Document Type: 
Document Number (FOIA) /ESDN (CREST): 
Release Decision: 
Original Classification: 
Document Page Count: 
Document Creation Date: 
December 12, 2016
Document Release Date: 
August 10, 2001
Sequence Number: 
Case Number: 
Publication Date: 
May 12, 1958
Content Type: 
PDF icon CIA-RDP84-00499R000200130001-0.pdf986.17 KB
Approved For Release 2001/$EGkDP84-00499R000200130001-0 Briefing 12 May 1958, Room 117 Central Building, 4:30 p.m. As of this writing I recall little of the back- ground of the briefing and the circumstances surround- ing it. I know that Mr. Dulles asked me to do the job, probably, as a part of an extended series of briefings to be given by officers of the Clandestine Services. I. am fairly sure that this was first visit to the US as Director of the a position he had not held very long. The substance of the briefing follows the principal judgments of National Intelligence Estimates considered to be current at the time. For obvious reasons the briefing contained a lot more solid information regarding Soviet military matters than the briefing which I had given - a few months earlier. At the same time it carefully avoided precise numerical estimates in - 1 - 2iQ y-RDP84-00499R000200130001-0 Approved For Release 20011 9UkT Approved For Release 2001 /'IaBCR1 ' DP84-00499R000200130001-0 such important end-items as heavy jet bombers, submarines, and ICBM's. Reading it over today and doing the translation into English (the original English text was probably destroyed when the version was finished) I am notably pained by paragraph #16 on the Sino-Soviet relationship and how its endurance is something almost solemnized in Natural Law. The final poetic sentence about the biological symbiosis was my own gratuitous interpolation. To have coordinated this sort of prose through. the final draft of an NIE would have been impossible, but I will warrant that the community would have agreed in the sentiment even while it rejected the flowery formulation. As to the - of the text, we had better luck than with the briefing. This reads somewhat better, but has its full cargo of in- felicities of structure and vocabulary. As I go over it, I. only wish we could do it again and from scratch. But for the sake of the historical record we have left it as delivered over the pained remonstrance of the gifted - lady wh_o has typed i.t for preservation in this form. Approved For Release 2001/1gff;iIO-RDP84-00499R000200130001-0 Approved For Release 2001/'4BCATRDP84-00499R000200130001-0 My English. translation takes some :Liberties with 25X6 the- which is generally apparent with the appear- ance of words and phrases in square brackets. Approved For Release 2001/121DA 2DP84-00499R000200130001-0 SECfi 25X1C Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Next 10 Page(s) In Document Exempt Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Approved For Release 2001g/RDP84-00499R000200130001-0 English translation of the text of the briefing note in 1. I hope you will permit me to read rather than speak this short briefing note on the Soviet Union which we of my office have put together. What I will give you are some of our estimative judgments regarding the most important [intelligence] problems [which we confront]. The judgments rest upon a considerable volume of information collected by [US] intelligence and represent the views of the [intelligence] components of the Central Intelligence Agency. 2. [Introductory]. Some eighteen months ago the Bloc experienced a very severe crisis. The [public] repudiation of stalinist terrorism caused tremors in the USSR and its satellites and severely shook a great number of western communists. 3. However the Soviet Union has rewon the lost ground. It has been able to reaffirm the grip it used to hold on central Europe. The Bloc as a whole has regained its habiliments of unity and strength. Approved For Release 2001/12LQ6jc RDP84-00499R000200130001-0 Approved For Release 200'LAt.--RDP84-00499R000200130001-0 4. [With these introductory phrases] I propose abruptly to launch out into the chain of circumstances which has permitted the Bloc to achieve a. most remark- able progress. 5. First I should note Soviet accomplishments in the development of guided missiles and the extraor- dinary impression that their success has made through- out the world. In the underdeveloped countries the reclame was the greater for the fact that the USSR itself had been only recently in a comparably under- developed condition. 