179 Ward to Australian Government

Cablegram B36 BANGKOK, 29 March 1949, 9 p.m.

IMPORTANT RESTRICTED

E.C.A.F.E.

Today's session devoted to preliminary statements by delegates.

Indian delegate submitted draft resolution for the establishment of a Committee on Industry and Trade at Government level to promote implementation of specific projects particularly those already past the planning stage. The Committee would appoint sub- committees to carry out the tasks along the lines suggested in our proposal for Secretariat.

The statements of the Indian delegate made it clear that he was not very interested in detailed functions but promoting action to assist E.C.A.F.E. countries at Government level. Little indication was given as to what such action would be, but it may be assumed that financial assistance and supplies of capital goods are the main objects. I made statements pointing out the necessity of examining the working party's report and distinguishing clearly what kind of action the Commission could profitably take and whether any further Government call on machinery was necessary to implement it.

The Indian delegate displayed sharp impatience with any attempt at precise definition of functions of the proposed Governmental Committee.

United Kingdom delegate supported our general position but proposed that the Committee of the Whole should be transformed into general committee on Industry and Trade to meet once a year between regular sessions of the Commission. It would, therefore, amount to a commission meeting with limited terms of reference on matters not so far in the province of any other specialised agency. Stress placed on limited frequency of meetings and on carefully defined terms of reference. United Kingdom proposal essentially a compromise designed to go some way towards Indian proposal but avoiding anything like a permanent standing committee. Provided terms of reference strictly limited, I suggest we might support the proposal on these lines and would appreciate instructions.

As you will have gathered, the issue is now not entirely the merits of any particular proposal, but a political one in view of India's insistence on the Committee. China supported the Committee in some form, but other Asian countries lukewarm from, to some extent, suspicion of India's motives. Siamese delegate has informally frankly expressed such suspicion to me. United States delegate made a brief guarded statement along the lines that his delegation had an open mind until the kind of action the Commission could take was made clear.

Actually, of course, the United States is on guard against any pressure from Asian countries, particularly India, for large scale aid. [1]

1 The Government replied that the India. proposal was expensive and elaborate. The delegation should endeavour to get agreement to the UK compromise provided that terms of reference were limited and the role of the secretariat was clear.

[AA:A1838, 383/1/2/4, i]