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During late nineteenth century, Khuzistan was considered to be the most fertile land of Persia which at one time had yielded $ 50 million if calculated on 1962 price index. Many British officials presented in Iran and India office have recorded the abundance of water through a network of five rivers and canals, making Khuzistan a fertile ground for major staple and cash crops. At the time when the general populace was affected by the famine, Khuzistan stood unaffected. But thoroughly and gradually Khuzistan had faced deplorable condition owing to the British policy and power struggle. With the opening of the Karun River, the British influence had reached to the extent that they started interfering in the appointment of governors and granting of Khuzistan developmental projects to French, Dutch or Germans. The present article highlights the increasing influence of British in the political and economic affairs of Iran especially Khuzistan which was considered to be the 'second Egypt' next to Seistan. They had even assisted by the principle Arabs and Bakhtiaris tribes of Khuzistan as well as the influential trading and commercial figures to sabotage the irriga-tion project which could hamper the water flow to Karun River, a back bone for their commercial interest. In the first quarter of 20th century the British policy in Khuzistan proved detrimental to their vested interest.

Keywords: Khuzistan, Irrigation System, Colonial Records, British Policy, Karun River, Dam

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