6. For the first time the world perceived the possibility, and that in the near future, of the United States being vulnerable to a Soviet ICBM attack. . With this came the realization that a great change would occur in the relative strength of the two power blocs. These two factors have nurtured the belief that the USSR would [henceforward] exercise upon the US the same sort of restraint that the US has hereto- fore exercised upon the USSR. 7. The USSR's progress in the realms of science [and technology] and of economics have helped reaffirm its political power - both directly and psychologically. Approved For Release 2001/W6kwDP84-00499R000200130001-0 Approved For Release 2001/8k4R(EiRDP84-00499R000200130001-0 8. In mathematics and in the physical sciences (within which I include nuclear physics), the USSR has dramatically demonstrated its talent. It has surpassed the US in the number of its trained scientists. Moreover it can deploy its scientific personnel to the service of its foreign political aims and its military aspira- tions. 9. The recent rate of growth of Soviet GNP has been twice that of the US. [It is worth mention that] Soviet GNP is only 40 percent of that of the US and that the Soviet population consumes only about 25 percent of [what] the US [population consumes.] 10. The USSR in its ability to limit consumption and to enforce other of its economic objectives has been able to overtake the US in certain areas [of the economy] and will soon overtake the US in others; for example, the production of machine tools, freight cars, coal, and cotton textiles. The USSR is [now] in a position to allocate resources in such a way that its economic effort in such areas as research, military preparedness, industrial investment, and foreign aid are already the match of those of the US. Soviet military expenditures in recent years, translated Approved For Release 2001/ W6 0 .;RDP84-00499R000200130001-0 Approved For Release 200' / 4 1 i-RDP84-00499R000200130001-0 into dollars, are about the same as those of the US, and Soviet industrial investment is only 15 percent less. 11. Military Matters: Since the end of World War II Soviet grand strategy has been greatly influenced by the fact that the US - its most important potential enemy - is [geographically] well beyond the reach of its traditional military power. Therefore the USSR has channeled much effort towards the building of a submarine fleet, long-range bomber aircraft, guided missiles, and [an arsenal] of air defense weapons. We believe that the Soviets have developed an array of nuclear weapons for purposes of both long-range attack and air defense. [We estimate] the number of their long-range bombers at some 1500 [of all models]. Their submarine force possesses a formidable capability for torpedo and missile attack. The perfection of their radar, the growing production of all-weather fighter [-interceptor] aircraft and their development of surface-to-air and air-to-air missiles contribute to the continued growth of their air defense capa- bilities. The magnitude of the scale and nature of the Soviet program of missile testing shows a firm, Approved For Release 2001/1.2104 C.~I4j DP84-00499R000200130001-0 Approved For Release 2001 /gpjR Pf RDP84-00499R000200130001-0 well-conceived, and rigorously applied plan of action which we believe [will have] yielded [scientific and technological] insights of great value - especially in the area of [non-military] satellites [e.g. sputniks], ICBM's and [indeed in that of the whole range] of military missilry. Soviet efforts are being concen- trated in the field of ballistic missiles and [to a lesser. extent] in other systems, such as for example, cruise missiles. 12. The USSR has by no means neglected [the development of the capability] of forces for operations on the periphery of the Bloc. It has carefully reor- ganized and modernized its ground forces; other im- provements in fire power and mobility are probable in the future. We contine to estimate that the number of Soviet line divisions is 175 - with a con- siderable variation in real strength between division and division. 13. The Soviets are giving increased attention to air-borne forces. Their military doctrine and training [show] them adapting to conditions of nuclear war as well as conventional. Approved For Release 2001/W kj RDP84-00499R000200130001-0 Approved For Release 2001,-4/RDP84-00499R000200130001-0 14. The tactical disposition of Soviet forces would permit their rapid deployment to several widely- separated theatres of the Eurasian land mass. In Eastern Europe the Soviets alone dispose 32 line divi- sions,nnre than 1100 fighter [interceptor] jet aircraft, and at least 250 light jet bombers. It goes without saying that the mission of these forces is not confined to being a military threat to Eastern Europe; their role in the maintenance of [political] control over the European Satellites is equally im- portant. 