BRITISH INTERESTS IN PERSIA.

HC Deb 22 January 1902 vol 101 cc574-628

(12.10.) MR. JOSEPH WALTON (Yorkshire, W. R., Barnsley)

The Amendment which I have to propose is— And we humbly represent to Your Majesty that it is essential that adequate measures should be taken for the safeguarding of the commercial and political interests of the British Empire in Persia. I notice that a colleague of mine on this side of the House (the member for Merthyr Tydvil), has put down an Amendment to my Amendment; he would have British commercial and political interests safeguarded throughout the whole world, and therefore, his Amendment includes mine. But I venture to say it is more convenient that we should not enlarge the scope of our survey on this occasion, and that the situation in Persia, especially in relation to the maintenance in the future of our Indian Empire is ample subject for the consideration of this House at this particular sitting. Now with regard to the Amendment I feel inclined to say, perhaps more strongly than ever I did—believing as I do that in foreign affairs as regards the question of upholding the commercial and political interest of this country we ought to know no Party—"A plague on all your Parties," because I am convinced that the Amendment I have put down is, in its terms one which, apart from the question of Party, would command the assent and unanimous approval of the whole House.

With regard to the situation in Persia to-day, I desire to draw the attention of the House to what has been, and in my opinion wisely so, the traditional policy of this country ever since we acquired our great Indian Empire. We have always felt—and successive Ministers, whether Tory or Liberal, have felt—that the true policy of this country with regard to Persia was to maintain its independence and integrity, and the open door for trade throughout the Empire. That policy was declared by both the Governments of Russia and Great Britain in 1834, and these declarations have been repeatedly renewed from that time until now. It is desirable that Persia should be maintained as an independant neutral buffer state, because it lies on the land frontier of our Indian Empire and because it also possesses an extensive sea board adjacent to the sea-board of that Empire. Perhaps it is of even greater importance that this condition of affairs as regards Persia should be maintained than it is in the case of Afghanistan, where there is merely a land frontier, for between the frontier of Afghanistan proper and our Indian frontier there is a considerable mountainous neutral zone. Therefore I regard the question of the maintenance of the integrity and independence of Persia as of greater importance than the maintenance of the independence and integrity of Afghanistan. Now as to our commercial interests in Persia, We had a considerable trade in North Persia, through Kars and Batoum, but under the Treaty of Berlin those places were ceded to Russia, and whereas previously to the cession only a small Turkish Transit Tariff was imposed on British goods, subsequently to the conclusion of the Treaty of Berlin Russia, having obtained possession of Kars and Batoum, put her full protective tariff on all British goods intended not for consumption in Russia, but merely in transit to Persia, the same tariff in fact as is put on goods sent to Russia for consumption in that country. In that way, and by shutting out every other flag but the Russian, from the Caspian Sea, Russia has succeeded in increasing her trade with Northern Persia, and not only did she put on these full protective tariffs, but goods produced in Russia for export to Persia are conveyed over the Russian Railways at less than the rates of carriage charged on the goods of other nations. Thus British commerce in Northern Persia has been almost extinguished. What has been our policy on the Persian Gulf and in Southern Persia? The Persian Gulf was infested by pirates. We had a considerable trade in Southern Persia, and I am glad to know that we still have it. We have, as the House knows, policed the Persian Gulf, and we have absolutely repressed and extinguished piracy. But we have not done it for our own exclusive advantage, as Russia has acted in closing the Caspian Sea to the flags of all other nations, and putting on protective tariffs in order to prevent British goods going through Kars and Batoum into Northern Persia. We have policed the Persian Gulf equally in the interests of the goods and ships of all nations. I am glad we have set this example to Russia and other nations.

We have heard a good deal about an understanding with Russia. I desire a good understanding with Russia, but I desire also an equitable understanding, and I ask you to remember how difficult it must be for a free trade country like England, commercially considered, to get an equitable understanding with a protectionist country like Russia. What is the case in regard to Russia? She has put on prohibitive tariffs in order to exclude British goods from Northern Persia, and by her coasting arrangements, so called, she has imposed in the territories she possesses north of Manchuria high protective tariffs, and if goods are to be sent from the Baltic or from the Black Sea round to that portion of the Russian Empire they can only be sent in Russian steamers. In that way we find that the tendency of Russia to put this prohibitive protec- tionist system in force is such as will make it difficult, as far as commerce goes, for a mutually advantageous and equitable arrangement to be arrived at. I nevertheless desire that an arrangement should be come to, and these difficulties over come. I admire in Russia her enterprise, and the means she takes to promote her commercial and political interests. Take the case of Northern Persia for instance. Russia has unhesitatingly constructed good roads down to the three principal centres of trade in Northern Persia. She has built a good road from the Caspian Sea to Teheran, another to Tabriz, and another to Astrabad, and when it became a question of money, the Russian Government did not hesitate for one moment to find £170,000, one half of the cost of making the road to Teheran in the commercial and political interests of Russia. Now, take the case of Southern Persia. We fortunately still maintain our commercial supremacy in that region. In the year 1900 the total quantity goods inwards and outwards from the Persian Gulf was 963,000, and of this 766,000, or 80 per cent. was British trade, so far as carrying at any rate goes. In 1900 the Russian and German trade was nil, but since then, as the House knows, the Russian Government have begun to subsidise a line of steamers from Odessa to the Persian Gulf in order to create trade with Southern Persia. I can only say that I admire the Russian Government for their enterprise. But we must not leave out of consideration the fact that we have an enormously difficult, and, in fact, an abnormal competition to contend with, and, therefore, it may be wise that we should reconsider our policy if we are desirous of maintaining the commercial interests of England in South Persia. In my opinion not only is the British Government deeply interested in upholding British commercial interests in Persia, but so also is the Indian Government, and, therefore, whatever may be done to assist the upholding and extension of our commercial interests there, might reasonably be expected to be done partly by the Indian Government and partly by the Home Government. As I have pointed out to the House, Russia has constructed no fewer than three roads down into Persia from the north in order to increase the facilities for the transport of Russian goods to consumers in Persia. I submit that it is desirable and essential, if we are to maintain the predominance of British commercial interests in South Persia, that we should reconsider our position and, be prepared to go somewhat on the same lines as the Russian Government. It is idle to attempt to adhere to the methods of the past, when you have foreign nations and foreign Governments adopting new methods of conquering further regions in favour of their commerce as against ours. A new road has been opened up from the Persian Gulf to the centre of Persia to facilitate trade, and I may point out to the House that on this new road foreign nations enjoy equal facilities with the British nation. Nevertheless, I consider it desirable that the British nation should provide other facilities for increasing our trade and commerce, by the creation of good roads and good means of communication between the sea-board of the Persian Gulf and the interior of Persia. I had the pleasure of travelling over the new trade route from Ispahan to Ahwaz, and I wish, in connection with the contemplated reform of the procedure of this House, that the Government could arrange that, in discussing matters such as that on which I am attempting to speak to the House to-day, for us to have a large map hung within our sight. There are many hon. Members who may not take a very special interest in this question, and if we had a map and were able to refer to it, it would help to make one's remarks more intelligible. When I speak of the new caravan route from Ispahan to Ahwaz I question, with all deference to hon. Members, whether 19 out of 20 of them are able actually to locate the places. I will only say, therefore, that the old main trade route from the Persian Gulf through Bushire and Shiraz formerly occupied something like from 35 to 40 days to cover by means of caravans. But I travelled over the new route in 15 days. It is clear, therefore, that it is a much shorter and necessarily a much cheaper route, by which to send British Goods from the Persian Gulf into the centre of Persia. But there is another road which, in my opinion, ought to be made by British enterprise in the interests of British commerce, and it is a road from Bunder Abbas, through Kerman to Ispahan. We have lately got concession to make an extension of the Indo-European telegraph system from Ispahan, and it is eminently desirable, as hon. Members will see, that we should have a road along the line of the telegraph system from Ispahan to Kerman I hope too, that the Under Secretary for Foreign Affairs will be able to tell us that His Majesty's Government intend to place at Kerman, which is an important centre of Persian trade, a British Consul to look after British interests, so as to follow the excellent work done by Major Sykes, who was, until recently, our representative there. The country from Kerman to Ispahan is comparatively level, and a road made on that route would be of great value to British commercial interests. At the present moment Russia has got a road from the Caspian Sea to Zeheran, and the British Imperial Bank of Persia has constructed a road from Teheran southwards about 100 miles to a place called Kum. We should endeavour to arrange for the concession, in British interests, of an extended road to Ispahan, with connecting roads to Kermanshah and Sultanabad.

I think that in the case of Persia, as in the case of China, we ought to be able to come to a friendly understanding with Russia, as to which are to be our respective spheres of influence and our spheres of practical action as regards railway construction. I venture to submit that, in connection with concessions for the construction of new roads, we ought also to have recognised in South Persia a priority of right sooner or later to construct any railways which may be required along these roads, and which the Persian Government does not find itself able to undertake, whilst we should not object to Russia having similar priority of rights in Northern Persia. We made an arrangement of this nature with Russia in regard to China, and I should desire to see it repeated in the case of Persia, There is another trade route into Persia which we have recently opened up with a view, if possible, of retaining some portion of the trade of North Persia. The Quetta-Nushki trade route is a route in which one who was a Member of this House for many years, and who now occupies the highest position perhaps, under the British Crown—I mean Lord Curzon—has taken the keenest possible interest. It is the route from Quetta to the Baluchistan frontier not far south of the frontier of Afganistan and then through Seistan to Meshed. We commenced trading by that new route only about five years ago, and, whereas, in the first of the five years the trade done amounted to about five lakhs of rupees, the trade in the last year was at the rate of 16 lakhs of rupees per annum. That is eminently satisfactory. But I am afraid that our Russian friends are a little jealous of our getting my portion of the trade of North Persia by that route. What is happening? We find the Russians representing to the Persians that there is very grave danger of plague being introduced into Persia by caravans entering the country by the Quetta-Nushki route. We know that ten days is the full time in which the plague is developed. We know too, that it takes much more than ten days for a caravan to travel along that route before it touches Persian territory, and, therefore, it is obvious that all fear of plague must be gone long before our caravans reach Persia. The Russians, however, induced the Persian Government to allow them to send Russian doctors into Seistan and Meshed, and by this means there has been considerable interference with British caravans. I hope that the Under Secretary will be able to give us some re-assuring information with regard to this matter, and some promise that the British Government are determined that British trade on this route shall not be unduly interfered with. We do not object to fair competition, but it is intolerable if our caravans are to be stopped on Persian territory by Russian doctors.

