'File 73/7 II (D 22) Status of Koweit [Kuwait] - Baghdad railway, Anglo Turkish negotiations' [‎61v] (128/540)

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Recent advices received from Baghdad show that the available storage room
in the town is small, and all has been secured ; much more is wanted, and, although
the local agency An office of the East India Company and, later, of the British Raj, headed by an agent. of the Imperial Ottoman Bank is quite willing to erect temporary
stores, no suitable site can be found within the town for putting up such buildings.
The administration has been brought by a series of circumstances to face ohe
difficult problem of reorganisation and construction at Baghdad, and this is now
rendered more difficult of solution by the fact that the Baghdad Kailway Company
are taking in hand the work of construction of the line from Baghdad northwards,
and besides have in viaw the construction of the port.
The new Customs buildings should be constructed close to the port and also be
within easy reach of the railway terminus, and it is quite obvious that the Customs
administration can take no steps until the railway company have fixed the site of
the terminus and decided the position of the future port on the river. Even when
these two points are settled, the question of the storage of goods has also to be solv
ed, as the railway company not only have the right to construct the port of
Baghdad, but by Articles 23 and 24 of the Convention of the 5th March, 1903, also
have the right to build warehouses for the storage of goods.
In view of these considerations and of the urgent necessity for coming to a
prompt decision in order to place the customs service at Baghdad on a proper foot
ing, the administration, rather than undertake the carrying out of an expensive
scheme of construction, which will very probably involve an expenditure of some
£ T. 130,000, would seem more inclined to arrive at some arrangement with the
railway company. Negotiations have not, I understand, actually taken place; the
administration has limited its action to making enquiries of the railway company
as to the intentions of the company with regard to the port, railway terminus, and
the stores, and the sites which those works are to occupy. Enquiries have also
been made as to whether the railway company would be prepared to entertain pro
posals for the building of the new custom-house, and I understand the company are
favourably disposed to discuss matters with the administration and to make suit
able arrangements. Matters appear to have reached this stage, and it is feared
that, should further congestion take place in the Baghdad Customs, the administra
tion will have no alternative but to come to terms with the railway company.
In the concluding paragraph of their letter of the 10th ultimo the Board of
Trade express the view that it appears premature to make any arrangements for
the construction of the custom-house and bonded stores by the railway company
until the company which will work the lines from Baghdad to Bussorah has been
formed, and, further, that, as the lines north and south of Baghdad will be under
different companies, it would be preferable that the construction of the cutoms
buildings should be the joint undertaking of the two companies rather than that of
the Baghdad Railway Company alone. The actual position of affairs at Baghdad is,
however, such that it cannot be allowed to continue indefinitely ; some line of action
must be adopted, and the hands of the administration may be forced at any time to
come to some arrangement with the Baghdad Company.
Although the Baghdad Railway Company have given up their concession for
the construction and working of the Baghdad-Bussorah section, they still retain the
exclusive right to build the port of Baghdad and to put up warehouses for the
storage of goods, and it is conceivable that some arrangement for the erection and
working of these and similar stores conjointly with the new company that is to
construct the Baghdad-Bussorah section might be come to, were this company
already formed. The subject of participation in the building of the port and ware
houses might possibly be considered in the forthcoming discussions relative to the
Bussorah section.
February 24, 1912.
(Copy sent informally to the Army Department for transmission to the Divi
sion of the Chief of the Staff.)