Persian Empire 1845

Chapter 26 Industrial Federation

Inside the exhibition hall, a meeting is being held.

The attendees were all high-ranking members of the federation, including President Larijani, Vice President Zakani, Publicity Director Karibaf, and Treasurer Hatami.

"Ladies and gentlemen, since the establishment of the federation, the voice of Azerbaijan’s industrial and commercial development has grown considerably. Moreover, several factories have already been established in Tabriz. This is a new beginning, and we must continue our efforts."

Applause rang out in the conference room.

"To date, our membership has exceeded 300, which is a very good trend. Next, we plan to establish branches in cities such as Rasht and Qazvin to make everyone in Iran aware of the importance of industry."

As soon as he finished speaking, Karibaf began to talk.

"The president is right. More and more people are subscribing to our newspaper and magazine these past few months. There are also a lot of visitors to the exhibition hall. The branch member we sent to Al-Dabil sent back a letter saying that more than 20 people have already wanted to subscribe to the newspaper. Our promotion is very effective."

The federation's newspaper primarily promoted industry and reported on market conditions, targeting mainly businessmen and factory owners. The government also supported their propaganda activities, which is why they were so successful.

"Now, not only new factories, but also some small workshops have switched to machine production. For example, the raw silk factory last time introduced new machines, which increased efficiency several times over."

The workshops in the city were clamoring to buy the new machine because of its high efficiency, saying it was great. But it wasn't just about the machine; they also needed to train the workers to use it. Although the expenses were high, they believed that if they could get through this period, they could make a fortune.

Furthermore, some industries have seen the emergence of a contract dealer system or a piecework system. This system involves distributors providing raw materials and production equipment to farmers, who then produce the goods at their homes. Farmers are paid by piecework, and the distributors collect and sell the products before receiving the raw materials for the next production run, creating a continuous cycle.

This situation is particularly prevalent in the textile industry, but it is still negligible compared to the national average. However, it has set a precedent.

“Lord Amir from the Governor’s Office spoke to me before. He praised our actions, but also made it clear that the banks must not get involved, or their assets would be confiscated.”

He didn't understand why the governor wanted to forbid them from engaging in banking; wasn't that how it was done in the West? It could even stimulate the economy. However, they could invest in railways, but with limited shares, at most 30%.

"Perhaps they're worried we lack experience. You know, not just anyone can start a bank. We need to continue expanding our membership. Also, the first delegation to visit Britain has been formed. They'll go to London to meet with the new industries and bring back their advanced experience."

“That’s good.”

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In the Maragay region of Azerbaijan, the economy is a typical mixed agricultural and pastoral area. Whether landowners and nobles or merchants, their businesses all revolve around planting and grazing. Most of these merchants deal in seeds, fertilizers, farm tools, and livestock, while the nobles consider the land's output, what to plant this year and next, the scale of grazing, and how to sustain it in the long term.

Not long ago, a businessman named Jahangiri opened a grain processing plant in the area, selling flour. Business was pretty good; I heard he even sold it all the way to Trabzonspor. Now he plans to expand by adding a textile factory, but Jahangiri is currently struggling to raise funds.

“Hassan, you watch the factory for now, I’ll go look for a bank,” Jahangiri said to his son.

“Father, is this really going to work? You’ve approached him several times already, and we still have a significant shortfall in our mortgage loan. Perhaps we should look for other solutions,” said Hassan, Jahangiri’s son.

“Those are loan sharks. I’ve seen too many people go bankrupt because of them. I won’t go to those people unless it’s absolutely necessary, and you shouldn’t keep thinking about using that method,” Jahangiri scolded his son.

Although Azerbaijan now has banks, a private lending market persists. These lenders profit by lending at high interest rates to those unable to obtain loans from banks. Most of these lenders are influential locals who have no fear of borrowers defaulting. While the impact of banks has made their situation more difficult, some still continue to operate.

After scolding his son, Jahangiri dressed smartly and went to the Industrial and Commercial Bank of China branch in Malagay. "Excuse me, is President Selim in?" Jahangiri asked the receptionist with a smile after straightening his clothes.

"Mr. Jahangiri, are you here to see the branch manager again, still about that loan?" the staff member asked him politely.

"Yes, the amount you provided isn't enough for the construction of the new factory. I'd like to ask if it could be increased a bit." Even when dealing with a junior employee, Jahangiri answered politely. After all, running a factory is inseparable from banks, and if you offend him, who knows when it might ruin your plans.

"The branch manager is in his office right now, let me go ask him for you." Seeing how polite the other person was, the junior employee felt a little embarrassed.

"sorry to bother you."

After seeing the staff member go in to report, Jahangiri sat on a nearby bench and waited.

After the junior clerk who had gone to report came out, he saw Jahangiri sitting on a bench waiting and said, "Mr. Jahangiri, the branch manager wants you to come in."

"Thank you for your help." Jahangiri thanked the junior employee and then walked to the door of Branch Manager Selim's office and knocked.

"Please come in."

Jahangiri pushed open the door and saw Selim busy at work.

The branch manager looked up at Jahangiri, then continued speaking busily. "Mr. Jahangiri, please have a seat. I'll be right there."

“Okay, I can wait.” Jahangiri found a stool, sat down, and waited.

A moment later, the branch manager of Selim Bank finished his work and asked, "Mr. Jahangiri, is this another loan matter?"

“Yes, I need 150,000 rials to build this textile factory, but I only have 20,000 right now, which is quite a big gap,” Jahangiri said, explaining his purpose.

The branch manager, sitting behind his desk, asked after hearing the purpose of his visit, "Mr. Jahangiri, how much has your current processing plant cost?"

"125,000 riyals."

"Our bank is offering you a mortgage loan of 100,000 riyals, which is the maximum loan amount we can offer. We can't lend you as much as you need, and I don't have that authority. Do you understand what I mean, sir?" The branch manager was also having a bit of a headache with this somewhat stubborn middle-aged man. He had been to the bank several times, but when faced with someone wanting to set up a factory, he could offer a different perspective.

“However, Mr. Jahangiri, you can go and see the Industrial Association of Tabriz. They provide assistance to anyone who wants to start a factory. Maybe you can succeed.”

Jahangiri, who had thought all hope was lost, was given renewed hope upon hearing this. He decided to go to Tabriz and seek help from the Federation of Industries, hoping that he might actually succeed.

"Thank you, Bank Manager"

"No need to thank me, thank the Governor. Without him, there would be no changes like this."

Yes, thank you, Governor. Without your strong support, he wouldn't have achieved what he has today, and the bank wouldn't have been established. You could say the Governor changed many people's lives.

(End of this chapter)