Then again, in order to uphold our commercial interests in the very large district of Seistan, which is adjacent to our British Baluchistan frontier, we need to have without delay a railway constructed from Quetta. We also require a telegraph to the British Baluchistan frontier. This is not aggressive action on our part. It is not a measure of menance, because, at the present moment, Russia is busily engaged in constructing a railway from her trans-Caspian frontier down to Sarrakhs, on her frontier. Therefore, if we undertake the construction of such a line of railway and telegraphs in British commercial and political interests, we should only be doing what Russia is doing elsewhere in order to maintain her predominant position in North Persia, I do not consider that, in taking similar steps in South Persia, where our trade and commerce are predominant, we are guilty of any aggressive or menacing action whatever; we are merely exercising wisdom in upholding those just rights and commercial interests which every nation that wishes to enjoy prosperity is bound to maintain. Now, there is no question that British influence has declined in Persia in recent years. In my opinion the gravest mistake that has been made, and the greatest blow inflicted upon British influence in Persia, was the refusal of the Government to guarantee the two and a half millions loan to Persia in 1900. It was offered to us repeatedly. It is amply secured, and more than amply secured, on the Customs receipts of Persia, apart altogether from the Customs receipts of Fars and the Persian Gulf ports, at which, as was gathered from the reply to a question put by an hon. Member the other day, were the Customs allocated in satisfaction of this loan. Hon. Members know, of course, that the Government of Persia is a somewhat impecunious one, and they can see that to hand over the financial control of the country in this way to Russia would be to give her a practical advantage over us that she ought never to have. The fact is, that in the interests of British India alone, apart altogether from the commercial interests of Great Britain, it was a great act of folly not to guarantee this loan. What were the consequences which followed the refusal of the British Government to guarantee it? The Russian Government stepped in and guaranteed it, and, in so doing, imposed terms and conditions unfavourable to British commerce, which the British Government would not have imposed as against Russian commerce. They debarred Persia from contracting any foreign loan before the year 1910, and they debarred her also from giving any railway concession whatever in Persia till after the same year. That last provision appears to me to indicate somewhat that Russia, having her trans-Siberian and Caspian Railways in hand did not wish the question of constructing railways in Persia raised in the immediate future. It was a convenient way of holding the matter over until she was in a position to take a large share in the work. That was clever diplomacy. It is a serious thing that the Persian Government is bound by the Russian Government not to grant any railway concession to any British subject until after 1910. But I think it is still more serious that she is debarred from contracting any loan with any persons or nation other than Russia. It is unfortunate that the Government in Persia is somewhat impecunious, as it is almost certain that, in the not remote future, Persia will require a further loan; and it must therefore, be obvious to hon. Members that Russia, in face of the agreement and stipulations I have referred to, is in a position to impose practically whatever conditions she chooses upon Persia. It is true that the agreement which sets forth that Persia shall not give any railway concession before 1910 may be abrogated by mutual consent. In all probability it will be, and we may then find, in connection with any further loan to Persia from Russia, that the latter power has got a railway concession for the continuation of the line now building to Sarrakhs down through Seistan to Bunder Abbas with a branch to Meshed. It is quite possible, also, that there may be another branch line by Kerman, Yezd to Ispahan, Teheran, and Enzeli, with probably connections to Kermanshah, Tabriz, and Tiflis. Supposing some fine day we wake up to the fact that an arrangement of this sort has been concluded, and that Russia has also secured the lease of a harbour in the Persian Gulf. We know what in the long run that would lead to. We know that at first it would be a strictly commercial harbour, but that ultimately it would be a strongly fortified naval base. We must consider the future in the light of the history of the past. What amazes me more than anything else is that apparently our Government and Foreign Office learn nothing from past experience.

I want to press on the Under Secretary of State, who has, I hope, a long and useful career in front of him, that the policy of shutting our eyes to the lessons gained in the past—lessons which ought to be turned to the advantage of British interests in the present—must be abandoned. What do I advocate? It is no use condemning the Russians for exhibiting a spirit of enterprise with regard to their interests in Persia unless I have some alternative policy. Hon. Members will note that I am asking not for an alternative Government, but an alternative policy in the commercial interests of this country, a policy which will be supported by men of both parties. My alternative policy is that which I indicated earlier in my speech, viz., that I think we ought to intimate distinctly to the Persian Government that, as regards South Persia, we intend to claim priority of right for constructing such railways as the Persian Government will not themselves construct. We do not desire to interfere with Russia having the same priority of right in Northern Persia. The sort of sphere of influence which has been given in China with regard to railway construction, can be given in Persia without interfering with the independence and sovereign rights of that country. I desire that Persia shall be preserved to the Persians, and all I would require is that our trade rights, without the imposition of any protective tariff, shall be maintained by the Government. There is another matter which is engaging the attention of Russia in Persia. The fiscal system of Persia is based on the treaty of 1828, which provides for an all round 5 per cent. ad valorem duty being levied on all imports. At the present moment Russia is negotiating with the Persian Government a new commercial treaty, to be substituted for the 1828 treaty, and she is endeavouring to secure that certain goods she sends into Persia, shall be subjected to a lower duty than 5 per cent. The suggestion is, I believe, that Russian goods shall pay 3 per cent., whereas, on the other hand, the duty on tea, which is mainly imported from the British Empire, is to be raised from 5 to 8 per cent. Russia says that there is no interference with the most favoured nation clause in this case, because the duty would apply to all the tea imported from whatever country it may come, and that therefore if the tea were sent from Russia it would also pay the 8 per cent. But the fact happens to be that the tea is not sent by Russia. It is almost exclusively sent by England, and although in one sense you may say that the most favoured nation clause is not interfered with, yet, in a very practical sense, a burden is placed on British trade with Persia in tea, while it is taken off Russian commodities sent to Persia.

I venture to submit to the Under Secretary for Foreign Affairs that it is eminently desirable, considering the importance of British trade in Persia, that when the question of a new commercial treaty is under consideration we should, equally with Russia, have direct negotiations with the Persian Government on the subject. I am bound to say that when I was in Teheran I found that the British Minister there was exercising vigilance and activity in ascertaining exactly what was going on, and endeavouring to protect British commercial interests. I believe he was doing as much as he possibly could do. But I want a little more done, I want our Minister at Teheran to be backed up more strongly by the authorities at home. I want the British Government to claim that our commercial interests in Persia are of so important a character that we cannot have these negotiations going on with Russia, to a certain extent behind our back, to the possible prejudice of the future of British trade. I have raised this question of the present situation in Persia to-day largely because of a succession of articles of a most astonishing character, which have appeared recently in British Reviews and British newspapers, which had been going out of their way to invite Russia to come down to the Persian Gulf. I could not conceive anything more disastrous to British interests than that, and I may say frankly, that after meeting many officials in Persia, and many of the best informed commercial men there, I went on to India and there I met many high officials, both in civil and military circles, and I found only one opinion among them, viz., that, it would be disastrous, and that it would endanger the future of our Indian Empire if the status quo of our traditional policy with regard to Persia and the Persians were departed from, I may quote with regard to the suggestion directly inviting Russia to come down into the Persian Gulf, the opinion of the man who, I venture to say, of all others knows more about Persia and who, in his present position, knows more as to what would be the effect, so far as our Indian Empire is concerned, of Russia accepting the invitation to come down into the Persian Gulf, and there acquire a port, which possibly would ultimately become a naval base. I have here a quotation from a book written in 1892, in which the author says:— I should regard the concession of a port upon the Persian Gulf to Russia by any Power as a deliberate insult to Great Britain, as a wanton rupture of the status quo, and as an intentional provocation to war, and I should impeach the British Minister who was guilty of acquiescing in such a surrender as a traitor to his country." That is strong language. It is the language of Lord Curzon, the present Viceroy of India, a man who, perhaps of all others, has taken the deepest interest in Persia, and in India, and who by travel, by research, and by study has qualified himself beyond any other man to express an opinion as to what would be the effect of letting Russia into the Persian Gulf, so far as the interests of our Indian Empire are concerned, I am glad to know that, although I make this quotation, I have not to charge the Government with giving any indication of the fact that they are not in absolute agreement with the view expressed in this book upon Persia by Lord Curzon, I should like to road from The Times the words which fell on Thursday night from the lips of the Under Secretary for Foreign affairs in regard to this matter. He said: There was no change in the attitude maintained by the British Government in the affairs of the Persian Gulf. Our position in the Persian Gulf, both commercially and politically, was one of a very special character, and His Majesty's Government had always considered that the ascendancy of Great Britain in the Persian Gulf was the foundation of British policy. This was not merely a question of theory; it was a statement of facts. Our trade interests there far exceeded those of any other country. Our recognised man time supremacy secured our political acendancy. It was a great satisfaction to me to hear that declaration. I did think, nevertheless, it would be desirable to-day that we should have a discussion on this subject of the situation in Persia, and the policy which ought to be pursued in regard to it in the interests of our Indian Empire, and that it could not be without advantage at any rate in giving a sort of death blow to the kind of writing which has recently been found in certain British Reviews and newspapers, who have desired to extend an invitation to Russia to come down into the Persian Gulf. I maintain that it is to-day more than ever the duty of the Government to maintain intact the just commercial rights and privileges of the British Empire all over the world.

I naturally desired to extend my Amendment to China as well as Persia. I am glad to recognise that the Government are doing all in their power to secure greater facilities for British trade in China, and I gladly and frankly acknowledge that, from the latest information I have received, I have every hope that great success will crown their efforts. But what I desire to point out is, that whereas during the last three years we have had in this country a period of abounding commercial prosperity, today we are face to face, in all human probability, with an equally long period of severe commercial depression. It is alarming to me when I learn how severe the competition between Britishers and other nations is likely to become in this time of commercial trouble. Only the other day the Corporation of Manchester gave out a contract for electrical appliances to a German firm for £110,000, the lowest offer by a British firm having been £136,000. Again there is the case of New Zealand. Although we know the warm feelings of attachment and friendship on the part of our fellow citizens there towards the Mother Country, they gave a large contract for bridge building work to an American firm because they got it immensely cheaper than from any British firm. When we know the tremendous financial burden which is going to rest on this country for years to come in consequence of the calamitous South African War, and when too, we know that the burden of taxation instead of decreasing, is likely to be increased in the near future, and that in connection with that increase we have to contemplate a serious depression in our commerce, then I am afraid that the situation in which the country will find itself will be very deplorable indeed, and therefore I submit that if ever there was a time when we should strike out into new paths it is now. The Government, instead of saying "we do not guarantee foreign loans," or "we do not give subsidies for the construction of roads in foreign territories," should admit that this is a time for looking towards the future. Bearing in mind the methods adopted by foreign nations to maintain and extend their commercial interests, we must to a certain extent abandon our old methods and be prepared to adopt new ones. I would submit to the noble Lord the Secretary of State for India that it would be infinitely to the advantage of India that the British and Indian Governments should join in guaranteeing loans for the construction of free roads from the Persian Gulf to the interior of Persia, to facilitate British trade in the same way that the Russian Government have constructed three roads down from the north of Persia in the interests of Russian trade. I believe that this is a time when we must make new departures, and I hope that the Government will favourably consider any suggestion. It is not put forward in any party spirit. Its sole object is to benefit British trade and commerce, and the community generally—Liberals and Tories alike will reap the advantage. I, therefore, think we should unite in urging a more vigorous and determined effort on the part of the Government to uphold British commercial interests in Persia and elsewhere.

