NOTE: External links to other Internet sites should not be construed as an endorsement of the views contained therein.
| The State Department web site below is a permanent electronic archive of information released prior to January 20, 2001. Please see www.state.gov for material released since President George W. Bush took office on that date. This site is not updated so external links may no longer function. Contact us with any questions about finding information. NOTE: External links to other Internet sites should not be construed as an endorsement of the views contained therein. |
250. Letter From President Johnson to the Shah of Iran/1/ Washington, November 28, 1967. /1/Source: Johnson Library, National Security File, Special Head of State Correspond-ence File, Iran, 9/1/67-12/31/67. No classification marking. Telegram 76981 to Tehran, November 30, transmitted the text of the letter for delivery to the Shah. (Department of State, Central Files, AID (U.S.) IRAN) Your Imperial Majesty: This is to let you know that I have received and read with interest your letter of November 15./2/ I am considering the points you raised and will respond soon. /2/Document 242. I wish also to add a personal word to my formal statement for the ceremonies here this week marking the closing of our AID mission in Tehran./3/ I am sure from our talks together you know how highly I respect the work you and your people are doing in the development of your nation. Many times--as I face frustrating and difficult problems in various parts of the world--I am heartened to remember what Iran has accomplished under your great leadership. And I would underscore my hope that the end of our AID program will be the beginning of a new era of cooperation and partnership between our countries. /3/For text of statements on November 29 by Secretary Rusk and President Johnson marking the termination of the U.S. AID mission in Iran, see Department of State Bulletin, December 18, 1967, pp. 825-827. I am grateful for the close relationship that exists between ourselves and between Iran and the United States, and I look forward to continuing and strengthening this relationship. Mrs. Johnson joins me in sending warmest wishes to you and to the Empress. Sincerely, Lyndon B. Johnson
251. Telegram From the Embassy in Iran to the Department of State/1/ /Tehran, December 5, 1967, 1410Z. 1/Source: Department of State, Central Files, POL IRAN-US. Confidential. Repeated to CINCSTRIKE/USCINCMEAFSA. 2410. New Era in U.S.-Iran Relations. 1. Referring to four major economic projects which Shah had inaugurated preceding two days in Khuzistan, I began 90-minute audience with him 5th by suggesting this experience was for me dramatic example of new partnership between US and Iran which President had in mind when issuing statement re conclusion of AID program in Iran. I noted all four projects have some American private sector participation. At same time they fully Iranian in character and foreign contribution is mix of several nationalities. 2. Shah was obviously exhilarated by launching above-mentioned projects. In characteristic mood he said Iran would go on to greater heights in economic development. Noting that natural gas has 2700 possible derivatives, including even aspirin tablets, Shah said petrochemical field is one area where Iran can achieve large-scale success. He looks particularly to Americans who have leadership in petrochemicals to be helpful. He also referred to special relationship with US which he wishes to maintain in desalinization field. 3. There followed philosophical discussion of factors which have caused Iranian spectacular success, e.g. oil income and its wise use, stability stemming from cultural tradition of monarchy, Iran's ability to adjust to changing times and to pick up good points from various societies. When subject of strong leadership was mentioned, Shah quickly described this as an ingredient temporary in nature. He said he looks forward to day not too far distant when Iran will also take off in institutionalized representative government. 4. Referring again to USAID termination celebration on November 30, I noted fine publicity this received in US and my impression that broader segment of American public opinion as well as President and USG grateful that Iran is success story of type envisaged when President Truman began Point Four Program. I said I felt appreciation is all the greater because number of such examples is too few. Shah expressed gratitude for President's kind words. Meyer
252. Action Memorandum From the Assistant Secretary of State for Economic Affairs (Solomon) to the Under Secretary of State for Political Affairs (Rostow)/1/ Washington, December 11, 1967. /1/Source: Department of State, Central Files, PET 6 IRAN. Confidential. Drafted by Akins on December 8 and cleared by Eliot and the Economic Bureau's Director of the Office of Fuels and Energy John G. Oliver. SUBJECT The Consortium maintains that the "negotiations" with Iran ended in agreement among all parties in December, 1966, i.e., there would be an 11 percent increase in offtake in 1967 and 1968. Because of the Middle East crisis, Iranian production in 1967 will actually be over 20 percent above 1966 levels. Although the Consortium emphasizes it is not obligated by the agreement to give any further increase in 1968, it has just assured