E.26.

The British Consul-General and self decided to despatch following
telegram to our respective Governments.

'In the course of its investigations the Consular Commission has
borne in mind the possibility of finding some way of securing the
reduction of casualties and relief of tension pending the
constitution of Three Power Committee. The following two
suggestions have been discussed with the Military Sub-
Commi[ssion]. [1]

(a) The establishment of a demarcation line between the Dutch and
Indonesian troops.

(b) The cessation of mopping up operations by the Dutch in
exchange for the cessation by the Republicans of attacks on the
Dutch patrols.

2. As regards (a) the Military Sub-Commission report that on the
assumption that rapid military defeat of Indonesian troops which
have been isolated by the Dutch actions between July 20th and the
present date is inevitable, it would be possible to fix a
demarcation line. They consider it should approximate the present
Dutch position and that a demilitarised zone not exceeding ten
kilometres in breadth should be created between the positions of
the two forces. The supervision would be essential to ensure that
the zone is and remains demilitarised. Repatriation of isolated
troops with arms, equipment and all other warlike stores should be
allowed.

3. In my opinion there are two strong objections to this course:-

(a) Actual demarcation line would necessarily be a matter of some
considerable time, and
(b) That it would entail sacrifices from the Republican side only.

It seems unlikely that the Republican Government would be willing
or able to agree without some substantial quid pro quo.

4. The Military Sub-Commission consider most unlikely the
suggestion of (b) would be accepted by the parties though if it
were they think good results would be obtained. I do not
altogether share their pessimism. Both sides have I think reached
the point where they would willingly make some gesture in order to
relieve the tension and to prepare the way for the Three Power
Committee. It would be certain to require strong pressure from an
outside source to induce them to make up their minds to take the
plunge, but once taken, it seems to me that this would offer the
quickest and most promising interim progress. It could only be
carried through if accompanied by positive propaganda on both
sides. At present the propaganda is inflammatory and efforts to
get it toned down have had only a very partial effect.

5. Both sides have indicated their willingness to consider
suggestions, but the Commission feels it cannot pursue the matter
in the present circumstances because
(a) Their terms of reference are only to report and not to make
recommendations, and
(b) Any negotiations might well be prolonged and would be almost
certain to involve Three Power Committee at the outset of its task
in developments which it might not find helpful.

6. The Commission accordingly decided that it could best help by
refraining from discussing the matter with either side at present
and that the above suggestions should preferably be put before
their individual Governments rather than referred to the Security
Council where the debate might equally embarrass the Three Power
Committee.'