The Soviets agreed not only to withdraw promptly from Gilan, but also to cancel all Tsarist loans, claims, and concessions – everything except the Caspian fisheries. They, however, reserved the right to return in full force if a third power ever invaded the country and posed a threat to the Soviet Union. This gave Iran a protective umbrella. The British, meanwhile, with a straight face and no sense of irony, presented Tehran with a bill for weapons delivered to the Cossacks and the South Persian Rifles. The bill totaled £313,434 17s. 6d. 4 In abrogating the 1919 agreement, Reza Khan assured the British that this would “throw dust in Bolshevik eyes.”
He also assured Theodore Rothstein, former Manchester Guardian editor who had just been appointed Soviet minister in Tehran, that his government was determined to eradicate British influence and pursue a policy of strict neutrality in foreign affairs. The Soviets soon elevated their legation to a full embassy. The British legation summed up the post-war situation: From an external point of view Great Britain was generally regarded as the enemy, Russia as the possible friend.
Although the obvious Russian efforts to diffuse Communist ideas and propaganda caused certain uneasiness, the apparent generosity of canceling Persia’s debts to Russia, of returning all Russian concessions acquired in Tsarist times, of handing over the Russian Banque d’Escompte to the Persian Government and surrendering the Capitulations had made a profound impression, and the Russian-inspired idea that Persia had everything to gain by association with a Russia purged by the fires of revolution and everything to lose by succumbing to the imperialist and colonizing ambitions of Great Britain, was sufficiently plausible to gain many Persian adherents.
Reza Khan, however, for the time being kept his promise to the Qajars even though he lost no time in making himself, in the words of the British legation, a “virtual military dictator.” He established himself as the real power behind the throne, first as army chief, then as war minister, and then as premier as well as commander-in-chief of the armed forces. During these years, he made and unmade ministers and premiers, including Sayyed Ziya who was packed off to exile after ninety-nine days.He did not openly venture on to the central stage until 1925–26 when he convened a Constituent Assembly, deposed Ahmad Shah, accepted the crown, named his son heir apparent, and crowned himself monarch – much in the fashion of his heroes, Napoleon and Nader Shah. It was rumored that at the coronation the Speaker of the Majles stepped forward to bestow the crown, but he took it in his own hands, declaring “This is not something someone else can place on my head.”The ceremony was choreographed along the lines of European as well as Safavid and Qajar coronations. It opened with a prayer by the Imam Jum’eh, and closed with a flowery oration by the prime minister with long passages from the Shahnameh. Reza Khan had become Reza Shah. He remained so until the Anglo-Soviet invasion of 1941. These fifteen years, together with the preceding five, can be described as the Reza Shah era.