MIDDLE EAST AFRICA SOUTH ASIA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001600090001-6
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: December 12, 2016
• Document Release Date: May 23, 2001
• Sequence Number: 1
• Publication Date: August 20, 1975
• Content Type: NOTES

Approved For Release 2001/08/08 : CIA-RDP79T00865A00160004fop-Secret
No Foreign Dissem
tl 2
H.0
r
Middle East
Africa
South Asia
Top Secret
140
SC No. 08351/75
August 20, 1975
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
No Foreign Dissem/No Dissem Abroad
Background Use Only/Controlled Dissem
Warning Notice
Sensitive Intelligence Sources and Methods Involved
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Classified by 010725
Exempt from general declassification schedule
of E.O. 11652, exemption category:
?56(1), (2), and (3)
Automatically declassified on:
Date Impossible to Determine
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
 Approved For Release 2P(p6/W.(C;FkP7@119MM01600090001-6
This publication is prepared for regional specialists in the Washington com-
munity by the Middle East - Africa Division, Office of Current Intelligence,
with occasional contributions from other offices within the Directorate of
Intelligence. Comments and queries are welcome. They should be directed to
the authors of the individual articles.
Iran: Foreign Borrowing in
Perspective . . . . . . . . . . . . . . . . . . 3
Tunisia: Bourguiba Meets with
Ma smoud i . . . . . . . . . . . . . . . . . . . 4
Bangladesh: Moscow's Reaction to the
Coup . . . . . . . . . . . . . . . . . . . . . 7
August 20, 1975
Approved For Release *01#)8/9E4 t)'P7 WqfPP01600090001-6
 25X6 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
Next 1 Page(s) In Document Exempt
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
TOP SECRET UMBRA
Foreign Borrowing in Perspective
Contrary to recent press reports, Tehran does
not have a balance-of-payments problem requiring
foreign borrowing. Iranian officials have been
downplaying their country's financial strength to
fend off aid requests and to justify higher oil
prices.
Iran's balance-of-payments prospects remain
highly favorable. Foreign reserves have reached
$10 billion and may well increase another $2 billion
by the end of the year.
Oil earnings of about $20 billion, plus nearly
$2 billion in non-oil exports and investment income,
will exceed the outlays for imports and net services,
yielding a current surplus of nearly $9 billion.
After allowance for capital account movements, Iran
still will be left with a hefty $4.3 billion addition
to reserves.
Although Tehran itself is not negotiating any
large loans from abroad, individual private firms
and public sector corporations are likely to borrow
in the months ahead to help finance Iran's dynamic
economic growth. Actual foreign borrowing will
probably be less than $1 billion in 1975.
Last week the privately owned Industrial and
Mining Development Bank of Iran arranged for a $100
million Eurocurrency loan. Another major potential
borrower is the National Petrochemicals Company,
which may ultimately float bonds for $600 million
in international capital markets. (CONFIDENTIAL NO
FOREIGN DISSEM)
Aug 20, 1975
Approved For Release 200T,( /O@E E 21W91Jp0865A001600090001-6
 Approved For Release 200 TO 0 E - 2 Urj I r865A001600090001-6
Tunisia
Bourguiba Meets With Masmoudi
Last week President Habib Bourguiba reportedly
met with visiting former foreign
minis er o arled Masmoudi to discuss the terms
under which Masmoudi could return to Tunisia
permanently. Masmoudi has been living in Europe
since he was fired in the wake of the Tunisian-
Libyan union fiasco in 1974.
Masmoudi, a proud man with influential
contacts in and out of Tunisia, is probably
holding out for a ministerial position as his
price for being "rehabilitated." Tunis has been
rife with rumors that Masmoudi seeks the post of
prime minister, now held by Hedi Nouira. After
a period of "good behavior," Masmoudi may be
restored to a government position, but is not
likely to be made prime minister. At this time,
Nouira seemingly still has Bourguiba's support.
(SECRET/NO FOREIGN DISSEM/NO DISSEM ABROAD/
BACKGROUND USE ONLY/CONTROLLED DISSEM)
Aug 20, 1975
Approved For Release 20Fq"8,NC J -FJIA00865A001600090001-6
 25X1D Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
Next 1 Page(s) In Document Exempt
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
 Approved For Release 200/08/08: f I U ~~ TA 0865AO01600090001-6
Bangladesh
~'cs eo ~'s ;cactio;? to the Coup
The Soviets have been publicly noncommittal
about last week's coup in Bangladesh, but--like
most observers--undoubtedly see it as a setback
for Soviet and Indian interests in Bangladesh.
Moscow had its problems with former president
Mujib, who resented Soviet niggardliness in pro-
viding economic aid. The Soviets felt, nonethe-
less, that he was the only person who could keep
Bangladesh from disintegrating under the burden of
its economic problems. They welcomed his assump-
tion of more authoritarian power not only because
it was in keeping with their own political tradi-
tions, but also because they hoped it would enable
him to deal more effectively with Bangladesh's
problems.
The coup seems to have taken Moscow by surprise.
The day before, one of the USSR's South Asian "ex-
perts" in Moscow had said he thought Mujib had a
good chance of ridding the Bengali government of its
administrative chaos and corruption because Mujib
enjoyed broad popular support, especially among
younger cadres. The day of the coup, Soviet officials
in Dacca were busily scurrying about town trying to
find out about the origins of the coup and the orienta-
tion of the new regime.
The Soviets are probably uneasy about Pakistan's
early recognition of the new regime, fearing that a
Pakistani-Bengalee rapprochement can take place only
at the expense of Dacca's ties to New Delhi and Moscow.
They are also unhappy about the alleged pro-US sym-
pathies of the coup leaders. Their greatest concern,
however, is that the new government will move to
improve Bangladesh's relations with China.
(Continued)
Aug 20, 1975 7
Approved For Release 2001'108/?8-cgtATRD'P9T00865AO01600090001-6
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
TOP SECRET UMBRA
Until they have a better idea of which way the
wind is blowing, the Soviets are unlikely to do or
say anything that would antagonize the new leaders.
Moscow will probably let India take the lead in
testing the sincerity of the new government's pledges
that Bangladesh will continue to follow the same
foreign policy as before. The Soviets will caution
India against overreaction even though India appar-
ently needs no such advice. Reporting from New Delhi
suggests that while India.believes the new government
is anti-Indian and anti-Soviet, it will "wait and
see."
The Soviets may be worried about the "domino
effect" of events in Bangladesh or neighborin India.
Moscow has supported Prime Minister Gandhi
but even prior to the coup expressed rn
he possibility of a right-wing reaction to
Gandhi's recent moves. (SECRET NO FOREIGN DISSEM/
NO DISSEM ABROAD/BACKGROUND USE ONLY/CONTROLLED
DISSEM)
Aug 20, 1975
Approved For Release 24 0igE(RETA- BRAT00865A001600090001-6
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6
Top Secret
Top Secret
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01600090001-6