As you say in your letter of the 10th May 1949, the important issue is what alternative there is to the United Kingdom Government's current policy of working for a 'Malayan', i.e.
Malay-Chinese-Indian, solution in this country.
2. I believe myself that it can only be a Malay one, and that this in turn really means an Indonesian one, for Malaya as a sovereign state could never resist Chinese pressure on its own. This is also the established belief of the Malay leaders themselves.
3. The strength of the Malay population in the Federation is at present 2,403,000, an increase of 27.1% on the 1931 figure of 1,891,000, while the Chinese population is 1,883,000-an increase of 46.2% on the 1931 figure of 1,288,000. In Singapore Island 729,000 of the total 940,000 are Chinese. There is apparently no way of telling what proportion of the Chinese increase is due to natural increase or to immigration but as immigration was almost unrestricted until 1939, a large proportion of it must be from this source. On the other hand, infant mortality among Malays is very much higher than among Chinese.
4. If the two parties were left to themselves now the Malays would probably seize power with the help of the considerable armed forces at their disposal, and turn the Chinese into a minority, without political rights, but dominating the economic life of the country as is the case in Siam. But without support from Indonesia it is doubtful whether the Malays could retain such a political hegemony once the Chinese here were able to count on support from their homeland.
5. As you know, the Malays have a considerable footing in the administration, both in the State Governments and in the territorial districts, as a result of preferential treatment accorded them by the British authorities. They also have free and compulsory primary education in the Malay language. Their relative backwardness to the Chinese seems to derive largely from their unwillingness hitherto to leave the land for employment in industry, or to engage in commerce, and their social backwardness is due to the influence of religion and tradition, and in the case of most of them, their indebtedness to Chinese money-lenders.
6. To my mind, the British authorities are faced by a choice between two evils. They cannot now afford to hand over power here in the future to the Chinese, and they must therefore take such steps as they can to prepare the Malays to assume it. Practical action in this case is:-
(a) to continue the preferential treatment in the administration given to the Malays;
(b) to use their new-found nationalism as a spur for acquiring modem education, and (c) to tackle the rural indebtedness which keeps the Malays, apart from the Raja class, as non-political peasants tied to the land.
With the object of remedying the last of these evils, Dato Onn  asked in 1948 for a grant of 10,000.000 from the United Kingdom Government for Malay welfare and agricultural improvement. But the High Commissioner of the Federation refused to endorse this, unless the money were put towards the cost of the present military campaign here. So nothing has been done.
7. It seems to me that the course of wise statesmanship now is to improve the material and educational position of the Malays, as a matter of deliberate choice working towards the day when a transfer of power here can take place in conjunction with the entry of Malaya into a sovereign Indonesian Federation. The authorities in London have to decide soon whether this is a less disagreeable alternative than allowing this country, at a time when the United Kingdom may be engaged in a European war again, coming under direct Chinese communist control, and bringing about their own total exclusion from economic association with it.