Iran of an increase in offtake of almost 9 percent over the high 1967 levels. The Iranians have told the Consortium that this proposal for 1968 is not satisfactory. They say Iran must have $6 billion from oil from now through the end of the fourth development plan in March 1973. (Current production plans and steady growth of about 10 percent per year would give Iran only about $4.5 billion during this period.) The obvious way to get this income would be through increased production but increased payments per barrel of oil or company investment in Iran might also be satisfactory to the GOI. The Iranians are particularly disturbed by the Consortium over-lift provisions and believe that if they were changed the total offtake from Iran would increase substantially. Last year I recommended to the American participants, through Mr. Henry Moses of Mobil Oil, that they should agree to a liberalization of the Consortium's over-lift arrangements. The Consortium did alter those arrangements. Consortium companies may now over-lift up to 15 percent of their Annual Programmed Quantity--APQ--share at a price halfway between cost and posted price. Previously any volume above the APQ was to be over-lifted at full posted price. But it is clear from our traffic on this problem that the Iranians since last year have become fully informed as to the terms of the over-lift in both Iran and Saudi Arabia and they have demanded specifically that the Consortium adopt a system at least as favorable as the Aramco system. Aramco companies can over-lift as much as they want above the amount their shareholding in Aramco would entitle them to have at a price equal to cost plus one quarter the difference between cost and posted price. The companies have explained to us that the Consortium as a whole usually takes only about 93 percent of the APQ--the agreed total offtake for the year--and that the crude short companies (Shell, Mobil, CFP and the Iricon group) are thus able to take 7 percent above their "rightful" share at cost--a more favorable arrangement than in Aramco. It is when they exceed this amount that they pay the halfway price. (N.B.: It is in this case when the comparison with Aramco becomes pertinent.) The Consortium companies say they have been unable to explain this adequately to the Iranians without exposing the method of setting APQ and other Consortium rules and regulations; and this cannot be done without causing great trouble for Consortium. However, the companies have consistently told us and the Iranians that the Aramco system would result in lower offtake for the Consortium as a whole. The Iranians have also demanded specifically that the 6.5 percent OPEC discount be eliminated. If it were, Iran would get about $0.10 per barrel of oil, and if the discount were completely eliminated by January 1968, Iran would get about $200 million extra in the next five years. Negotiations between Aramco and the Saudi Arabian Government are continuing on this subject; Iran and other OPEC members will get whatever Saudi Arabia succeeds in getting from Aramco. The Consortium members say they cannot increase offtake from Iran without cutting back production in the Arab world and this cannot be done without provoking a reaction from the Arabs. They have not yet been willing to discuss large scale investment in Iran. However, the final Consortium positions have not been established. Its members are now meeting in London to discuss new proposals to Iran and the Iranians have said they can wait at least until January to hear them. Proposed Action 1. I would recommend that we tell the American companies in the Consortium that we understand their reluctance to discuss internal Consortium arrangements with the Iranians but point out that the GOI already has the essential details of the over-lift arrangements in Aramco and the Consortium. We could tell the companies our view that this has become an important issue with the Iranians and we believe the Consortium would be well-advised to consider adopting something they could call a "quarter-price" for over-liftings. Even if Iran profited little, a troublesome issue would have been eliminated and the Iranians would no longer be able to claim they were being discriminated against. 2. I would recommend that we urge the companies to be as generous as they can in making their next offer to the Iranians. However, we should avoid making any further specific recommendations at this time. If it becomes clear that the next Consortium offer will not be acceptable to the Iranians we might have to take a more active role in the talks than we have; but we hope GOI-Consortium relations do not deteriorate to this point. While we probably can never get involved in making specific offtake proposals, we might have to tell the companies sometime that we believe there will be serious problems in Iran if, by 1973, it does not reach the same level of exports as Saudi Arabia or, as a minimum, does not enjoy the same absolute annual increase as that country./2/ /2/A handwritten notation in the margin of this paragraph reads: "Please double check the facts." 3. I would recommend that for the time being we do nothing more with the Iranians than repeating our hopes that the talks will continue and that neither side will take rash steps which might be regretted later./3/ /3/Approved by Rostow on December 13.
