CIA HISTORICAL REVIEW PROGRAM RELEASE IN FULL
THE CURRENT SITUATION IN IRAN
DISSEMINATION NOTICE
copy of this publication Is for the Information and use of theon the front cover and of Individuals under the jurisdiction of thowho require the information for the performance of their official duties.elsewhere ln the department to other offices which require thefor the performance of official duties may be authorized by the following:
a. Special Assistant to the Secretary of State for Research and Intellipence for the Department of State
o. Director of Intelligence. GS. USA, for the Department of the Army
Naval Intelligence, for the Department of the Navy
of Intelligence. USAF, for the Department of thc Air Force
of Security and Intelligence. AEC, for the Atomic Energy
eputy Director for Intelligence. Joint Staff, for the Joint StafI
g. Assistant Director for Collection and Dissemination, CIA, for any other Department or Agency
copy may be either retained or destroyed by burning in accordancesecurity regulations, or returned to the Central Intelligence Agencywith the Office of Collection and Dissemination, CIA.
RIBUTTON: Office of the President National Security Councilecurity Resources Board Department of State Office of Secretary ot Defense Department ot the Army Department of the Navy Department of the Air Force
State-Army-Navy-Air Force CoordinatingJoint Chiefs of Star! Atomic Energy Commission Research and rjcvelopment Board
THE CUKHENT SITUATION IK IRAN
SUMMARY
During the first halfoUtical Instability In Iran Increased, and theof unsatisfactory economic conditions increased popular discontent, especially in Azerbaijan. Internal security, however, was generally maintained, and thefirmly resisted Soviet pressures.
In the political field the government failed lo press for the adoption of any specific program, the Majlis. Immersed In lime-consuming debate and faction, passed scarcely any legislation, and the Shah, by seeking wider powers, contributed to the atmosphere of uncertainty and disunion The leitisi Tudehotentially dangerous Soviet tool, displayed signs of reviving strength, while the clamor of anti-court and fanatical religious elements added to thc general confusion
In the economic field thc government failed to make any significant progress in the implementationuch-discussed large-scale program of social and economic improvements or to take effective steps toward the solution of the problems ofinflated living costs, an unfavorable balance of trade, and inefficient
In the military field the Iranian General staff displayed considerable activity in making agreement* wiih certain tribal groups. In deporting large numbers of allegedly subversive individuals from northern Iran lo other parti of the country. Insecurity sones and security patrols tn regions adjacent u> the frontiers, and in checking soviet border violations. The ability ot the army lo maintain internal security will be increased as shipments of surplus military equipment purchased Irom the US arrive in the country.
Current trends may be expected to continue lot some lime without sharp breaks or shifts. Conservative elements will remain dominant In the government and will be reluctant to adopt any reform program which mighl have an adverse effect upon their special interests. Economic difficulties will persist
In the field of foreignelations with the USSR have been marked by thc exchangecries of aharply worded notes The USSR, repulsed in its effort* to win concessions through pressure and threats, appears lo be buildingase which could be usedretext for direct intervention In Iran on grounds of self-defense The Iranian Government has continued lo reject Soviet demands for the elimination of US assistance to and interest in the country but hu also raised nationalistic claims unfavorable lo the US and UK The Helmand River dispute continues, to lhe detrl ment of Iranlari-AlRhan relations.
Note: Thex of8
The intellls<me* oiganmiloiu of lhefrmy. Navy, and Uie Airconcurred In ihU
Thc dctermlnalIon of thc USSR to achieve eventual ascendancy over Iran willn dominant factor in Iranian affairs. Current evidence does not indicate thai, the USSR considers its present position in Iran so critical as to call for directmore probably, it will continue for the time being to rely on methods short of armed force in pursuing its immediate objectives of eliminating US influence andan oil concession The USSR may. however, inspire open disorders in northern Iran. It may also dispatch notes demanding specific action by Iran to correctallegedly inimical to Soviet Interests and then, after denouncing the replies as unsatisfactory, invoke1 treaty as authority tor direct intervention.
Iran may be expected to continue Its resistance lo Soviet pressure, although extreme duress may cause it to waver between consolidation of Its tics with the Western Powers and outright conciliation of the USSR. Atime. Iran will be greatly influenced by the momentary extent of its conAdence in Western protection.
THE CUKKBNT SITUATION IN WAN (September
I potmCAL Srruano*.
