THE OUTLOOK FOR NEPAL

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CIA-RDP79R01012A018500040001-4
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July 11, 1961
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NIE
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Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 , Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 3407 17 JUL iSR, NIE 38.1-61 11 July 1961 NATIONAL INTELLIGENCE ESTIMATE NUMBER 38.1-61 (Supersedes Relevant Portions of NIE 55-59) THE OUTLOOK FOR NEPAL Submitted by the DIRECTOR OF CENTRAL INTELLIGENCE The following intelligence organizations participated in the preparation of this estimate: The Central Intelligence Agency and the intelligence organizations of the Departments of State, the Army, the Navy, the Air Force, and The Joint Staff. Concurred in by the UNITED STATES INTELLIGENCE BOARD on 11 July 1961. Concurring were The Director of Intel- ligence and Research, Department of State; the Assistant Chief of Staff for Intelligence, Department of the Army; the Assistant Chief of Naval Operations (Intelligence) , Depart- ment of the Navy; the Assistant Chief of Staff, Intelligence, USAF; the Director for Intelligence, Joint Staff; the Assistant to the Secretary of Defense, Special Operations; and the Director of the National Security Agency. The Atomic Energy Commission Representative to the USIB, and the Assistant Director, Federal Bureau of Investigation, abstained, the sub- ject being outside of their jurisdiction. DOCUMENT NO. NO CHANGE IN CLASS. t DECLASSiriED CLASS. CHANGED TO: TS S C NEXT REV;EW DATE. AUTH: HR -..7c4-2 DATE:? Y.) REVIEWER: a 0 N? 362 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 CENTRAL INTELLIGENCE AGENCY DISSEMINATION NOTICE 1. This estimate was disseminated by the Central Intelligence Agency. This copy is for the information and use of the recipient and of persons under his jurisdiction on a need to know basis. Additional essential dissemination may be authorized by the following officials within their respective departments. a. Director of Intelligence and Research, for the Department of State b. Assistant Chief of Staff for Intelligence, Department of the Army c. Assistant Chief of Naval Operations (Intelligence) , for the Department of the Navy d. Director of Intelligence, USAF, for the Department of the Air Force e. Director for Intelligence, Joint Staff, for The Joint Staff f. Director of Intelligence, AEC, for the Atomic Energy Commission g. Assistant Director, FBI, for the Federal Bureau of Investigation h. Assistant to the Secretary of Defense, Special Operations, for the Department of Defense i. Director of NSA for the National Security Agency j. Assistant Director for Central Reference, CIA, for any other Department or Agency 2. This copy may be retained, or destroyed by burning in accordance with applicable security regulations, or returned to the Central Intelligence Agency by arrangement with the Office of Central Reference, CIA. 3. When an estimate is disseminated overseas, the overseas recipients may retain it for a period not in excess of one year. At the end of this period, the estimate should either be destroyed, returned to the forwarding agency, or permission should be requested of the forwarding agency to retain it in accordance with IAC-D-69/2, 22 June 1953. 4. The title of this estimate when used separately from the text should be classified: FOR OFFICIAL USE ONLY WARNING This material contains information affecting the National Defense of the United States within the meaning of the espionage laws, Title 18, USC, Secs. 793 and 794, the trans- mission or revelation of which in any manner to an unauthorized person is prohibited by law. DISTRIBUTION: White House National Security Council Department of State Department of Defense Atomic Energy Commission Federal Bureau of Investigation Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 THE OUTLOOK FOR NEPAL THE PROBLEM To estimate probable developinents in Nepal and in Nepal's relations with India, the Communist countries, and the West during the next few years. CONCLUSIONS 1. Nepalese political developments in the near future are likely to be centered on the conflict between King Mahendra and the Nepali Congress Party exile move- ment. The King has not demonstrated the qualities of leadership necessary for the difficult tasks that face him. Never- theless, he has a number of factors in his favor, notably his control of the country's security forces. (Paras. 