There is a further responsibility resting on them. I submit that to give Russia a port on the Persian Gulf, which, possibly, would ultimately be made a naval base, connected with the railway system of the Russian Empire, would alter the whole situation in the East. It would enable Russia to turn the flank of our natural N.W. mountainous frontier in India, and it would certainly necessitate an enormous increase in the defensive forces of India, both by land and sea. Having taken upon ourselves the responsibility of guiding the destinies of 300,000,000 of people in India, it is our duty rigidly to safeguard their interests against any aggressive or menacing action, by a firm, judicious, and wise upholding of our interests in Persia, and by the maintenance of the status quo there, so as to prevent the possibility of the native population having their burdens largely added to, by being called upon to find millions of money additional every year in order to provide for the increased military forces which such an alteration in the position of affairs, would necessarily demand, without any regard whatever to any unfriendly feeling on the part of Russia. We must provide for the contingency that Russia desires to make an attack upon India, and take the Indian Empire from England. But I say if such a condition of affairs existed, that if we had Russia with a naval base on the flank of our road to India and the Far East, as well as having turned the flank of the natural mountainous frontier of India, we would be bound to increase our defence forces in India, and if we did so, I am told by experts, that we would be bound to increase the number of British troops pro rata with the native troops. We have now 70,000 British troops in India, and, if by reason of sitting still and neglecting to uphold our just rights in Persia, and maintain the status quo, where are we going to get the other 70,000 British troops to add to the 70,000 already there, without denuding the United Kingdom of the forces necessary to uphold our interests in other parts of the British Empire? I submit to hon. Members that this question which I have ventured to raise to-day is a most important question. It is much more important than it appears at the first glance. I have received a considerable amount of chaff from hon. Members as to what on earth is the good of raising at the present moment a debate on Persia; that the people did not care—I will not use the usual adjective—for it, and there would not be half a dozen Members present. But, unless the British nation have lost almost entirely those qualities by which their forefathers have been distinguished, and by which they built up the greatest Empire ever existent on earth, they will not occupy their minds with South African affairs only, but give due attention to safeguarding and upholding their just rights in other parts of the world. It is in that belief that I have made my statement in regard to Persia, and that I move the Amendment standing in my name.

* (1.6.) EARL PERCY (Kensington, South)

I think we will be all able to congratulate the hon. Member for Barnsley in having made a most interesting and instructive speech upon a subject which is of very great importance, and upon which I do not recollect that there has even been a debate since I had the honour of a seat in this House. We may congratulate the hon. Member on the fact that he has given to his speech, what is not always characteristic of speeches on foreign affairs, a practical turn. He has not confined himself to giving rambling recollections of a traveller; he has given to the House the outlines of a rational and consistent policy. I do not propose to follow the hon. Gentleman into the discussion of the rumours which have been current lately with regard to the possible acquisition by the Russian Government of the concession of a port on the Persian Gulf, and of a railway to connect that port with the Trans-Caspian Railway. Such rumours have been current for a long time past, ever since the date of the secret agreement of General Kuropotkin in 1885. When travelling in that region, three years ago, I received information from what I thought reliable native sources, that even at that time a concession had been signed by the Persian Government, giving Russia the right of access to the port of Bandar Abbas. I attach less importance to rumours of that kind because, in the first place, I am rather inclined to doubt whether the real, as opposed to the ostensible object of Russia, is directed to that port at all. But even if such were her ambition, the realisation would be absolutely impossible without a reversal, on our part, of our traditional policy as regards the Persian Gulf. It is not unreasonable that people in this country should imagine that if Russia wishes for a commercial outlet on the Persian Gulf she should seek it at Bandar Abbas, which is the only port where she has even an insignificant trade; but, on the other hand, it must be remembered, Bundar Abbas is by no means an ideal commercial port. It has a very small population, mostly Hindu; its climate is almost as bad as that of Muscat. The story may be remembered that when a Shiek of Muscat died and went to a place not supposed to be very cold, he sent back to this world for his blankets! In the second place, the Port of Bundar Abbas has no deep-water anchorage nearer shore than four miles, and has no facilities for landing either passengers or cargo. It would be more natural if Russia wished for a port in that district, that she should go to the Port of Lingah, where there is a deep-water anchorage nearer shore, a breakwater, and a wet dock. Turning from the port to the railway, I do not believe that such a railway, connecting the Trans-Caspian Railway with Bundar Abbas, could possibly pay. Hon. Members may recollect that it was the opinion of the present Viceroy of India that no railway made in Persia could possibly pay, after construction, for four or five years, and that is still more true of the railway to which I have referred, which would encounter the maximum of physical obstacles. Moreover, it would run counter to the geographical features of the trade routes which lie N.W. and S.E., not N. and S., and the practical result of such a railway would be to advantage British trade by enabling us to compete more successfully than we can at present, in the markets of Meshed and Khorassan, in the north-west of Persia, from which it is the principal object of Russia to exclude us. I do not deny that both the acquisition of a port, and the construction of a railway, would be very valuable to Russia from a strategic point of view. The railway would enable her to command the roads to Herat and Farrah-Kandahar, and to threaten the flank of our West Indian frontier and Beluchistan. I do not think it can be denied that, with the expenditure of a considerable amount of money, the Port of Bundar Abbas could be made into a strong naval base, but I think it is far more probable that, if Russia had any such desire, she would not apply for a concession at Bundar Abbas unless she also held the islands of Kishm, Ormuzd, and Kharak. Russia, for this purpose, is more likely to fix her eyes on the deep water harbour which lies between Kishm and Hengam, where there is an easy entrance and a safe anchorage for the largest ships of war, and which was actually recommended by Sir John Malcolm to Lord Wellesley in 1800.

Although there is a great deal to be said from the strategic stand point, I do not think that it is really profitable to enter into a discussion of the question at any length this evening, because I am perfectly convinced that those concessions could never be granted without an entire reversal of the policy of His Majesty's Government. Ridiculous as the claim of Russia has always seemed to be in my judgment—a country which has a Gulf trade of no more than £750 a year—to have territorial facilities that we, with a trade of three million pounds, do not possess—I do not imagine for a moment that there is any competent naval strategist or responsible statesman in this country, on whatever side of the House he sits, who would suggest that we should yield to that claim, if it were dictated by no other than political considerations and with a hostile design. If I may express my opinion for what it is worth, I do not believe that if Russia comes down to the Persian Gulf she would come down in times of peace or in the guise of a commercial traveller. It is far more probable that her descent would be the crowning act of a successful and almost certainly an unexpected war; and that the avenue of her descent would be, not the salt deserts and the mountain ranges of South East Persia, but along the fertile valleys of the Tigris and the Euphrates, which will some day rival Egypt as one of the granaries of the world. I do not want to follow the hon. Member for Barnsley at any length into the question of the policy or the methods pursued by the Russian Government of late years; because, in the first place, these methods are not new, and, in the second place, because they constitute no ground for an attack on His Majesty's Government. It may be regretted that Russia should adopt an attitude, which, even those in favour of a friendly understanding with her, can hardly describe as friendly; that she should oppose Persia's acceptance of a British loan (and the Government was mistaken in not at once concluding the proposed loan in 1900), that she should impose a fiscal policy on the Persian Government, directly unfriendly to ourselves, and of which we disapprove, and that she should have used her influence to veto the construction of railways in Persia until 1910. Those are very regrettable evidences of the intentions of the Russian Government in approaching the Persian problem. She has more than once interfered to prevent the acceptance of British loans by Persia, she has opposed uniformly the enterprise of the Imperial Bank of Persia, and she extorted from the Shah the Convention which gave her the right of veto on the construction of railways as far back as 1889. However much we may regret all that, it does not constitute a ground of attack against His Majesty's Government.

But we have no right in these matters to dictate to the Persian Government, pro- vided the Government recognises our treaty rights, and does not infringe them. As regards the customs tariff, the raising of the duties upon imports, which come from England more than, from any other country, would at all events be opposed to the spirit of, not to the letter of, these treaty rights. Provided the Persian Government recognises our rights as to the customs tariff, and as to facilities for transport in the interior, then I think we are bound to allow it to manager of mismanage its own affairs as it pleases. I believe there can be no more fatal delusion than to imagine that you can force reforms on an Eastern people against their will, and the only result of any attempt at coercion, even if coercion be practicable, is that it arouses a spirit of reaction which sets you further back than if coercion were never attempted, and I think I will carry the general sense of the House with me when I say that the proper method is to carry with us the sympathy of the people of these Oriental countries, even more than the sympathy of their Governments, and to persuade them that their interests are identical with ours. That is the policy we have pursued with regard to Persia in the past. We do not desire, and I hope we shall never possess, an inch of Persian territory. When we had taken what might have been most valuable acquisitions as a result on the last Anglo-Persian War, we voluntarily, and of our own accord, gave them up. There is practical evidence of our interest, esteem, and sympathy as regards Persia in our great institutions in that country which have contributed most materially to its prosperity and general security. I refer to the Imperial Bank, the great telegraph department, and the opening up of the waterways to inland navigation. I trust that we shall not only carry with us the sympathy of the people of those countries in what we do, but that we will show no petty spirit with regard to reforms initiated by other countries. I am thinking more particularly of the control of the customs by Belgian officials, which has been extraordinarily successful, and which has added, in the course of a very few years, a revenue to the Persian Government which has contributed directly to its enrichment, and has therefore served our own interests by tending to free the Persian Goverment from the financial control of other Powers whose object may be to retard the internal development of the resources of the country. I am not quite sure that, from a purely selfish point of view, we need take so much to heart the policy of Russia with regard to vetoing the contruction of these railways. It is quite true that the non-construction of the railways makes it more difficult for us to compete with Russia in Northern Persia. The reverse is equally true, for the non-existence of these railways makes it much more difficult, in fact, almost impossible, for Russia to compete with us in certain provinces in Southern Persia, the trade of which is much more valuable. How valuable that trade is may be seen by a mere cursory glance at the statistics. In 1899 and 1900, of the total imports of the Persian Gulf, amounting to £2,800,000, the United Kingdom and India sent no less than £1,800,000. That is to say, we actually have two-thirds of the whole import trade of the Gulf in our hands. The import trade sent by Russia amounted to no more than £572. Of the export trade, which amounts to a little over £2,000,000, the United Kingdom and India take £908,858, or nearly a half. Taking individual ports, we see that the trade is not only very large, but is growing. It is impossible to take all the ports, because with regard to two of them, there were special circumstances which make it impossible to institute a relative comparison. In these two ports there was a great falling off in trade, owing, in the case of Lingah, to failure of the pearl fishery, and at Bundar Abbas, partly to the insecurity of internal communication, and partly to a general and most unwise strike against the control of the Belgian custom's officials—a strike which resulted in a general standstill of business for four or five months, and a loss of 25 per cent. of the receipts. Taking the port of Bushire our imports rose from £666,000 in 1899 to £992,000 in the following year, and our exports rose from £173,000 in 1899 to £291,000 in 1900. In Mohanmesah and Karun ports our imports rose from £41,000 in 1899 to £81,000 in 1900, and our exports from £191,000 in 1899 to £251,000 in 1900. It is therefore quite obvious that the value of our trade, and the possibilities of its growth, infinitely outweigh the value of the trade which Russia possesses in the northern markets.