Political power In Irta rests with an oligarchy ol wealthy landowners, merchants, army officers, and tribal chieftains over whom neither the young Shah nor any other political figure has recently been able to exercise effective sustained leadership. In Ihe fallrime Minister Ahmad Qavam showed promise of establishing such leadership. In the new tffcjhs more thanfeputies seated were members of the Democrats of Iran Party, which Qavam personally sponsored, and the bodyan early appearance of cohesion by Its overwhelming rejection of thc Soviet-Iranian otf protocol onctober. Disintegration of the Democrats of Iran was already under way, however, and on JO December Qavam's government fell. It was succeededonservative, do-nothing cabinet under the respected but unaggressive elder statesman, Ibrahim Hakimi.
By8 Qavam had regained slump, influence in the Majlis, but he apparently did not care to become prime minister until clicumstances should force the Shah (who views himival for political power) to recall him to office. When the Hakimi cabinet Anally toppled after sue shaky months in office, Qavam gave tacit supportoo!artisan of the Shah, and thus made possible thc latter'S election (ons head ot the Incumbent government. Hajir has no organizedof hts own and is bitterly opposed by the anti-court faction, fanatically religious elements, and the leftists. His continuance in office will accordingly depend not only on the strength of the Shah's support, bul also on the attitude of Qavam, who. as Iran's strongest political personality, will probably continue to wield considerableIn the Majlis.
Thc factionalism and the complete lark ot corporate responsibility exhibited by thc Majlis have not only undermined the stability of recent governments but have also stood In the way of Iran's obtaining much needed internal reforms. During its eleven months of deliberations up to August 1MB. the current Majlis had passedandful of bills II seemed united only in Its anti-Sonet altitude (only eight members displayed pronounced leftistn an Irresponsible chauvinism which evokes periodic demands for the rc-establishment of Iranian sovereignty over the Bahrein Islands, andesurgent nationalism expressed through attempts to revise lhe terms of thc Anglo-Iranian Oil Company concession, Jimll the authority of the US military missions in Iran, and eliminate foreign companies in Iran.
The Shah, riling the irresponsibility of the Majlis, has put forward proposals aimed al curtailing ils power. Heonstitutional amendment authorizing him lo dissolve the Majliseriod not lo exceed six months and to dlimlss the prime minister and cabinet even when the Majlis is in session. He is also seeking legislation to activate the Go-man Senate (hall elective and half appointed by lhe Shah) which is provided lor in lhe constitution but which has convened but once Thc Shah is not
SE
likely lo win these broader powers, however, as Hie Majlis is jealous of its prerogatives, and public Opinion strongly opposes any moveevival of the dictatorshipby fle/ji Shah, father of the present ruler.
A more subtle threat to the power of the government Is that of the Tudeh Party, which directs Its appeals toward industrial workers and the underprivileged classes generally. Alliough it has no official representation In thc Majlis and is supported byew deputies, the Tudeh Party Is the only political organization in Iran which appeals directly to the people for support; the other parties are controlled by large landowners, tribal leaders, and other notables, who use their local power lo obtain thc election of their candidates Aftererious decline in strength and prestigehe party is currently being revived through extensive recruiting and theof secret cells. While no reliable estimates of Its present membership arc available. Us system of provincial and urban councils headedarge nationaland Its use of affiliated groups make it the best organized political party in Iran.
The Tudeh Party's strident press follows the line laid down by Soviet broadcasts to Iran, and the contact which party leaders maintain with thc Soviet Embassy In Tehran makes it certain that the party is receiving advice and guidance from trainedorganizers and funds from Soviet sources Thc parly may be expected to test its renewed strength by promoting labor troubles and communal disorders, timing such activity to coincide with peaks of Soviet pressure on Iran, and it willrive for representation in the XVI Majlis, which Is due to be elected
Despite the political divisions In Tehran, the activities of the Tudeh Party, and Sovet agitation, the central governmentelatively high degree of success In maintaining internal security and Its control over outlying sections of the country. In particular, relations between the government ond the habitually restive tribes have lately shown considerable improvement following conciliatory government moves. These moves were dictated by the exigencies of the period of Soviet occupation, which gave rise to autonomist movements and to Tudeh ascendancy and by the more recent realization by the army high command that tribal assistance was needed In curbing Soviet penetration and subversion.
