168 Department of External Affairs to Mackay
Cablegram 280 CANBERRA, 26 July 1947, 11.50 a.m.
MOST IMMEDIATE TOP SECRET
Your 390. 
We were informed from London of Indian approaches to the United Kingdom Government.  We have been in constant touch with the United Kingdom Government who are endeavouring to arrange with the United States Government an approach of mediation or arbitration and, failing a favourable reaction, we will discuss together the next step.
2. For your personal information, we have informed the United Kingdom Government that we are disposed to draw the attention of the Security Council to the situation, but, at their request, have refrained at least until the United States response is known.
3. You will appreciate that the position we find ourselves in, that is refraining from action and from a statement of policy at the request of the United Kingdom who wish to make this first attempt at mediation, places us in great difficulties, not only in Australia, where action is being demanded, but in relation to all the peoples of South-East Asia. We would have preferred to draw attention of the Security Council to the matter, asking for a semi-judicial enquiry into the facts and in that way we would have suitably responded to Indonesian requests and at the same time give no cause for charges of bias.
4. You are in a position to communicate both with Indian leaders and Sjahrir, who is with Nehru, and, while it would be disastrous for current negotiations if they were to make known our endeavours, they should not be under a false impression because of apparent inaction by Australia. This is an important matter and you must use your discretion based on your relations with the two persons as to how much you tell them and, in any case, we would appreciate a full report of any conversations you might have with these leaders or with others.
5. Our position will be reviewed on Monday next, by which time the United States reply should have been received, but events in the meantime might be such as to place us in the awkward position outlined, and then it would be too late to convince Sjahrir of our intentions.