15. The growth in Soviet military strength is substantial; however we believe that the Soviet leaders have given evidence of a sober respect for the superior military power of the US which has the capability to inflict unacceptable damage upon the states of the Bloc. We therefore believe it unlikely that the USSR and [Communist] China will undertake courses of action which they judge capable of leading to general war. The USSR might believe, however, that the growth of its nuclear power would deter the US and its allies from running [the kinds of] risks which could lead Approved For Release 2001/W RWDP84-00499R000200130001-0 Approved For Release 20014/RDP84-00499R000200130001-0 to the outbreak of a new war. From this line of reasoning it might follow that the Sino-Soviet Bloc might wish to capitalize upon what it estimates to be the advantage of greater flexibility of action in local situations. Thus it is possible that the Bloc would move to armed action in peripheral areas or in those areas where the interests of the US appear to be of secondary inportance. One perceives that this [would be] the same error which led Stalin to order the invasion of Korea in 1950. 16. [In the light of the foregoing] we believe that the main effort of the Sino-Soviet 'Bloc will lie in the promotion of its goals through non-military means. In Europe, the Bloc will take an essentially defensive position, for its moral power in the European Satellites has been prejudiced while the political and military power of NATO will [further tend to] limit its field of action. The Bloc will, [however] continue to take initiatives in Asia, Africa, and the Middle East where it will be able to exploit popular desires for social, economic and political change and [the widespread urge] to express national identity. In following these courses the Bloc will deal with Approved For Release 2001/W6jcj RDP84-00499R000200130001-0 Approved For Release 2001/1RDP84-00499R000200130001-0 non-Communist and [even] anti-Communist governments as readily as with those of ideological kinship. 17. In spite of the substantial growth of the economic and military strength of the Bloc and despite its confident stance in matters of [general] foreign policy, Soviet leaders are confronted by a number of serious unresolved problems. Their recent successes in coping with ructions in the Satellites have not solved the basic problems of growing nationalisms. 18. The monopoly which Moscow enjoyed over communist thinking was broken with the recognition of Yugoslavia as a communist state in good standing, by the emergence of a semi-independent Poland, and the growth in the power and influence of Communist China. These changes have loosed forces of instability in Eastern Europe. At present we believe that the Soviet leaders may have plans in train to remedy the situa- tion: especially in Yugoslavia and in Poland. They have [also] given to Peking an augmented stature and a very considerable latitude for independent action. [As of] today it would be extremely difficult for Soviet leaders to return to the Stalinist methods of imposing a [general] conformism. The likelihood of Approved For Release 2001/w0! k w - DP84-00499R000200130001-0 Approved For Release 2001/RDP84-00499R000200130001-0 disruptions in the Satellites in coming years seem reduced, but the action of forces freed by the death of Stalin will persist. It is likely that changes in the relationship between the several states of the Bloc will take place gradually. 19. One of the principal sources of Soviet strength lies in the loyalty to the Bloc which Com- munist China professes. The Chinese leaders have borrowed certain aspects of Soviet domestic policy and adapted them to the Chinese scene. But we believe that their goal is to build a society modeled on the Soviet. In matters of foreign policy we perceive an almost exact identity of the Chinese with the Soviet. While admitting the possibility of friction we believe that their alliance [of the two powers] is solid, built [as it is] on a common ideology, a common concern to eliminate western influence from Asia, and [strengthened] by the necessity borne of a strong interdependence. The relationship is a sort of symbiosis - almost biological - like that which exists between the gold fish and the water plants [of a balanced acquarium.] Approved For Release 2001/W WDP84-00499R000200130001-0 Approved For Release 20019ppI -RDP84-00499R000200130001-0 20. As to the Soviet Union itself whose speedy growth in economic power and in scientific accomplish- ment is impressive, we [nevertheless] noi:.e that it will be more and more handicapped in its endeavors to solve the problems inherent in its complex industrial society by the built-in inflexibilities of its communist regime. Already the Soviet.leaders are not able to .require the-great outlay of worker effort without giving to the labor force a greater share of the product. This problem cannot but slow the pace of economic growth. The Party has already felt the weight of a significant opposition to its monopoly of power. So long