BATAVIA, [1 October 1947] 
REPORT ON THE MILITARY SITUATION IN JAVA AUGUST-SEPTEMBER 1947
1. Object The object of this report is to cover:-
(a) The observance of the 'CEASE HOSTILITIES' order and (b) The conditions prevailing in areas under military occupation or from which armed forces now in occupation may be withdrawn by agreement between the parties.
This object in general terms covers Security Council Resolution dated 25th August 1947.
2. Execution of Object The Australian Military Observing Officers were employed as follows: Group A consisting of Brigadier L. G. H. DYKE, C.B.E., D.S.O., and Squadron Leader L. SPENCE, D.F.C., R.A.A.F., were located at JOKJAKARTA between 14th and 27th September inclusive and observed the situation in the following Republican Areas:-
GOMBONG TENGARAN BOEGEL SARANGAN SOLO MADIUN At SARANGAN, all Divisional and Regimental Commanders of Republican Forces operating on East Java fronts were interrogated.
Group B consisting of Commander H. S. CHESTERMAN, R.A.N., and Major D. L. CAMPBELL, A.M.F., were located at SOURABAYA between 15th and 23rd September inclusive and observed the situation in the following Dutch Controlled Areas:-
GRISSEE MODJOKERTO MALANG KLAKAH MADOERA Group B also Spent 24 hours at Jokjakarta en route to Sourabaya and met the President, Premier and Military Staff Officers of the Republic.
Both the above Groups spent the majority of the time available in extensive travelling and in interviewing a large number of officials of varying types. Also in view of the fact that a large number of detailed documents and maps were studied and exhaustive inquiries were pursued, the Australian Military Observers feel that they are as reliably informed as the time available permitted. Their period of observation has been longer than that of the Representatives of any other country.
After full discussion between Groups A and B this combined report is submitted in the following form:-
Part I The observance of the 'Cease Hostilities Order'.
Part II Conditions prevailing in Areas visited.
Part III Answers to Questionnaire.
Appendices 'A' Security Council Resolutions of 1 and 25 August 1947.
'B' Republican and Dutch orders to 'Cease Hostilities'. 
3. Interpretations of relevant Security Council Resolutions It is desired to emphasise that the Security Council Resolution dated 1st August 1947 called upon the parties to 'Cease Hostilities forthwith' vide text of above Resolution contained in Appendix (A). However in accordance with the Security Council Resolution dated 25th August 1947 vide Appendix (A), the Career Consular Representatives are required to furnish a report to cover the observance of the 'Cease Fire Orders'.
We are of the opinion that there is a difference in meaning between the above terms which, in the military sense, are considered to be as follows:-
(a) 'CEASE FIRE' means that troops stop firing guns, rifles, mortars etc.
(b) 'CEASE HOSTILITIES' means to stop all acts of warfare including:-
(i) use of all military weapons;
(ii) naval blockade;
(iii) air reconnaissance;
(iv) fifth column activities;
(v) all forms of hostile propaganda;
(vi) movement of troops into territory occupied by the other side.
The term 'CEASE HOSTILITIES' is thus capable of a much broader interpretation than the term 'CEASE FIRE'. Australian Military Observers have concerned themselves with the observance of a 'CEASE HOSTILITIES ORDER' and not with that of a 'CEASE FIRE ORDER'.
In view of the fact that detailed and comprehensive amplification of the term 'CEASE HOSTILITIES' was not included in the Security Council Resolution, dated 1st August 1947, each side was at liberty to place its own interpretation upon the term. In fact each side did place a different interpretation upon the term 'CEASE HOSTILITIES' as demonstrated by the initial orders to cease hostilities promulgated by each side to the Commanders in the Field vide Appendix B. This initial divergence in orders to Republican and Dutch Forces (which has remained unaltered), viz.
the Republican Government ordering a 'Stand Fast' and the Dutch Command ordering operations to continue without interruptions in occupied territory, is considered to be the major factor contributing to the continuance of hostilities.
4. Factors precluding observance of 'CEASE HOSTILITIES ORDER' (a) Divergence in interpretation of 'CEASE HOSTILITIES ORDER' as detailed in foregoing paragraph.
(b) Police Action, which is the term used by the Dutch to embrace the Military Operations between 21st July and the 'CEASE HOSTILITIES ORDER' of 4th/5th August, is considered by the Republic as tantamount to a Declaration of War. The Republic does not recognize Dutch control of the territories thus gained.
(c) The Dutch armed patrols which have been operating within the Dutch controlled area, are considered necessary and justified by the Dutch to counter hostile acts by Republican Forces. On the other hand, the Republic maintains that these armed patrols are contrary to the 'CEASE HOSTILITIES ORDER'.
(d) The declaration by the Dutch of the 'Van Mook Line'  is regarded by the Republic as a hostile act. The authority or right of the Dutch to establish this line is not only denied but fiercely resisted by Republicans. It is the cause of much bitterness, and is contemptuously referred to as the 'Van Mook Dream Line'. There is considered to be no chance of settling the dispute so long as the Dutch attempt to maintain this line.
(e) The contention of the Republican Government that orders issued from Jokjakarta should be obeyed by all Indonesians whether in Republican or Dutch controlled territory, which is totally unacceptable to the Dutch.
(f) Continuance of aggressive propaganda including orders to all Indonesians vide (e) above. The Dutch consider such action to be a form of psychological warfare.
