Foreign Relations of the United States, 1969–1976, Volume XXVII, Iran; Iraq, 1973–1976

29. Memorandum of Conversation¹

Washington, July 26, 1973, 11:45 a.m.–12:45 p.m.

SUBJECT

• Meeting with the Shah of Iran

PARTICIPANTS

• Iran
• The Shah
• Ambassador Zahedi
• Department of Defense
• Secretary Schlesinger
• Deputy Secretary Clements
• Ambassador Hill
• Vice Admiral Peet
• Deputy Assistant Secretary Noyes
• Major General Brett
• Mr. Alne
• Department of State
• Ambassador Helms

The Shah opened the meeting by remarking what a good morning he had had at Andrews AFB witnessing the flights of the F–14 and F–15, as well as examining both aircraft.

The Shah then entered into a rather lengthy discussion of the situation in which Iran finds itself today. He opened by stating that Iran must remember where Iran is today and where Iran intends to go. In this vein he stated Iranians cannot just sit back and enjoy the pleasure of their country but because of their geographical situation must be constantly aware of their needs. He observed that Iran must applaud the USG coming to terms with the Soviets, as no good can come out of nuclear exchange between these two great powers; consideration must be given to mutual limitations by all concerned. Moreover, we cannot go back to the past relationships, as these will present difficult, if not impossible, problems. However, the non-confrontation of the big powers might well cause others to pursue policies of adventurism. The USG may be sure that no adventures will originate with Iran, and certainly Iran will do whatever it can to pursue peace; but others within the region may try more radical and/or active policies. A prosperous country has much to lose and therefore can be counted on to more vigorously pursue peace, but the poorer countries have little to lose. In addition their governments must keep their people busy focusing on external activities, and this could be troublesome.

The Shah identified a major problem with Afghanistan in that he believes the Soviets could pursue through Afghanistan the objective of obtaining a warm water port on the Indian Ocean. This would obviously lead to the disintegration of Pakistan. The Shah stated that he had said openly and publicly many times that Iran would do anything in its power to prevent trouble in the area and would not let radicals or insurgents into the Persian Gulf. He added that one should imagine the trouble that radical elements could cause in this sensitive area. His government would not neglect its Iranian armed forces to the extent that its future would be jeopardized or that Iran would be unable to meet its obligations within the area. The interesting thing, he stated, is that Iran, by building up its armed forces and establishing a stable, productive country, is doing a positive service to Europe, Japan, and the U.S. The cost of oil will escalate along with everything else; indeed, it is in the U.S. interest that Iran raise the price of oil because, otherwise, the USG would not be able to get resources for shale oil, tar sand, oil gasification, or other types of energy. Therefore, the interests of Europe, the U.S., and Japan are directly related to what is being done in Iran.

The Shah stated that he thought he had mentioned it before, but his plan is to build a gas line to Europe through Turkey and Yugoslavia to Trieste, Italy, and onward (fanning his hands outward) into Europe. When one considers that vegetable oil costs have risen over 300%, one must recognize that gas won’t remain the same price, or, for that matter, even coal. The USG has gas and coal, but others do not, so by placing a gas pipeline into Europe he is linking his country to Europe and can be of service. Moreover, this will preclude the Europeans from separating their security from Iran’s or concentrating on their local security. Security considerations will link all together, and that is why Iran must support Europe. There is a question if Europe goes under, Iran will too. The USG’s problems are lessened to a great extent by the policy the USG pursues with Iran. The Shah remarked that he remembered the first time he came to the U.S.—begging for two battalions of Sherman tanks. Now we are discussing sophisticated aircraft, which clearly means both our countries have progressed. “I do not know what would have happened to us,” he said, “if U.S. policy had not grown with ours.” The Russians call Iran the “self-appointed gendarme of the Persian Gulf.” Why not? Iran would be willing to share the responsibility with others, but they are not ready, and Iran cannot abandon its role because such abandonment might well result in Iran’s destruction.

Iran is an important and prosperous country and must continue to fulfill its role in the region. Unfortunately, some of the arms buildups are not controlled by other countries. Iran must attach priority to its forces, with first priority being the Air Force, and with definite priorities to the Army and the Navy—the Navy because the Persian Gulf is so important to solving the energy crisis in the world. Iran must also go to the Indian Ocean and become an Indian Ocean power. Iran’s planning, however, will have to be done carefully to accomplish this. The Iranian Navy must not have less than is necessary, but also must not overdo its buildup. The Shah saw a very active role for his air power in the Indian Ocean through the use of aerial refueling. He mentioned two refuelings, and an interest in “more than a thousand miles” into the Indian Ocean. The Shah asked, rhetorically: “How far into the Indian Ocean?” “As far,” he replied, “as necessary to have a friend meet me.” He then mentioned as a corollary the need for friendly relations with Australia, South Africa, and Lee Kuan Yew. As he remarked the other day at Blair House,² he feels his air power must have the capability to strike the enemy over their own territory, both as a deterrent force and to preclude air attacks on his country against significant targets. He again spoke of his capability to strike the enemy rapidly through the use of air power and end a war while it was still being discussed in the UN or on a hot line.

Secretary Schlesinger thanked the Shah for his remarks and stated it was a view that we entirely shared. He stated he had a number of points that he felt pertinent to mention in light of the Shah’s remarks. First, the USG is very concerned over the withdrawal of our forces from Europe. The replacement of these forces is dependent upon limited air mobility in that it would take 500 air sorties to lift an armored division to Europe in a day’s time if we had our forces in readiness. In Iran’s case, a careful mix of air and ground forces must be made so that Iran can reach every corner of its country. Secretary Schlesinger encouraged the Shah to investigate the mix of his forces so Iran would not be dependent on tactical air power alone.