253. Memorandum From the President's Special Assistant (Rostow) to President Johnson/1/ Washington, December 19, 1967. /1/Source: Johnson Library, National Security File, Special Head of State Correspondence File, Iran, 9/1/67-12/31/67. Secret. SUBJECT The Shah wrote you describing his military and economic development programs for the five years beginning next March./2/ /2/Document 242. In short, he ticks off his own economic plans and hopes for U.S. private investment much as he outlined them to you in August. He also urges you to lean on our oil companies to increase their liftings from Iran--a perennial request. The main surprise is the size of his military program--$800 million. We think that must be a bargaining figure. He wants to know what he can count on from us. All we can say is that we are going ahead with the third and fourth slices ($50 million each) under our amended 1964 agreement and beyond that will do all we can but have to see what Congress does. We've consistently tried to keep the brakes on his military spending, but that's increasingly hard to do with his oil revenues rising as they are. We've tried to strike a balance in the attached reply/3/ between the responsiveness I believe you would want and the limitations imposed by uncertainty over what Congress will allow. Our best leverage now is to ride along with him and inject a word of caution where we can. /3/Document 254. Attached is a letter for your signature, if you approve. Walt For Reference: In 1964, we signed a $200 million agreement to cover 5 years, FY 1965 through FY 1969. It also provided that grant aid would end in FY 1969. In 1966, we amended that agreement to add another $200 million in sales in four $50 million slices through FY 1970--September 1966, June 1967, June 1968 and June 1969. The last two are those referred to in the attached reply. The Shah hasn't yet defined his new program precisely enough for us to know how it would be related to the present program.
254. Letter From President Johnson to the Shah of Iran/1/ Washington, December 19, 1967. /1/Source: Johnson Library, National Security File, Special Head of State Correspond-ence File, Iran, 9/1/67-12/31/67. No classification marking. Your Imperial Majesty: I have now studied carefully your important letter of November 15/2/ and want to give you the more detailed reply which I promised in my note of November 30./3/ /2/Document 242. /3/Document 250. First let me say that your visit here was one of the bright spots of the year for me. I warmly appreciate the privilege of talking to a leader who shares our views and approach to the problems of the world and who understands the heavy burdens which those problems place upon this country. I also appreciate the cordial reception you gave on November 22 to Governor Harriman who has reported to me on his valuable talk with you. I am glad we can maintain our continuing exchange of thoughts through talks like that as well as by letter. What you tell me of your new five-year development program is indeed good news. The pace of Iran's development arouses deep admiration everywhere. I am especially heartened that economic development will continue Iran's major goal. We have worked closely with you in this field. Now with the closing of our aid mission in Iran we look forward to a different, but equally productive, kind of economic cooperation between our two countries. We hope this will include increased participation by private American firms in Iran's development, as you suggest, and we will do what we can to support American investment there. I am also glad that planning is moving ahead on the water resources study on which we agreed in principle when you were here. I hope this will become another important aspect of our continuing economic cooperation. Our team can go to Iran as soon as we receive the preliminary data your authorities will provide and we can complete the Memorandum of Understanding now in Tehran for study. In view of the importance of the revenues from Iran's petroleum resources to the development of your country, it is natural that you should seek the maximum in exports of oil from Iran. I know that the American oil companies, for their part, take their commitments to the Government of Iran seriously. While the policies of the oil companies are not without some limitations deriving from commercial factors, I have every reason to believe that they desire to assure that Iran will receive as favorable treatment as possible. I was pleased to note Iran's outstanding 20 percent increase in crude production in 1967 over 1966. An added dividend of this healthy partnership is its encouragement of investment in other fields such as petrochemicals. I hope that this mutually beneficial relationship between Iran and the companies will continue to flourish. I also want to continue our close relationship with Iran in the military field. We are ready to begin discussions on the third $50 million credit tranche under the amended 1964 Memorandum of Understanding. We intend to seek at the appropriate time the necessary authority and funds from the Congress for the fourth $50 million credit tranche. We cannot, of course, predict Congressional