IRAN

HC Deb 20 February 1979 vol 963 cc257-72

The Secretary of State for Foreign and Commonwealth Affairs (Dr. David Owen)

With permission, Mr. Speaker, I wish to make a statement about the current situation in Iran and the surrounding region.

The people of Iran are determining their own future, and we respect their right to do so. Iran is a country with a long history, real political and strategical significance and considerable economic potential. In our recognition we made plain our wish to have good, close relations with the new Government.

As to our commercial relations, the events of the past few weeks have brought Iran's economy near to standstill. This is bound to have its effect on our exports, as well as on employment within the affected industries in this country. It may be some months before we see the full consequences. Nevertheless, I believe that our trading relations should survive the present difficulties. The greater part involves civilian goods and services of a kind that Iran will continue to need once its oil production and economic activity revive.

So far as defence equipment is concerned, the Iranian authorities indicated some weeks ago that they wanted to cancel some contracts and amend others. All the implications of this are now being carefully examined and we will keep the House informed as to the results.

The implications of the Iranian situation in the world energy market are potentially serious. The loss of 5 million barrels a day of Iranian crude has been only partially compensated by increased production elsewhere, and so stocks everywhere are being reduced. We hope that the problems that have arisen will be only temporary. Meanwhile, we are discussing with both our industrialised partners and with the oil-producing countries ways of mitigating their effects.

I had valuable discussions on events in Iran during Her Majesty the Queen's very successful visits to Kuwait, Bahrain and Saudi Arabia. The Gulf States and Saudi Arabia are already adapting to the new situation and I assured them of our continuing full support.

The new Iranian Government will wish to determine for themselves the future pat tern of their security arrangements and I hope they will do so in consultation with their closest neighbours.

I am glad to say that the British community has not suffered physical harm during recent events. There are now only about 800 British citizens left in Iran. The Royal Air Force has flown out over 600 of our nationals during the past four days and others have left by sea. I am most grateful, as I am sure the House is, to the Royal Air Force and to the Royal Navy for their help with this difficult operation.

The situation is too uncertain for us to be able to make confident predictions about future developments in Iran and in the region. But it will clearly be even more important than hitherto to reach a comprehensive settlement of the Arab-Israeli dispute.

Finally, these last few months have seen a dramatic change in a country of pivotal importance. We will best maintain our interests and influence by being seen to respect the judgment of the peoples of the region and by working with them as they shape their own destiny.

Mr. Pym

Is the right hon. Gentleman aware that we hope very much that stability will return quickly to Iran for the sake of Iran, the surrounding region and the whole West? I agree with him that it may be some little time before the full consequences of what has happened will emerge. I doubt whether the statement tells us what we really want to know in the light of the major change that has occurred.

Our first consideration must be the safety of British subjects. I endorse what the right hon. Gentleman has said about the Royal Air Force and the Royal Navy and the work that they have done. Will he say something more about the remaining 800 British citizens who are left in Iran? What provision may be made for their safety and protection?

The statement may be as far as the Govenment feel able to go today. Obviously a full statement of all the consequences and implications will be required. I hope that the right hon. Gentleman will undertake to keep the House informed both before we rise at the end of the week and when we return, especially as we in Britain have special concerns in Iran with defence contracts. energy supplies and trade generally. In these circumstances, it would be right and helpful and better from the Government's point of view if the right hon. Gentleman were to take the House and the country fully into his confidence about the implications of what has happened.

On any analysis, we have witnessed a drastic change in Iran and in that region. I ask the right hon. Gentleman what strategic reassessment is being made with our European partners, the United States and NATO to take account of the changed circumstances in Iran.

Dr. Owen

The strategic implications have been discussed extensively with our European colleagues at a number of different meetings at Foreign Minister level during the past few months. The decision on recognition is the most recent example of the close co-ordination between member States.

As for the strategic significance, I think that we are all concerned about supplies of oil and their unfettered passage through the Gulf. That is a concern for everybody in the world. We should not be too alarmist or too complacent about the likely outcome. I see no signs of Iran, which has immense internal problems, wishing in any way to challenge the integrity of the States surrounding it. It is important that they should see their relations in a regional context and consult among the other States. In discussions with the Gulf States, I think that that is very much how they see it. They do not want too much outside interference from us. They want to feel that they have confidence in our friendship and support. I do not think that they want outside military, overt NATO interference in their strategic situation.

