145. Telegram From the Embassy in Iran to the Department of State 1

1585. Annual Review. Reference: Deptel 1158.2

Annual review with Shah took place evening 24th. Two-hour discussion went reasonably well. Shah agreed that Jablonsky and SCS sketch out phased program of procurement within credit limitations set forth in reftel. We made clear all Shah’s expectations cannot be accommodated, but did not discuss price details. Shah gave his views as to which items should have priority.
Bore down heavily on economic burden, as well as complications which would result for US if Shah makes substantial purchases elsewhere. Only outside purchasing Shah seemed seriously interested in is naval package from British.
Threshing out detailed program, which will require Shah to make some hard choices, will still be difficult, but believe at least until his return from three state visits situation here is under control.
Appreciate expeditiousness which our Washington colleagues accorded this problem. More detailed report tomorrow.3
  1. Source: Department of State, Central Files, DEF 19–8 US–IRAN. Confidential; Priority; Limdis. Repeated to CINCSTRIKE/USCINCMEAFSA.
  2. Document 142.
  3. Telegram 1594 from Tehran, May 25, transmitted a detailed account of the annual review session on May 24. (Department of State, Central Files, DEF 19–8 U.S.-IRAN)