I do not wish to suggest for a moment that we should be indifferent to our trade in the northern markets, or that we should not take every step we can to develop it. I am not personally pessimistic about the trade, and I could read a great many statistics in support of my view if I were not afraid of trespassing on the time of the House. A great many alarming statements have appeared in the press as if British trade in Khorassan were being absolutely destroyed by Russian competition. I do not believe that this is the case. As a matter of fact Russian exports exceed ours, but as regards our imports, the increase is greater than the increase in Russian imports. The advantage which Russia possesses is due to circumstances over which we have no control, and which no action on the part of the Government could remove. In the case of imports it is largely due to the bounty system which Russia has put in force, and also to the importation of petroleum oil from Baku. The increase in exports is largely due to the presence of Russian troops at Ashkabad which has increased the demand, and also to the fact that there is this railway quite close to the frontier and that it is therefore easier for Russia than for us to meet the demand in Trans-Caspia, Russia, and even Constantinople. I do not wish to minimise the importance of that trade. This question is one of very few practical instances in which we are justified inputting more pressure on the Persian Government than we do at present, and I hope that the hon. Member for the Berwick Division will support this view if he takes part in this debate, as I hope he will. We know that when the Trans-Caspian Railway was first built and brought within 90 miles of the Persian frontier, the Persian Government insisted that the Russian Government should construct at their own expense, and at the cost of £30,000, a road to the Persian frontier to connect it with the Russian road to Ashkabad. Facilities of the kind granted to one power and not granted to any other Power are of the nature of preferential treatment, and that preferential treatment is contrary to the spirit if not to the letter of our treaties. I submit, therefore, we should be perfectly justified in putting pressure on the Persian Government to take steps to improve and to keep open the roads from Bundar Abbas to Meshed, and from Dizful to Khoremmabad, which have recently been closed by tribal raids, or else that we should be allowed to undertake that work ourselves. When all is said and done, I do not believe that we can ever hope to compete on at all equal terms with Russia, in the northern markets of Persia, where Russia has the advantages of proximity and the bounty system, and I believe that our best policy will be to concentrate our energies on the southern markets south of a line drawn from Kuh Malek Siah through Kerman, Yezd, Ispahan, Dizful and Khoremmabad.

I have three suggestions to make to the noble Lord as to the way in which we can maintain our position in the southern markets. The first we can carry out on our own initiative and responsibility, without asking any leave whatever. It is the construction of the railway to which the hon. Member for Barnsley has alluded, and which, I understood from the noble Lord yesterday is now under the consideration of the Indian Government. That is the proposed railway from Quetta through Nushki to Kuh Maleh Siah. It is to follow the present caravan route, and may be of infinite strategic value, and from the commercial point of view—the question on which I am at present engaged—it will be of enormous value both immediately and in the future of enabling us to compete for the trade of Seistan. But I do not believe that will enable us to compete with Russia in the markets of Meshed, because the cost of railway carriage from Kurrachi to Quetta will always make the longer route from Bundar Abbas a cheaper one. Then there is another step we can take, namely, the establishment of a greater number of consuls in the country. I have observed lately that there no subject upon which the Foreign Office, or perhaps I ought to say the Treasury, is less amenable to conviction, than that with regard to the value of a large consular staff abroad. It is obvious that in a country like Persia, if we have a great number of consuls in the great centres of trade, or in the centres where trade is developing, they would be able to prevent the obstruction which arises from the deliberately hostile conduct of foreign employees appointed by the Persian Government to carry out their quarintine regulations, and by inland custom officers, and also deal with cases of repudiation of contracts, by no means rare, by native merchants which, in the absence of any regular court of jurisdiction, are now exceedingly difficult to deal with, and have to be referred to Teheran, but which, if there were a British agent on the spot to whose notice and cognisance they could be directly brought, might not occur at all. I shelter myself in this matter under the authority of the noble Lord, the Viceroy of India, who in his book written ten years ago stated that it was essential that we should have, not merely one consular agent at Kerman, as at present, to supervise the whole of South East Persia and Persian Baluchistan, but also Consuls at Yezd and at Bunder Abbas. Lastly, there is one course we could take, we could cultivate friendly relations with the tribes of Bakhtiari and Luristan, and encourage them to keep open the roads between Dizful and Khoremmabad and between Ahwaz and Isfahan, both of which have been closed to traffic by the general feeling of insecurity in the country. If we take these steps we have very little to fear from the future. When the Euphrates Valley Railway is completed nothing can prevent its linking up the fertile districts of the Karun basin with the central markets of Persia.

My hon. friend the Member for Barnsley has spoken of spheres of British influence in Persia. If that means that we shall in the South of Persia ask for a monopoly of all concessions; or the forcing upon an unwilling population reforms running counter to their desire, then I am opposed to it; it is a wrong policy because it tenders ultimately to partition.

* MR. JOSEPH WALTON

If the noble Lord will pardon me, I merely indicated that an arrangement should be arrived at with regard to Persia somewhat on the lines of the Anglo-Russian Agreement with regard to China, which would be merely an undertaking that England would not attempt to obtain concessions in Northern Persia, and that Russia would undertake not to obtain concessions in Southern Persia, but this would not deprive the Persian Government of liberty of action in undertaking Railway construction themselves, or in granting concessions to powers other than Russia or England.

* EARL PERCY

The Anglo-Russian agreement with regard to China may be a very good one, taking the existing circumstances into consideration, but if we had to start afresh I should be very sorry to see such an agreement concluded. There is a striking analogy between the situation in Persia and that in China, from which valuable lessons may be drawn. I am convinced that the force of resistance must come from within and not from without, and external action, if it be admissible at all, must take the form of friendly co-operation for commercial purposes, and not political pressure. There is some idea that the establishment by Russia of a certain amount of financial control by means of loans is tantamount to the surrender of the country so controlled. I do not believe that the financial control by Russia would be much more than nominal so long as this country holds the greater part of the trade, or that political control at Teheran would mean absorption of Persia, any more than that the position of Russia at Peking means the absorption of China. Although I am aware that I should not be in order in discussing the question of the Euphrates Valley Railway, which must be considered to be outside the geographical boundaries of Persia, I should be very sorry to sit down without expressing an earnest hope that the Government will never adopt any other than a friendly attitude towards German enterprise in that quarter. Germany is doing for Turkey what we have been doing for Persia. She is working for the social improvement and material welfare of the native races; and for my part I believe, that if the struggle of the future is to be between the Salvonic policy of compelling stagnation or the Teutonic policy of spreading the blessings of enlightment and civilization the victory will lie with those nations which are striving selfishly or unselfishly, consciously or unconsciously to fulfil the high aims which Providence has entrusted to the Imperial races of Christendom. I beg to second the Amendment.

Amendment proposed, at the end of the Question, to add the words— But we humbly represent to Your Majesty that it is essential that adequate measures should be taken for the safe-guarding of the commercial and political interests of the British Empire in Persia."—(Mr. Joseph Watton.)

Question proposed, "That those words be there added:"—

*(1.38) MR. NORMAN (Wolverhampton, S.)

said he desired to associate himself with the views which had been put forward with such force by the mover and seconder of the Amendment now before the House with regard to the Russian occupation of the Persian Gulf by means of a subsidised vessel which the Russians had sent there. He did not think we need fear any danger from that source. He believed the whole of the cargo of that vessel was sold at a great loss or given away, and he believed that trade on those lines could only be developed by means of a very considerable subsidy. He believed the hon. Member for Barnsley had rather understated the facts with regard to the contracting of loans by Persia. He understood the hon. Gentleman to say that the Persians were forbidden to contract a loan until 1910; his own recollection was that there was no time limit in the prohibition. With a great many of the demands of the hon. Member for Barnsley and the noble Lord he warmly sympathised—but it appeared to him that the point of discussing detailed action with regard to Persia had not yet been reached. There was something much more important to be settled, and that was the broad principles of policy to be adopted. In the first place, we were in advance of Germany in the Persian Gulf, but that advance was the most serious problem at present. The Germans were getting a concession to build a railway to the Persian Gulf, and were already asking in the name of the Sultan for a concession for a harbour close to or at Koweit. There was, as the House now knew, a Secret Treaty existing between Great Britain and Germany, and the noble Lord the Under Secretary for Foreign Affairs did not find himself in the position to deny that this Secret Treaty referred to the Persian Gulf, so that they might have it that very great concessions awaited Germany there in return for services rendered to us elsewhere.

* THE UNDER SECRETARY OF STATE FOR FOREIGN AFFAIRS (LORD CRANBORNE,) Rochester

May I point out to the hon. Gentlemen that if I once began to deny that a Secret Treaty referred to this or that, the secret would very soon be out.

MR. NORMAN

said he had no desire to press the question upon the noble Lord. He merely wished to express his opinion that there was reason to fear that this Agreement had reference to the Persian Gulf. The noble lord had stated on a previous occasion that the object of the British Government was to guard the political status quo in the Persian Gulf; but he had ventured to point out that there was such a thing as a commercial status quo. The noble Lord on the same occasion said that the commercial status was a matter for our merchants, that if they had sufficient energy they would settle the question of commercial status themselves. That surely was hardly reasonable. It was putting too grave a burden of Imperial responsibility on British merchants to tell them that, if Germany was to be prevented gaining a commercial inlet in the Persian Gulf, they themselves were to do it. For his own part he could not, see what possible means of doing it were within their power. A commercial concession such as this necessarily, rapidly, and inevitably developed into a political concession. He, therefore, hoped the Under Secretary for Foreign Affairs would be able to give the House a more definite assurance on that subject, or, at any rate, to point out how British merchants were to accomplish the great task of preserving in the Persian Gulf the commercial status quo.

Another grave issue was that connected with the relations between this country and Russia. He was one of those who believed that a wide-reaching understanding with Russia concerning the various world-interests of the two great Powers was not only desirable, but eminently possible, that often was steadily growing with the country. There was the highest political authority for the statement that in opposing Russia through a long series of years we had been putting our money on the wrong horse; and there was also the assurance that in the opinion of His Majesty's Ministers there was ample room in Asia for both Powers. The same was true, beyond question, with regard to public opinion in Russia. By Russian opinion he did not mean popular opinion or the opinion of the Russian Press, neither of which really counted for much, but it was with his personal knowledge that some of the very few men who in Russia, after the Emperor, exerted real influence in the course of events, most heartily desired such an understanding, and would be prepared to go great lengths to facilitate its achievement. In all fairness, the position of Russia with regard to Persia should be considered. Russia's one political object was to gain access to the warm water, not merely as an outlet of trade or as a strategical outlet, but as a sentimental outlet, just as someone who was struggling for air would try to push his way through every obstacle before him. Besides the real political and commercial reasons, there was this strong sentimental desire on the part of Russia, and that would not be altered by anything that might happen. Russia, at present, had a warm water outlet in the China Sea; she had prepared for herself an outlet which, though not in the warm water, was, at any rate, not frozen in the extreme north of Europe. She was at present closed up in the Black Sea, but it was safe to prophesy that that would not be forever, if it was for long. She had one other great desire, and that was to get to the warm water in the Persian Gulf. The policy against which he protested, and concerning which he hoped the Under Secretary for Foreign Affairs would declare it to be not the attitude of the Government, or, at any rate, that it was qualified by many other considerations, was the mere "hands off" policy. The noble Lord the Member for South Kensington had stated that an outlet for Russia could not be granted without any entire reversal of the policy of His Majesty's Government. He ventured to differ. The political opponents of this country, and particularly Russia, had gained their way without any entire reversal of British policy. They had gained it bit by bit, while Great Britain had stood still. Not many years ago the assertion made by the noble Lord would have been made by any Member of the House about Central Asia. It would have been said that the complete absorption of Central Asia, and the development of the Russian Railway up to the very frontier of Afghanistan, would not be allowed without an entire reversal of the British Government. But it had come about. A few years ago the same remark would have been made about China. It would have been said that the absorption of Manchuria, the fortifying of a base at Port Arthur, the supersession of Great Britain as the most influential power in the Far East, would not be brought about without an entire reversal of the policy of His Majesty's Government. But that also had come about. There had been quoted the very strong declaration of the present Viceroy of India, that he would impeach any British Minister which ceded to Russia a port on the Persian Gulf. He (the hon. Member) would not mention the noble Lord's name in criticism without at the same time paying him his humble, but sincere, tribute of admiration for the work he was accomplishing in India. But the policy of the British Government was not tied to the declaration made by Lord Curzon ten years ago. As any student of his Lordship's published works would see, Lord Curzon had changed his opinion on more than one point, and possibly enough water had flowed under the bridges during the last ten years, to lead him, if not to change, at any rate to modify his opinion on this point also, so that although he might disagree with any British Minister taking the step to which he was then opposed, he would hesitate actually to impeach him.