8-14) 2. The Nepali Congress exile movement, which is led by former Deputy Prime Min- ister Subarna Shumshere, has developed only limited strength to date in its cam- paign to end the King's direct rule. Most of the party's leaders, including former Prime Minister B. P. Koirala, are under arrest. However, the Nepali Congress is in the best position to take advantage of the political unrest that is likely to de- velop under the King's rule, but its ability to do so will depend on its success in se- curing army support or passivity. The 10,000 man army presently appears loyal to the King, but if faced with continued political deterioration the army might throw its support to the Nepali Congress, seize power itself, or force the King to compromise with the opposition move- ment. Considering all factors, Mahen- dra's government is unlikely to remain in power beyond another year or two. (Paras. 15-16, 18-19) 3. The Communist Party of Nepal has a limited but growing ability to influence events in Nepal. The party has let the Nepali Congress take the initiative against the King while it concentrates on improving its organization and infiltrat- ing governmental and other organiza- tions. Conditions in Nepal will provide growing opportunities for the Nepalese Communists. (Paras. 17, 20) 4. Nepal has had little success in devel- oping its subsistence economy to date, and the outlook for any significant eco- nomic growth during the next few years is poor. Its development efforts will con- tinue to be almost entirely dependent on foreign aid. However, a lack of economic progress is unlikely to have serious politi- cal repercussions in the near future. (Paras. 21-23) 1 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 5. Virtually all Nepalese leaders are con- vinced that Nepal should follow a neu- tralist foreign policy, particularly in the UN. Mahendra, however, is more suspi- cious of India than are the Nepali Con- gress leaders, and is likely to continue to follow a more cooperative though still cautious policy toward Communist China, which the Chinese Communists have re- ciprocated. The King appears convinced that he can use the threat of reliance on the Chinese to keep India from gaining too strong an influence in Nepal. (Paras. 24-26) 6. India's major interest in Nepal is to preserve the country's integrity as a key element in the Indian security position. 2 India is likely to encourage Mahendra to reach a compromise with the Nepali Con- gress, although in the event of an ex- tended struggle Indian support is likely to be increasingly engaged on the side of the Nepali Congress. Nevertheless, we believe that 'India will pursue a cautious ? course for fear that Mahendra, if pushed too far, might rely more heavily on Chi- nese support to stay in power. (Paras. 27-28) 7. Nepalese relations with the West are likely to remain relatively good. Nepal will continue to rely on the US for sub- stantial aid for its development program. (Para. 29) DISCUSSION 8. King Mahendra's abrupt dismissal of the Nepali Congress Party Government in Decem- ber 1960 ended the country's first brief ex- periment with representative government. This experiment followed eight years of highly unstable government during which the King sometimes ruled directly and sometimes through political leaders of his choosing. The King eventually decided to accommodate the growing pressure for representative govern- ment, and Nepal's first national elections were held in mid-1959. The Nepali Congress Party, a moderate socialist party composed mainly of small landholders and middle class ele- ments, won two-thirds of the parliamentary seats and took office under Prime Minister Koirala. 9. The division of power between the King? who retained extensive powers under the con- stitution?and the Nepali Congress Party Gov- ernment made friction almost inevitable. However, during the first year after the elec- tions both sides appeared aware of the need for cooperation to prevent a return of politi- cal instability. The government took some promising steps in the direction of social and economic reform. However, Prime Minister Koirala offended the King who came to feel that the Nepali Congress had designs against the monarchy itself. Meanwhile, the "palace clique," composed mainly of .landowners who feared the Nepali Congress land and tax re- form programs, was able, to play on the King's fears that he would lose his dominant position unless he moved against the government lead- ers. Mahendra began to harass the govern- ment in various ways. He acted secretly and swiftly on 15 December by ordering the arrest of most of the government and opposition leaders including Prime Minister Koirala, dis- missing Parliament, and resorting to direct rule. The Nepali Congress leaders who were able to avoid arrest went to India where they have established an exile movement aimed at their return to power. Nepalese political de- velopments in the near future are likely to be centered on this conflict. 