reaction to our worldwide credit sales request at this time. With regard to the future, you may be sure that the United States continues to regard its military relationship with Iran as mutually important. As I told you when you were here, we will continue to do our best to be helpful. But it is still too early for me to say definitively what we can do beyond what is covered in our existing agreements. We need, first, to know more specifically what your equipment and credit needs from us will be. I have heard from Ambassador Meyer of his and General Jablonsky's discussions with you and your military authorities, and I suggest that those discussions continue. I hope that we will be able to assist you in assessing your equipment needs and in reducing their costs. We have already begun exploring your credit needs in a preliminary way with Governor Samii of your Central Bank. In the light of Congressional views, we will also have to consider carefully with you the implications of the substantial military expenditures you project. You are, of course, the best judge of what Iran's security requires, and I know your determination that every rial diverted from economic and social development to military expenditures be spent in Iran's national interests. However, my deep interest in the success of Your Majesty's development program prompts some concern about the contemplated size of your military program as mentioned in your letter and to Governor Harriman, and we will wish to discuss this concern with you. It remains, Your Majesty, a source of great satisfaction to me to note the example which Iran is setting in the Middle East through its economic and social progress and its constructive position in international affairs. Your statesmanship in the Arab-Israeli crisis and your current efforts to strengthen your ties with the moderate Arab nations, as evidenced by your forthcoming trip to Saudi Arabia, provide rays of hope and encouragement in a troubled area. Americans everywhere are proud to have you and your country as our friends. Mrs. Johnson and I would also like to take this opportunity to send you and the Empress our warm good wishes. Sincerely, Lyndon B. Johnson
255. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, December 29, 1967, 0824Z. /1/Source: Department of State, Central Files, PET 6 IRAN. Secret; Priority; Limdis. Repeated to London. 2702. Ref: Tehran 2701./2/ Iranian Oil. /2/Dated December 29. (Ibid.) 1. My audience with Shah 28th turned out to be one of most unpleasant of my tour here. He was obviously smouldering over devaluation shortfall issue with which he had been preoccupied earlier in day (see reftel). 2. Using terms such as "robbery," "thieves" and some unprintable epithets, Shah professed to be completely disgusted with consortium's behavior. At one point in discussion, Shah said if companies wanted war they could have it. This time it would not be with a Mosadeq but with a united Iran behind Shah himself. 3. When I noted consortium believes it has legal basis for its position and perhaps arbitration might be one possibility for solving devaluation problem, Shah said arbitration is totally unacceptable. As for matter being legal issue, Shah said GOI would take care of that once and for all by immediate passage of legislation which would insure GOI undepreciable payments. Comment: Since this is critical point, I later sounded out Shah again and received distinct impression that as of now unilateral legislation which Shah has in mind for dealing with devaluation issue will be limited to insuring value of payments. Question is, of course, re wisdom of having any precedent set for unilateral legislation against consortium. 4. In justification of righteousness his cause, Shah cited fact that both British Ambassador and consortium Chief O'Brien had registered disapproval of consortium's action in reducing December 15 payments. 5. Shah's bitterness splashed over whole oil picture. Re OPEC discount problem, Shah contended companies give with one hand, i.e. agree to phase-out of discount, but then take back with other, i.e. gravity allowance. He said he had doubted wisdom of Amuzegar's going to .52 cents on gravity allowance figure but had gone along with it. Comment: [garble] Amuzegar indicated (Tehran 2633)/3/ that he had only gone to .45 cents in recent Tehran discussions, Shah's use of .52 cents figure, which he repeated twice, may mean that Amuzegar is prepared to move to that figure in attempt to reach compromise. /3/Dated December 21. (Ibid.) 6. Shah went on to berate consortium for its continual maltreatment of Iran, despite Iran's exemplary behavior in comparison with other countries. My efforts to point out that Iran has in fact been treated very well fell on deaf ears. Shah once again contended that consortium is sitting astride Iran's vast reserves and he cannot permit such restraining influences on Iran's welfare. 