as the Free World is able to maintain a balance of forces and [so long] as it can hinder the communists from their continual encroachments upon the rights of others, we believe that the Soviets' own internal problems will bring about an evolution in the political system of the USSR. We believe that Khrushchev has strengthened his position of control and that of the Party. But we foresee a continuation in the struggle for power which we believe may result in a shakeup among the leadership. Approved For Release 2001 11 J C DP84-00499R000200130001-0 SE C k"- Approved For Release 2001/8p"R q'RDP84-00499R000200130001-0 Briefing of Noon - Director's Conference Room Administration Building: 15 January 1958 The title of the briefing, had there been one, would have been a quick tour of the world's horizon with special emphasis upon the things to which the US though should be especially alert. The text as it appears hereafter is as delivered in - The English version is a translation back from the not the original from which the was derived. This was cheerfully thrown away when it had served its purpose fifteen years ago. Unfortunately if I ever knew the details sur- rounding the event, I have since forgotten them. About all I can recall is receiving word from Mr. Dulles that would be in 'Washington in mid-January of 1958, that he would come to the Agency for a general briefing, and that I was to prepare a short presentation in - which would 25X1A encompass the principal conclusions of current National Intelligence Estimates. As to substance I received almost no instructions. Had it been necessary, I Approved For Release 2001/1 Rt DP84-00499R000200130001-0 Approved For Release 200154/ftRDP84-00499R000200130001-0 would have been told to avoid quoting estimated numbers of important items of Soviet and Chinese armament, but since I knew that I needed no such word of warning. As far as the actual formulations are concerned, they are as close to the English originals as we could make them. We did not, repeat not, concoct a set of new estimates to serve the political purposes of our government. On the other hand, it would be silly to suggest that the choice of what was to be said and the distribution of emphasis was wholly blind. I knew why was on a state' visit and the crux of what the US government wished to convey to him. I knew that Secretary Dulles and other important officers of the administration knew of the precarious situation in _ and wished to give an outward sign of US moral backing and, incidentally, a little Dutch uncle's advice about the dangers which lay in his easy-going relationship with the local communists. (This I understand was administered in no uncertain fashion at the dinner of with Approved For Release 2001/W,6kyf DP84-00499R000200130001-0 Approved For Release 2001/(ffDP84-00499R000200130001-0 Mr. J. F. Dulles the host). I therefore will not pretend that the briefing was a Far Eastern equivalent of something prepared for the ears of, say, the The technical problems of putting the briefing into were a bit more than I had bargained for. Happily there was only one line in which the brief- ing touched upon the new weapons, nuclear warheads, long-range bombers, and what we called in 1958, "guided missiles." But finding sound equivalents for what had already become cliches in the language of the Cold War was more difficult. The - of the person who did the first translation from the English text was that of a twenty-five or thirty years back, and it just wouldn't wash. It - 3 - Approved For Release 2001/1~VC DP84-00499R000200130001-0 Approved For Release 2001/' 11 RDP84-00499R000200130001-0 got jimmied into final shape with the aid of a number of speakers. Even so, as I read it. to-day (February 1973) it is nothing to claim with pride. In fact it is just not good. The English translation reads better because I have made it come out that way. My new inter- polations (February 1973) appear in square brackets. I remember little of the actual briefing except that it took place in the Director's Conference Room in the (new) Administration Building in the 25th street campus (old South). Mr. Dulles was present. My presentation was the first of several (I believe) and after I had given it, I left the room before the DDP officers took over, as was the custom. I gathered from some later remarks of Mr. Dulles that Approved For Release 2001/1 , VC. i1klDP84-00499R000200130001-0 Approved For Release 2001/'RDP84-00499R000200130001-0 an important part of the message which was conveyed was that the communists in _ were up to no good and that should be wary. Mr. Dulles told me that seemed to have taken the admonitions of the briefing and what Secretary Dulles had told him two days earlier in stride. He re- marked to our Mr. Dulles that he knew all about the communists and was not too alarmed about their secret subversive capabilities: after all their leader, 25X1A with whom he had a candid relationship. 