Coll 28/109 ‘Persia. Anglo-Soviet-Persian Treaty of Alliance, 1942.’ [‎23r] (45/442)

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2 ,
4. As regards war damage compensation, His Majesty's
Government have already refused, during the negotiations for
the Treaty of Alliance, to consider any payment for damage
caused at the time of the Allied occupation. They have
similarly refused to agree to any payment for damage
ru" lc ^ e( ^ duri ?g military operations in Syria and the
Lebanon._ It is realised that the Persian Government may
again raise this question, but His Majesty's Government are
most unlikely to modify their attitude. As regards other
claims, it isthe practice of the British forces to
entertain claims for damage, other than v/ar damage, against
the amy of occupation, and to settle them on their own
merits, so that it seems doubtful whether any formal
agreement on this point is required.
5. As regards immunities, please consult Commander-in-
Ghief whether, m the light of paragraph 1 . above, it is
desirable to draw up proposals for a formal agreement. If so,
he could be asked to produce a draft, which snould be based on
the position in Iraq and Egypt, for consideration by you
and m London.
6 . The central problem is how to obtain a
contribution from the Persian Government towards the cost of
works carried out bv the Allies, and it is important that
we should be clear how this problem is to be tackled before
we negotiate agreements in respect of railways, ports, roads
and aerodromes. The expedient suggested in paragraoh 2 of your
despatch No. # 92 [of 24th March] is no longer practicable. But
we think it important that any financial arrangements we
make should safeguard our power to obtain payment from the
Persian Government within their capacity to pay. The
longer the war lasts the more sterling xhe Persians will have
and the mpre the Persian Government can reasonably be asked
to pay, since they must, for reasons given in my telegram
No. 12 Saving [of.the 25th June] get much of these funds out
u ?P- Va ^ e hands into their own. Please consider therefore
whether there is any alternative proposal which would meet
this requirement. Could the Persian Government, for instance,
be induced to agree to set aside half yearly, when they
convert 40$ of their sterling balance into gold, some
smaller percentage of these Balances towards paying for
assets "necessary for the needs of Persia"?
7. Failing this, we favour some arrangement on the
following lines
We would ask the Persian Government to agree now to
the terms which would operate in the case of any transfers
which may be agreed upon subsequently. The effect of this
I 36 that nothing could be taken over by the Persians
without their being liable to make payments to us in
accordance with the agreed principles. The terms which we
think should apply are as follows:
(a) that the Persian Government should have an
optionfor a limited time after the end of
hostilities, to take over, at cost less depreciation
or at a valuation, buildings and facilities which
axe the property ®f H is Majesty's Government;
/ (b)