THE BAHRA AGREEMENT.

But preparations for the conference at Bahra were already in progress, a representative of the 'Iraq Government had been selected to join Sir Gilbert Clayton, and on 1st November, 1925, an agreement between the 'Iraq and Nejd was completed. All points which had been settled before the Kuwait Conference broke up, in 1924, were ratified and it was laid down that a joint tribunal should be appointed to fix responsibility for future raids and assess damages. Ibn Sa'ud accepted important points with regard to the treatment of refugees which had been put forward at Kuwait by the 'Iraq representative with the approval of the British Government, and it was agreed that the question of extradition should be decided by friendly negotiations between the two Arab States. Sir Gilbert Clayton brought the agreement to Baghdad where it received the informal approval of King Faisal, and on 3rd December, at a special meeting of the Cabinet, Sir Gilbert made a statement on the negotiations and explained the clauses of the agreement. The Cabinet thanked him warmly for having carried out his mission on behalf of 'Iraq and expressed the hope that the Agreement would lead to friendly and stable relations.

SECURITY IN THE DESERT.

In the winter season, closing the year under report, there has been security on the desert borders. The shepherd tribes have gone out to their pasturages; when, according to their custom, they have crossed the Nejd frontier, they have concluded arrangements for their own safety with Ibn Sa'ud's representative, the Governor of Hail, by whom they were invited to return to their old grazing grounds. These peaceful conditions have enabled them to profit by the plentiful supply of grass which has followed on the good rains of the autumn and winter.

6. Relations with Persia.

NON-RECOGNITION OF THE IRAQ STATE BY PERSIA.

No further steps have been taken for the recognition of the 'Iraq State by the Persian Government. Relations between the two countries are still conducted through the High Commissioner and His Britannic Majesty's Minister in Tehran.

THE PILGRIMAGE.

The embargo placed on the pilgrimage in 1923 was removed in the autumn of 1925 and many thousands of Persian pilgrims visited the holy cities of 'Iraq before the end of the year. The railways have greatly benefited, but their existence has changed the character of the pilgrimage, which is now performed much more speedily and cheaply than before.

* Cmd. 2566.

CHANGE OF DYNASTY.

On the deposition of the Shah, the ex-Vali Ahd arrived in Baghdad on 5th November, on his way to Europe. The mother of Sultan Ahmad Shah with several members of his family had reached Baghdad a few days previously, intending to return to Persia. When they heard of the dynastic change they revised their plans and left for India. Little or no interest was taken in 'Iraq in the change of Government in Persia which was felt to be a domestic revolution concerning Persians only. Persian divines living in the holy towns have abstained from comment.

PUSHT-I-KUH.

The Persian Government has been engaged in setting its house in order, a process entailing the substitution of a centralized government for semi-independent rulers in the provinces on its western frontier and an inevitable period of dislocation. The 'Iraq Government has been careful not to be drawn into any controversy that may have arisen between Persian authorities and their subjects, but at the same time to maintain, through the intervention of the High Commissioner, its own rights under changing conditions. Thus, when at the beginning of the year, the Wali of Pusht-i-Kuh, alarmed by the appearance of Persian troops in his country, took refuge at Badra, the High Commissioner informed him that if he wished to remain in 'Iraq, he must dwell at some distance from the frontier. He was persuaded, subsequently, to make his peace with the Persian Prime Minister and to return to Pusht-i-Kuh.

SALAR AL DAULAH AND SHAIKH MAHMUD.

In April, Salar al Daulah, brother of the deposed Muhammad 'Ali Shah, made a sudden appearance at Kadhimain and, without permission, left at once for the Persian frontier of Sulaimaniya Liwa, where he proceeded to enter into negotiation with Persian chiefs for the purpose of raising rebellion against their government. A message from the High Commissioner was delivered to him, strictly enjoining him to report to the British Administrative Inspector, Sulaimaniya, failing which he would be considered as an enemy of the British Government. He returned rambling replies and at the end of July it was learnt that he was maturing plans for a general rising in Persian Kurdistan and had induced Ja'far Sultan of Auraman to join him. Ja'far Sultan, though a Persian subject, owns a number of villages on the 'Iraq side of the frontier and on this account has official relations with the 'Iraq Government towards which he has been friendly and helpful. The High Commissioner sent him a personal letter advising him to have nothing to do with the fantastic schemes of Salar al Daulah and he withdrew, thereupon, from the movement. Shaikh Mahmud was at the time a refugee over the Persian border, although representations had been made to the Persian Government asking that he might receive the same

treatment which had been accorded to the Wali of Pusht-i-Kuh and removed from the neighbourhood of the frontier. It seemed possible that H.H. the Prime Minister of Persia might be induced to enter into a concerted movement with an 'Iraq column in order to dispose at once of the two rebels, Salar al Daulah and Shaikh Mahmud; but the defection of Ja'far Sultan destroyed all danger of a general Kurdish rising in Persia and the scheme. did not materialize. In October, the Air Officer Commanding in 'Iraq, Sir John Higgins, flew to Tehran to discuss the project fully with the Prime Minister. It was decided that it was too late in the year for troops to operate in the Auraman mountains and no further action was taken, except that the High Commissioner has, so far, succeeded in keeping Ja'far Sultan from embroiling himself with his government.

INFRACTIONS OF THE IRAQ FRONTIER.