If there are difficulties over the 800 citizens still left in Iran coming out, we would be prepared to try to help, as we have done in the past, with Service-assisted flights. I believe that those people who are staying are fully aware of the situation and are staying because they have a vital job. I hope that many citizens will be able to go back and contribute to the commercial life of Iran. We have much to contribute to Iran over the next few months as that country builds up its economy. I hope that Iran will look to this country for help and support.

Mr. Hooson

Will the Foreign Secretary indicate what proportion of defence contracts which have been cancelled were prepaid and what proportion of those will be annulled? It is our greatest hope that British commercial and trade relations will be resumed when normality is restored. These things tend to revive. What steps is Her Majesty's ambassador taking to contact the new Government on these matters?

Dr. Owen

Our ambassador has already had a useful talk with the Prime Minister and his new Foreign Minister. There is as much contact as there can be in very difficult circumstances on all aspects of our commercial and defence relationships. It is difficult to give an exact picture of the eventual outcome. I recognise that the House will want more information. I readily accept that this is necessary. Various Ministers who are involved will be prepared to inform the House—my right hon. Friend has already given some information about defence contracts—when the situation is clearer.

It is good that a very high percentage of contracts has already been covered by payments. The exact percentage is difficut to assess at this stage, but we will report to the House.

Mr. Russell Kerr

My right hon. Friend mentioned in his statement that the Iranian authorities had come to certain decisions about defence equipment. Which Iranian authorities?

Dr. Owen

Some of the decisions were made by the previous Government of Dr. Bakhtiar. The present Government of Dr. Bazargan has not carried through the full implications of all those discussions. We are still resting to some extent on the decisions taken by the previous Government. I have no reason to think that they will be very different. We shall need to discuss the detail with the new Government and come to an arrangement over tidying up some aspects. I do not rule out the possibility of an arrangement being made which will not be quite as dire as it once looked. We have to examine the full consequences and consult with industry in this country.

Mr. Amery

Is the right hon. Gentleman aware that, with the intended withdrawal of Iran from CENTO and the cancellation of a number of our defence contracts, Iraq now becomes by far the strongest military power in the Gulf and that Iraq is tied to the Soviet Union by a military treaty and is well equipped with Soviet weapons, including offensive tanks and bombs? What steps are the Government taking to try to restore some kind of military balance in the Gulf? Has the Foreign Secretary assured our American allies that if they were prepared to send a maritime or air force presence into the area we would be prepared to join with them?

Dr. Owen

No; I do not think that that would be either an appropriate response or one with which we would wish to be identified. I do not think that that is what our friends in the Gulf would wish. I have spent the last week in discussions with three countries which have a long, traditional friendship with this country. I do not believe that that sort of overt military presence is what they believe the present situation requires. Far from it. What they want to feel is that, if they need help and request it of us, we will be ready to respond. That is very different from volunteering it.

The countries with which I have had discussions—Saudi Arabia, Kuwait, Bahrain and others—are ones to which we normally supply defence equipment. Under these arrangements, we have a close relationship in defence matters. This relationship can be developed or extended if they wish it. These are choices for those countries to make. They are not for us to make for them.

Mr. Whitehead

Does my right hon. Friend have any information about the whereabouts of Dr. Bakhtiar, the former Prime Minister? Now that we have established communications with the new regime and have recognised it, can the point be made with suitable sensitivity that we hope that Dr. Bakhtiar will be treated justly and humanely and not be overtaken by the summary vengeance which has befallen many of the agents of the Shah's regime?

Dr. Owen

I do not, unfortunately, know the answer to my hon. Friend's question about Dr. Bakhtiar. I hope that the many statements which the Ayatollah Khomeini and others have made about human rights over the past few months will be demonstrated in the admittedly difficult circumstances with which they are dealing. We must hope that they will respect that. I hope that all Members of the House would wish them to do so.

Mr. Maurice Macmillan

The right hon. Gentleman referred to consultation with our European partners. How recently, and in what sense, has he been talking to his opposite numbers, in view of the point made by my right hon. Friend the Member for Brighton, Pavilion (Mr. Amery) and the dangers that obviously adhere to the present situation in the Gulf?