10. The problems involved in governing Nepal as it attempts to make the transition from an isolated medieval society to a modern state Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 are formidable. Nepal's geographic and ethnic divisions make it difficult for any government to develop a national consciousness and estab- lish firm control over the entire country.1 The country has few readily exploitable resources, and the lack of administrative talent is a major handicap to any efforts to modernize the country. Less than five percent of the people are literate. Nepal's location between India and Communist China severely limits its freedom of maneuver in international af- fairs. Finally, the failure of the King and the political parties to work out a satisfactory relationship indicates that force and intrigue will be the major determinants of future po- litical trends. The King's Position 11. King Mahendra has never demonstrated the qualities of leadership necessary for the difficult tasks that face him. Although the 41-year-old monarch is shrewd at playing off one group against another, he is an unin- spiring leader and a poor administrator with only limited knowledge of political and eco- nomic matters. He has so far been unsuc- cessful in his attempts to obtain the services of capable officials. The five members of the Council of Ministers he has chosen to assist him are distinctly second-rate and not par- ticularly loyal to him. In any case, his basic problem will remain to plague him, i.e., the need to give his Ministers adequate power to govern effectively without allowing them to achieve a position which would threaten his control. 'Nepal consists of three major areas: the Terai or plains country in the south, the lower mountains and valleys stretching across central Nepal, and the high Himalayan ranges in the north. The country is further divided by north - south ranges, which make Nepal's transportation and communications problems extremely difficult and limit the central government's authority in large parts of the coun- try. The people of the Terai?about one-third of the estimated 9,000,000 population?are ethnically similar to the people of north India. The popula- tion of central Nepal?about half of the total?is a mixture of Indian and Mongoloid, and the peo- ple of the sparsely settled northern areas are ethnically and culturally closer to the Tibetans than to the other Nepalese. 3 12. The King's rule has slowed even the mod- erate rate of progress achieved before the coup. Mahendra has talked of formulating plans to provide limited self-government from the village upwards, while maintaining control through close supervision of the process. He would like to carry out certain social and economic reforms, but since December he has devoted his major attention to maintaining in- ternal security. This preoccupation with se- curity has already caused him to carry out an extensive purge and reorganization of the civil service, which has reduced its already limited ability to administer the country. 13. At the same time, the King's personal rule is supported by a number of important factors. His demonstrated determination to retain his dominance is in itself a considerable asset. Respect for the monarch, regarded by many as a reincarnation of a Hindu deity, is widespread among the people. Political apathy, still prevalent despite the growing popular involvement in political life during the last decade, probably is equally important. Landlords and local officials generally support the monarchy, although these elements have recently become somewhat apprehensive be- cause of Mahendra's talk of the need for re- forms. The most important element of the King's power, however, is his control of the country's security forces. 14. Nepal's 10,000 man army is the key unit of the country's security forces, as the 3,500 man armed police force can do little more than carry out its routine law and order func- tions.2 The army is poorly equipped and led even by Asian standards despite nearly a decade of effort by an Indian training mission. The army consists of 9 infantry battalions and 9 separate companies, though the latter are generally ineffective. Six of the 9 battalions? including 2 battalions of specially selected troops which comprise the Palace Guard? are located in the Katmandu Valley. One battalion is dispersed throughout central Nepal, and the remaining two battalions are in the lowlands along the Indian border. 2 The Militia, a paramilitary organization of com- pany-sized units controlled by District Governors, is generally ineffective. Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Detached units are scattered elsewhere throughout the country. Logistical difficul- ties are a major obstacle to troop deployment beyond the key centers of population. The army has the capability of quelling most civil disorders that are beyond the ability of the police to control, but probably is not capable of putting down widespread or, major dis- turbances.3 The Opposition Forces 15. The major opposition to the King comes from the Nepali Congress leaders who are in India, since the Nepali Congress units in Nepal, though largely intact, are inactive. With Koirala in jail the exile movement is led by former Deputy Prime Minister Subarna Shum- shere, who has long been the party's principal financier. While he lacks Koirala's personal popularity, he is a widely respected and ca- pable leader. The active party workers in India?which apparently number a few hun- dred at present?come from the ranks of Nep- alese students and other residents in north- ern India. Some elements of the conservative Gurkha Parishad, which emerged from the 1959 elections as the second strongest party in Nepal, are also active in the exile movement, as well as members of some minor parties. The opposition movement apparently has re- ceived only moral sympathy and advice?in addition to the right of political asylum?from the Indian Government, but it has received limited support from the Praja Socialist Party of India. The opposition also has been at- tempting to obtain support?including arms? from other countries, notably Burma and Israel. 16. The movement has developed only limited strength to date, although it apparently has sufficient resources to support its present level of activities. It has been able to maintain contact with local units of the Nepali Con- gress inside Nepal, and has carried out some The Nepalese Army is less successful than the British and Indian Armies in its recruiting efforts among the hill peoples?commonly referred to as Gurkhas?in view of the greater rewards and pres- tige that result from service in the British and Indian Armies. The Nepalese Army also includes non-Gurkha elements. propaganda activities against the King in various parts of the country. While its or- ganization is the most widespread of any Nep- alese party, it probably has suffered some- what from the King's repression since last December. A more serious weakness is its inability to secure enough arms to provide a reasonable chance of ending the King's direct rule. 17. The Communist Party of Nepal (CPN) , which won only eight percent of the votes in the 1959 elections, has a limited but growing ability to influence events in Nepal. The party, which is aided by the Soviet and Chi- nese Embassies in Katmandu?and to a lesser extent by the Indian Communist Party?has its principal strength in the Katmandu Valley and eastern Nepal. Its membership is prob- ably no greater than 8,000. Nevertheless, this represents a fairly rapid growth over the past two years. Since December the CPN has been aided by the relative freedom permitted the party despite the ban on political parties by King Mahendra, who may view the party as a counterweight to the Nepali Congress. The party has traditionally suffered from serious factionalism, however, and has been divided on the policy to pursue since December. One faction wanted to join with the Nepali Con- gress in opposing the King, while the other thought that Mahendra's "feudal" rule would eventually provide greater opportunities for the party to exploit. Since the Nepali Con- gress has refused?at least for the present? to cooperate with the CPN, the latter has so far left the initiative for any widespread agita- tion against the King to the Nepali Congress. At the same time, it is steadily seeking to infiltrate governmental and other organiza- tions. Thus it hopes to be able to exploit any instability caused by a Nepali Congress insurrection without running the risk of being suppressed should the agitation fail. Political Outlook 18. King Mahendra has admitted to the US Ambassador that things are not going well. He is aware of the danger that a prolonged period of direct rule might make him the focus of popular discontent, and probably will make new efforts to obtain the support of more ca- Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 ?Tztlibakiiica= pable and representative political figures. He has made unsuccessful overtures to Subarna Shumshere, apparently in an attempt to se- cure the latter's services and thus split the Nepali Congress Party. We believe Subarna is unlikely to cooperate with the King unless Koirala and the other Nepali Congress leaders are freed and Parliament restored. While Ma- hendra might eventually see no alternative to such a compromise, he is unlikely to con- sent to such conditions in the near future, partly out of fear for Koirala's popularity, but also because such a retreat would mean a drastic reduction in his power. Therefore the King is likely to attempt to secure the services of the leaders of other parties, such as the Gurkha Parishad, but even if he experiences some success along these lines this will not prevent an increase in political unrest and economic deterioration. 