7. I pointed out problem is one of marketing. In this connection, I suggested Iran may be trying to carry water on both shoulders, i.e., pushing consortium to find greater markets while at same time stealing some of consortium's markets, e.g. recent IPAC deal for providing 18,000 BPD to Philippines which previously been almost exclusively market for American majors in consortium. Shah argued such competition is infinitesimal compared with bonanzas greedy oil companies are throwing to countries like Libya. When I pointed out geographic factor which places Libya in favorable situation with Suez closed, Shah said what really infuriates him is companies' lifting large quantities from sheikhdoms like Kuwait and Abu Dhabi when Iran with its 26,000,000 people needs funds to maintain its progress and play its role in Mideast security. Shah also asserted that Saudi Arabia's production will soon move up to 4,000,000 barrels per day. Since geographic factor a la Libya cannot be applied vis-a-vis Saudi Arabia, this further demonstrates he said, how companies discriminate against [garble--Libya]. 8. Shah once again mentioned possibility of legislation which would enable GOI to have oil at well-head for clients which GOI may develop not in competition with consortium. He noted Iraq had long since found companies submissive to such measures. My natural response was to point to Iraq's sorry plight today and how much better off Iran is. I urged Shah "with every bone in my body" not to go down Iraqi road. 9. When subject of Iraq first arose, Shah said derisively, "congratulations." He contended that unhappy developments in Iraq, leading to influx of Soviets into Iraq's oil fields, are primarily due to faulty Western policy over past ten years. Since there was little likelihood of rational discussion, I did not pursue this point further to ascertain what Shah had specifically in mind. 10. I told Shah Washington would be appreciative his views re Soviet intrusion in Iraqi oil industry. Shah said much depends on nature of Soviet involvement. However, danger is real, he said, that perhaps with pipeline through Syria, Soviets can get both Iraq and Syria in their clutches, thus leapfrogging over Turkey and Iran. This would place them in dominating position in Mideast, particularly since they already doing so well in what Shah has often mentioned as triangle (it is somewhat linear) of Cairo, Aden-Yemen, and Djibouti. 11. This provided occasion to pass some of interesting analysis contained in Beirut 5181,/4/ particularly ambition of Soviets to become international major. I noted in this connection recent PIW statistics that Soviets last year exported 56 percent of their production, which was 14.6 percent increase from previous year. /4/Dated December 26. (Ibid.) 12. This led to general discussion on subject, "whither Mideast oil industry?" I took occasion to express concern that increasing Balkanization of this industry has real dangers for Iran, i.e. fall-off in markets available to consortium and unfortunate if not catastrophic repercussions to oil price structure. 13. Once again I reminded Shah that GOI's relationship with consortium likely be much more productive if it continues as partnership than if it is coercive. Shah readily agreed but said companies seem only interested in great profits and fail to take into account broader issues such as encouraging a country like Iran which is moving in positive direction and which has potential for influencing whole area in constructive way. 14. Before closing discussion, I told Shah I had obviously picked a bad day for my audience. He managed to permit himself a brief smile, but added that on any other day he would feel the same way about the oil companies' behavior vis-à-vis Iran. 15. Dept may pass on to companies as much of substance of this telegram as it wishes. Meyer
256. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, December 29, 1967, 0950Z. /1/Source: Department of State, Central Files, DEF 12-5 IRAN. Secret; Priority; Limdis. 2704. 1. In opening discussion re arms procurement with Shah 28th, I referred to President's letter./2/ Shah expressed appreciation for warmth of friendship and President's favorable disposition which letter reflected. /2/Document 254. 2. Shah had President's letter before him and inquired re para which mentions our considering with him economic implications of his proposed military expenditures in light of Congressional views. I noted both Executive Branch and Congress have inherent desire to see developing countries spend less on military hardware and more on economic development. Fortunately, until now Iran's economic progress has been heart-warming and all of us should be interested in keeping it that way. 3. When I noted that $800 million projection had come as somewhat of a shock, Shah reverted to his line that rate of expenditure is less than in past three years. He added, however, that if an adequate program could be developed for $600 million or less so much the better. 4. Noting that specifics re hardware being covered in HIM's talks with Jablonsky, I said problem is to come up with feasible five year program of procurement. Shah agreed, but said that this should immediately be followed by USG determination as to how much credit it can provide for such program. I pointed out that, given situation in Congress, Shah cannot expect President or USG to make categoric credit commitments that far ahead. As is obvious President's letter, I said, disposition of Executive Branch toward maintaining close military relationship is favorable and Shah would simply have to take chance that Executive Branch can secure Congressional support in years ahead. It was regrettable if Shah might not find it possible to have such patience. 