I am directed by the Prime Minister to refer to your letter of 22nd July on the subject of the future constitutional position of Ceylon.  In general, the Australian Government agrees that a country, before admission to the British Commonwealth, should undertake certain obligations. Among the questions which have been considered by the Government are first, whether such obligations should be stated in contractual form and second, whether, particularly where the obligations involve the Commonwealth as a whole, they should be discussed at a Commonwealth meeting rather than negotiated solely between the Governments of the United Kingdom and Ceylon.
The Australian Government agrees that the Defence obligations to be undertaken by the Government of Ceylon should be stated in the form of an Agreement. While such an Agreement is a matter for concern to the Dominions, it is appropriate, since the United Kingdom Government is undertaking full responsibility in the matter, that this Agreement should be negotiated and signed by the Governments of the United Kingdom and Ceylon, on completion of the normal intra-Commonwealth consultation.
In regard to the terms of the Draft Agreement on Defence, it is noted that it has been cast in general terms and that military facilities to be granted to the United Kingdom, including the use of naval and air bases, ports, military establishments and telecommunications are to be such 'as may from time to time be agreed'. In the light of the above, it is considered that, as far as the United Kingdom is concerned, the Agreement is generally in accord with the strategic requirements of Australia. It is noted that the question whether the draft Agreement should contain a time limit or whether it should contain a provision whereby it could be terminated by either party on giving some period (e.g. 5 years) of notice is still to be considered by the United Kingdom Government. It appears desirable that the Agreement should remain in force as long as possible, preferably indefinitely, and that this might best be achieved by omitting all reference to the time factor. Further, it is assumed that existing defence arrangements in Ceylon would remain in force pending the conclusion of a satisfactory mutual agreement between the United Kingdom and Ceylon Governments regarding the details of future defence arrangements.
The obligations which might be undertaken by the Government of Ceylon in regard to the External Affairs appear different from those in regard to Defence.  Whereas the latter do not involve any commitments on the part of other Dominions, the very fact of the admission of Ceylon to the Commonwealth may involve all other Dominions in obligations. In particular, the Dominions may feel obliged to keep the Government of Ceylon informed of their intentions in the field of foreign policy, in accordance with the normal practices now in use, and they may wish to receive similar benefits from that country. It is noted that the draft Agreement on External Affairs as between the United Kingdom and Ceylon makes no reference to the obligations to be undertaken by Ceylon in regard to the other Dominions and by the other Dominions in regard to Ceylon. Further, in the absence of consultation with other Dominions, the Australian Government is not convinced that such obligations would most suitably be expressed in contractual form.
At this preliminary stage it appears that an appropriate procedure might be for the relations of Ceylon with the United Kingdom and the other Dominions to be discussed at a Commonwealth meeting at which representatives of the new Ceylon Government would be present. Such a meeting could conveniently be held in London, the Dominions being represented by their High Commissioners. The undertakings mutually agreed could be formulated in the type of statement usually issued on conclusion of British Commonwealth meetings.
Should such a procedure be adopted, the points stated in the draft Agreement on External Affairs would, in general, be those which the Australian Government would wish to have discussed. As the Agreement stands at present, its terms do not cover the undertakings which Dominions such as Australia might expect from the Government of Ceylon and those which they in turn would wish to give to the Government of Ceylon. The first five paragraphs would appear to need redrafting to make them applicable within the Commonwealth as a whole.
Consideration has also been given to the fact that should such a procedure be adopted for the admission of Ceylon to the Commonwealth, it should also be adopted for the admission of other countries. The case of India and Pakistan is not however an exact parallel. The Government of India has been in practice regarded as a member of the Commonwealth, and the Australian Government for its part has in general included India in its intra-Commonwealth consultation. It would not therefore expect of India or Pakistan prior undertakings similar to those which might be asked of Ceylon or any other country which is entering the Commonwealth for the first time as a fully self-governing community.