2. Economic Situation.
In certain basic respects, Iran's economic situation is favorable. Agricultural production8 should be sufficient to meet the country's food requirements (except in lea and sugar) and tourplus of some agricultural products for export Although Iran continues to suffer from government deficit financing and anbalance of trade, its financial position will be improved by the Anglo-Iranian Oi! Company's expanding production, which is providing Iran with increased revenues and foreign exchange
Nevertheless. Iran faces serious economic problems, which are mainly responsibleenerally inarticulate but growing dissatisfaction among the people Thewho form the bulk of the population, arc subjected lo constant exploitation by
SEJfftET
the landowncrs Mso inCiT standard or living, always low, is further depressed by the high commodity prices. (Although the general price level has fallen from thc wartime high which obtained. it remains more than eight times that) The less numerous industrial workers, with totally Inadequate wages even for Uie way of life to which they arc accustomed, suffer not only from the high cost of living but also from unemployment arising out of the general dislocaUon caused by the war. It is estimated that about one fifth ofho comprise the Industrial class are now unemployed, and the percentage would be far greater if the government were to reduce the swollen ranks of officials and workers in inefficiently run state-controlled industries. The government has been able to avoid labor troubles thus far through its incorporation,f all labor unions into organizations controlled by the new Ministry of Labor. These "captive" unions, however, have provided no tangible benefits for their members; hence, if unemployment is not reduced, Uie Tudeh Party may succeed in promoting additional unrest among workers and in re-establishing control over thc Unions.
Thc hope of stabilizing Iran's economy and ot raising the low standard of living ot its people depends on the applicationomprehensive economic development program.7 Qavam's government repeatedly promised thatrogram would begin at an early date,S firm (Morrison-Knudsen International Company) prepared an extensive reporteries of projects for developing Iran's natural resources, Industries. communicaUons, and public health facilities. The report outlined two alternaUvc programs, one involving an estimated expenditure0 million, the other calling0 million outlay. Later in thepeciallySupreme Planning Board0 million seven-year program of its. own. which was submitted to the Majlis for approval It was contemplated that the necessary capital be obtained from government oil revenues and loans from Uie National Bank of Iran and the International Bank for Reconstruction and
Despite these ambitious proposals, and despile the fact that the US and UK recently urged the immediate Inaugurationimited program of social and economic reform, the developmentrogram is still in the initial stage. The Majlis but recently appropriated funds to the exlcnt ofillion) for further studies. Procrastination, inefficiency, and inexperience will almosl certainly result In additional prolracled delays In the formulation and execution ofrogram.
3 military Situation.
The armed forcesominant factor in Iranian affairs. They exert greatin domestic matters, especially in the provinces, and thc army's loyalty lo the throne provides strong support to the Shah Much of the success with which internal order is now maintained may be credited lo the army. Military leaders are trying to gain for the army an even stronger voice in domestic affairs. Encouraged by the Shah, they are determined to transfer control over the gendarmerie from the Ministry of the Interior to the army. Although Qavam opposed sucheaker prime
minister might yield to pressure. The merger, however, would need the approval of the Majlis, which seems generally hostile to such action on thc grounds that it would further increase thc power of the army lo the detriment of the civil administration and could facilitate possible efforts by the Shah to establish an authoritarian regime. Many of the people, who are habitually victimized by army graft and other corrupt practices, also frown on efforts to strengthen the military establishment.
Thc government has recognized the army's need for modern equipment byMajlis approval (onillion loan from the US for the purchase of surplus US war material. The US has since arrangeddditional credits to cover handling and shipping expenses, and the acquisition of the equipment Is proceeding. This material will increase the ability of the army tointernal order but will have little effect on its capabilitiesis the USSR.
US military missions have been advising the army and the gendarmerieesult of Internal pressure from military leaders and members of the MajUs (and also influenced by repeated Soviet complaints about the alleged activities of thche Iranian Government recently Indicated its determination to alter the terms of the gendarmerie mission contract which gave the US head of mission direct command functions; the US agreed, and the role of the mission was changed Irom one of executive authority to one of advisory functions. With regard to the US mission to thc Iranian Army, the Iranian Government has recentlyesire to modify terms of the contract which specify that during the life of the mission no nationals or countries other than the US may be employed as military advisers without US consent.
Security within thc country has improved since the endorkingbetween the array commandumber of tribal leaders have resulted in months of relative calm. At the same time the army has strengthened its forces In possible danger zones and has intensified its efforts to control subversive elements. Security zones, within which foreigners may not travel without special permission, have been established along all the frontiers of Iran, and martial law is Imposed In troubled spots such as Azerbaijan and in the eastern Caspian coastal area. Reinforcements have been moved into thc regions adjacent to the Soviet frontier, and numerous patrols, aided by tribesmen, have been employed In these regions to guard the border. Several thousand Individuals whose loyalty to rran was open la question have been rounded Up in Azerbaijan and other northern areas and despatched to detention camps in the South.esult of these steps, several known attempts to penetrate Iran from Soviet territory have been vigorously checked and the movements of subversive elements within Iran considerably circumscribed.