The second point Secretary Schlesinger made was the role that Iran would play in the area in the event of trouble in the Emirates or elsewhere in the region. Iran’s readiness to take action is one the USG can only applaud. A question is will it be done on a bilateral or unilateral basis. If Iran takes action or plans to take action, it can expect considerable pressure from the Soviets, and it will take courage to withstand this pressure. The USG must examine what it can do to help Iran withstand these pressures.

Secretary Schlesinger’s third point was with respect to the structure of the Iranian forces. He remarked that in order to achieve effective forces, a careful examination must be made of the mix of their capabilities, the appropriateness of their operations and maintenance systems, the acquisition of military hardware, and how all of these are integrated into the overall force structure. The Secretary stated that through the help of the MAAG much could be done to achieve appropriate forces. He added that a careful resource analysis must be made along with continuous evaluation of all aspects of the armed forces in order to maximize the available forces. The Secretary stated that DoD is prepared to provide technical assistance, including the training of Iranian people in force analysis, both military and civilian, in order that the Iranian forces can withstand the test when called. Secretary Schlesinger remarked that he mentioned this in passing because, unfortunately, others have not effectively integrated their force structures with equipment acquisition.

The Shah thanked Secretary Schlesinger for his remarks and stated that he would be most interested in pursuing this subject. At the moment, he believed the force analysis of the Air Force was on track; however, the Navy needs a comprehensive analysis, particularly as it expands. Deputy Secretary Clements observed that we can help the Iranian Navy as we have the Air Force. The Shah also added that morale, which is essential to an effective force, cannot be accomplished with computers but only with dedication. Iran was achieving this dedication through its programs for social justice. Moreover, he believed his country has progressed to a sophistication wherein it can absorb sophisticated items of equipment. He asked the Secretary if he agreed, and both Secretary Schlesinger and Deputy Secretary Clements responded in the affirmative. The Shah then remarked that over the years the USG and his government had planned and worked together, and would “face the music together,” but, hopefully, “it would be our music and we would play it.” He believed that the value of our effective fighting capability was that one would not have to use it.

Secretary Schlesinger stated that the acquisition of superior arms and their control does not necessarily achieve a country’s objective. It is how it is employed. For example, in the support of Kuwait if Kuwait were attacked, while superior aircraft in themselves would be essential ingredients to such an attack, there are many other issues of importance, a set of issues to which the Secretary stated he does not have all the answers. Such issues must be jointly explored to insure that Iran is always a “bastion of freedom to protect the Persian Gulf.” The Shah agreed and remarked that they are exploring the mobility of Iran’s forces in order to be responsive throughout the region, and are attempting to determine what is enough, based upon the various threats his country faces. In respect to Kuwait, he believes that Iran would have to go to their aid, but how to do this most effectively is the question. The Shah remarked that here is where the Pentagon could be of help, in that they could make a study of the most effective way for Iran to go to Kuwait.

The Shah stated that currently his government was making a study with the Germans on upgunning their tank fleet, particularly the M–47 tanks. He added that Iran has over 880 tanks of older vintage, and it would be foolish to discard them when they could be retrofitted with good guns and made into a viable part of his armed forces. His people liked the M–47s (after overhaul) better than the M–60s. Moreover, this is particularly important in consideration of the need to protect the eastern part of the country. In this regard he stated it was very peculiar how the situation in Afghanistan came to his attention. It was first noted when the Afghans accused Iran of concentrating armor in the East, when in actual fact the Afghans were concentrating armor on Iran’s border. He thought an Afghan might have seen an Iranian bulldozer and had misidentified it. (Note: the Shah stated there was another development which he told to Mr. Elliott last night; however, Mr. Elliott had not read it and could not make a comment. We do not know what he was referring to.) The Shah ended this discussion by stating that the situation in Afghanistan made it necessary for Iran to set up new units in the East.

The Shah then discussed the buildup of his Navy. He introduced his remarks on the Navy, which were very similar to the remarks he made at Blair House, by pointing out how drastic it would be if one of the super tankers were sunk in the Gulf or the Straits. Basically his remarks were directed to upgrading his ships, including British-furnished ships with Harpoon missiles and Iran’s requirement to study this jointly with the USG.

The Shah (this came as some surprise) wants to establish an electronics industry. Japan, the Shah said, is very enterprising, and Iran will inevitably have a civil sector electronics industry. But the Shah wants to include military electronics with emphasis on Hughes and Westinghouse. He wants to join Israel, Italy, FRG, UK, and others on co-production schemes. Such co-production will cost less, he believes, than the alternative of small independent national plants. He said that he needs orders from the USG to make the economics viable. He asked us to consult with General Toufanian, with Hughes and Westinghouse. Secretary Clements asked if he meant production to the same specifications. Mr. Alne noted that Iran may wish to select components and equipment figuring in follow-on overhaul and maintenance activities—to achieve higher and more economic production levels. The Shah said he understood and agreed.

A discussion was then held between Secretary Schlesinger and the Shah on the practicality of utilizing atomic energy for desalinization.

After this brief discussion, the meeting was adjourned to the Secretary’s Dining Room.

1. Source: National Archives, RG 59, Central Files 1970–1973, POL 7 IRAN. Secret; Sensitive. Drafted by Brett and approved by Hill. The meeting was held in Secretary Schlesinger’s office in the Pentagon. Hill provided the Secretary with a briefing memorandum prior to the meeting on July 26. (Washington National Records Center, OSD Files: FRC 330–78–0002, Box 6, Iran 091.112, 1973) The memorandum of conversation was sent to the Department of State on August 8 by Major General John A. Wickham, Jr. of the Office of the Secretary of Defense under a covering memorandum.
2. See Document 26.