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623. Tho Government of India submit­
Ibid, No. 328.
ted the following proposals to the Secretary
of State in their telegram dated 16th October 1904:—
Id view of tho opinion expressed in Lord George Hamilton's telegram, dated tho l^th
February 189N, and iu order to avoid direct British control of the Maskat customs, it is pro­
posed that the Imperial Bank of Persia should bo induced to open a branch at Maskat, and
lixod monthly advances on tho security of tho customs might then ho made on a Government
guarantee, on the condition that tho cu.'loms rovonuo will be collected by officers approved by
tho British Government, and that tho monoy so collected will be paid into the Bank. Any
balance due oither way could be paid on settlement of account at the close of tho year. This
proposal is considered most dosirablo by the local Political Officer, and there is pressing need
for the introduction of Customs reform. "VVe trust that you will, if the proposed action is
approved, kindly obtain tho views of the Directors of the Bank in London; and if they are
agreeable, His IlighnesH the Sultan will be approachod, and his decision in the matter reported
to you. Should the Sultan prove obslructive to those proposals it is intended to seoure, as an
alternative, his agreement to tho Bank forming out tho customs and to financing His Highnes?.
As apart from the customs question, it is considered that an Agency of the Bank would
pruyo beneficial to Indian traders at Maskat, tho Political Resident in tbo Persian Gulf has
been instructed to consult tho nearest Agent of the Bauk on the general proposal to establish
an Agency there.
624. On 13tli February 1905 the Government of India telegraphed to the
Secretary of State that Captain Grey
Secret E., March 1906, Not. 908*915.
reported that consequent on a lull in the
demand for arms at Koweit, the Sultan feared a temporary decrease of some
4,000 dollars a month on the customs revenue, that he was greatly dissatisfied
with tho customs administration, and owing to disputes oould not get from
them monoy even to despatch his steamer to Zamihar. The Government of
India suggested, in these favourable
Secret E , March 1906, Noe. 908-916 (No. 914 )
circumstances, that the following propo­
sals be made to the Sultan in respeot to his customs administration :—
(a) that a head customs officer be appointed by the Sultan, who should
be nominated by the Government of India;
(5) that the officer so appointed should be a servant of the Sultan, who
would accept the friendly arbitration of the Political Agent in
the event of a difference arising on any important point between
His Highness and the head customs officer;
(c) on the above specified condition, the Government of India to
guarantee a monthly customs revenue of 20,000 dollars, any
balance in the Sultan’s favour being also handed over to him;
(d) that the present head of tho customs should continue to he employed
as a deputy; and

(e) that tho above arrangement be terminable at one year’s notice by
either side.
It was suggested that, if His Majesty’s Government sanctioned the pro­
posals, 10,000 dollars might be paid at once on account and 10,000 dollars on
the day when the new head took over charge; the amount being recovered later.
Pending the settlement of the above question that of opening a branch of
the National Bank of India at Maskat was deferred.
626. Tho Secretary of State replied that His Majesty’s Government
saw no objeotion to the appointment by the
Secret A., Julj 19C6, Not. 386*-391.
Sultan of an official recommended by the
Government of India to superintend the Sultan’s customs, but they consi­
dered that the proposed reference to the Political Agent of important questions
might be held incompatible with the independence of His Highness and that
the guarantee to him of a fixed miuimum monthly sum by the Government
of India would be open to the objeotion of being considered equivalent
to a subsidy (telegram dated 20th March 1905).

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