144 Cranborne to Commonwealth Government
Cablegram D1305 LONDON, 26 July 1945, 9.05 p.m.
My immediately preceding telegram.  Following is a general summary of our views on the policy towards Siam.
1. (A) Siam by failing to resist Japan accelerated the overwhelming of Malaya and Burma;
(B) Her alliance with Japan was a flagrant violation of the Anglo- Siamese non-aggression treaty of 1940. 
2. Consequently our normal course would be to call for unconditional surrender and it would be justifiable, prima facie, to require full restitution and reparation together with guarantees of future good behaviour.
3. On the other hand the Pibul Government which signed the alliance with Japan has been overthrown and movement against Japan is under way , the leaders of which have in accordance with our advice refrained hitherto from action which might be premature. A situation may well develop in which we shall be dealing with a Government which will have repudiated Japanese connection with the intention of collaborating with us in the expulsion of Japanese.
The Government will undoubtedly have the entire sympathy and support of the United States Government who have said (my telegram D1223 paragraph 5 ) that they will recognise and resume diplomatic relations with the Siamese Government when conditions which led to non-recognition are removed. The Chinese Government may also be expected to regard such a Siamese Government with benevolence.
4. None of this need, or should, prevent us from securing just redress for injuries done to British interests but- (A) Neither military nor non-military means of pressure will be easy to apply without the co-operation of the United States Government;
(B) The willing co-operation of a genuinely friendly Siamese Government will be necessary to us both if we are to acquire the maximum quantities of Siamese rice (which will be necessary for the relief of other Countries liberated from Japan), and also in conclusion of eventual security arrangements in South East Asia.
5. The agreement to be concluded with the Siamese Liberation Government will differ from an armistice based on unconditional surrender in that once it is concluded it will not be open to us to impose further conditions. The agreement must therefore be sufficiently comprehensive both to liquidate the state of war and also provide the foundation for future co-operation with Siam.
6. A particularly important subject is rice (see section D paragraph 12 of draft conditions ). To meet current shortages it is vital to secure the Siamese rice surplus which cannot, however, be bought without greatly increasing [price], consequently we believe the course best designed to secure a maximum possible amount of rice is- (A) To invoke the analogy of Mutual Aid and demand substantial contribution of rice from the Siamese Government as a free gift toward the Allied war effort as a counterpart to arms and munitions which might be made available for Siamese use against Japan and (B) To obtain for repayment maximum supplies available in addition. Allocation of financial benefit of free rice would be subject to special negotiation between receiving Nations but  distribution would be effected in accordance with ordinary Combined Food Board procedure.
7. Form and time of agreement. It would clearly be convenient if any agreement could be signed by Admiral Mountbatten as Supreme Allied Commander, South East Asia, on behalf of all Governments concerned. But apart from any other consideration it would be difficult for him to act on behalf of Governments who are at war with Siam and of United States Government who are not. We feel therefore that any agreement which he signs will have to be restricted to matters germane to his responsibility as an Allied Commander. But any such military agreement will have to be preceded by a political agreement which may have to be concluded with great urgency in order to facilitate military operations. For this reason we consider that political agreement (which is so worded, however, as to cover allied interests where restitution and conservation are concerned) should be purely British in the first instance (but without excluding the possibility of parallel United States and perhaps French agreements). Actual terms contained in my immediately following telegram  represent the minimum which we should be prepared to accept but we propose to leave over to actual negotiations settlement of exact form of agreement. Broadly speaking what we have in mind is that it should cover the whole field in general terms with the provision that certain questions e.g. military action to be taken and military aid to be furnished by Siam and question of rice shall form the subject of Siam's existing assets in sterling and their foreign exchange. To exact rice required as reparation would be reasonable in enemy territory but would be an inappropriate procedure vis-a- vis a Siamese Liberation Government. Separate detailed agreements with Supreme Allied Commander or other appropriate authority and others (e.g. Trade Agreements) would be negotiated in detail at later stage.
8. As regards France we would propose to notify the French Provisional Government in advance of terms which we propose to present to Siam explaining the operational urgency which may necessitate immediate agreement and pointing out that the agreement will safeguard French interests (including in particular return of Indo-Chinese territory ceded under Japanese award of May 1941 ) and is without prejudice to any parallel agreement which French may decide to negotiate.
9. As regards China on security grounds we should not propose to inform Chinese Government of our proposals until Siamese Liberation Government is on point of declaring itself.