Persian Empire 1845

Chapter 77 Iranian Minister to the Ottoman
While the association was discussing Iran, people within Iran were also paying attention to them.

“Your Highness, the Russians are oppressing the locals too much, so some people have formed an organization to oppose Russia,” Said told Nasser al-Din, recounting the recent developments in the South Caucasus. Nasser al-Din stood up, turned to look at the map of Iran behind him. Hanging a map behind one's back—a common practice in his previous life—was somewhat unacceptable now, but no one dared to say anything to the Crown Prince.

"Alas, the Byzantines taught them faith, the Mongols taught them violence, and the Westerners taught them advanced technology. When these three factors are combined, Russia becomes this inhuman and monstrous creature."

Located at the crossroads of East and West, Russia learned from experiences in various places and rapidly grew stronger after the reforms of Peter the Great and Catherine the Great, eventually making Russia one of the major powers in Europe.

However, their reforms were based on serfdom, which meant that Russia did not break free from the feudal system and directly adopt new modes of production. It should be noted that such countries have the highest expansionist sentiments, not only Tsarist Russia, but also Japan.

“We must continue to gather intelligence here; the Russians will not be satisfied with the current territory,” Naserdin said to Said.

"As you command, Your Highness."

The previous military exercises were quite satisfactory, and the expert meeting unanimously agreed to increase military spending again and promote the implementation of nationwide conscription. The old army is being completely reformed, and cold weapons are gradually being phased out. The Iranian military is moving towards modernization.

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Istanbul, Qasim returned to the city. He had lived there for a time as a businessman, so he knew the place well.

Upon arriving at the Ottoman palace, he presented his credentials to Sultan Abdullah al-Majid as Iran's first ambassador to the Ottoman Empire and explained the Shah's situation to the Sultan. The Sultan was deeply concerned when he learned that Mohammed was not in good health.

"I hope he recovers. His passing is a huge blow to your country."

"Thank you, Sultan, for your blessings to Shah. Our two countries will surely be able to build a better future together."

Reshid Pasha, who was standing nearby, also said: "The Ottoman and Persian countries have had many conflicts in history, but that is all in the past. Now there is room for cooperation between the two countries in other areas. They should work together to deal with new threats."

This new threat was Tsarist Russia. Russia had inflicted significant damage on both the Ottoman Empire and Iran, seizing considerable territory. The Ottoman Empire, after a series of reforms, had nominally entered the ranks of civilized nations, and Iran was gradually overcoming its poverty and weakness. However, they still seemed no match for Tsarist Russia.

“Reshid Pasha is right. The two countries do need to face the new threats together. From now on, the relationship between the two countries will enter a new chapter.”

After the Sultan and Qasim spoke for a while, the Sultan took his leave, leaving only Mejid and Reshid Pasha behind.

“Your Excellency Sultan, Persia’s dispatch of an ambassador to our country must have ulterior motives. They may have sent spies to gather intelligence, so we must be careful.” Reshid displayed a different expression than before, but the Sultan did not seem so anxious. “Pasha, you’re overreacting a bit. Persia now hopes to stand with us against Russia. As a neighboring country, they will inevitably request our help.”

That being said, Reshid was still somewhat uneasy. Russia in the north had not yet given up Constantinople, and he hoped there wouldn't be any problems in the east. After all, they hadn't dealt with Muhammad Ali for very long; if they had behaved themselves, nothing would have happened.

This was just a minor incident; Sudan had more important matters to attend to. These included establishing Ottoman criminal and commercial laws based on French law, setting up a public education council, and establishing the Ummimiye, which was essentially the prototype of a parliament.

“Sultan, we have reached an agreement with Ambassador Canning that Britain will continue to increase its support. They are willing to lend us £800 million to reorganize our army.”

Eight million is a considerable sum. Neighboring Iran only dared to lend 3.5 million, which shows that the Ottoman Empire was rich in resources and there was no need to worry about the other party being unable to repay.

"Wow, that's a lot. Thinking about it carefully, there are indeed many places where we need to spend money recently. But we haven't paid off the loans to Armenians and Jews in the country yet, so it's not a good time to borrow money."

At this time, the Ottoman Empire had no foreign debt, but it did have domestic debt. Due to the expanding trade with the West, Austrian, French, and Russian currencies flooded the Ottoman market, becoming important mediums of exchange within the empire. Currency devaluation, a traditional method to alleviate the financial crisis, was gradually phased out. Although domestic merchant-run banks provided loans to the Sultan's government, the amounts were limited and high interest rates were charged. Galatian and Armenian/Jewish bankers became the Sultan's main borrowers. To date, the Sultan had borrowed 1500 million akiçes from them.

“These can be repaid directly once the British loan arrives. As soon as the British loan comes in, we can accelerate the pace of reform.”

Tanzimat is now entering a critical phase, with the new policies including the formation of a new army and the expansion of the bureaucracy costing enormous sums, leaving the Ottoman Empire's finances in deficit.

To increase fiscal revenue, economic development, namely industry and commerce, was necessary. But for the Ottomans, this might be a bit too far in the future.

Beginning in 1536, the Ottoman Empire signed trade treaties with France, granting French merchants free trade rights and extraterritoriality (consular jurisdiction) within Ottoman territory. Subsequently, other Christian states in Europe followed suit, signing a series of trade treaties with the Ottoman Empire that enjoyed similar privileges.

In 1838, Britain and the Ottoman Empire signed a commercial treaty stipulating that the Ottoman government would levy a 5% tariff on goods imported from Britain and a 12% tariff on exports. Subsequently, other Western countries also obtained similar trade preferences from the Ottoman government.

This tariff policy was highly beneficial to Europe, and in the following years, Ottoman imports tripled. A massive influx of cheap industrial goods flooded the Ottoman market. Textiles were the most important import, severely impacting traditional Ottoman cotton and silk weavers. Traditional handicrafts were brought to the brink of collapse.

Developing industry under such circumstances is extremely difficult, as was the case in Iran. However, it was easier because European capital had not yet entered the market, and government support made it easier. Sudan's government also recognized the power of the steam engine, but they had not yet realized the role of government policy and still pinned their hopes on private investment. This is the difference in industrial development between the two countries.

(End of this chapter)