asked the Prime Minister whether in view of the formal statement of representatives of the Russian Soviet Government that Russia, following upon the resumption of diplomatic relations with this country, is prepared to place orders in Great Britain amounting to £150,000,000, including an order for cured herrings to the value of £500,000, and having regard to the long-continued trade depression, especially in the herring-fishing industry, the summer season of which is now approaching, he will forthwith reopen negotiations with the Soviet Government for a resumption of diplomatic relations and the revival of trade between the two countries?

I have been asked to reply. Presumably the hon. Member is referring to the statement made by Monsieur Piatakov, the President of the Soviet State Bank on 5th April. The relevant portion of his speech, as reported in the "Pravda" of 6th April, reads as follows: If we can come to an agreement satisfactory to both parties and if at the same time we can work out a financial programme satisfactory to both parties, we could easily place in England a programme of orders of industry for 150 million pounds sterling…. And by a satisfactory financial programme M. Piatakov appears to have explained that he means an agreement for a guarantee on the lines of the draft treaty of 1924 "properly extended and supplemented."

From this, it will be seen that the placing of orders in the United Kingdom is made to depend not only upon a resumption of diplomatic relations between His Majesty's Government and the Soviet Government, but also apparently upon the granting of extensive new credits to that Government. Thus no satisfaction is offered for the abuses of which His Majesty's Government complained while a demand is made for a revival and extension of those financial provisions of the 1924 draft treaty which His Majesty's Government declared to be unacceptable.

Seeing that the right hon. Gentleman is not certain whether these are, in fact, the terms on which the Soviet Government would be prepared to trade with us, would it not be worth while, having regard to the importance of this question and the importance of a revival of trade in this depressed industry, to get in touch with the Soviet Government and see whether a satisfactory arrangement can be arrived at?

If the Soviet Government desire at any time to make definite proposals to His Majesty's Government, there are sources of communication open to them.

Is it not a fact that the proposed 1924 Agreement depended on the guarantee of a loan to Russia [HON. MEMBERS: "Answer."]

I have answered that question.

You have not answered it, and you are afraid to answer it.

The Foreign Secretary has just stated that the 1924 Agreement depended on guaranteed credits. Was it not a free condition of such guarantee that a satisfactory arrangement should be come to for the payment of debts to private individuals in this country?

My answer to the question put to me by the hon. Member for Thornbury (Captain Gunston) was "Yes," and apparently that answer did not reach the benches opposite. If further information is wanted about the Agreement, the hon. Member had better consult the text.

Is it not a fact that we can get as many orders from Russia as we like if we not only supply the goods but the money to pay for them as well?

That was the policy of the 1924 Agreement.

Does the right hon. Gentleman not realise that the first essential to a re-establishment of trade with Russia is the re-opening of diplomatic relations?

No, Sir; trade has never been interrupted. The Soviet Government have placed orders in this country though never to the extent of the credits open to them by the amount of goods our people have bought from Russia.

Is it not a fact that the Soviet Government have very large trade balances in this country?