed the Shah that the
Development Loan Fund might be able to provide $40 million in loans
in the current year if justifiable development projects are
submitted. Current negotiations between an Iranian delegation and
representatives of the Fund indicate that it will be possible to
lend Iran a substantial portion of this amount in the current year
and to have a credit available for the remainder. We have pointed
out frequently to the Shah and to other Iranian leaders that
Congress appropriates funds on an annual basis and that the United
States Government cannot make commitments for future years.