19. The Nepali Congress is in the best posi- tion to take advantage of this situation, but its ability to do so will depend on its success in securing some army support?or at least passivity. While our knowledge of the atti- tudes of Nepalese Army leaders is very limited, they appear loyal to the King but unenthusi- astic about his assumption of direct rule. In addition, army leaders are not anti-Con- gress in outlook, and some of the younger offi- cers?who have been educated at military schools abroad?may be in sympathy with the party. Given the prevalent political apathy in Nepal, it is unlikely that a Congress agita- tional campaign would evoke widespread sup- port at this time. Nevertheless, the capabili- ties of the opposition movement are likely gradually to increase?especially if it receives outside support. Faced with the prospect of continued political deterioration the army might throw its support to the Nepali Con- gress, seize power itself, or force the King to compromise with the opposition movement. The choice would depend upon the circum- stances at the time. In any event, the loss of army support would result in the downfall of the King from his present dominant position, though he might be retained in a lesser role. If faced with marked adversity, the King might panic and abdicate. On balance, the chances of King Mahendra's government re- 5 maining in power beyond another year or two are poor. 20. Whatever the outcome of the present po- litical struggle, no government is likely to make more than modest progress in moderniz- ing Nepal in view of the inherent obstacles. The return of Koirala and the moderate so- cialist Nepali Congress to power probably would result in an improvement in govern- ment operations as the Nepali Congress lead- ers are more capable than Nepal's present leaders. However, having failed in its initial attempt at representative government, Nepal will find it more difficult to make the transi- tion from government by force and intrigue to establishment of the rule of law. Any fu- ture government's attempts to carry out a program of reforms will be handicapped by the weakness of the administrative apparatus and the active opposition of vested interests?par- ticularly large landlords?to any moves that adversely affect them. While the authority of the government is likely to be strengthened over time and thus make possible a more rapid pace of modernization, constant struggles for power will result in political stability remain- ing more of a goal than a reality. Such an en- vironment, particularly if the struggle be- tween the King and the Nepali Congress is an extended one, will result in growing opportuni- ties for the Nepalese Communists. Economic Outlook 21. Nepal has been attempting to develop its subsistence economy since 1950, but it has had little success to date. Lack of communica- tions and local capital and the difficulty of ex- ploiting the country's resources have proved to be formidable obstacles to development. Even more important have been the effects of political instability and the weaknesses of the administration. Although the bureauc- racy was adequate for its traditional admin- istrative functions, it has operated poorly in its attempts to formulate and execute eco- nomic development programs. These develop- ment programs have been designed to over- come the lack of transportation and commu- nications facilities and to raise productivity in agriculture. However, Nepal's outmoded fiscal system has prevented the government from Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 obtaining adequate tax revenues and it pe- riodically faces serious financial difficulties. It has been forced to rely almost exclusively on foreign aid for its development projects. Nepal had received aid commitments of $144 million by the end of 1960, but only about 40 percent has been expended to date.4 22. The outlook for any significant economic growth during the next few years is poor, and living standards will remain among the lowest in Asia. Indeed, the King's preoccupation with maintaining internal security will make it difficult for the government to maintain even the slow pace of recent years. Under present conditions, a large infusion of foreign aid probably would not accelerate develop- ment to any significant extent, particularly since the civil service is badly overstrained at- tempting to manage the projects already under way. However, in view of the limited impact of the development program to date and the primitive nature of the economy it is doubtful that a lack of overall economic prog- ress will antagonize enough people in the country to cause serious unrest in the near future. A breakdown of the traditional econ- omy from floods or famine would be a more serious matter, as the government's capabili- ties for alleviating any such distress are lim- ited. Nevertheless, a slowdown in the devel- opment program?brought about by a domes- tic financial crisis or a reduction in foreign aid?probably would eventually create unrest, particularly among politically conscious ele- ments. 