Dr. Owen

We discussed this matter informally at the last Council of Foreign Ministers. We have discussed it on many other occasions. I must say to the right hon. Gentleman and a number of right hon. and hon. Members on the Opposition Benches that the belief that the way to help and support stability in that region is best achieved by military overt influence by Western European countries is not shared by our Western European partners. They do not have enthusiasm for this type of military response. One has only to see the statements made by the Federal Republic of Germany and France to realise their attitude.

Mr. Newens

Does my right hon. Friend recognise that the manner in which Britain and the United States have based their past policies on support for autocracy and military dictatorship in the Gulf and their refusal to recognise the opposition and democratic forces has ended in the complete failure of those policies? Will my right hon. Friend take care to ensure that we do not make the same mistake in the rest of the Gulf? Should he not now make clear that we recognise the rights of all the peoples in those areas to democracy and to proper humane treatment?

Dr. Owen

I have noticed that this Government and, to some extent, the United States Government are criticised, on the one hand, for paying too much attention and putting pressure on human rights and the need to move towards greater liberalisation and democracy, and, on the other hand, for doing nothing in all these areas. The fact is that we were concerned about those developments. History will judge the outcome of what is happening in Iran. It is much too soon to make predictions about what will happen. I shall be content to be judged by history as to whether or not we chose wisely in the British national interest.

Sir John Eden

In view of the serious implications of what has happened in Iran for the defence and commercial interests of this country and the whole Western Alliance, will the right hon. Gentleman ensure that when he makes a fuller and more considered statement to the House on this subject it forms the basis for a full day's debate in Government time?

Dr. Owen

My right hon. Friend the Lord President no doubt heard the right hon. Member's remarks about a debate.

Major issues will need to be considered. But it is difficult to make definite predictions at this time. The situation is still moving. There is still much movement. I believe that it is in the interests of the Iranian people and of the West that the Government of Dr. Bazargan should be given every support to enable them to sustain their authority and that authority throughout the whole territory of Iran.

Mr. Watkinson

Does my right hon. Friend accept that there should be some satisfaction at least in the ending of many of the repressive practices of the previous regime? Does he further accept that the problems that the West now faces in respect of oil could be acute? Has he seen the transcript of Dr. Schlesinger's evidence to a committee in the United States? Does he agree that the inflationary impact of the cut in oil supplies could be very serious for the West? Does he agree that we should take due note of those inflationary consequences?

Dr. Owen

There is no doubt that there is the potential to affect the whole economy of the world, not just of the West. The inflationary spiral in 1973–74 had savage effects upon Third World countries.

It is too early to be certain that this will happen. Much will depend on whether there is an increase in production to make up the shortfall. Much will also depend on the decisions that are currently being considered and made on pricing policy. I believe that we must be vigilant and examine the situation carefully as it develops in the next few months.

Mr. Patrick McNair-Wilson

Does the Foreign Secretary agree that the strongly pro-Palestinian attitude that is being adopted by the new regime could pose serious problems for the small Gulf States that he visited recently, since they have large Palestinian populations? Does he agree that these groups of people now have access to a large arsenal, which was hitherto denied to them? Therefore, does he agree that urgent consideration should be given to finding a just and fair solution to the Palestinian problem?

Dr. Owen

I agree. One definite conclusion that can be drawn from the events of the last few months and weeks is that far greater priority even than has been given recently will have to be given to trying to achieve a comprehensive peace settlement in the Middle East. I believe that this is one of the consequences of the events, and we should act accordingly.

Mr. Faulds

I return to the previous question. Does my right hon. Friend agree that because of the Islamic revival and the collapse of the Camp David initiative—which some of us foresaw—and in view of the overriding consideration of British interests, it is now necessary for the Government to reconsider their stance on Israeli intransigence in the Middle East and on the absolute need to recognise Palestinian rights, and to work for the establishment of a Palestinian State?

Dr. Owen

On the latter part of my hon. Friend's question, he will know that we have recognised Palestinian rights. We have always stated our profound belief that there will be no resolution of the Arab-Israeli problem unless the Palestinian viewpoint is taken into account. We have said, further, that we believe that a Palestinian homeland is a necessary part of taking into account those legitimate aspirations. The problem facing the West is how to maintain the momentum established by Camp David. I do not believe that my hon. Friend is right to say that the Camp David initiative has collapsed.