25X6 MMM 12 March Approved For Release 2001/1 2 JI DP84-00499R000200130001-0 25X1C Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Next 10 Page(s) In Document Exempt Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Approved For Release 2001/1g ftkt iDP84-00499R000200130001-0 1. Our director has requested that I present to certain of the most important [substantive] conclusions which derive from the work of his organization. These relate to those parts of the world where the situation is critical. They rest upon a wealth of information which we have collected and represent the basic judgments of all components of the Central Intelligence Agency. _ will permit me to remark that I ten honored in the performance of this task. The shortness of time at our command will allow for only a partial tour d'horizon and I therefore propose to confine myself only to those parts of the world which hold an immediate concern for our two governments. 2. This briefing is similar to those which our Director gives to the President and the National Security Council when the latter is considering important foreign policy matters. At such meetings the Director carefully limits himself to a discussion of problems whose present or future significance warrants the attention of the Council. In light of Approved For Release 2001/1 R1 1DP84-00499R000200130001-0 JL~ -L Approved For Release 2001/4RCRDP84-00499R000200130001-0 the importance which our two governments attach to the Far East, I will therefore focus my attention upon the USSR, [Communist] China, and the countries of Asia. 3. The continuing growth of the military and economic strength of the Sino-Soviet Bloc is a danger which preoccupies all of the Free World. Neither the new leaders of the countries of the Bloc nor the changes in tactics which they have shown in recent years permits us to conclude that the communists have abandoned their goal of imposing their system upon the Free World by force or by subversion. We believe that in their thinking the notion of irreconcilable conflict remains in force. If they have substituted the principle of "peaceful coexistence" for the Korean type of military adventurism, it is only because they are led in this direction by the continuously growing power of nuclear arms. 4. The growth of Soviet military strength is considerable as witness their production of nuclear weapons, heavy bomber [aircraft], and guided missiles. We believe, however, that the Soviet leaders have given proof of a sober respect for superior power of Approved For Release 2001/12 VC. jl DP84-00499R000200130001-0 A-j -L Approved For Release 2001 /1g kt f DP84-00499R000200130001-0 IIA-A the US - a power which rests upon our capability to respond [to an act of armed agression] with a visitation of unacceptable damage. Thus we believe it unlikely that the USSR and [Communist] China will undertake actions which they estimate likely to lead to general war. The USSR might believe, to be sure, that the growth of its own nuclear power will suffice to inhibit the US and its allies [from courses of action] which incur the risks of a new war. It might follow therefrom that the Sino-Soviet Bloc will wish to exploit local situations in which their greater flexibility of action gives them an advantage. Therefore the Bloc might go so far as to use armed strength in peripheral areas where they believe the interests of the US are secondary. It is [would be] the same error, hick led Stalin to order the invasion of Korea in 1950. 5. In fine, we believe that the Sino-Soviet Bloc will put its major effort into the promotion of its interests by non-military means. In Europe it will [probably] adopt some sort of defensive stance for its shaky moral position within the satellites; the political and military strength of Approved For Release 2001/1Z &C. !! DP84-00499R000200130001-0 Approved For Release 2001/152t:DP84-00499R000200130001-0 NATO will limit its field of action. The Bloc will [however] continue to take initiatives in Asia, Africa, and the Middle East where it can exploit desires of the peoples to express their national identity, to better their economic condition, to enjoy political liberty, and to push on with social reform. In pursuit of this goal the Bloc will negotiate with non- and [even] anti-communist govern- ments as readily as with those more favorably dis- posed. 