5. Conclusion Under the circumstances outlined above, breaches of the 'CEASE HOSTILITIES ORDER' were well nigh inevitable particularly under the prevailing temper of the parties concerned.
It is considered that there is abundant evidence of the fact that both sides have committed, and are continuing to commit, daily breaches of the 'CEASE HOSTILITIES ORDER'. It has been impossible for the observers to determine which party initiated breaches of the 'CEASE HOSTILITIES ORDER'.
Conditions prevailing in areas under Military Occupation The observations regarding conditions prevailing within the Republican and Dutch controlled areas are restricted to those within the areas visited by the observers and are as follows:-
(a) Republican Areas.
This is not intended to be a comprehensive survey of the economic situation but simply a brief statement of conditions, other than military, prevailing in the areas visited.
Morale This factor is probably one of the most important of all. The language barrier has hindered us in obtaining the views of many classes of the population. There is no sign of consternation or panic amongst the people living in close proximity to the various fronts. Everyone seems to be going about his or her business as usual.
Most of the villages have organized some form of local defence force. Training in some form or other is being carried out. The only equipment with which villagers can oppose them is the bamboo with a sharpened point.
We are of the opinion that morale is high and the determination to resist the Dutch is strong.
The view was freely expressed that if the Dutch did overwhelm the population with force, then the people would refuse to co-operate with them.
Administration After making careful inquiries in a number of areas, it appeared to the Observers that the administration of those areas was being carried out effectively.
Officials are carrying on in spite of many difficulties imposed upon them by the abnormal conditions now prevailing in Java.
A visit was paid to the District of Godean.
The system of administration was studied and the Observers had the opportunity of meeting many of the officials concerned with it.
It is quite obvious that there is no chance of the administrative system breaking down.
Agriculture Generally speaking, crops are good and there is an abundance of food.
Some damage has been done to tobacco crops by the early rains but the damage is not widespread or serious.
Industry Many 'home industries' have been established. The increase in the number of these has been considerable due to the movement of people from areas occupied by the Dutch or from areas in close proximity to them.
This is particularly noticeable in Jokjakarta to which city many additional people have recently moved.
Some of these industries were inspected by the Observers.
It was noticed that as many as twelve employees were working in small 'home' factories.
Wages for workers in the silver industry were Rs 3 per day while in the copper industry Rs 5 was the usual thing.
From inquiries made, it was ascertained that 8 hours per day for 6 days a week was customary.
We were impressed with the concentrated attention of the workers who continued to work in spite of the fact that ten or more visitors crowded around them to watch each process of manufacture.
Only hand labour was employed in the factories visited.
Transport (a) Road transport.
Very few motor vehicles are on the road.
Some cars are in use but the transport by road of goods has practically ceased.
The Republic has been unable to obtain tyres for a number of years and consequently tyre troubles are a frequent occurrence.
(b) Rail transport.
The capacity of the railways is not known but after travelling extensively over the railway system the Observers are convinced of their efficiency.
The big repair shop at MADIUN was inspected where some 3,000 men are employed. Very little rolling stock was awaiting repair and the whole atmosphere of the shop was one of efficiency.
Education In the areas under the control of the Republic schools were open.
In areas between the opposing forces, the schools were closed.
A visit was paid to a public school. There is a shortage of teachers in some schools but generally speaking, education is proceeding normally.
Health The general standard of health at present is good.
However, much remains to be done to improve the general standard of sanitation and hygiene.
Malaria is prevalent at this time of the year.
Paludrin is not available for the treatment of this disease.
There is a serious shortage of medical supplies of all kinds.
Many hospitals were visited and it appeared to us that they were being conducted in an efficient manner.
Finance The Observers witnessed the Village Bank functioning. There was much business being transacted. Advances are made to the people to assist them in financing their crops, businesses etc.
It was noticed that the rate of interest charged was about 30%.
This appears to be high but we were informed that it was very low compared with that charged by the Chinese.
Justice A visit was not paid to any court of law but it is understood that courts are functioning as usual.
There is very little crime at the moment. Communications Roads are in a poor state of repair. No bitumen is available to bind repairs if these were attempted.
Telephone communications are working satisfactorily in the Republic but not beyond the areas at present occupied by the Dutch.
The telegraph is working in the areas under control of the Republic.
There is no outside communication with the world except by radio broadcast.
Evacuees Considerable numbers of people have moved out of areas which can be described as 'no man's land', i.e. those areas between the two forces. The population of some of the bigger cities like Jokjakarta and Solo has increased considerably in consequence.
No serious disturbance of the economy of the country has resulted from this movement of the population.
(b) Dutch Areas.
Taking into consideration the recent and prevailing circumstances, conditions appeared to be reasonably stable with the Indonesian Civil Administration co-operating with the Military Commanders to alleviate distress, to achieve economic stability and to effect security of life and property. The Dutch Military Forces appear to treat the Indonesian local population with understanding, justice and tolerance. The towns and villages appear to be regaining prosperity.
In certain areas and mainly by night, infiltration by Republican Forces occurs and acts of sabotage take place. Also towns and villages are subject to sporadic attacks from Republican Forces with headquarters in the mountain areas. The damage inflicted, largely to roads, bridges and communications is repaired as rapidly as practicable. Dutch Military Patrols operate in areas liable to the above attacks in order to afford protection to the civil population and to counter enemy operations.
L. G. H. DYKE Brigadier
H. S. CHESTERMAN Commander
D. L. CAMPBELL Major
L. T. SPENCE Squadron Leader