Security 440.

Indonesia.

1. We have been in close touch with Sjahrir, Hadji Agoes Salim and
their advisers over the weekend and they have been very receptive
to our suggestions. However the following factors have made
planning difficult.

(A) Sjahrir has not yet received advice from his Government that
they have accepted joint American-Australian arbitration (your
telegram 452 [1]).

(B) United States representatives here have been stressing to
Sjahrir that United States have offered only good offices and that
United States have not agreed to joint mediation and arbitration
(earlier reports that United States had offered mediation and that
Dutch had accepted were apparently incorrect).

(C) United States representative also placed stress on visit by
Foote to Djogjakarta. (Your telegrams 462 [2] and 463 [3])
suggesting that further action be delayed until results of visit
are known.

(D) Dutch move to revive earlier proposal for voluntary invitation
to group of neutral States to send observers [4] (we understand
Washington Embassy have reported on this today [5]).

2. Sjahrir has as a result been somewhat hesitant to take action
without new instructions although he has wide authority.

3. We emphasized again this evening points in your 462 and Sjahrir
is now preparing statement tonight which will reiterate need for
arbitration and acceptance of Australian proposal. He would make
this statement at first opportunity if Council agrees to invite
him to participate.

4. We are most concerned however at the attitude of United States
who have throughout expressed doubts concerning jurisdiction of
Council and will probably join United Kingdom, France and Belgium
in opposing further action, especially approval by the Council of
joint arbitration with which they do not agree. In addition we
have no indication of what Soviet-Polish reaction may be.

5. We have drafted resolution (text in our immediately following
telegram [6]), with these considerations in mind but risk of
rebuff (A) by the United States (B) by the Council is still
considerable and we propose to withhold resolution if we judge it
expedient.