The noble Lord the Member for South Kensington had spoken of Russia as the Slavonic power compelling the stagnation of oriental power. That was an unjust remark. He (the hon. Member) had recently been travelling somewhat extensively among Eastern and uncivilised peoples now ruled by Russia, and he asserted without hesitation that she was carrying on a great work of civilisation there. She was developing commerce—of course Russian, not British, commerce; she had imposed peace, and certainly so far as her work in Central Asia was concerned—and he had seen a good deal of it—he must testify his respect, for it was truly a work of civilisation, in the best sense of the word.

EARL PERCY

made a remark which was inaudible in the Press gallery.

MR. NORMAN

said he had no desire to misrepresent that noble Lord, but he must point out that the people in Central Asia to whom he referred were not, a short time ago, under Russian rule or in Russian territory, and there was no reason to suppose that Russia would behave differently to other peoples than to these. What he asked was that the British Government should have with regard to the Persian Gulf some policy other than that of "hands off," to Germany or Russia, and that there should be a definite statement of that policy. It was not sufficient for the Government to have this "hands off" policy, and then do nothing while other powers advanced, perhaps even in conflict, until British policy found itself in the position of a nut between the two blades of a nut-cracker.

Neither the mover nor seconder of the Amendment had alluded to a document which he thought could hardly be entirely omitted from the discussion. There was in existence, though it was frequently ignored by writers, on the relation between Great Britain and Russia with regard to Persia, an understanding conveyed in remarkable language between the Russian and the British Governments for protectives and respecting the integrity and independence of Persia. This understanding was contained in a despatch from Lord Salisbury to Sir Robert Morier, dated March 12th, 1888. But the understanding dated back long before that, and the despatch was a confirmation of an exchange in other letters in 1837, 1838, 1839, 1873, and, finally, 1888. Lord Salisbury then stated that he had had an interview with the Russian Ambassador in London, who had read to him a despatch from the Russian Foreign Minister, and he proceeded: As regards our desire for an assurance that the engagement between the two Governments to respect and promote the integrity and independence of Persia is considered by the Russian Government as remaining in full force, M. de Giers states that, although, in their opinion, there are no present grounds for apprehending any danger to Persia, and although they have received no communication on the subject from Teheran, yet the Russian Government have no objection to placing again on record that their views on this point are in no way altered…. It has been highly satisfactory to His Majesty's Government to learn that those views are so much in accordance with their own, and they owe their acknowledgements to M. de Giers for enabling Sir H. D. Wolff to inaugurate his mission by an assurance to the Shah, that the engagement between Great Britian and Russia to respect and promote the integrity and independence of the Persian Kingdom have again been renewed and confirmed. He (the hon. Member) invited the Under Secretary of State to say whether or not in the opinion of the Government that understanding held good, because if so—and he had no doubt it did—it afforded a good basis for approaching the Russian Government on the question of the interests and policies of the two countries with regard to Persia. In conclusion, quite apart from all details, he desired some assurance on the general lines of British Policy with regard to other countries which at present were approaching Persia—he would not say in a spirit hostile to Persia, but at any rate with a view to making demands upon her which probably would not be compatible with the continued independence of the Persian Government; and to express the opinion that if the policy of the British Government was simply to keep out Russia, and, more particularly to keep out Russia by means of any understanding, secret or otherwise, which would let Germany into the Persian Gulf, they would be preparing for themselves not only grievous commercial injury, but possibly also imperial disaster. (2.0.)

(2.30.) SIR ALBERT ROLLIT (Islington, S.)

It is refreshing after the debates which have recently taken place, disclosing partisan differences of opinion in this House, that we should have introduced to-day a subject in which we not only feel a common interest, but in which we are disposed to take common action, if possible, in furthering the trade of our country in distant parts. We ought to bear our tribute of gratitude to our friend who introduced the subject, in that he devotes his vacation to visiting the outposts of British commerce, and brings back to this House information, not through the ordinary or diplomatic or political channels, but of a distinctly commercial character, and based upon practical commercial experience. To-day he has given us a record which cannot fail to be instructive, and which, I hope, will be the basis of some advance in favour of the promotion of our trade. A national need exists in that direction. I, myself, during the autumn, visited some parts of the Near East, and whether it were in Syria, Turkey, or the Balkan provinces, there were certainly parts in which British trade, and also British political influence, were being seriously infringed upon, chiefly by the two countries referred to in this debate, Germany and Rusaia, which advance their commercial interests through political methods and considerations. And we ourselves may have to more seriously consider in the future than we have thought it necessary to do in the past our political in relation to our commercial policy. My hon. friend has illustrated the value in our commercial work of securing the best possible commercial intelligence; and I hope the Intelligence Committee of the Board of Trade, established two years ago, and of which I have the honour to be a member, will exert every possible influence in this direction. That Committee must feel an obligation to my hon. friend for the information which he has given from China last year, and which to-day he has been able to afford in regard to Persia. I would suggest to the noble Lord the Under Secretary for Foreign Affairs that more use should be made of such commercial emissaries like my hon. friend, and also of Chambers of Commerce which contain practical business men. I would remind the noble Lord that during the early stages of the Chinese affair a recommendation was strongly made by the London Chamber of Commerce that Chusan would be a more useful stand-point than Wei-hai-Wei, commanding as it does the estuary of the Yangtse. Similarly, in the case of the Venezuela dispute, years before the matter was referred to arbitration, when it was in the conciliatory hands of Mr. Bayard, of the United States Embassy, the London Chamber of Commerce recommended that arbitration was the proper mode of settlement before the question became acute, and that this might prevent the possibility of war which eventually nearly happened.

Everyone must also approve of the suggestion of the noble Earl, the Member for South Kensington, that we ought to be better represented commercially abroad than in the past. I am quite aware that the Foreign Office have appointed more commercial attachés who are doing excellent work; but there is room for more consuls. That is the system pursued to a much greater extent and with great advantage by foreign nations. The noble Earl said there was much need of more consuls in Persia. I would urge that they should be of a distinctive commercial character, appointed for commercial considerations, and that a knowledge of the language of the country to which they are accredited should be in necessary qualification. I hold a letter which tells me that scarcely more than six of our consuls in the Russian Empire are masters of the Russian language. Then, foreign Governments habitually support their commercial interests by diplomatic action. I hope that our merchants trading in foreign countries will always feel secure, not only of the sympathy but of the help of the Foreign Office. I certainly know of one case in which the Foreign Office actively supported one British trader against another British trader. [LORD CRANBOURNE: Quite so.] Under the administration of the present Viceroy in India, and of the noble Lord, there has been great willingness on the part of the Foreign Office to give proper support whenever it can be reasonably given, and this policy should be continued, and, if necessary extended. This is the new deplomacy in its best form. The figures of the shipping in the Persian Gulf are of a striking character. They indicate in the best way the importance of our interest there. I find that in the case of the ports of Bushire and Lingah of the 193 steamships which entered last year, 189 were under the British flag, three under the Turkish flag, and the remaining one under the Austrian flag; while of the 157 steamers which cleared from these ports 152 were British, two Austrian and three Turkish. And here I think it is right to pay a tribute to the Persian Government for having greatly improved the conditions of Commerce, notably in the collection of the Customs at the Persian ports. The Customs Department is now working excellently though in Belgian hands.

There is one other reform I could ardently wish for, and that is the establishment of regular courts of justice not only at Teheran, but also at the various ports. British traders at present suffer greatly, because they are constantly taken to the distant capitals to have their cases tried, and this subjects them to troublesome delays, and sometimes to miscarriages of justice, which greatly interferes with British trade. I assure the noble Lord that in dealing with this matter he would have the most active sympathy and support of the British Chambers of Commerce, if he advised the Persian Government to this effect. So important did the Associated Chambers of Commerce, which met in Paris in 1900, feel the British-Persian trade to be, that they presented a memorial to the Shah, who was in Europe at that time. I presented that memorial to the Shah and his grand Vizier personally in Eastern Europe, and in the long interview which His Majesty did me the honour to receive me, I indicated the deep interest of British traders in Persia and their long trade connection with Persia directly with this country and through India. I am bound to add that these, assurances were most frankly reciprocated by His Majesty, a most able monarch, the Shah, and his enlightened Ministers, including the Persian Ambassador to the British Court, who is so able a representative of his sovereign. If the Persian Government were assured of the confidence and interest of this country, and of the continuity of British policy in dealing with commercial and political matters, I am persuaded there would be the strongest disposition to reciprocate the good feeling of this country, and much more would be achieved in the future than in the past. I think it will be admitted that the Chambers of Commerce have rendered some service, and they will be glad to render further service in this important matter. But mere expressions of sympathy and interest are not now a days quite sufficient. There must be at times—and other countries adopt this new diplomacy—something more tangible I heard with interest the suggestion as to the support of railway and other concessions. Of course, in dealing with matters of private enterprise by companies and concessionaires, the greatest care and discrimination must be exercised so far as the public funds of the country are concerned; but there may be, as there has been, exceptional cases in which Government help could and should be given. For instance, in the case of the loan of 1900, a great opportunity was lost by this country. Only a guarantee was required and the security was ample, and whatever may be said about Russia, which ultimately furnished the loan, not gaining any practical advantage from it, all experience points to the contrary. The now diplomacy must be prepared to give some considerations in exchange for or granting prospective advantages for trade and for saving our trade because that is often the question involved; to take some responsibility, to render help, and do more than give mere expressions of sympathy and interest. Our country has guaranteed many worse loans, and by doing so to Persia a valuable commercial and political status would have been gained.

Now, my hon. friend indicated some lines of policy, but I venture to think that one of the worst things we could do would be to foreshadow spheres of influence, those precursors of ultimate partition. We must not attempt to treat those countries which have an ancient and high civilisation as corpora vilia for political an commercial experiments; still less should we attempt anything like coercion in such countries. Our advice should always be friendly and proffered in the interests of the country to which it is given as well as our own.

