Your No. 88.  Portuguese Timor.
Recommendation for appointment of Commonwealth Official Representative as described in my No. 201  is at present before Cabinet.  As Foreign Office were aware of proposal from my No.
197  am surprised that they are now raising objections at this stage after pressing for decision.
It is of course possible that the Portuguese Government will not be agreeable to accepting official with proposed status but this can only be ascertained when request is made assuming Cabinet accepts recommendation. In our mind there seems little substance in other points raised in your 88. On the contrary information has just been received from Hudson Fysh  to effect that Governor at Dilli  does not desire to see Japanese Consulate opened, and says no need for Consul. If Australian Consulate were set up Japanese pressure for this would be impossible to resist. The same difficulty would not arise with appointment of official of elastic status as proposed. All evidence suggests that Governor is pro- British and we do not anticipate any reluctance to co-operate with official representative.
Incidentally reports that large numbers of Japanese are at Timor, that wireless station has been erected, regular air service has been established and that consul will shortly be located there are all false. There are only 13 Japanese there including women and children. We are, however, fully alive to the desirability of forestalling attempts at penetration and exploitation.