4. Foreign Aitatrs.
a. Relations with the USSR and Uie VS
The chief problems in recent Iranian foreign relations have arisen from Soviet efforts to eliminate or at least reduce US Influence in Iran. Following the Iranian Government's categorical refusal (ino grant oil rights to the USSR, the Soviet Union subjected Iraneries of threatening notes directed against the
SECJrST
employment ot US military missions and the purchase of US military supplies. It has also continued Its attempts to penetrate Iranian economic and political life and Its subversive work among the Azcrbaijanis and other discontented groups. Moreover, the Soviets have employed trade restrictions to work hardships on the Iranian economy, particularly in Iran's northern provinces.
The Soviet diplomatic ofTensive has been marked by extravagant charges that Iran hasostile attitude toward the USSR, has allowed the US to "take over" the Iranian Army and to create military bases Tor use against the Soviets, and has encouraged the Iranian press to develop an anti-Soviet bias. Sovietto Iran have more than once suggested the possibility of war between the US and USSR, and have characterized Iran's attitude as intolerable, because of its refusal to grant an oil concession as well as for its dealings with the US The tenor of many ol thc notes suggests that thc USSR is laying thc groundwork for possible directin Iran under Article VI of the Irano-Soviet Treatyhich permits such action if Iran Is unable to halt the effortsthird party" to turn Iranian territoryase for military attack against thc USSR.
Allhough the impact of Soviet notes, particularly their Implication of direct action against Iran, has recently given rise to considerable sentiment in favor of(but not appeasing) the USSR, Soviet efforts lo browbeat Iran have failed thus far to change its attitude of resistance to Soviet interference.
In8 the Majlis, after considerable delay and soul-searching, accepted thc US arms credit in the face of express Soviet displeasure The Hakimi Government sharply denied the various Soviet accusations made against il and in turn protested against Soviet harboring of groups hostile to Iran as well as against Soviet press and radio attacks, the mcurslon of armed bands into Iran from lhe USSR, and other hostile acts. Although Hajir, the present prime minister, may have had conciliatory motives for tils recsnt appointment of two pro-Soviet men to important governmeni posts, he firmly rejected the Soviet Ambassador's suggestion that thc elimination of US influence would pave the wayettlement of al! Soviet-Iranian differences.
While Iran'5 repealed requests (or advice and assistance Indicate that it regards the US as ils principal source of support against Soviet aggression, it is not unaware of the difficulty of obtaining prompt US assistance in the event or Soviet invasion. It is considering submission of the recent Soviel notes and the Iranian replies to the UN Security Council, which remains seized of Iran's old Azerbaijan case against the USSR, as further protection against Soviet use of some legalistic pretext for
Moreover. Iran's oricntalion toward the US is not inflexible and unquestioning. From time to time Iranian military leaders have indicated their dissatisfaction over thc scale of US military assistance to Iran (as compared to that provided Turkey and Greece) and over difficulties they have encountered in obtaining materiel under the US arms credit program. Other indications that Iran does not consider itself rigidly bound to the US are provided by recent popular supportolicy of strict neutrality, which was reflected in the attempts to restrict the scope of the US military missions,
and by the renewed demand for Iranian control ol the Bahrein Inlands, In disregard of US and British interests
Iran Is also constantly threatened by Soviet subversive efforts within the country The USSR continues to use Its commercial enterprises to facilitate theand operations of Its agents and has reportedly attempted to regain Influence over Iranian aviation through the purchase of Iranian Airways Company shares by such agents Current Soviet covert activity, while present In many parts of Iran, appears to be concentrated mainly in the northwestern province of Azerbaijan. Armed groups from the USSR have attempted to enter Iranian territory, Pariani tribaland former members of thc Democratic Party of Azerbaijan who found refuge In the USSR are reportedly being made ready for action, mid Soviet agents infiltrate Kurdish tnbes. The USSR lias further indicated its interest In the area by raising the former Soviet vice-consular post at Makuonsulate. landestine radio (apparently operating In Soviet territory) announced the formation of anFree State" under General Gholan Yahya Daneshian. who fled to the USSR following the collapse of the autonomous Azerbaijan regime0 While this action may be but another phase of the Soviet war of nerves, it mayew attempt to establish an autonomous government in Azerbaijan. In addition to supporting autonomist movements, tlie USSR could construe any dtsluibances, especially inor other sensitive areas adjacent to its border (which Isiles from the USSR's vital Bakuhreat to Soviet security and might useretext for direct Intervention.
b. Relations with the UK.