It is necessary to move on from substantial progress in agreement between Israel and Egypt in relation to Sinai and to widen that agreement so that it covers the West Bank and Gaza and forms part of a comprehensive peace settlement that all the moderate Arab States can support. I believe that they wish to do that. This will be the task of American statesmanship and the European Community in the next few months. It is an urgent task.

Mr. Eldon Griffiths

Has our ambassador made any personal contact with the Ayatollah Khomeini? Will the Foreign Secretary send to the Ayatollah a message expressing repugnance at the horrible executions that are now taking place in Iran? In order to facilitate a further debate, will the right hon. Gentleman tell the House, as soon as he can, what is the Government's best assessment of the number of jobs that are at risk through the cancellation or postponement of contracts? Will he also estimate the loss of foreign exchange to Britain as a result of the fall in BP's oil lift?

In view of the collapse of CENTO, what consultation is the Foreign Secretary having with our European and American allies about the future of the powerful Iranian air force, which must now be a destabilising factor since it is in uncertain hands?

Dr. Owen

The hon. Member talks of repugnance. The issues involve human rights, about which I have spoken many times from the Dispatch Box. I have expressed my concern and justified private representation between Governments. I still believe that that is the best way to achieve results. That is the best way when dealing with the new Government, as it was when dealing with the Shah. I shall make those representations in a way in which I think is right and appropriate.

It is difficult to quantify the loss of jobs at this stage. The amount of lost foreign exchange is also extremely difficult to estimate, particularly when oil products are involved, because much depends on price and the availability of supplies.

The hon. Member said that there was a destabilising influence. It is not for me to make such decisions. These are matters for the Iranian Government. I hope that they will be able to achieve an accommodation with the armed forces in that country. There are limits to how far the House can pretend to interfere with the arrangements of the internal forces in Iran.

Mr. English

Will my right hon. Friend illustrate the virtues or defects of Ques tion Time by answering a simple question? Was his support of the Shah based on, or contrary to, the advice of our ambassador in Tehran?

Dr. Owen

It was a considered judgment by the Government, taking into account all the evidence that they had at the time, including advice from the ambassador in Tehran. But there are more inputs to that judgment than come from Tehran. They come from all round the world.

I am prepared to be justified by history. It is far too early to say whether we shall regret decisions taken in September or October. The full consequences to employment, the economy and strategic and political stability have yet to be determined.

Sir John Langford-Holt

Is the Foreign Secretary aware of the contracts between the British Government and the former Iranian Government on the one hand with the British Defence Department and manufacturers on the other? May we have an assurance that the British Government will, under all circumstances, adhere to the contracts that they have made?

Dr. Owen

It is not just a question of the Government. In some cases the Government are parties to the contracts. In others the Government are involved, but indirectly. A complex legal question arises over the attitude of the new Government in Iran to the contracts that were entered into by the previous Iranian Government. These are reasons why it is impossibly difficult to quantify in terms of cost and employment. It will take some weeks or months before we are fully able to dc that. For our part we shall certainly argue for the upholding of contracts between Governments and between private industry and Governments.

Mr. Flannery

Does my right hon. Friend agree that, in view of the many statements about human rights made by the British Government and the United States Government and our knowledge of the Savak, it is staggering that we should have clung on for so long to the coat tails of the Shah? Does he accept that the Opposition, who hypocritically talk about the armaments in the hands of the new Iranian Government, helped the Shah's Government to supply practically all the armaments that are now being used in Iran?

Is he aware that at a meeting of the British-Iranian parliamentary group the other night the feeling was that we had grossly overdone the supply of armaments and that we should now supply peaceful equipment to the new Government of Iran?

Dr. Owen

The whole region has far too many armaments. Perhaps one of the justified criticisms is the extent to which arms have been poured into the region. They have been poured in as part of the Arab-Israeli dispute, which has involved this region. Arms supplies are a complex issue, which stretches back over a long time. It involves more than recent history. It has gone through the 1950s, the 1960s and the 1970s, and I do not believe this policy can be changed overnight; nor can we ignore others who are ready to supply arms. When we were asked to supply arms, it was not just a simple question of our refusing to do so; we had to take into consideration whether other countries would do so and what would be their influence on the country.