I will not attempt to follow my hon. friends who have spoken of higher political policies, but I would say that whatever we attempt—whatever arrangements that may be made even with Russia—should be arranged with a distinct regard to the Persian Government and people. We must conciliate both, not attempt at supersession of them, for Persia is an old and independent state, and if we are able to render them assistance by those means in the development of their country and interests, we shall probably take the best course to secure that open door which is of vital value to us, and to prevent that differential treatment of our country in regard to ships and the laws affecting shipping, tariffs, bounties, and other matters affecting our commerce, which, whatever we may say, is bound to be the result of any predominant position gained by our rivals.

A rapprochement with Russia is one of those things which is devoutly to be desired, but I do not think the recent utterances in the Russian Press indicate that we should succeed best by courting it, or that the time has quite arrived when it might be feasible. But a clear and reliable understanding with Russia, carrying with it—probably what many of us even more earnestly desire—a fair and frank friendship equally with France—on the basis of the interchange of despatches in 1888, is certainly to be desired. I hope my noble friend will be able to assure us that such a reciprocal understanding still exists and may be expected to be fulfilled on both sides. If that is so, I am sure an advance will have been made in both the commercial and political interest of this country, and I venture to say I think the House and the country is under a deep obligation to my hon. friend for initiating this debate.

(3.50.) SIR EDWARD GREY (Northumberland, Berwick)

I join heartily with the hon. Member who has just sat down in congratulating my hon. friend the Member for Barnsley on having initiated this debate. My hon. friend stated that his intention to do so had been the subject of chaff on the part of other hon. Members. Well, Sir, I am sure that the course which the debate has taken has made him feel that the House will appreciate the opportunity which is given to them of discussing this most important question; and, if there was any idea that the discussion could not at this period of the session be a serious one, I am sure that will be entirely destroyed by the evidence of knowledge, zeal, and interest which my hon. friend showed in his speech in introducing the debate. He had an admirable seconder in the noble Lord opposite, and I think the House will congratulate themselves on the prospect of continuing to have a most interesting and useful discussion.

Well, Sir, the terms of my hon. friend's Motion will, I am sure, have the support of the whole House. I do not mean that he would have that support if he went to a division. We are, in form, discussing a Motion of want of confidence in His Majesty's Government, but as a matter of fact we are really engaged in a reasonable and moderate discussion of important British interests. This question has two aspects. There is the local aspect which is involved, and there is the wider aspect of our foreign policy. My hon. friend expressed some apprehension about certain articles which he had seen in the autumn in magazines or newspapers, which incidentally dealt with some aspects of the Persian question. I am not quite sure that I know whether he and I both allude to the same articles, but, if he means the articles that I saw, they do not arouse in my mind the apprehension which I think they have aroused in his. Those articles, after all, dealt with the Persian question purely as an incident in the matter of general policy. What they did deal with was the whole question of the future relations between the British Government and a foreign Power, or groups of foreign Powers. Their main object, as I understand them, was a desire to remove, at any rate between the British Government and the Russian Government, that cloud of suspicion and mistrust and that continual friction that has existed for so long between the two countries. I sympathise entirely with that object as a matter of policy, and this Persian question no doubt is very germane to it because I do think that the Persian question is in the main a matter between the British and the Russian Governments. They are the two Powers at present most intimately concerned in the Persian question—others may come in later, but at present the question mainly concerns these two Powers.

There are three possible policies which we may pursue towards the Russian Government. They are all of them practical. One is undesirable, the second, I think, is desirable, and the third I regard as intolerable. The first possible policy is that of perpetual resistance to Russian expansion everywhere in Asia, on the ground that somehow or other it would endanger British interests. We are not to make forward moves ourselves, but we are always to put obstacles in the way of the Russian Government's making a forward move. That I regard as a possible policy, but a very undesirable one. The second policy, which is, I think, a desirable one, and I believe to be a practical one—anyhow, one which I wish to see put to the test as it can only be put to the test by the Government of the day—is that of an understanding between the two Governments which would result in a fair and frank interchange of views and adjustment of interests in Asia. It is only in that way that the Persian question can be adjusted between the two countries. Russian policy in Asia and British policy in Asia must be looked upon as a whole, and only in that way can the Persian question be adjusted between the two countries. I do not believe you will get an agreement with the Russian Government about Persia by itself—you will have to take Asiatic policy as a whole, and it is much more desirable that that should be the case. I believe that an agreement with Russia on one point would not result in a general amelioration and general easement of the relations between the two countries, which could be arrived at if you treated individual interests in Asia as part of a whole policy. The third policy, which I regard as an intolerable one, is a policy of drift. I think it is intolerable, because Russia always gains by it. It is a policy which seems to me to have been pursued up to a certain point in the Far East some time ago, and I would define it as a policy which combines in a most extraordinary way the disadvantages both of yielding and of resistance without getting the advantages of either course. We have on some other occasions, by waiting and doing nothing, arrived at this position with regard to Russian expansion in Asia—that we have made all the concessions which ought to have entitled us to reward and friendship in return, while we have incurred odium and enmity and friction, even though the concessions were made in the end. That is a policy which we must not pursue with regard to this question of Persia. There is plenty of timenow—it may be years before things come to a head. Now there is time to look ahead and to foresee that, if there is to be Russian expansion in that part of the world, it should be expansion which comes about as the result of agreement with the British Government, and which results, not in increased friction, but in a better understanding between the two countries. Of course, that is a policy which can only be forwarded by His Majesty's Government. Discussions in this House may ventilate it and may suggest it, but it is His Majesty's Government alone who can forward a policy of that kind. I trust that their object is to put to the test, to the utmost that is compatible with the maintenance of British interests, the possibility of that policy, and that they will not be afraid of any impeachment by their Viceroy of India if they take stops in that direction, because I think we have all felt with regard to Lord Curzon that the great interest which he has taken in this important work, both in this house and since he went to a higher post, has made him not only a great practical force, but a most reasonable force in upholding British policy.

Of course one cannot go into details with regard to what might be done. It is emphatically one of those cases in which you do not state terms in advance. You cannot state terms in advance. Nobody on the Opposition side could outline such a policy; I should not think of doing it without having got the best information which I could from the Government of India and without having consulted the highest authorities on the question. The first step would be to find out what the Russian Government really want and what they desire, and having found that out, to make up our own minds whether it is compatible with British interests, or how far it is so compatible with our interests to come to an agreement with Russia. But, for one thing, the Russian Government must be made to feel that our interests in this Asiatic problem, outside our own possessions, are trade interests. We do not desire any territorial or political extension. I would go further and say that we are not jealous of the strategical position of other nations except where our own interests are most acutely affected, but we do desire that our trade interests should be preserved. With regard to the strategic question affecting the Persian Gulf, if I may follow up the position I have sketched, I understood the noble, Earl to say (and he spoke with great knowledge from having been in that part of the world), that the key to the naval position in the Persian Gulf rested in certain islands rather than on the coast. I should like the noble Lord to tell us exactly, if he can, what rights the British Government have in the Persian Gulf, and whether we have any right with regard to these islands at the present time. We have been in the Persian Gulf for a long time. Our rights are not always clearly defined, although certain vested interests do grow up, but I should like to know whether, directly or indirectly, we can consider ourselves interested in these islands. On the general question as to the mainland, we have got to bear in mind that we cannot stand still. The Russian Government is making great efforts to guard its own vested interests, and we must make similar efforts ourselves on our side too. I think we have lost ground lately. The noble Earl said that the loan that Russia has guaranteed to the Persian Government has not in any way infringed the independence of Persia that it had not given Russia political rights.

EARL PERCY

What I said was that it did not entail the surrender of Persian independence.

SIR. EDWARD GREY

Well, no doubt that is strictly true, but it has undoubtedly increased Russian influence. The noble Earl in the earlier part of his speech dwelt on the way that Russia pushes her own interests at our expense by opposing concessions we wish we could usefully have, and promoting concessions specially in her own interests. Russia, having granted that loan, was enabled to do that with greater force. You cannot be under pecuniary obligations to another Power without at the same time feeling that the influence of the Power is increased. That is why I am afraid that Russian influence is increasing; and, if that is so, I fear British influence may be decreasing, and the longer we wait under these conditions the poorer the bargain we shall be able to make in the end. I agree with the noble Earl as to the steps to be taken as to the policy of making roads in Persia, and as to consuls, and about not taking an inch of Persian territory. We ought to consolidate our influence by the extension of our trade interests, and these, after all, become a great vested right. If we allow our trade in Souther Persia to dwindle, and take no practical steps to acquire new political rights, we may be sure that the interests of other Powers will be growing and our position deteriorating. The noble Earl seems to prefer the policy of the independence and the integrity of Persia, and so do we all, including, no doubt, His Majesty's Government. I agree that this would be entirely the best result, but the whole of this question of the integrity and independence of these States in Asia is one to be regarded with great care. The buffer State policy is excellent where we have a State which can take care of itself; but in Asia you have always to be afraid of relying too much on counsels of perfection and finding that, after all, they have not been in accordance with the facts of the case. We should pursue the policy of maintaining the independence and integrity of Persia, but we must be prepared for eventualities. After all, a country like Persia is very much in the position of a weak State propped up by two strong Powers, one on each side. If one withdraws its support and the other leans more heavily, the weak State is sure to topple over. That is the reason why I think His Majesty's Government should relax no effort to maintain the position we already have in Southern Persia. While doing that, I think that from this time on, if not already begun, there should be unrelated efforts to come to an understanding with other Powers, and especially with the Russian Government. Russian vested interests in Persia are growing every day. We do not wish to have trouble there. We wish, as far as our interests are concerned, that Persia should be kept open to the trade of the world; that the trade of everybody should go there. We do not wish to see the commercial and political position jeopardized, but we wish also to treat it as part of a whole. We wish to see the legitimate aspirations of other Powers for expansion recognised; and all I will say is that I trust His Majesty's Government are looking ahead and making arrangements to protect British interests, and that in doing that they will safeguard the future by a good understanding with the other Powers specially concerned.

*(3.10.) Lord CRANBORNE

I do not think the Government have any reason to complain either of the inception of this debate, or of the speeches which have been delivered in the course of it. The tone that has characterised every speech has been one which we gladly recognise as patriotic, and intended not to thwart, but to further the ends of the policy of His Majesty's Government. The Amendment is, as the hon. Baronet has most justly remarked, in the form of a vote of censure on the Government, but the appearance of my noble friend, who is so ardent a supporter of the administration, as a seconder of the Amendment is, I think, a guarantee that it is not so intended. I cannot hope to compete either with the hon. Gentleman, the mover of the Amendment, or my noble friend, in the personal and practical knowledge of the country and the subject with which they have dealt. Both of them are great travellers, both have been in Persia itself, and both are, therefore, far more qualified than I am to speak upon the actual facts as they saw them. But I am not quite sure whether the suggestion which the hon. Gentleman made in the course of his speech, that we should have a large map of Persia hanging up at the end of the House, would lead to a complete apprehension of all the problems with which we have to deal. I am afraid a map would not be sufficient, because my noble friend pointed out most justly that, although the hon. Gentleman opposite knew something of the Persians, he did not quite understand the geographical distribution of the mountains, the rivers, and the trade routes; and I am afraid that, unless we went there ourselves, and spent perhaps a little longer time there than hon. Gentleman could spare, it would be impossible thoroughly to know the intricacies of the Persian question.

