A third component of Iran’s foreign economic policy was foreign trade. The foundation for an expansion of trade with Russia had been set by the commercial instrument appended to the Treaty of Turkumanchai, which assured Russian subjects extraterritorial privileges and established the pattern of capitulatory terms for Europeans under the Qäjär dynasty. It also provided that Iranian customs duties, both import and export, should be 5 per cent ad valorem. This simple formula also governed Iran’s trade relations, through the operation of most-favored-nation clauses, with other European powers, the most important of which was Great Britain.
Although Russo-Iranian trade increased subsequent to the signing of the 1828 treaty, at first the competition of European goods in Iranian markets was too stiff for Russia. To overcome this competition, Russia abolished the free-transit zone through Transcaucasia in 1883. This compelled European exporters to carry their goods for Iran by the expensive Trebizond-Erzerum-Tabriz caravan route. It also assisted Russian exports to northern Iran.
By 1890 Russian exports to Iran, consisting principally of sugar, petroleum, and cotton fabrics, were valued at over 10,000,00 rubles. By the time Iran consented to the revision of its tariff rates in 1901 (see below), they reached the value of nearly 21,000,000 rubles. This phenomenal increase in Russian exports was matched by an equally significant rise in Iranian exports to Russia, consisting primarily of dried fruits, raw cotton, and nuts. These exports, valued at nearly 11,000,000 rubles in 1890, were worth over 20,000,000 by 1901.
Iran’s foreign trade became closely tied to its loans from Russia. In the second loan agreement (1901) the Shah had promised a revision of Iranian tariffs subject to the approval of Russia. This was effected the same year by means of a new commercial treaty with Russia, which successfully, and secretly, dictated the terms with the assistance of a Belgian official. This official, a Monsieur Naus, had been put in charge of the customs houses of Kermanshah and Tabriz in 1898 and had later been made the Minister of Customs in recognition of his “effective improvement of the administration of customs.”
The Shah had naively entrusted the destiny of Iran’s most important source of revenue to the hands of this “protégé and agent of the Russian Government.” ** He had also ingenuously signed the new agreement primarily serving Russia in disregard of the interests of Iran and those of its other important trade partner, Great Britain. The Russian gains were threefold: the new tariff rates (1) improved the security of Russian loans to Iran, (2) discriminated against British commercial interests, and (3) increased Russia’s control over Iran’s fiscal policy.
Modern Communication Devices and Revolutionization of Revolutionary Activism in Qajar Era