23. No matter who governs Nepal, no more than limited economic progress is likely until transportation and communications facilities 4FOREIGN AID COMMITMENTS TO NEPAL 1951-1960 (millions of dollars) India 51.7 United States 43.5 Other Free World 7.6 Total Free World 102.8 Communist China 33.7 Soviet Union 7.5 Total Communist Bloc 41.2 Total Foreign Aid 144.0 a All aid to Nepal has been on a grant basis. 6 are improved, the shortage of technicians and administrators alleviated, and the efficiency of the government's administrative apparatus improved. In time, expansion of the land under cultivation and improved agricultural techniques may raise agricultural output above present low levels. In addition, Nepal has extensive timber resources and hydroelec- tric potential?along with more modest min- eral resources?which offer prospects for mod- erate economic growth in the future. International Affairs 24. Nepal's foreign relations are dominated by the rivalry between India and Communist China for influence in the country. Another factor of lesser but growing importance in re- cent years has been the competition between the US and the USSR. Nepal regards its mem- bership in the Afro-Asian group in the UN as a means of preserving its independence; it has often voted with the group against the US position on East-West issues. Mahendra, like virtually all Nepalese leaders, is convinced that a neutralist foreign policy is the only one which offers a reasonable hope of preserving the country's independence and extracting from the competing nations the maximum for- eign aid consistent with this goal. 25. The King, at the same time, is more sus- picious of India than are the Indian-oriented Nepali Congress leaders. In addition to fear- ing that republican sympathies emanating from India may threaten his throne, he is more suspicious that India aspires to a degree of influence in Nepalese affairs which could threaten the country's independence. This suspicion has caused the King to adopt a more cooperative?though still cautious?at- titude toward Communist China. 26. The Chinese Communists are aware that Mahendra's attitude since the coup offers them an opportunity to expand their influence in Nepal. Peiping has privately expressed to the King approval of the December coup, and has renewed its invitation to visit China later this year?an invitation accepted by the King. It has also adopted a conciliatory posture in the Sino-Nepalese boundary negotiations, and Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 a border treaty appears likely in the near fu- ture. In addition, the Chinese have offered further aid, particularly for constructing a road between Katmandu and the Tibetan bor- der. Although the King hopes to avoid any substantial increase in Peiping's influence, he appears convinced that he can use the threat of reliance on the Chinese to keep India from trying to unseat him. For example, he has privately threatened to call on the Chinese if India should intervene in Nepal. He has also curtailed the flow of Tibetan refugees into Ne- pal and may even have agreed to joint Sino- Nepalese military operations inside Nepal against Tibetan rebel bands if they attempt to harass the Sino-Nepalese border demarcation terms. 27. India's major interest in Nepal is to pre- serve its integrity as a key element in the Indian security position. Indeed, Nehru has publicly stated that India's Himalayan de- fense perimeter runs along Nepal's northern border.5 The two countries have a treaty calling for consultation if the security of either is threatened.6 India's policy in Nepal has long been designed to encourage the emergence of a stable and progressive?as well as pro-Indian?government as providing the best insurance against Communist influence. Thus New Delhi has provided an Indian mili- tary training mission to increase the effective- ness of the Nepalese Army, and has extended sizable foreign aid to enable Nepal to embark India also regards the isolated Himalayan fron- tier states of Sikkim and Bhutan as falling within its defense line, and has moved to increase its capabilities to defend them. The number of Indian troops in Sikkim?an Indian protectorate?has been substantially increased, and New Delhi intends to retain its control of the state. Bhutan, though semi-independent and traditionally suspicious of India, has recently been moved by fear of Chinese expansionism to increase its ties with New Delhi. The first road from India into Bhutan has been completed and a small number of Indian troops per- mitted to enter Bhutan, which will increase India's ability to influence and defend the area. 7 on a program of economic development. At the present time, India appears primarily concerned with the threat to stability in Nepal, and has continued its aid programs and as- sured the King it will do nothing to subvert his regime. At the same time, India is likely to encourage Mahendra to reach a compromise with the Nepali Congress, although in the event of an extended struggle Indian support is likely to be increasingly engaged on the side of the Nepali Congress. 