14. Telegram From the Deputy Secretary of State (Rush) to the Department of State1

Depto 95/1942. Subject: Conversation with Shah.

1. Deputy Secretary accompanied by Sisco and Helms had ninety-minute audience with Shah, who was in particularly good form as he, in an expansive mood, articulated well-integrated and balanced tour d’horizon of current developments on world scene and in his own region. This preceded by lengthy and impressive exposition by Shah of internal Iranian progress. Throughout Shah made frequent references to his high regard for President Nixon personally and to his policies. Secretary Rush lauded Iran’s efforts and at invitation of Shah outlined in some detail President Nixon’s efforts to move away from era of confrontation to era of negotiation. Secretary Rush underscored warm and friendly relations which existed between Iran and US, our reliance on Iran as major element of stability in the Persian Gulf area, our continuing hope Shah will play leading role in developing broad regional cooperation among nations of the area, and our intention to continue to enhance Shah’s strength in order to deter possible Soviet designs and assure that any discussions and negotiations in the future will be from a position of strength.

2. After normal amenities and photographs, Shah spoke at some length on internal developments. He pointed out with obvious pride to 14.4 GNP growth last year and developments in both industry and agriculture. He touched on projected increases of steel looking to a goal of 15 million tons within the next 10 years, focusing on the province of [Page 44]Khuzestan. He is convinced that in the next decade modern technology will bring Iran to the level of advanced European countries, that the application of new irrigation methods which conserve water and the scientific use of fertilizers will produce double and triple crops. He focused in particular on the extraordinary production of alfalfa, sugar cane, and other farm products resulting from a happy combination of sun-ray angles and adequate water supply resulting from dam construction in recent years. He stressed that development of infrastructure will provide Iran with the means and institutions to help assure its stability. He is organizing local village councils along with labor associations to build democracy from the grassroot. Throughout, he stressed his own personal involvement and his hope that he will live at least another ten years to see his present goals achieved. He stressed his dedication to developing a modern Iran based on an ethic of hard work, meaningful rewards for work done in a society based on differences in capacities of individuals. He sees the two year compulsory military service as an essential training to inculcate principles of discipline in his people. He pointed up the “uniqueness” of the Iranian effort, taking the best from a variety of systems, citing for example that the collectivization of agriculture works in Iran (not in the USSR) because leadership motivates hardworking Iranians living in a climate devoid of the oppression characteristic of the Communist regime.

3. From this the Shah switched into a discussion of Soviet intentions in the area, identifying Iraq and India as two countries with which the Soviet Union has treaties of friendship and which could provide direct avenues in the traditional Russian thrust for access to the Persian Gulf and Indian Ocean. In this context, the Shah spoke of his frank talks with Kosygin during visit last month. The Shah reported he told “Kosygin that I could not stand for subversion in the Persian Gulf and that I could not stand for the disintegration of Pakistan.” He pointed out that the Persian Gulf is his life-line and that it must remain free for the uninterrupted passage of his ships and those of the littoral states. The Shah explained that the breakup of Pakistan could well tempt the Soviets into some deal with Afghanistan which would permit a direct thrust to the Indian Ocean. He stated that trouble in Pakistan would lead to a “Vietnam” near Russian borders, a development which Kosygin conceded the Soviets would not want to see. The Shah also emphasized his concern that there be no efforts in Baluchistan or Pushtunistan which could lead to their becoming separate entities.2 As for Iraq, the Shah [Page 45]stated that he would react positively to Iraqi peaceful overtures but then he would insist on a total end of Iraqi incursions across the Iranian border and other evidences of hostility before he would make any settlement which deprived him of his Kurdish card. He indicated that there had been some feelers from Iraq in recent days but did not become specific as to the form they took. At this point, the Shah spoke of India, its sanctimonious attitude toward the outside world, and his belief that this country employs a double standard in judging its actions as against those of other countries.

4. Deputy Secretary Rush lauded Shah’s internal efforts stressing that Iran’s military strength as well as its internal strength were a major element of stability in the Gulf. In some detail, he commented on various aspects of the internal developments described by the Shah, drawing various analogies to our experiences in agriculture. After reiterating the warm personal and official relations that exist between President and Shah, Rush outlined specifics of President’s policies in opening dialogue with Communist China, concrete agreements with Soviet Union, moves toward détente and the positive impact of these moves on the Persian Gulf and Arabian Peninsula area.3 We have more to gain than the Russians from these moves, Rush said. Deputy Secretary made clear our assessment parallels in very large measure that of the Shah’s on the significance of worldwide and regional developments. Shah was much interested in rundown which Secretary Rush gave of trip to the Subcontinent, the Simla process, the recent India–Bangladesh proposals, Mrs. Gandhi’s current outlook, our intention to maintain strong bond of friendship with Pakistan and Iran while trying to improve, if possible, our relations with India. Rush assured Shah that US would view with concern any move which could threaten the political independence and territorial integrity of Pakistan. He stressed Iran must be strong. Secretary Rush agreed with Shah’s efforts to try to improve relations with all of its neighbors, including Iraq since Iran would be doing so from a position of strength.

5. In response to a question from Secretary Rush about Saudi Arabia, the Shah replied that his relations with King Faisal personally [Page 46]were good and that he regarded him “almost as a brother.” On the other hand, he pointed out the Saudis were difficult to make ongoing arrangements with and he realized more work would have to be done to make a reality out of Iranian-Saudi collaboration. Turning to Sheikh Yamani’s intimation in Washington that Saudi Arabia may be more disposed than in the past to use oil as a political weapon in bringing about a settlement of the Arab-Israeli conflict, the Shah said that he could conceive that a beginning to improve the “political atmosphere” might be based on the Rogers Plan. He stated that when Egyptian Foreign Minister Zayyat visited Iran in March, he told the Shah, “Egypt will accept the Rogers Plan.” If negotiations in terms of Res 2424 were not feasible under Jarring, perhaps they could be put in the Four Power context. Since the Four Powers divided three to one against the U.S., the Shah stated, perhaps the forum could be expanded by the addition of certain littoral states of the Mediterranean, such as Italy, Greece, Spain, etc. In any event, the Shah emphasized something should be done to ease the situation between Israel and the Arabs if for no other reason than to keep President Sadat from embarking on some “suicidal” military venture.