Mr. Tapsell

Putting aside the right hon. Gentleman's justification by history for a moment, since history may have other things on its mind, can he give the House his estimate of the approximate total ECGD commitment in respect of Iran?

Dr. Owen

No, but if the hon. Gentleman likes to table a question I will certainly answer it.

Mr. Rooker

Can my right hon. Friend tell the House whether his Department has yet initiated any discussions with the revenue authorities about the tax status of our citizens who have had to come back to Britain earlier than they had thought they would?

Dr. Owen

No.

Mr. Whitney

Is the Secretary of State prepared to agree that the tragic events in Iran underline the need to make a much more realistic assessment of the international situation from the point of view of Western interests—the kind of assessment reflected, for example, by his own statement to the House this afternoon? Does he also agree that if West ern interests are to be protected they must be pursued with much more courage and determination than they have been over the last two years?

Dr. Owen

How far the strength of Western interests can be protected depends on the internal cohesion of the country they are supporting and to which they are allies, and when history turns its attention to these events—[Interruption.] Hon. Gentlemen on the Opposition Benches may want to escape it, but it may be that a very important decision has been taken, with a whole move away from a secular State and from a monarchy. Over the last few months we have seen in Iran what has been little short of a major revolution, and it is something at which history will look very closely.

Mr. Skinner

Does the Foreign Secretary agree that this whole episode will provide a salutary lesson to all in the House and outside about the extent to which British Foreign Office Ministers and others of that ilk have the pulse of every nerve centre in the whole world?

Dr. Owen

I do not claim to have this, and perhaps we have made mistakes, but before any of us reaches those conclusions I ask my hon. Friend to face some of the economic consequences that will be faced in this country as a result of what has happened in Iran over the last few months. The jobs of many people are to be put at risk. The standard of living of many people will be put at risk, and the consequences in respect of what may happen on oil will have an effect around the world. I do not believe that any of us should take a narrow party view of what has happened there, and I believe that some of the scoffing laughter of hon. Gentlemen opposite is something they will live to regret.

Mr. Biggs-Davison

In view of the importance that the right hon. Gentleman correctly attached to CENTO at its last ministerial meeting, will he answer the question put by my right hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) about the future of that alliance? Has Iran yet formally withdrawn? Is CENTO to meet? What adjustments has the right hon. Gentleman in mind?

Dr. Owen

The only formal statement that we have on Iran's attitude to CENTO came from the previous Government, but I have no reason to believe that the present Government will think differently about it. That Government have not yet intimated their attitude to the CENTO organisation and we have yet to hear the attitude of some of the other countries, particularly the regional members. The future of CENTO will largely depend on the attitudes of Iran, Pakistan and Turkey, but particularly Iran and Pakistan, and we will have to await their decisions. Certainly, as far as this country is concerned we shall want to take account of regional feeling and regional support for CENTO.

Mr. Lee

Will not one of the inescapable consequences of the revolution, which many of us have foreseen, be a diminution in the oil supply to South Africa, and will this not make it easier to bring pressure on South Africa to enforce our Rhodesian sanctions against the treasonable regime that prevails in that country?

Dr. Owen

I do not think that this will change very much. I do not think that it matters now to reveal that the previous Government of the Shah had already made it very clear that they wished to see peaceful settlements in Namibia and Rhodesia, and had made that very clear to the South African Government, so that there has been no dramatic change of policy except for the final decision to stop the supply of oil and to make the South African Government aware of the fact that by flouting United Nations sanctions on Rhodesia they are going against the views of all the nations in the United Nations.

Mr. Maxwell-Hyslop

Is the House to believe that it has not occurred to the Foreign Secretary to find out the quantum of the exposure of the Export Credits Guarantee Department on Iranian contracts? Of course, he cannot yet know which will go into default, but has he really not bothered to find out the total exposure?

Dr. Owen

Yes, we have bothered to do so. I have not got the figures before me, but I will ensure that the hon. Gentleman gets an answer as soon as possible.

Mr. Cryer

Does my hon. Friend understand that we on the Government Benches accept the view that too many arms have been forwarded to this region? Can he say precisely what political initiatives are to be taken? Are we to drift along in the old-fashioned way, as we have done for so long, selling arms to whatever reactionary regime comes along? How is it that Japan, for example, can take a stand against selling arms and yet be enormously successful commercially? Is not that the path that we should follow? Are we really going to learn a lesson from this debacle of defence contracts and start moving towards manufacturing for peace instead of concentrating too much of our efforts on manufacture for war?