5. Shah then came up with idea that after shopping list for next five years has been determined, GOI could proceed with placing orders, perhaps directly with American companies. If USG credit did not eventuate, Iran could secure financing from private American banks. I stressed importance of carefully phased program and re-emphasized point Jablonsky been making that Iran simply unable to find necessary trained personnel for military equipment which Shah has been talking of procuring within next five years. I acknowledged, however, that once practical program been outlined, possibility of credit from private banks is worth consideration. I gathered that Kuss and Samii were already doing some preliminary explorations. 6. Shah once again stressed his desire to keep air force American oriented, even if costs are higher, thus, he said, he would not oppose paying extra percentage point or two to private banks in order to continue American procurement for his air force. Shah also hoped that USG could assist by providing personnel to help maintain his air force. Five year package proposal for McDonnell to provide maintenance, he noted, estimates cost at $67 million. Thus USG by making military technicians available could be of real help. Comment: While Shah in discussion interest rates talks a bit cavalierly now, there likely to be resentment if and when American commercial credit terms are in fact proposed. 7. Re tanks, Shah said he goes along with Jablonsky's proposals for holding density to present M-60's, rehabbed M-47's and eventually 250 Sheridans. Threat to Iran in Gulf, he said, is more apt to require naval or air force counter-action than tank action. When I said presumably his naval requirements will be met by British, Shah said there were some items such as ship missiles which he would like from US. 8. When Shah referred to argument that Turkey has large tank complement, figures which Dept so helpfully provided in State 90119/3/ were given to Shah. It was emphasized that this info was for his personal info only. He was obviously impressed that Turks are not nearly as well off as he had thought. /3/Dated December 27. (Department of State, Central Files, POL IRAN-U.S.) 9. When question arose as to possible tank production. Shah once again registered resentment toward Paks. According to Shah, Paks are declining to cooperate in project where British tank factory would be established in Iran to produce tanks for Pakistan, Saudi Arabia, Kuwait and Iran. Pakistani reluctance makes whole project dubious. Shah said that Paks are showing active interest in British proposal for building five-ton tanks in Pakistan. Shah regards such project with great disdain. He described five-ton tanks as useless "mosquitoes." Meyer
257. Telegram From the Department of State to the Embassy in Iran/1/ Washington, January 12, 1968, 8:13 p.m. /1/Source: Department of State, Central Files, PET 2 IRAN. Confidential. Drafted by Eliot, cleared by Special Assistant to the Under Secretary for Political Affairs Robert T. Grey, Jr., and approved by Rockwell. 98267. Subject: Iranian Financial Problems. 1. In discussion January 12 of certain Iranian financial problems with Under Secretary Rostow, Iranian Ambassador Ansary expressed hope recognition would be given to role Iran must play in area. Rostow said Shah can have no doubt of our appreciation of role Iran playing and we will support Iran in every way we can. 2. Ansary said oil revenues are key. Rostow expressed pleasure concerning settlement devaluation issue and said our impression of general tone of companies' attitude on offtake issue is positive. 3. Rostow indicated while we still looking into various legislative aspects our arms sales program we are confident we will be able sell arms to Iran on substantial scale and are working on that premise. We hope be able take some action this spring on basis studies of military and economic aspects of situation which are now in progress. 4. Ansary raised matter of controls on private US investment, speaking as he has elsewhere about bad timing of application of these controls to Iran which is only just beginning major effort with US encouragement attract investment in non-oil sectors. He said Iran special case due to recent termination AID program, fact Iran paying for own defense needs, has substantial development program, needs American capital and has unbalanced trade with US favorable to US. Once again saying he not asking for specific action at this time, Ansary asked for special consideration of any problems which may arise. 5. Rostow stressed we can evaluate effects controls on investment only after we learn from companies of their investment plans within program. We must make clear to speculators and financial community that we mean business. We will watch with greatest possible concern effects of program and within program's limits will attempt facilitate investments companies wish make. He said Iran's and other countries' representations have been well received and convey realities which we wish take into account. If program hurts Iran we will give most sympathetic consideration to Iran's problems at a later point. But this does not necessarily mean we will make changes in program. Rostow added best procedure for taking care of problems which may arise is through arrangements for special licenses if they become possible. He pointed out Iran is in favored category because it can receive AID investment guarantees. Katzenbach
258. Telegram From the Embassy in Iran to the Department of State/1/ Tehran, January 16, 1968, 0900Z. /1/Source: Department of State, Central Files, DEF 12-5 IRAN. Secret; Priority; Limdis. Repeated to CINCSTRIKE and to Rome for Henry Kuss. 2897. Subject: Iranian Arms Procurement. 1. Arms procurement was only cursorily discussed during my audience with Shah 15th. 2. In discussing future Persian Gulf security (Tehran 2886),/2/ Shah categorically asserted that despite implications of British withdrawal he is determined not to augment five-year military program beyond scope already planned, except for few minor revisions. This conclusion is explicable by virtue of fact that in formulation five-year program Shah undoubtedly assumed British would be withdrawing by end of that period. /2/Dated January 15. (Ibid., POL 33 PERSIAN GULF) 3. General Jablonsky had seen Shah previous day and had some luck in further reducing Shah's shopping list, e.g., re artillery. Meanwhile Shah been consulting with Samii in anticipation latter's discussion re possible credit arrangements with Kuss in Rome. 4. While we gratified by interest being shown in Washington in direction responsiveness to Shah's requirements, we trying be careful here and we trust Kuss will do same in talking with Samii to remind Iranians current discussions re military credit sales dependent on Congressional concurrence. Meyer
259. Telegram From the Department of State to the Embassy in Iran/1/ Washington, February 28, 1968, 0045Z. /1/Source: Department of State, Central Files, POL IRAN-US. Confidential; Exdis. Drafted and cleared by Eugene V. Rostow on February 27. 121476. Ambassador Ansary asked to see Undersecretary Rostow urgently and alone on February 26. He said he had had a disturbing telephone call from the Shah asking him to come to Switzerland at once for consultations. Two issues were mentioned: a rumor that Americans had been seeing former Prime Minister Amini, and that we had not been neutral, but pro-Saudi, in the median line dispute in the Gulf. Rostow saw Ansary again on February 27, after urgent checks. He said the episode was instructive and useful. For him the moral was that the Shah should feel solid confidence in the stability of American policy, despite the sometimes frenetic atmosphere of rumormongering on the part of those who were anxious about their careers or interested in creating difficulties between the United States and Iran. Our policy was clear and simple--it was one of friendship and confidence for the Shah and for Iran. We also had friendly relations with Saudi Arabia and with King Feisal, and we hoped that developing cooperation between Iran and Saudi Arabia could become the nucleus for stability and progress in the Persian Gulf. In this process, naturally, patient and statesmanlike leadership on the part of the Shah was indispensable. Rostow said that according to the information we had been able to assemble overnight, no American had seen Amini for two years at least, and probably three years. This fact as he knew was contrary to our usual policy of staying in touch with a wide range of opinion. But we were aware of sensitivities between the Shah and Amini, and wished to do nothing to create difficulties for the Shah. There were even rumors in Tehran that I had seen Amini during my recent trip to Tehran./2/ As he knew, this was nonsense. I had seen a former student, Parvez Saney, who called on me at the Embassy when he saw that I was in the city. I told the Shah about the young man, and he said he was interested in hearing his ideas. /2/Rostow visited Tehran February 7-9 and met with the Shah. (Telegram 3258 from Tehran, February 9; ibid., POL 7 U.S./ROSTOW) As for the median line dispute, we had taken exactly the same line in both countries, stating our interest in a peaceful resolution of the conflict, and urging both parties, in the same words, not to take steps that would make it worse. Both Ambassadors were experienced and first-rate men, and had carried out their instructions fully. There were no currents of dissent about our Persian Gulf policy, so far as Rostow could tell, within the Department or the government. Ansary asked whether we had messages for the Shah on other subjects. Rostow reviewed the present state of the Jarring mission, and suggested that the Shah might wish at this point to do everything he could, as we and the British are doing, to support Hussein, and to urge him not to go to the Security Council on the Jerusalem question. Rostow asked for any suggestions the Shah might have as to what could be done to improve the chances of peace in the Middle East. Rusk [Continue with the next documents] |
