213 Williams to Chifley

Letter CANBERRA, 1 February 1949

IMMEDIATE TOP SECRET

I have been asked to pass to you at once the enclosed top secret message from my Prime Minister regarding an approach made by the Government of Burma to the United Kingdom Government. I enclose also the general appreciation referred to at the beginning of paragraph 2 of the message. The matter is clearly one of a high degree of urgency and secrecy and Mr. Attlee will, I am sure, be grateful if you could let him have a very early reply to the enquiry in the fifth paragraph of his message.

Enclosure

The Burmese Government have approached His Majesty's Government in the United Kingdom for substantial loans totalling over 25 million to cover budget deficit and to finance procurement of the rice crop. Further sums may be necessary for other purposes.

2. I am sending you separately a general appreciation of the position in Burma. [1] Maintenance of stability in Burma and retention of Thakin Nu's Government to which we see no effective alternative, seems to us a matter of vital interest and importance to all Commonwealth Governments which have interests in the security of South East Asia or which are dependent on Burma for essential supplies. If Thakin Nu's Government were to fall, reactions on the whole movement for self-government and democracy in Asia would be disastrous. We have consistently supported Thakin Nu and we are anxious to continue to help him in every way open to us and we hope that other Commonwealth Governments which are closely concerned in the maintenance of stability in South East Asia will all of them share our view. The United Kingdom Government because of its special responsibilities at the present time in Malaya has also to consider the reactions in that area of any breakdown in Burma.

3. We have in these circumstances anxiously considered how best to deal with the very threatening situation that seems to be developing. We are very anxious to give Burma any assistance that is in our power. But the position is not a simple one. Burmese national feeling, always extremely sensitive, might well distrust any offer of assistance which came only from the United Kingdom Government and opponents of Thakin Nu would find it easy to misrepresent in the most damaging way support only from the United Kingdom Government as a reimposition of British control and a surrender to 'foreign capitalism' with which we know they continue to make great play.

4. Primarily because we regard the situation as one of deep concern to other Commonwealth nations with interests in South East Asia, but also for the reason just stated, we feel that any approach to Burma should come from those Commonwealth countries including of course the United Kingdom. I have taken preliminary soundings of the Premiers of India and Pakistan which have a common frontier with Burma and I find that Pandit Nehru and Mr.

Liaquat Ali Khan are fully in agreement with this view. I have arranged with their agreement that Mr. Arthur Bottomley, Parliamentary Under Secretary at the Board of Trade will go out to Karachi and Delhi, leaving here on Thursday the 3rd February for preliminary talks confidentially with the Pakistan and Indian Governments on this matter. It is obviously of great importance to do nothing which would embarrass Thakin Nu and Bottomley's visit will therefore be announced as being for the purpose of trade discussions.

5. I should be most grateful if you could let me know whether your Government would be prepared to consider joining with other closely interested Commonwealth Governments in an offer of assistance to Burma. I will in any case inform you after Bottomley's preliminary discussions in Karachi and Delhi how the matter is developing. At a later stage it may be appropriate to arrange a discussion at which those Commonwealth Governments who are willing to participate in such an offer could all be represented.

1 Not published. The appreciation stressed the economic and strategic significance of Burma to the Commonwealth in general and south-east Asia in particular, and painted a gloomy picture of administrative confusion and internal conflict.

[AA: A6537, SEATS 4/1]