6. The USSR finds one of its principal sources of strength in the loyalty which [Communist] China professes for it. The Chinese Communists have adopted with modifications certain aspects of Soviet domestic policy and have shaped them to the conditions of their own country. However, we believe that their aim is to build a society on the Soviet model and that taken together, the foreign policy objectives of the two states are almost identical. [Although we perceive] the possibility of certain conflicts between the two, we believe that their alliance is a solid one: built [as it is] upon a common ideology, with a common concern to eliminate Approved For Release 2001/1:~RIDP84-00499R000200130001-0 Ev" Approved For Release 2001/'VtkGffDP84-00499R000200130001-0 western influence in Asia, and with the necessity for cooperation which is born of a strong inter- dependence. 7. Whatever the power and growing prestige of the USSR and Communist China we believe that they will confront serious domestic problems. The Soviet Union succeeded in putting down the revolt of the Hungarian working class thanks only to the inter- vention of the Red Army, the Polish government has successfully resisted the authority of Moscow and continues to pose serious problems for the USSR. We believe that the absence of any overall popular support in Eastern Europe and above all in the DDR to the [local] communist regimes will continue as a latent danger to the system of Soviet Satellites. 8. As to the USSR itself, although we are impressed by the speed in the growth of its power and scientific achievement, we see it more and more handicapped by the incompatibilities between a com- plex industrial society and the inflexible political institutions of a communist regime. It is no longer possible for the Soviet leaders to make the heavy demands of the past upon the labor force without yielding a larger share of the fruits. Already [an Approved For Release 2001/1:/ tt.iIDP84-00499R000200130001-0 Approved For Release 2001 pbt RDP84-00499R000200130001-0 awareness of this] problem has slowed the pace of economic development. The Party has already felt the weight of the opposition to its monopoly of power. As long as the Free World is able to maintain an equilibrium of forces and can impede the communists in their continuous encroachments upon the rights of others, we believe that built-in problems will lead to an evolution of the Soviet political system. We believe that Khrushchev has strengthened his own position of control and that of the Party. But we believe that the [internal] power struggle will continue and that in years to come we perceive the possibility of unexpected changes in the leadership. 9. As to Communist China, the establishment of effective political control over its metropolitan territory, the creation of a modern military force (thanks [in part] to Soviet materiel), and its economic development constitute [the principal] dramatic successes which it has achieved since 1949. 10. Today [Communist] China's steel capacity at 5 million tons represents an increase of 300 percent over 1952. Eighty percent of Communist China's Approved For Release 2001/16kcDP84-00499R000200130001-0 Approved For Release 200151/EFtRDP84-00499R000200130001-0 foreign trade is with the countries of the Bloc and makes possible the import of things essential for the development of its heavy industry. 11. While consolidating their control of the country and in endeavoring to make over the society, the Chinese leaders have lost the popular support which they had won in 1950. We believe, however, that police controls are sufficient to enforce the regime's will and notably to neutralize [sociall resiveness caused by the requisition of grain necessary to sustain investments in heavy industry. But the matter of impositions upon the peasantry for the sake of economic expansion is always something which could cause serious schisms within the government of Mao-Tse-tung. This ends my presentation concerning the power and problems of the communist bloc. I need not stress the importance of these phenomena as they affect the formulation of foreign policy within the Free World. 12. In the long run and of equally great importance are the questions of political independence, economic development, and social reform in the vast Approved For Release 2001/~CDP84-00499R000200130001-0 Approved For Release 2001 /~ 44RC RDP84-00499R000200130001-0 regions of Asia, the Middle East, and Africa. The Bandung Conference has clearly demonstrated the attitudes and aspirations of the peoples of this part of the world. The communist Bloc seems to believe that with its economic and military aid and its promises of anti-colonialist support it can easily penetrate these regions. Communist China, on its part, plans to effect this penetration proclaiming itself the Big Brother in Asia or a non-White State which must [also] face up to the common problem. On a par with this disruption we find the subversion which is carried out in large part by a whole series of [communist] front organizations. 