Thank you for your telegram of 31st October NO. 374.  We are very glad to have this full statement of your views. I can assure you that we have throughout had Australian interests well in mind.
2. We agree with you in hoping for political, social and economic reforms in the Netherlands East Indies. Both at this end and in Java we have continually urged on the Dutch the importance of making widely known to the Indonesians the Queen's declaration of 1942 which, as I said in Parliament the other day, is 'a very liberal statement promising a large degree of self government';
and we have pressed them to issue without delay a statement of the methods by which they intend to implement it. Events in Java since the liberation have come as a great shock to the Dutch and they have not been quick to adjust themselves but I think that they now recognise the necessity of taking into account feelings which have developed amongst the Indonesians since 1941. I am glad to say that we have at last brought about a meeting between Dr. Van Mook and the Indonesian leaders, including Dr. Soekarno. I hope this will promise to be the forerunner of others, and that they will be fruitful. But, even if the Dutch could be induced by further pressure from us to offer further concessions, the effect in present circumstances might only be to encourage extremists to open their mouths wider still and might not be in the ultimate best interests of the people of Java.
3. The Dutch feel that they have already come a long way to meet our point of view, and they now feel entitled to expect us to support them, as an ally whose sovereign position we have explicitly recognised and from whom (since through no fault of their own they were not in a position earlier to resume control of their territories) we are as it were trustee.
Our own position in Malaya and Borneo gives us a strong interest in ensuring a satisfactory settlement, but apart from this we have need for good relations with a neighbour in Europe, and it would be wrong for us to take advantage of the accident that the war has placed us in temporary military control in Java, to go any further in the direction of intervention in the domestic affairs of our ally than is strictly necessary. We should indeed be most reluctant to do anything to suggest that sovereignty is a factor which can be lightly set aside.
4. Tension is now acute and if we are to avoid a general flare-up the immediate need is to show a firm front and to support the Force Commander's warning to the Indonesians. Any suggestion that the problem should be referred to an international body might well lead extremists to argue that such a development was the direct result of their policy of violence. This is not to say that at a later stage it might not prove appropriate, subject to Dutch consent, to discuss the matter on an international plane.
5. Our attitude to the introduction of further Dutch forces into Java must be guided by the necessity of maintaining law and order, and a decision in this matter must depend very largely on the advice of our military authorities on that point. But we have to be careful to do nothing which could be construed as an attempt to impede the resumption of Dutch control.
6. We shall continue to keep you fully informed of developments.
7. I am asking Lord Halifax to give Dr. Evatt a copy of this message.