‘Bagdad Ry’ [‎38r] (75/129)

7
'when, as 1 had the honour to explain to. your Lordship, rapid and decisive action wa 8
essentia], would have probably resulted in upsetting the whole negotiation, and would
have enabled the Russian Bank to obtain, in return for a fresh Russian advance if not
a formal j\Iint monopoly, at any rate so stiong a IVfint contract as would have endangered
the future of the Imperial Bank of Persia.
I would also respectfully point out that by obtaining a collateral hold on the
customs of the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. , we have strengthened our guarantee against their beino-
employed as security, or partial security, for a foreign loan. The engagement of 1897
>vould not, as I have observed, have made it legally impossible for the Persians to under
take to pay a Russian advance out of the revenues of, say, the customs of Bender Abbas,
so long as the creditors did not stipulate for supervision and control in case of
default, nor will the clanger of such an assignation or ear-marking of these revenues be
absolutely excluded till we have either made a sufficiently large loan to prevent it, or
have obtained a clear promise from Persia, not only that she will not permit foreign
control or supervision over the customs of Southern Persia, but that she will never affect
or assign any portion of their revenues for a foreign loan without our consent. I cannot
but think that an agreement by which the customs of “ Pars and the Gulf Ports ” are
made for 20 years, the collateral security for an English advance is at least a slight step
in this direction, and pro tanto, a substantial, if only a modest, gain.
I also think that the lien on the posts, and above all on the telegraphs, including the
new line which the Persian Government is building to Seistan, is worth having, if'only
to prevent the pledging of their revenues to Russia, and thus giving her a pretext for
meddling in their management.
A colleague representing a neutral Government told me that he considered this
provision a distinct advantage from our point of view. “ L’Angleterre,” he said, “ a 4t4
tr£s adroite en chipant une ressource qui aurait pu servir de garantie, les douanes
du nord une fois epuisees, a un nouvel emprunt Russe.” And, as I mentioned in my
telegram No. 62, the Viceroy, who is now disposed to depreciate its value and to contend
that the Government of India always insisted on the customs as first security, himself
suggested in his telegrum of the 11th February, the telegraphs as first security and the
customs as second, for an Anglo-Indian loan of half a million.
AVhen his Excellency complains that these loans are not arranged on business lines,
by which I suppose he means, in an open and straightforward manner, and in return for
positive (instead of merely indirect, remote, and negative) advantages on both sides, he,
I think, loses sight of the fact that as Persia’s engagements Avith Russia forbid* her
to make a foreign loan “ a longue echeance ” at all, the conclusion of such a transaction,
in a strictly business manner, presents formidable initial difficulties, which can only be
turned by a flanking movement, and not by a direct attack on the open, like Lord
Methuen’s at Magersfontein.
Persia dare not openly violate her contract Avith Russia, and must therefore either
have recourse to subterfuges to evade it or submit to all its consequences, and, in return
for each Russian advance, consent to deal some fresh bloAv to British and Indian
interests. AVe have, moreover, in Russia an active competitor, which has already
advanced Persia over 3,000,000/. and is willing to provide more, if absolutely necessary,
on easy terms, rather than let her escape fram financial tutelage. Just noAv the Atabeo-
would, for a variety of reasons, rather borroAV from us, caeteris paribus, than from the
Russians, but he would rather borrow from them, even on unfavourable terms, than risk
an open rupture Avith them.
T ^ is °' vn v ^ ews on ^he subject Avere briefly summed up in a phrase which he used to
M. !Naus Avhen the pros and cons of our rival offers were being discussed by the Persian
Ministers: “ Si prenons aux Russes,” said his Highness, in his broken French, u Anglais
fdches—si pienons aux Anglais, Russes faches; quelqu’un toujours fache—alors prendre
ie meilleur.”
Had avc more fully realized this standpoint in 1898 avc might iioav be the masters of
Persia.
1 trust that your Lordship will excuse the excessive length of this despatch. The
most important question discussed in it—that of the bearing of the engagement of 1897
on the expression “Fars and the Persian Gulf The historical term used to describe the body of water between the Arabian Peninsula and Iran. ports ” of the loan Contracts—is no longer
immediately pressing, in view of the Grand Vizier’s decision, arrived at since I began to
write it, to defer for the present his request for the completion of the advance of the 4th
j ^ hoAvever, almost certain that he will, sooner or later, apply to us again, and
I hawe therefore thought it might be convenient, and might save subsequent misunder
standings involving costly telegraphic explanations, if I stated, however lengthily and
minutely, in a despatch, which could be kept for reference, the salient points to be borne
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