6. At this juncture in the audience, the Shah switched to the current oil negotiations between Iran and the consortium. He expressed the hope that these negotiations could be promptly concluded since in his opinion the consortium has nothing to gain by prolonging them. He stated that he had made up his mind not to push up the price of crude oil beyond what he felt was fair, i.e., we wanted adjustment made to compensate for the dollar devaluation, and he wants to obtain revenues comparable with those which will go to the Arab OPEC states as a result of the participation agreements. In explaining his interest in controlling the rise in price of crude oil, he pointed out that an excessive rise would cause increases in the price of goods and commodities in Europe and the U.S. which Iran had to buy and import. Such an increase in these prices he did not feel would be to Iran’s advantage at this juncture. The Shah also indicated that he was against leapfrogging and did not want to see it occur.

7. The Shah pointed out that Iran has recognized most of the Communist countries with the notable exception of North Vietnam. He said the North Vietnamese had not reacted to his overture and that as a result it will be a long time before there would be an opening of diplomatic relations.

[Page 47]

8. The Shah and Secretary Rush had an exchange about Iranian procurement of American aircraft during which the Shah presented his well-known views about the development of his Air Force. He reiterated his desire to have the new Chief of Staff of the U.S. Air Force come to Iran at the beginning of his term of office rather than at the end as General Ryan had done. The Shah said, “I want to start right off with the new man so that we can do joint planning together during his tenure.” Rush agreed and discussed with the Shah the role of the helicopter in a close support tactical capacity.5

10. Picking up the theme of worldwide developments, Secretary Rush gave a detailed explanation of the U.S. position on MBFR, CSCE, and the SALT negotiations. With a view to assuring the Shah that he could continue to rely on us in the future, Deputy Secretary Rush outlined in detail our defense posture, our plans to go ahead on the Trident and B–1. He explained that the disparity in the number of ICBMs and LCBMs in the SALT agreement was more than compensated by our qualitative advantages derived from MIRVing our missiles, our B–52, our bases, etc. In short, Secretary Rush stressed that we intend in the future to remain the number one military power in the world, and that we can be relied upon. This met with a very affirmative nod from the Shah. Rush said we will continue our diplomatic efforts to get the parties to the Arab-Israeli dispute negotiating.

11. Secretary Rush concluded the audience by again extending the President’s good wishes and noting his great pleasure at the prospect of the July visit of the Shah and Empress.6 The Shah indicated how pleased he was that he will be exchanging views with President Nixon in July.

Rush
  1. Source: National Archives, RG 59, Central Files 1970–73, ORG 7 D. Secret; Priority; Exdis.
  2. The Baluchis and Pushtuns of Pakistan’s frontier regions both had separatist factions which demanded independence or, in the latter case, union with the Pushtuns of Afghanistan. Under the rule of Mohammed Daoud, Afghanistan contested the existing Pakistan–Afghanistan border for denying self-determination to Pakistani Pushtuns and also supported the insurrection of the Pakistani Baluchis, which threatened to spread to Iran’s Baluchi population.
  3. Rush and Sisco met on April 24 with Hoveyda, who stated that Iran welcomed détente but feared that it might release Soviet energies for the Middle East. Hoveyda stated: “As for this area, Iran is far too vital to United States’ interest for the U.S. to make any deals behind Iran’s back. At the same time Iran cannot expect the U.S. to come to its assistance and Iran must stand on its own feet. This costs a lot but there is no alternative. Pakistan thought it could rely on its membership in CENTO and SEATO and on its special relationship with the U.S. to help ensure its security. However, look what happened in 1965 and 1971. Pakistan stood alone and lost.” (National Archives, RG 59, Central Files 1970–73, ORG 7 D)
  4. UN Security Council Resolution 242, adopted November 22, 1967, called for Israeli withdrawal from territories occupied during the 1967 war and “acknowledgement of the sovereignty, territorial integrity, and political independence of every state in the area.”
  5. In an April 27 memorandum to Kissinger, Saunders and Appelbaum conveyed the Shah’s additional request to transfer U.S.-origin aircraft and other equipment to Pakistan. Kissinger instructed the Department of State to advise Iran that the administration was prepared to consider this request favorably, pending a formal review. (National Archives, Nixon Presidential Materials, NSC Files, Box 602, Country Files—Middle East, Iran, Vol. IV, September 1971–April 1973) Telegram 98355 to Tehran, May 22, informed the Embassy that this case-by-case approach to Iranian transfers to Pakistan was designed to limit their negative impact on U.S.-Indian relations as well as assure that each request complied with statutory and policy requirements. (Ibid., RG 59, Central Foreign Policy Files, [no film number])
  6. Backchannel message WH30729 to Tehran, March 12, transmitted Nixon’s invitation to the Shah for a State visit: “I am most eager, as I begin my second term, to review with you the international situation, particularly in the area of the Middle East and the Indian Ocean.” (Ibid., Nixon Presidential Materials, NSC Files, Box 425, Backchannel Files, 1973, Middle East/Africa) In backchannel message 63 to Kissinger, April 6, Helms reported that the Shah had chosen July 24 for a visit. (Ibid.)