28. Nevertheless, we believe that India will pursue a cautious course, lest it jeopardize its other activities in Nepal. These include the manning of border posts along the Nepalese- Tibetan border and the right to recruit Gurkha troops. There are 29 battalions of Gurkhas totaling about 27,000 men in the Indian Army. Such rights are dependent upon the King's pleasure. More important, however, is India's fear that Mahendra, if pushed too hard, might carry out his threat to seek Communist military support, which would force India to intervene militarily in Nepal. While India could secure the southern lowlands and probably the Katmandu Valley and other points in central Nepal, the Chi- nese?who control two key passes north of Katmandu?could take over much of north- ern Nepal and thus greatly increase Indian difficulty in securing its Himalayan frontier. 29. Nepal's relations with the West probably will continue to be relatively good. The UK's principal interest in Nepal in recent years has been the recruitment of Gurkha soldiers. Nearly 15,000 Gurkhas are now in the UK armed forces. Despite the nationalist objec- tions of some Nepalese to such recruiting, the foreign exchange provided by such an ar- rangement is important enough to make its continuation likely. Nepal regards the US as occasionally too willing to defer to Indian policy toward Nepal?particularly in the co- ordination of aid programs. Nevertheless, Nepal regards the US primarily as a country which can be relied on to aid its economic development efforts without threatening its independence. gatolmitg?f"' Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 50X6 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 440130154- 30. Soviet activities in Nepal, which have in- creased substantially in recent years, appear designed chiefly to establish a USSR presence in the country and to counter Western?and Indian?influence. The USSR has maintained amicable relations with the monarchy and is moving forward to carry out its economic aid program. Moscow has demonstrated its willingness to act against Indian wishes by agreeing to survey, and possibly construct, Nepal's first east-west road. Such a road would lessen Nepal's dependence on India as it would no longer be necessary to use the Indian transportation system for east-west travel. Although Nepal probably will be re- ceptive to future Soviet aid offers, it will con- tinue to maintain a cautious attitude toward the USSR. 40-063091A0M" Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/02/25: CIA-RDP79R01012A018500040001-4 CONFIDENTIAL ... ? 1 , '-: P.S.S.R, ' : --,??1 14 e.,:24' XFG1-1; ',Owl' ...?.-4/ ? ' Ij.:1;u1'2' P Cf?.' 4 la, .'r419?'- f'.' 4 r zi N?s,k, ? mi? IP, ' ?,...4 4 ' 'fke:-,-/. ., ' 1:12 .., i t,./ -e. t7' -,,,,.......,..... .,.. (,if ,.. ."7--. ' '-- ? i. A ,,,. ..4,I ;:.9Zrat,) kirci )0 -.V.. ? ''torig - , ?:r7 '4,- ',/ '44?''-^ ???- i ' "I 11 ri7 "" '';'" ? '4:,,-.:1'.W. . i f IP t.4-4.._ .., .r. -4,,, L , -. ? A .' Pi 4 .-- 7i?I /I / .?. ( :!..r. "V, , r,?a.? :* "?:. ,- -.?-,171.,,,,,i....,;41...., 4 42. Karghalik 80 Khotan Ir? _ .????? ? SS 44 Art,. CI ARAKOkAM PASS A K)S A I f N ; .r7c7) U. LOCATION MAP S. S. R. Area of main map CH INA CHINA?INDIA FRONTIER AREA ANAK L.,10/ I IRAN !STAN 11' ;. ? e ? ???? ? ? - ? ? ? I...? ., ammirk, ? r????,. flak 4 R d.og, dv;JUNDIA lIert1 ACAO V..ONO AIWA a INTERNATIONAL BOUNDARIES SHOWN ON MOST U.S. AND WESTERN MAPS Demarcated Delimited only Indefinite 4?1?1?It CHINESE AND INDIAN BORDER CLAIMS-30 APRIL 1960 (shown only where they differ from the above boundaries): Chinese Indian Boundary of Jammu and Kashmir Cease-fire line in Jammu and Kashmir Inner Line (Indian Ministry of External Affairs)? State boundary (India only) Division boundary in the Northeast Frontier Agency of Assam Indian Trade Agency PAKISTAN Pathankot . -32- AMRITSAR * . .0144.. e, 0 LAHORE i ' 1 !ULLUNDU \LUDiN*NA 'C) us/ ?14 4?"7. INDIAN OCEAN Bhatinda 7 -28- Chanel" r. artok 732- ft, so ,:z21,1..IND0/ii- IA ocp,v Road Track or trail Railroad, broad gauge Railroad, narrow or meter gauge National capital State, Union Territory, or Protectorate capital (India only) AIRFIELDS * Runway 6000' or more, permanent surface O Runway 2000-6000', permanent surface (7) Runway 6000' or more, temporary or natural surface O Runway 2000'.6000', temporary or natural surface 0 50 100 200 300 'Trovel by foreigners beyond this line is restricted. Statute Miles 0 50 100 200 Kilometers 300 400 400 K a arh 8 BHUTANESE 84 8 0,14.4e ENCLAVES i - - NA.S4 /s9 ,4, A.-7 I ti ' 41 DELHI H !i .4 27 .e:;T:`,46 .