We have just completed a searching examination of the major military purchase program planned by the Shah of Iran over the next several years. This has been a particularly difficult exercise, for it has required us to balance an almost total lack of military requirements for additional aircraft against the likelihood that our close relationship with Iran would be damaged if we were to deny the Shah’s request.
As you know, the intelligence community examined the threat to Iran this summer and reported that the forces now possessed by the Shah are fully competent to meet any threat with which Iran may be faced for the foreseeable future. Juxtaposed against this limited threat, the Shah’s latest purchase proposal—for 71 F–4–Es, 4 RF–Es and 30 C–130s—is particularly disturbing to me, for the acquisition of so much new equipment can only concern Iran’s neighbors and, likely, force them to react by acquiring new arms for their own forces.
The Shah’s chief interest is his security. To agree to his full-purchase program would, to my mind, be destabilizing in the Persian Gulf area, lead his neighbors—principally Iraq—to increase their arms inventories, strain Iran’s financial and personnel resources, and present new opportunities for the Soviets and radical Arab states to penetrate the area.
I believe, therefore, that we must seek to dissuade the Shah from buying all the aircraft he desires and, for this reason, am willing to agree to sell Iran only two squadrons (UE–16) of F–4Es, plus up to 7 attrition aircraft, together with 4 RF–Es and 30 C–130s.
There is little question that the Shah will be unhappy over our unwillingness to sell him all that he wants. Nevertheless, I consider [Page 2]the course he appears to be following inimical to Iran’s interests and our own, and I think the time has come to talk bluntly with him about arms stability in the Persian Gulf area, as well as the excessive monetary and personnel costs which these programs would entail.
I suggest that our staffs should now discuss the means for persuading the Iranians of the logic of this arrangement, with a view to maintaining both a stable arms balance in the area and the close and productive US-Iranian relationship which in recent years has been so important for promoting U.S. interests in Southwest Asia.
- Source: Washington National Records Center, OASD Files, ISA Files, FRC 330–73A, 1975, Iran, 334–1970, 470 Iran. Secret. In Telegram 4760 from Tehran, October 31, the Embassy advised that the Shah had urgently demanded clarification of the news from F–4 manufacturer McDonnell Douglas that the U.S. Government had not approved the seventh and eighth squadrons. (National Archives, RG 59, Central Files 1970–73, DEF 12–5 IRAN.) In Telegram 4772 from Tehran, November 2, the country team recommended that the U.S. Government assert better control over Iran’s contract negotiations with private companies, and avoid manufacturer pressure to sign contracts in advance of funding, by channeling them into FMS procedures. (Ibid.)↩
- Anxious that unwarranted Iranian armament not destabilize the Gulf, Laird informed Rogers that he was prepared to sell only two squadrons of F–4Es to the Shah.↩