On several occasions the High Commissioner has been obliged to protest against infractions of the 'Iraq frontier on the part of Persian officials. These have occurred from the direction of Pusht-i-Kuh, but more especially on the Shatt al Arab. In 1924, Persian Customs officers had stopped vessels in 'Iraq waters in spite of protest. In July, 1925, serious incidents occurred in connection with the attack on Mohammerah by a large body of insurgent Muhaisin tribesmen. Persian forces at 'Abadan went the length of firing on the boats of 'Iraq subjects in 'Iraq waters; the boats were then chased by a Persian launch and brought into Abadan. Against these and other infractions of the frontier the High Commissioner protested strongly on behalf of the 'Iraq Government to the Persian Government through His Britannic Majesty's Minister. The Persian Government, on its side, declared that 'Iraqis had been among those who attacked Mohammerah and that many of these persons had returned to 'Iraq territory. Their extradition was demanded. Close investigations did not establish this accusation, but it was shown that the 'Iraq Government had taken steps to prevent its subjects from participating in the disturbances. Moreover, the High Commissioner pointed out that neither the laws of 'Iraq nor the provisional extradition agreement with Persia permitted such extradition, but that under the Tribal Disputes Regulations a person considered to be dangerous might be required to reside at any specified place and that in this way the 'Iraq Government could remove suspects from the vicinity of the frontier. The High Commissioner refuted also a claim that members of the Muhaisin and Cha'ab tribes, though residing on the 'Iraq side of the frontier, should be considered as Persian subjects. They had in the past admitted a vague allegiance to the Shaikh of Mohammerah. The High Commissioner demonstrated that such a claim was not based on principles which were in conformity with the practice of coterminous states in regard to tribes partitioned by their frontier.

PERSIAN GOVERNMENT'S MONOPOLY IN TEA AND SUGAR. Towards the end of May, considerable consternation was caused among the mercantile community of Baghdad by a report that the Persian Government proposed creating a Government monopoly for the purchase, transport and sale of tea and sugar, with an increase in cost to the consumer of two krans per batman of sugar and six krans per batman of tea. A copy of the text of the bill was received by the High Commissioner from Tehran on 2nd June, and was at his suggestion examined by a conference presided over by the Minister of Finance at which the British Chamber of Commerce, the local mercantile community, the Railways and the Customs Department were represented. conference raised certain queries on the draft law which were embodied in a telegram addressed by the High Commissioner to His Britannic Majesty's Minister, Tehran.

Further information received from Tehran in reply indicated :(i) That the Persian Government did not intend to operate the monopoly as such, for several years.

(ii) That in the meantime licenses for normal consignments would be issued free.

(iii) That the sur-tax on tea and sugar was retrospective and applied to all consignments cleared through Customs after 12th March.

(iv) That the bill had been ratified by the Majlis.

After a period of anxiety almost approaching panic among the Baghdad merchants, producing reports that the customs duties had been doubled and that all consignments had been held up at the frontier-reports subsequently contradicted or explained the atmosphere has become calmer. It was realized that for the present the tea and sugar trade would not be seriously affected and that the sur-tax will eventually be passed. on to the consumer. The British Chamber of Commerce has sent up a representative to remain at Kermanshah for some time and make himself familiar with the new situation.

RUSSIAN PREFERENTIAL TARIFF.

In August, reports reached Baghdad that the Russians had imported consignments of loaf-sugar to Hamadan and Kermanshah, where, owing to the preferential customs tariff which they enjoy on the north Persian trade route, they were able to sell it at a cheaper rate than the sugar imported from Baghdad. It was found, however, that at Hamadan no large stocks of Russian sugar were available and that, though the sugar was being sold at a slightly cheaper rate than that imported from 'Iraq, it was too hard to suit the needs of the Persians, and those who bought it were unable to re-sell it advantageously. In consequence, the price of sugar imported from 'Iraq, which had

fallen when the Russian sugar appeared on the market, began to recover. Nevertheless, the preference given to the Russians makes the position unsatisfactory and undoubtedly influences the sugar trade. In the financial year 1924-25, 122 lakhs worth of sugar were re-exported from 'Iraq to Persia, while during the first eight months of the financial year 1925-26 only about 30 lakhs worth had been re-exported.

THE GANGIR.

In October, a temporary settlement was reached between the Persian authorities and a representative of the 'Iraq Government over the vexed question of the distribution of the water of the Gangir. The Turco-Persian Frontier Commission had laid down that the water should be distributed in equal parts between Mandali and Saumar, but when the Saumar valley had been in the hands of the Wali of Pusht-i-Kuh, the people of Mandali had never been able to obtain their fair share of the water. It was now agreed that until the rainy season set in, one-third of the water would be enough to satisfy the needs of the Mandali cultivators, but in acquiescing in this arrangement the 'Iraq Government in no way abandoned its rights in the future to its full share.

SEIZURE OF BRITISH OR IRAQI TRANSPORT.

A difficult situation arose in November, when, owing to the extreme shortage of grain in Tehran, the Persian authorities decided to commandeer all available transport to carry surplus grain from Hamadan and Kermanshah to the capital. His Britannic Majesty's Minister made urgent representations against the seizure of British or 'Iraqi transport and the 'Iraq Government offered to forego transit dues on consignments of grain and lorries to be imported into Persia through 'Iraq. A friendly agreement was reached early in December, under which the 'Iraq transport was to take over all traffic between Khanaqin and Qasr-i-Shirin, using 2,000 camels and giving grain the preference over other merchandize. Any surplus of this transport could be used on the Qasr-i-Shirin-Hamadan road, the Persian authorities ensuring that a proportion of such transport should be used for merchandize.

It will be seen that in all matters of interest to both countries the 'Iraq Government has done its best to co-operate with the Persian Government through the High Commissioner.

7. Archæology.

The excavations at Ur and at Kish were continued during the first months of the year and reopened in the autumn of 1925. The results have been as satisfactory as in past years and many valuable objects have been added to the Baghdad Museum, while the museums engaged on the two sites have received their