British policy toward Iran is now in general accord with that of the US. although the UK has at times displayed Indications of willingness to permit Soviet economic penetration Into northern Iran, apparently In thc belief thatolicy would protect thc Anglo-Iranian Oil Company from Sonet Inspired attacks.
The UK has exclusive treaty agreements with the Sheikh of Bahrein and will certainly continue to deny Iran's claim to the Bahrein Islands Future contention between the UK and Iran may arise over the revision of the Anglo-Ira man Oil Company contract terms proposed by Iran and over the extension of the charier of lhe British-owned Imperial Bank of Iran. Recent Iranian Cabinets, however, have contained influential members generally considered pro-British, and it is not likely that Anglo-Iranian negotiations will become so acrimonious as to jeopardize relations between thc two countries.
e. RetaHont with States of the Middle East.
The dispute over the division of the waters of the Helm.ind River has neriously strained Iranian'Afghan relations. The US has proposed the establish mcnleutral mixed commission of technical experts to investigate the situation as the mostmeans of arrivingolution of the problem While both Iran andh3re accepted this proposal In principle, differences icjiaidtng procedure still exist.
Individual Iranians (especially the Moslem religious leaders) have spoken out strongly against thc establishment of Israel, and there is generally an undercurrent of sympathy for the Arab cause. Iran has shown no inclination, however, to give direct support to the activity of the Arab states against the Jews. Jewish communities in Iran have not been molested.
5. PflOBAiux Developments.
Although the situation in Iran Is characterized by disunion, procrastination, and irresponsibility, no major change in the current regime is expected in the near future The government will probably continue to be controlled by the conservative elements which dominate the Majlis andess degree) by the clergy, who are now engaged in efforts to revive orthodox Islam. These controlling lorces will be opposed by Iranians who earnestly desire social reforms, by those favoring greater power for the Shah, and by pro-Soviet elements of the population. Unscrupulous and opportunist leaders of various groups will continue to collaborate against whatever government Is in power, and fluctuating alignments (as in the past) will confuse the political scene and obstruct legislation The pro-Soviet Tudeh Party, which is now reasserting itself, willattempt to capitalize on the confusion.
Economic evils such as deficit financing, unfavorable trade balances, hoarding of and speculation in staples, inflated living costs, inadequate wages, andmay be expected to continue for some time. Popular and political pressure will probably compel the government toefinite program of economic and social improvements, but long delays in implementation of the program arc almost certain. Dissatisfaction with the government and the Majlis will increase; the Shah will feel encouraged to press for greater power; and Soviet sympathizers will beto greater activity
Soviet pressure against Iran will undoubtedly conUnue. The elimination of US influence and the establishmenttrong pro-Soviet subversive element are primary objectives in the Soviet program forreponderant influence in Iran. The Soviet Union may be expected to press Its demands for an oil concession, in order to wipe out the humiliation of Iran's rejection nf the oil protocoloothold In northern Iran, and obtain economic benefits The Soviets may attempt to gain control of strategic railways and ports through the Tudeh Party's influence among rail and dock workers, and they will continue lo restrict trade, at propitious limes, for the purpose of damaging the economy of Iran's northern provinces.
Mounting tension growing out of Iran's continued resistance to Soviet pressures may provoke Incidents leading to direct Soviet intervention; the Soviets may beto take such action by their belief that the US and the UK would not react drastically to Soviet occupaUon, particularly if it were confined to northern Iran At the moment, however, there Is no evidence lhat the USSR considers its relations with Iran so critical as to rail for armed intervention. It is therefore more likely that the USSR will continue for thc time being its present policy of diplomatic browbeating, subversive activity, and other methods shnrt nf war.
sj^rkt
Although Iran currently intends lo continue lis resistance lo the USSR and Its reliance on the US. the UK, und the UN lor support. Iranian policy cannot be considered Inflexible. Under extreme Soviet pressure Iran may waver between consolidating its ties with the Western Powers,olicy of strict neutrality, and conciliating lhe USSR Aware of its extremely vulnerable position, Iran will be greatly influenced atime by the momentary extent of Its confidence In the determination and thc ability of the Western Powers to protect It against lhe USSR.
10
Original document.
Comment about this article, ask questions, or add new information about this topic: