IRA                             483

  From conversations with British Ambassador and Ebtehaj in last
few days, I have impression Shah's mind regarding method may still
be fluid. There is no provision for amendment of present constitution,
hence some extraordinary procedure is essential if change is to be
made. There may be some precedent in his father's action for calling
constituent assembly. However, it now seems he may be thinking in
terms of having the new Majlis and the Senate themselves constitute
the constituent assembly, rather than following procedure outlined
Paragraph 6, mytel 161. He still appears to have in mind dissolving
present Majlis. This step might provoke considerable opposition that
would not otherwise be expressed against constitutional reform       as
such. Shah would obviously lack constitutional authority to dissolve
Majlis. Moreover, present Majlis in passing Seven-Year Plan law
this week has shown itself in better light.5
   Regarding timing, Shah is no longer disposed to listen to any gen-
eral arguments. He is convinced that he is now in position to deal
with any internal dissension. As regards the argument that the Seven-
Year Plan might be delayed, its passage by the Majlis has now been
effec-ýted, and in the Shah's view one of the main reasons for his
pl.an
of action is that rapid progress in implenentation of Seven-Year Plan
cannot be realized under existing political procedures.
   British Ambassador tells me he has sent a further telegram         to
 London emphasizing importance reaching definite decision on policy
 to be followed. He feels any temporizing advice at this stage would be
 a mistake and we should either oppose the whole project in principle
 or let the Shah go ahead, now that circumstances have made the
 present a more favorable time.
   Le Rougetel seems convinced situation has deteriorated; to point
 where only drastic action can avoid disaster. While I do not recall
 his having made comment attributed to him in paragraph 4 London's
 561 to effect nothing useful can come from Majlis during next three
 months, it is conceivable his pessimism with regard to present situa-
 tion may be influenced in some degree by difficulties British Govern-
 ment is encountering in its current negotiations with Iran on two
 highly important matters: AIOC and IBI.
   As regards Le Rougetel's view that situation is such that regime
 might be overthrown in a few months' time, I think it is true weakness
 of government and general lack of cohesion are such that if Shah had

   5The Majlis, on February 15, passed a law which authorized the Government
 to proceed with the Seven-Year Economic Development Program. The legisla-
 tion authorized the expenditure of 21 billion rials, or the equ~ivalen~t
,of $656 mu!-
 lion, at the official exchange rate of 32 rials to the dollar. The major
catego~ries
 involved social and municipa! reforms ($188 million), agriculture ($164
million)
 and railroads, roads, ports, and a~irports ($156 'million) (airgrams 63,
February
 18, and 79, March 3, from Tehmran, 89'1.50/2-1849, /3-349).