Papers of the War Cabinet's Eastern Committee [‎154v] (308/544)

4
Situation in Trans-
Caspia.
Financial Aid to
the Trans-Caspian
Government.
3.—(a.) The Committee had before them a number of telegrams
and papers regarding the situation in Trans-Caspia, including the
following: E.C.-2105; a note by the India Ottice on “Present
Situation and Future Action in Turkestan” (E.C.-2171). Appendix II;
E.C.-2252, 2279, 2281, 2299, 2308, 2309,2325,2320,2338,2349,
2353, 2373—Appendix III, and 2374).
The Chairman said that the situation in Trans-Caspia had
developed considerably since the Committee had last met. General
Malleson had pushed on to Merv, to which move the Indian Govern
ment had at first demurred. The matter had been referred home,
and eventually the Government of India had agreed, lor the time
being, to allow him to remain at Merv, subject to the reservation that
he was not to advance beyond it or south of it. The question of the
policy of His Majesty’s Government in regard to Bolshevism had been
discussed at a meeting of the War Cabinet the previous week, and the
decision then taken had been communicated by the Secretary ol State
for India in a telegram to the Viceroy, dated the 15th November
(E.C.-2373. Appendix III). This telegram laid down, among other
things, that Malleson should occupy Merv as long as the military
situation necessitated it, but British or Indian troops should not be
employed east or south of that place. In the light of the above, the
Indian Government had been invited to reconsider their orders not
to reinforce Malleson. He (the Chairman) did not share the fears
of the Indian Government as to the occupation of Kushk by
Malleson’s force. The Ameer, he felt sure, would far sooner have
Indian troops there than Bolsheviks, and he would have been
disposed to support Malleson’s policy in its entirety.
(b.) The Committee had under consideration three telegrams
from the Viceroy, dated 13th, 19th, and 20th November respectively
(E.C.-2372, 2402, and 2426—Appendix IV).
The Chairman said that the question of financing the Trans-
Caspian Government had been discussed by the Committee at their
35th Meeting (Minute 2) on the 17th October, when the Committee
decided—
“That the India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. should instruct Malleson that the
change in the general situation rendered our previous policy of
keeping the Trans-Caspian Government going of doubtful
value, and he should therefore be strictly on his guard against
committing himself to spending money ; he should further be
informed that His Majesty’s Government did not in any case
contemplate any issue of notes or the establishment of a local
currency.”
The most recent telegram before the Committee, which had
only just been received, stated that, while Trans-Caspia’s monthly
expenditure was 16,000,000 roubles, they had no means of raising
revenue until a stable Government was installed, owing to trade
stoppage and inability to impose taxes ; that there were only two
methods which were likely to produce money—(a) to sell bank drafts
on India for rupees Indian silver coin also widely used in the Persian Gulf. , or on London for sterling, in order to tempt
larger holders of depreciated roubles to make them available ;
(6) Malleson to lie authorised to collect rouble notes against a
promise to pay in silver rupees Indian silver coin also widely used in the Persian Gulf. three months later, that there was a
good deal of money in the country which was hoarded in small
quantities ; and, finally, that, if His Majesty’s Government decided to
give the financial assistance asked for, the supply from India of the
specie required was out of the question, and the Indian Government
could not undertake to meet rupee drafts on India.
Mr. Keynes said that the Treasury were not clear as to the
purpose for which it was proposed to maintain and finance the
Askabad Government. The sum asked for to-day was a quarter of a
million sterling, but a total of one million sterling would eventually
be required. The rouble currency was at present in a ridiculous
position, no less than twenty or thirty kinds of currency being