The debate has dealt in the main with Persia, but there has been a series of references to the general position of Great Britain in the East, and to the general attitude which she ought to adopt. Far be it from me to go into such a wide subject as that; but it must be realised, it cannot be too strongly realised, that we do not enjoy a monopoly of influence in Asia, and that as in the course of time other countries with great resources, with great energy, and great administrative power, push forward on their various careers of development in Asia, the relative position of this country as regards them must inevitably alter. Absolutely, as the House is well aware, we occupy a magnificent position; we have a vast Empire, a most prosperous Empire; but, as other great dominions approach ours, the relative situation must be modified, and there is no shame in confessing that such should be the case. There is another matter that has to be borne in mind. You may roughly lay down that our object in Asia is to maintain the status quo. I do not mean to say that that is a statement to which there may not be some exceptions, but, taking it generally, the policy of Eng- land throughout Asia is to maintain the status quo. That is an advantageous policy. It was not always our policy, because at other times a different policy was more suitable; but at the present moment, with the very great extension which our Empire has had of late years, undoubtedly the policy of maintaining the status quo is the right one for this country. This is a policy which may be mistaken for what was called by one of the hon. Members who have spoken a policy of drift. It does not follow that it is a policy of drift. It is a difficult policy to maintain, because as other countries advance, a purely defensive policy must always present much greater obstacles than any other.

What is true of the East generally is true of Persia. We have very large interests there. Far be it from me to minimise thorn in the least. They are interests of the highest political order, vast commercial interests which it is our wish and our duty to maintain. We see no reason why that should make us seek anything but friendly relations with Russia; but although we seek friendly relations, I must remind the House and the hon. Baronet that these friendly relations are not to be sought at the cost of any of the rights which by treaty we possess. Whether to Russia or to any other country, it does not become us and it is not our interest to go cap in hand for an under standing. We have shown that we are anxious to work on perfectly friendly terms with every country, and we have, since the present Government came into office, in a large measure succeeded. But in Persia there should be no difficulty. The hon. Member for South Wolver Hampton referred to an exchange of notes which took place in 1888 in regard to Persia, and he quite accurately quoted what passed on that occasion. It was that mutual assurances had been given that the policy of England and Russia was the maintenance of the integrity of Persia; and, in reply to the question put to me by the hon. Member, I have special reason to believe that on both sides that assurance is maintained. One thing I can answer for. As far as we are concerned, we are perfectly sincere in our anxiety for the integrity of Persia, and we are anxious, above all things, to be friendly to Persia. When people speak of methods of conducting inter- national policy, and point to spheres of influence as the direction in which international policy ought to tend. I wonder if they think that the countries which are the subjects of that process and furnish the area of the spheres of influence really like the situation in which they are placed. I can assure them that such is not the case. If you desire to be friendly with a country, do not reduce it to the level of a sphere of influence.

My noble friend the Member for South Kensington, who made, if he will allow me to say so, such an admirable speech this afternoon, pointed out that what we ought to seek is the sympathy of the Persians. That is not to be done by coercing them either into reforms or into any policy which we may desire, but by studying their interests and seeking their friendship to induce what we are unwilling to enforce. As I have said, our policy is the integrity of Persia. That apparent unselfishness is not due to any elaborate moral motive, because it is our interest that Persia should remain in its present territorial condition, but when I state that, I ought to add that there are limits to that policy. That policy cannot be pursued independently of the action of other Powers. We are anxious for the integrity of Persia, but we are anxious far more for the balance of power; and it would be impossible for us, whatever the cause, to abandon what we look upon as our rightful position in Persia. Especially is that true in regard to the Persian Gulf, as I had the honour to state to the House a few days ago. It is true not only of the Persian Gulf, but of the Southern Provinces of Persia, and especially of those provinces which border on our Indian Empire. Our rights there, and our position of ascendency, we cannot abandon. In the Gulf itself, as I ventured to state on a previous occasion, our ascendency is not merely a question of theory, but a question of fact. Our position of ascendency is assured by the existence of our maritime supremacy; and I may say, in answer to a remark by the hon. Baronet, that that to my mind, is a far more solid guarantee than any paper rights to which he pointed.

Beyond the integrity of Persia, our next object is the development of Persia, for that means the development of the commercial capacity of Persia, and, therefore, of the trade of this country. I believe that every gentleman who has spoken in the debate shares our desire to further Persia's development. Some of them would go a long way in this direction. Many of them have urged upon the Government a large investment of money in Persia. Some have reproached us because on a certain recent occasion we did not lend money to Persia when, as they say, we could have done it. But we are a nation of men of business, and men of business do not lend money except upon proper security, and I do not think this House will ever quarrel with the Government because, before embarking on any such policy, they are anxious to see whether the security is both sufficient and suitable. I do not mean to say that we exclude altogether as an impossibility the lending of money to Persia. I would not lay down any such propositition. It might be on some occasions a proper thing to do. But no British Government could come to the House of Commons for the purpose of advancing money to such a nation as the Persians, who are not particularly famous for economical administration, unless they previously saw that the security was such as business men would lend money upon. And what is true of a loan to the Persian Government is also true more or less, of the investment of money in various public works in Persia, as has been urged upon us. This must be done with a strict regard to business considerations.

Being anxious for the development of Persia, we welcome that development from whatever source it springs. It has been represented as a reproach to us that the Russians have acquired certain rights of railway construction. We should welcome the fact that the Russians should take their share in the railway development of that country, just as we should welcome the fact that the Germans should take their share in the development of those regions. We are assured of this, that, subject to the fair administration of the railways, the mere making of railways makes for prosperity and prosperity is good for the trade of this country.

A certain number of specific questions were asked of me in the course of the debate, as to what we have done in furtherance of British interests in Persia.

My noble friend and others, but especially my noble friend, called the attention of the House to the necessity of consular representation in Persia. I quite agree with him; I think he will find that there is no difference on that point between His Majesty's Government and himself. Of late years we have extended considerably consular representation in Persia. We have established a Consulate recently at Bundar Abbas, about twelve months ago. I am not quite sure about the other places he mentioned. Ispahan has been raised to the dignity of a Consulate-General, and altogether, I may say that there are a dozen or more Consulates and Vice-Consulates in Persia. The question of consular representation there will be very carefully watched, and if it is found that British interests demand its still further extension, I am quite sure the Government will consider it. My noble friend mentioned the question of British interests on the Tigris. I do not want to call attention much to that point because it is, as a matter of fact, outside the terms of the motion. I should just like to mention that that is a locality in which a British postal subsidy is given; and, as the House of Commons is well aware, postal subsidies are more useful than the name seems to imply. Then mention has been made of the enormous extension of the value of trade in Beluchistan in recent years, and, as the House learned from an answer which the Secretary of State for India gave yesterday, the question of a railway in that direction is being considered.

Then there is the telegraph question. A telegraphic convention is on the point of settlement with the Persian Government for a great central Persian line, which will be useful to Persian interests, and also, as we hope, by future development, as a relief line between England and India, overland. Several hon. Members have mentioned the reforms in the Persian Customs administration under Belgian auspices. That is a matter of great congratulation to the Government, and though these were not undertaken at our instance, we welcome them, and the result has justified our expectations. The very able administrator there has produced a complete reform in the Customs system, which will be highly beneficial to Persia itself, and also to countries having commercial relations with Persia. In connection with this, and in reply to remarks from the hon. Member for South Islington, I may say the Foreign Office will be glad to receive any suggestions from Chambers of Commerce, and others interested as to the propermeans and methods for promoting our relations with Persia. The fact is, and it is almost a truism to say so, our commercial policy is calculated to benefit everybody concerned. To us such things as differential dues and preferential rates, as between one country and another, are unknown. Wherever we have roads; wherever we promote railways, or have control of harbours, or have ascendency on an Oriental coast, everybody, no matter of what nation, is free to compete with us on friendly terms, and thus our policy has been beneficial, both to commerce generally, and to Persia. Upon this I have not noticed during the debate any serious note of disagreement, and I can assure hon. Members that, subject to the general considerations I laid before the House at the beginning of my speech, we shall continue to maintain that position in Persia, and especially in the Persian Gulf, which we consider to be essential to our interests, but subject to that, our dearest hope is for the reform and development of the prosperity of Persia.

*(3·35.) MR. STEVENSON (Suffolk, Eye)

I have listened with interest to the reply of the noble Lord, but I very much regret the absence of information with regard to some particulars which have been inquired for in the course of this debate. I notice that my hon. friend the Member for the Berwick Division asked a specific question, with regard to the rights, direct or indirect, with respect to certain islands in the Persian Gulf, and the only reply which the noble Lord made was to make a general reference to the naval supremacy in the Persian Gulf. It is possible that, as these questions have come so closely within the purview of the Indian Government, that information on that particular point was not at the moment in possession of the Under Secretary of State for Foreign Affairs. If it should happen that in the course of this debate the Secretary of State for India should rise, he may be able to throw some light upon the question put in regard to these particular islands mentioned by my hon. friend. That was with reference to the rights possessed by us in regard to certain islands in the Persian Gulf.

I will now pass to another apparent deficiency in the noble Lord's reply. He referred to the great necessity of maintaining the status quo, but a good deal depends upon what is exactly meant or denoted by the phrase "status quo." The political status quo is a matter upon which we are all agreed, but with regard to the commercial condition of affairs it is, unfortunately, a fact which has been recognised by many speakers in the course of this debate that the commercial interests of this country have considerably suffered during the past few years, and other Powers have gained certain advantages at our expense. I do not look at this matter precisely upon the lines suggested by my hon. friend the Member for Barnsley, but some effort ought to be made for the purpose of keeping up and developing commercial intercourse between the ports on the Persian Gulf and the interior of the country. I was glad that my hon. friend drew a distinction which other speakers have also drawn between Southern and Northern Persia. Those are two parts of the country which ought not to be confused in the course of this debate.

With regard to Southern Persia and the Persian Gulf, I cannot see that the position we occupied there two years ago has been maintained, and an active policy ought to be maintained by the Government, in order to safeguard the commercial interests of this country. I regard the phrase "sphere of influence" which has been used as one open to objection, and it might be misconstrued in Persia itself. If for that phrase you substitute "sphere of interest," I do not think that would be open to the same objection. Both from the point of view of India and the commercial interests of this country I cannot conceive that there would be any very serious objection to the use of a phrase of that kind. The noble Lord the Member for South Kensington refers us distinctly to the interests of this country in the territories on the Tigris and the Euphrates, and although they are literally outside the scope of this Amendment, they cannot be dissociated from our interests in the Persian Gulf. It is to that portion of the country that attention should be directed, perhaps oven more than in the other direction.

