Created: 2/3/1959

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Submitted ft* theDIRECTOR Of CENTRAL DTTIUJOENCR ThsRctoeted tn ths pttpsrtaion ol thiiThe Cmtml InUOtoetietnd Ut* tnteBiernee oQ+sdiahoni ol Vie Departtnenli oli .Stole, the Arms, their Force, and The Joint SUB! I

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AiiUfanT Chlf/Taaalorentpl the Haty; IA* Aufatanf.rOeBiBenee; 'iJthe.Seert'Energy,CommUsivri



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To estimate the consequencesoviet-Iranian nonaggression pact on Iran's foreign position and domestic situation.



The Shah's negotiations with the USSRonaggression agreement reflect histo retreat from the extremely vulnerable position in which he believes Iran has found itself during thc past several months. His decision probably stems from the convlcUon that the US is unwilling to supply theaid and security commitments wliich he believes necessary lo support anpro-Western position in the face ofSoviet threats and promises aimed at getting Iran to return to its traditionalHis sense of insecurity has been heightened by the overthrow of the Nuri Said regime, the growth of Communist influence in Iraq, and continued Soviet aid toHe has apparently been impressed by what he deems Is Nasser's ability to exploit both the East and West to the advantage of the UAR; the Shah may have hoped by the threat of an agreement with Uie USSR to elicit further concessions from the US. He may also fear that the West is moving toward an accommodation with Nasser. Finally, he probably believes that he canimited agreement with the USSR which wUl allay Soviet pressure without seriouslyIran's basic ties with the US.

The Shah has indicated that he intends to Until the new agreement with the USSR to provisions whereby the USSR will agree to


cease propaganda attacks on Iran, and Iran will promise to permit no foreign military bases on its territory and will agree not to sign the contemplated bilateral militarywiih thehe Shah insists that Iran willember of the Baghdad Pact, will conUnue to rely on the West for military and economic aid, and will notSoviet economic or military assistance. According lo the Shah thc agreement, rather than nullifying the Soviet-Iranian treaties of1ill "complement" them in the light of changed conditions, and will be registered with the UN.


Tlie Soviet Bloc will almost certainly be able toonaggression agreement with Iransychological victory over the West and will herald it as thc death rattle of the Baghdad Pact. Apart from this, the real effect of such an agreement as the Shah Ls apparently now contemplating will dependarge degree on the reaction of the Westespecially the USthe Shah's move.

We believe Uiat the Shah remainsand culturally oriented toward the West.

1 It is not yet clear howrovision would affect certain of thc present U8 personnel and actlvines In Iran.


will probably continue to hope lor Western assistance for his economic developmentand for support for his Westcrn-equlpjicd military establishment He willcertainly remain convinced that USwould be Indispensable to him In the event of any direct Communist aggression against Iran. He is unlikely deliberately to divorce Iran from its alliance with tlie West, as long as the West docs not cut him ofT.

Shah, and indeed many Iranians,aware of Uie Communist threat toand Independence. He is likelycarefully the terms of anythe USSR. However, If he were toconvinced that Uie US has writtenhe would probably feel compelled,Iran's Isolated foreign position,favoring neutralism, and thcobtain economic and military aid, totruly neutralist posiUon byties with the USSR.

Baghdad Pact concept is likely tomain casualty of an Iranian-Sovietagreement. Indeed thethat the Pact has provenan Instrument for protection of Iran'sprobablyarge role in histo negotiate with thc USSR. Anonaggression pact would hare anpsychological effect In Turkey andboth of which have attempted taIran's campaign for additional aidfrom the US. Both ofhowever, disparage Iran'sand will argue that their securityadditional strengthening ofSEATO. While Iran,esult ofwith the USSR, may feelIn sympathy than has been the caserecent past with such neutralistIndia and the UAR, It will probably atUme seek to continue closeTurkey and Pakistan.


hile the Shah's prestige will inevitably suffer to some degreeesult of his hav-

ing to change his policy, we believe that, onoviet-Iranian nonaggressionof the type which the Shah is nowconsidering is unlikely to have any major effect on Internal stability in Iran in tho nearivilian reformist elements in Iran and some lower and middle levelofficers who we believe share theirneutralist feelings, will probably be mollified temporarily at least by the Shah's gesture of disengagement from lhe cold war. Tho more radical of them, however, areto abandon Uie antlrnonarchicalwhich are on the main basis of their opposition to the Shah. Certain conservaUve elements who have long approved the wisdom of Iran's seeking to preserve Its independence and promote Its Interests through thepolicy of playing one great power against another may also welcome the change.

hese reactions will probably be balanced by others of opposite hue. The more radical reformist elements might Interpret the Shah's moderate moveign of weakness and attempt to take advantage of it totronger movement toward neutralism. The military forces tn general will be fearful that disengagement from the West may result In loss of military aid and consequentof their privileged status To avoidoss, many of them would probably be wlU-Ing lo accept Soviet military aid There is also the possibilityew top officers, suspicious of Soviet moUves. desirous oftbe military establishment in its present form, and dissatisfied with the Shah's inability to remain on his charted course, might seize the opportunity to attempt to take power andontlnuaUon of an aggressively pro-Western foreign policy. The chances for Uie latter two developments would be intensified if thc feeling was to become widespread in Iran that tho US hadIts approval of Uie Shah and might be prepared to accept his ouster.

subject will be considered in more dotall In. -The Outlook forhich Is now In process.

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