761.91/10–2544: Telegram

The Ambassador in Iran (Morris) to the Secretary of State

783. 1. Soviet military transport authorities here have notified the Iranian Government officials that all transport to and from Tehran and points in Russian zone of Iran (with exception of Soviet military supplies) has been suspended until November 1 with no assurance that it will be resumed even then.

While I am informed that supplies of grain here are sufficient to carry over until receipt of new harvest now being gathered the Soviet action may have effect of nullifying certain beneficial regulations which now exempt small grain producers from requirement to sell portion of their crop to Government. Soviet action also harmful just at this time since it stops protective warehousing of newly harvested grain which must be done within next week or so because of bad weather.

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2. Other developments of interest this connection:

1.
Passage yesterday by Parliament of controversial army bill providing credits for army of 90,000 men by vote of 76 out of 86 members present which is taken to be gesture of Iranian unity for straight Soviet consumption.
2.
Press conference held last night by Vice Commissar Kavtaradze in which he is quoted as having stressed benefits to Iran of a Soviet oil concession but hedged as to payment of royalties which he said would be left for future consideration and declared that while Soviet Government’s relations with Iran are friendly collaboration with present government of Saed is impossible. This is first open declaration made by a Soviet official against Saed government which has come to my attention although as noted in my wire 779 of October 24 local Soviet Embassy has been and continues in general opposition to Saed personally.

Sent to Department repeated to Moscow and Cairo.

Morris