I regret that no statement was made by the noble Lord with regard to the position of the German railway, about which we have heard so much lately, which is to touch upon the Persian Gulf. No doubt he will reply that this matter lies outside the wording of this Amendment, although it does not lie outside the spirit of it, because that railway must have very important economic and political importance in the future, and this House should be informed at the present time as to what is the progress and the prospects of that undertaking. I do know whether the Under Secretary of State for Foreign Affairs or some other Minister who sits upon the Front Bench opposite will be able to give us some information upon this subject, for I am not aware that any authoritative statement has been made upon that point. We have heard a good deal upon that scheme lately, and we have heard that the Turkish Government, at the request of Germany, have undertaken kilometric guarantees. The financial position of Turkey is not a satisfactory one, and if the Turkish Empire undertakes a financial obligation of that kind it must be by means of the Customs Revenue, or some other source of revenue which is under international control. A great portion of it will be derived from dues levied upon the imports of the Turkish Empire which passed through the hands of British merchants, and those duties will be levied mostly upon goods produced by the manufacturers of this country. We have this rather curious fact that a railway intended to benefit German trade primarily will, to a considerable extent, be financed by means of dues levied upon goods imported into the Turkish Empire by British merchants and manufactured in this country.

It is conceivable that at some future date the control of that railway may pass into the hands of some other Power, but for a good many years to come it will be in German hands for the purpose of pushing the trade of our rivals in another part of Europe, and it seems to me that we ought to have some information upon that point, and we also should learn what is the likelihood of its influence upon its position of affairs in Persia and upon the Persian Gulf, and the trade connection which will be affected in that quarter. I do not desire in the least that we should pursue a dog-in-the-manger policy, and stand in the way of any development of those parts of the world; but, at all events, when a railway of that kind is constructed it seems to me that if it is intended to push the trade of the rivals of this country, it ought not to be constructed in the way I have indicated, and every effort ought to be made by the Government to see that the trade of this country does not suffer by what is being done. The Government should see that the arteries of British commerce in the valley of the Euphrates and the Tigris and the Karun, which is connected with Persia, should be kept open to British commerce, and they should also see that every encouragement should be given to the development of our commercial intercourse in that region. While I desire to welcome both the Motion of my hon. friend, and also the speech which has been made by the Under Secretary for Foreign Affairs, it seems to me that he has not altogether replied to the questions which have been addressed to him upon the subject, and it is to be hoped that some further information will be given by some other right hon. Gentleman who sits upon the Front Bench opposite before this debate comes to a close.

Certainly the mere maintenance of the status quo, however desirable it may be for political reasons, is not sufficient from the point of view of the commercial interests of the country, and it seems to me that an effort ought to be made to take a leaf out of the book of those who have been our successful rivals in some parts of the world, so that we shall not merely maintain our present position but develop and increase it in the future. With regard to the Bagdad railway, how can we expect that traders will have a fair chance given at that port, when we see such a condition of things as that revealed in the statement of the Under Secretary of State with regard to the position of affairs at Constantinople? Our merchants have not been able to obtain a single farthing of compensation for their losses sustained, while the merchants of other countries were able to obtain it. We desire that a more satisfactory attitude should be taken up by the Government in regard to those great questions in many parts of the world, and more especially that they should direct their attention not merely to not losing ground in Persia and the adjacent countries, but to going further than that and endeavouring to retrieve the position lost and improving it in the future.

(3.45.) MR. MOON (St. Pancras, N.)

said the view expressed by the supporters of the Amendment, and the Under Secretary for Foreign Affairs concurred, was that status quo ought to be maintained in Persia, but it occurred to him while his noble friend was speaking that the attitude of the Government had not been so vigilant for the interests of British shippers in Persia as he hoped it would be in the future. With reference to the loan, according to his recollection, which he had been unable to verify, it was applied for in the ordinary way by the Persian Government to the capitalists here, and arrangements were actually completed for the loan on the guarantee of the Custom Houses on the Persian Gulf. It was only because the Russian representative at Teheran made a number of difficulties and took a strong line, that the Government took steps to have it dropped. He hoped from what had been said in the debate that that line of policy would not be followed any longer He thought the proposal of the hon. Member for Barnsley in regard to roads might be carried out for a period extending up to 1910. Our position in Persia could only be maintained by strength and insistence. Something might be done in the way of an agreement such as we had with Russia about Manchuria, and the only suggestion he would make was that such an agreement should be thought carefully out and that there should be no necessity for explanatory notes at the end of the agreement which caused difficulties.

*(3.47.) SIR. EDWARD SASSOON (Hythe)

The point raised by my hon. friend who has just sat down, as regards the question of the loan, is in its main particulars substantially correct. There can be no doubt that the reason for the collapse of the loan which the Persian Government required, and with regard to which negotiations with an English bank had practically culminated, was the pressure exerted by the Russian Government to prevent its being carried through. I don't wish to be severe upon the Foreign Office; there is little doubt that if they had exerted sufficient vigilance this country instead of Russia would have had the issue of a loan and with it the security upon the Customs' Revenue of Persia, which has been alluded to in the course of this debate as constituting such an important leverage in the direction of political influence. Then the Member for Eye expressed some disappointment that the Under Secretary did not mention the names of the ports which, according to my noble friend the Member for South Kensington, might be considered available to be transferred to another Power. Sir, I venture to think that there are no ports in the Persian Gulf which can be so disposed of, and if any Government thought of surrendering, or connived at the surrender, of these ports or islands by the Persians, the position of such a Government would soon become very untenable. The House must have listened with considerable satisfaction to the vigour and firmness which characterised the statement of the Under Secretary of State. At the same time I listened with some uneasiness to that part of his speech in which he attenuated his remarks by saying that there was likely to be, or that we must expect, some modification of the relative position of the Powers in the Gulf, owing to the increasing energy and ambition displayed by those Powers.

Lord CRANBORNE

I did not suggest that there was going to be any alteration in the Persian Gulf. On the contrary, I said it was the policy of the Government to resist it.

* SIR EDWARD SASSOON

I am delighted to hear, not this correction, but this affirmation. It was certainly the impression both of myself and my hon. friend beside me that that was the effect and gist of what my noble friend said.

LORD CRANBORNE

Oh no, no.

SIR EDWARD SASSOON

The late Under Secretary for Foreign Affairs in his admirable speech gave the House two considerable bits of advice. He first said that out of the many practicable and alternative policies, the worst policy we could adopt in respect of our relations with Russia was the policy of drift. I think the House will be disposed to concur in the soundness of that counsel, and we have only to look to the effects of that policy in China to know how much it has benefited Russia, and diminished our influence in regard to the transaction in the Gulf of Pechili.

The second advice was that we should abstain ourselves and endeavour to procure the adoption of a similar attitude on the part of Russia from doing anything that would interfere with the integrity of Persia. We know that the Shah is a man of most enlightened views, and while he is very correct in his relations with Russia, he has shown the most friendly disposition towards this country. His Majesty's Government would do well to see that the Shah is not squeezed out by pressure being exerted upon him by the British and Russian Governments, nor, which seems more likely to be the case, that owing to our half-heartedness and possible defection on the one hand, and the overlaying of Russian influence on the other. Persia does not cease to exist for all practical purposes as a political entity and a valuable buffer between the two Empires. The mover and seconder have effectively shown how disastrous the establishment of a great European Power upon the shores of the Persian Gulf may be to our Indian Empire; why, it would mean a direct, a perpetual menace to the whole of the western littoral of India, and I cannot conceive that any party in this country could be so unmindful of the traditional rights of England in the Gulf as to cause the status quo to he altered.

I now come to the speech of the Member for South Wolverhampton. He seemed to display certain very decided proclivities, and even tenderness, to Russian susceptibilities. Surely my hon. friend must know that while Russia possesses, and exercises, a predominant influence, and even more over-lordship in the whole of the northern part of Persia, and, as the Member for Barnsley remarked, to the extent of having converted the Caspian Sea into a Russian lake, if he has any opportunity of tendering advice to the Russian Government, it would be only right to point out to them that they might be satisfied with what they possess, and that they should leave us alone to exercise that control in the waters of the Gulf which almost essentially of tradition and possession, has enabled us to acquire an undisputed title to. Not only that, the supremacy in the whole of Southern Persia, as against the possible intrusion of any other great Power in that sphere, has been recognised to follow upon our determination to accept and to exercise such control.

What does the Motion seek to affirm? The necessity of safe-guarding British political and commercial interests. I think the other day my noble friend, in reply to some Question, affirmed that the Government would be vigilant as regard political interest, and that merchants and bankers must see to the commercial side; but surely my noble friend knows that in Eastern countries political and commercial affairs are very closely interwoven and inter-connected, that where, owing to the action of some Consul, or some Minister, the political prestige of his country tends to decline and dwindle away, that the commercial interests of that country diminishes even still more in proportion. I would here interpolate an appeal to the Foreign Office, and urge them strongly to consider the question of the non-alienation of that strip of road leading from Teheran to Koom, to which the Member for Barnsley referred. The Persian Government are not in a position, financially, either to buy it or to keep it in proper repair; if the Indian Government, whose interests are directly affected, do not see their way to purchase it, the inevitable result will be that it will be alienated for ever to the Russians, and it will thus become a thorn in our side, in connection with that important artery which leads to the Karun Valley. It is practically an insignificant matter, and worthy of the attention of the Government. Seeing that this Amendment emanates from the opposite Benches, and that the House has shown both interest and unanimity in the debates, I cannot but believe that it is of good augury, and that it is eminently calculated to stiffen the backs of His Majesty's Government. After this profession of faith I may suggest to the hon. Gentleman opposite, who cannot be desirous of displacing the Government on this issue, that he may be satisfied with the outcome of the discussion, and that he will withdraw the Amendment.

(4.0.) SIR JOHN BRUNNER (Cheshire, Northwich)

I will put myself in order by moving to omit the words "British Empire in Persia" and to add the words "United Kingdom."

* MR. SPEAKER

The hon. Member will not be in order in moving that Amendment. The question before the House is the commercial position of this country in Persia.

* SIR JOHN BRUNNER

Then, Mr. Speaker, you will tell me if I am out of order in my subsequent remarks; but I shall endeavour not to be so. I regret that the public mind is so much occupied in the consideration of affairs which are of so small importance in comparison with the enormous extent and value of our trade at home. It appears to me that we have gone absolutely crazy on these matters, and in making up our minds to spend money in making railways in Persia and Uganda, and even in making a railway throughout the whole length of Africa from north to south, instead of developing our trade at home and in those countries which have been most progressive in recent years. That is not the way in which the German Government started to develop their trade. They had not spent enormous sums of money in different parts of the world before they reduced, in a fashion we do not dream about, the cost of carrying goods from one end of their Empire to the other, and more especially to the seaports. Instead of spending eight millions on a railway in Uganda or two millions in Persia, if we were to make a free canal from the Mersey to the Humber—

* MR. SPEAKER

Order, order! The remarks of the hon. Member are not relevant to the Amendment before the House.

SIR JOHN BRUNNER

Then I will say no more;but I recommend to the House with the utmost earnestness that they should not occupy valuable time on such a small affair as trade with Persia, but should ask the Government to facilitate our transport at home in the firm conviction that that is the way in which best to promote the prosperity of our Empire.

* MR. JOSEPH WALTON

After the reply which has been given by the Under Secretary, for Foreign Affairs, I do not desire to press the Amendment. I placed the Amendment on the Paper in order to give the Government an opportunity of putting on record their policy in regard to Persia and India. Though the noble Lord did not cover the whole ground, yet, so far as he did go, I regard his statement as satisfactory. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Main Question again proposed.