for a concession is taken into favorable consideration, and also that Great Britain's attitude towards Turkey will depend largely upon how she meets this demand of yours." Upon the refusal of the Ottoman Government to accede to this demand, Sir Edward Grey wrote to Sir Henry Babington Smith, English representative on the Ottoman Public Debt Administration, that England must be awarded at least a 55% participation in the Bagdad-Basra section of the Bagdad Railway, as well as concessions for the construction and control of port works at Koweit. In addition, Turkey should be made to understand that Great Britain could approve no agreement without the sanction of the French and Russian Governments.
When Djavid Bey was in London in July, 1910, he submitted two counterproposals to Sir Edward Grey: first, that the portion of the Bagdad Railway from Bagdad to Basra should be internationalized upon terms agreeable to Sir Ernest Cassel and Dr. Arthur von Gwinner; or, second, that the Ottoman Government itself should undertake the construction of the line beyond Bagdad. The British Foreign Office indicated that it might consent to an increase in the Ottoman customs duties until April, 1914, upon some such terms, provided the consent of the other Powers were forthcoming, and provided Turkey would surrender her right of veto over the borrowing powers of Egypt. Because of the collapse of the loan negotiations, however, nothing further came of these proposals.
On March 7, 1911, the Ottoman ministers at London and Paris presented to the British and French Governments respectively a proposition that the Bagdad-Basra section of the Bagdad Railway should be constructed by an Ottoman company, to the capital of which the Turkish Government should subscribe 40%, and German, French, and British capitalists 20% each. The Sublime Porte