13. We believe that the communists will achieve new successes in their exploitation of the hopes and fears of the [countries of the ] region; on the other hand we perceive numerous native forces which are resisting the communist take-over. In Vietnam, Burma, and Malaysia, we see a substantial effort to develop those strengths which will protect against the armed threat of the communists. We observe a sustained endeavor in their work to counter communist Approved For Release 2001/W WDP84-00499R000200130001-0 Approved For Release 2001gEL4RINTRDP84-00499R000200130001-0 communist propaganda by bettering the standard of life in their countries. The Republic of the Philippines has scored notable progress in this and other respects. There, a democratic political arrange- ment works, and better still, the Philippines renders a notable service to its neighbors in sharing with them its experience and its achievements. 14. We estimate that Japan has gone past its pre-war rate of production; more, it has arrived at a high degree of political stability. In these cir- cumstances the Japanese communist party has been able to develop only very modest secret paramilitary forces. It has also had its difficulties in building up a skillful leadership for its overt operations. Japan offers to the countries of Asia growing possibilities for reciprocally advantageous trade. We do not believe that Japan can approach its pre-war volume of trade with [Communist] China. We believe therefore that Japan will make great efforts to expand its trade to [the countries of] South and Southeast Asia. 15. We believe that India can lead the way for the states of Asia. However, it will realize its potential only if its ambitious.plans for economic Approved For Release 2001/~C,~2DP84-00499R000200130001-0 Approved For Release 2001/WDP84-00499R000200130001-0 development succeed. it faces many difficulties. We have noted a loss of vitality within Nehru's Congress Party and some ground gaining by the [Indian] communists who have demonstrated their strength in their elect- oral victory last year in the state of Kerala. We believe that the next few years will be critical ones for India and that substantial foreign aid will be necessary for the continued progress of its economic program. The matter of foreign aid is not only of greatest importance to the future of India, but to that of the other states of Asia as well. 16. Finally, the crisis in Indonesia presents one of the most dangerous of the Asian problems. [We perceive] in this situation a number of possibilities, all of them grave: for example a failure or dis- appearance of the central power; the dispersal of [central] control to the local governments of the islands, the growth of the influence of the Communist Bloc which we believe might be taken on by local communist parties, dissident groups, or even by the armed forces. One of the reasons behind the present confusion is the failure of the Dutch to leave be- hind enough capable administrators, technicians, and Approved For Release 2001/1 2r(; tRDP84-00499R000200130001-0 Approved For Release 2001/1S2ftfDP84-00499R000200130001-0 sophisticated political leaders. A hypersensitivity on the part of the Indonesians to western influence has, [of course,] impeded an efficient utilization of the foreign assistance available. Demagogic appeals to anti-Dutch sentiment has begun to replace constructive efforts towards economic progress. The absence of a unifying spirit between the nationalist and Moslem parties has per- mitted the communists to capitalize upon the situation and in criticizing administrative corruption and the lack of progress to put forward their own plans of action. In Java the power of the communists has grown greatly, but whether or not they hope to try to seize power during the present year will probably depend on advice from Moscow and Peking. Leaders in the Sino-Soviet Bloc probably fear that a premature attempt in Java might precipitate counter blows in Sumatra and in such a fashion discredit their efforts to gain adherents elsewhere in Asia and the Middle East. Approved For Release 2001/1? -/RIDP84-00499R000200130001-0 Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 870 15 Jan 58 Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Approved For Release 2001/12/04: CIA-RDP84-00499R000200130001-0 Approved For Release 2001/12/04: CIA-RDP84 CASE FILE CHARGE-OUT INSTRUCTIONS _ 2bV 3ta y dq,~pl of charged out folder. I orizon in returned file folder. CARD FORM NO. i 19 REPLACES,c p -.o,~et$for Release 2001/12/04: CIA-RDP84-00499R000200130001-0 I AUG 54 WHICH Mir a usEO. (7) CASE FILE (DESCRIPTION Approved For Release 2001/12/04: CIA-RDP84 00499 R0002001309O7RUicTIONS _ dmw Place card upright in place of charged out folder. place card horizontally in returned file folder. CASE FILE ?R~ D ~l,~T Approved For Release 2001/12/0CC H I 4-0CAR8000200130001-0 rVHM NO. 119 REPLACES FORM.36.152 I AUG 54 WHICH MAY BE USED. ;,~?y' (7)