Your 390. [1]

We were informed from London of Indian approaches to the United
Kingdom Government. [2] 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.