Dr. Owen

Apparently, Japan is still restricted on arms sales by treaty arrangements, and that country spends far less of its gross national product on defence, although this is starting to increase. We may well find, as usually happens when countries do this, that Japan will start selling overseas. The problem of the over-abundance of arms supplies to the region stems from the Arab-Israeli dispute and the Middle East situation. It is because of this that vast quantities of sophisticated armaments have gone to the Arabs, and this has gradually extended from the States immediately bordering Israel to various Arab States, across into the Gulf, and there has been a very substantial build-up, which in most cases can be traced to the Arab-Israeli dispute. In the case of Iran it can be traced to the Shah's belief, after the British decision to leave the Gulf region, that it was necessary to build up Iran's forces, although I do not believe that even then this was justified to quite the extent that it was done.

Mr. Mayhew

What steps does the Foreign Secretary think the five successive cuts in defence expenditure relating to equipment as well as to men will have on our ability to meet the requests of our friends in the Gulf, which he tells us were made to him, as Foreign Secretary, last week?

Dr. Owen

No specific requests were made to me on my visit to the Gulf, and the States that I visited already have very effective defence forces. Our ability to respond depends upon the industrial potential of our commercial firms and the ordnance factories and shipbuilding yards of this country. We are ready to respond to those countries to which we think it is right to supply arms.

Mr. Hugh Jenkins

My right hon. Friend may be justified by the crystal ball of history. Would it not be better to look at the order book of immediate past history and to note the motions that have appeared on the Order Paper, criticising him at the time for advising Her Majesty the Queen to go to Iran? Looking back on that, should not his future conduct be guided by the Members who gave advice of that kind, because, in that event, possibly the view of future history will be changed?

Dr. Owen

I readily acknowledge that my hon. Friend and others have long been critics of the policy of support for Iran and of the supply of arms to that region. I did not say that I would be justified by history. I said that the Government would be judged by it. Whether we are judged partially or rightly is somethink that my hon. Friend and I may see.

Several Hon. Members rose

—

Mr. Speaker

I propose to call those four hon. Members who rose.

Mr. Rhodes James

Is the right hon. Gentleman aware that over the past nine months his advice, statements and forecasts—as well as those of the Prime Minister—on Iran have proved consistently wrong? Why is that so? Will he now reconsider his position?

Dr. Owen

I am not sure that they have been proved consistently wrong. I think that the consequences of toppling the Shah have been fairly accurately predicted. What is now being seen is the consequences of that. As I have told the House, the people of Iran have made their decision and we must respect it, just as we should respect any sovereign State and citizens deciding their future. We must hope that they will be able very quickly to restore relations between their country and not only their neighbours but us. I believe that that is possible.

Mr. Benyon

Is it really true that Iranian students in this country are receiving Government assistance because their grants have stopped, while our own nationals are being kicked out by the new regime?

Dr. Owen

I suggest that the hon. Gentleman tables a question to my right hon. Friend the Secretary of State for Education and Science. There is a problem of Iranian students in this country. I think that it has been dealt with by local authorities and various other grant authorities. I must stress that it is in the interests of this country to establish good relations with the new Government in Iran. We shall not do that by either acting vindictively towards its students who are affected by the changes or by a whole range of policy suggestions that seem to have come from the Opposition Benches.

Mr. Fairbairn

Having recently been judged wrong by history on the last regime in Persia, will the Foreign Secretary content himself with merely recognising the regime that took its place with such religious fervour and emotion, and look beyond that and see whether it is not merely the replacement regime for a worse regime more in the maw of Russian influence?

Dr. Owen

I have already told the House that I do not believe that one can predict clearly what will happen in Iran at this stage. What we should try to do is so to support the Government of Prime Minister Bazargan that they bring stability to that country and some of the dire and alarmist predictions made by many are not fulfilled.

Mr. Brotherton

The Foreign Secretary having failed to tell the House what are his views on the rape, robbery and murder under the new regime in Iran, and having failed to condemn in, this House rape, robbery and murder in Rhodesia, will he tell us where his standards lie?