Your telegram 25th May No. 147. [1]

INDONESIA

Our reports from Batavia are not sufficiently detailed to enable
us to comment on all the points raised in your telegram, but the
following are our views on the essential nature of the problem.

2. We share your concern at the situation which would arise if a
deadlock were reached.

3. We agree with much in your general analysis of the situation,
but, although the Dutch have behaved tactlessly and the underlying
intentions may still be in doubt, we think also that the faults
are not all on the Dutch side. The Republicans, as well as the
Dutch, can be charged with a good deal of special pleading as
regards the interpretation of the Renville Agreement. [Though
their action] [2] can be explained a's being due to suspicion of
Dutch motives, the result of some of their tactics has been to
increase suspicion on the Dutch side that they are not prepared to
accept Dutch sovereignty in the interim period, as laid down in
the Renville Agreement, or a position in the future United States
of Indonesia as only one (even if the most influential) of a
complex of states.

4. H.M. Consul-General in Batavia also reports his view that, if
the Republicans could settle their internal political [and
personal] differences the prospect of an agreement with the Dutch
would be much nearer. There has hitherto been a definite tendency,
in our view, for the Republican Delegation to give temporizing or
evasive replies on points of particular interest to the Dutch for
fear that they may not be able to carry the whole Republican
Government with them. All of this must make the conduct of
business on the Dutch side very difficult.

5. We cannot see much prospect, in these circumstances, of
inducing an understanding by pressure from Governments not
directly concerned with negotiations. We are in a somewhat
equivocal position, not only is the matter in the hands of the
Committee of Good Offices, but also we cannot justly claim that we
know all the facts, since we are not fully in the confidence
either of the Dutch or the Indonesians or the Committee on the
progress of the negotiations.

6. There is the special point also that the Dutch elections take
place in July and we doubt whether, in the pre-election
atmosphere, any radical change in approach is obtainable from the
side of the Netherlands Government.

7. H.M. Consul-General in Batavia is returning to London shortly
for consultation and we intend to review the position fully with
him. His latest reports do not suggest that the Dutch are
contemplating the forcing of an early crisis but rather that,
despite their pessimism, they are still casting about for a means
of settlement.

8. Although, as indicated above, we see little prospect of success
at present in an approach on the lines you suggest, we should like
to emphasize that we have lost no convenient occasion to keep our
general attitude before the Dutch. This was emphasised to them
recently in connection with the arms embargo which we have refused
to raise, and again when H.M's Charge D'Affaires at The Hague had
occasion to discuss with the Dutch a newspaper report that
conversations had been interrupted in Batavia pending fresh
instructions from The Hague. On being informed that the
Netherlands Government were still considering these instructions,
the Charge D'Affaires, at our request, expressed the strong hope
that the Dutch would not discontinue negotiations.

9. In this same conversation the Netherlands Ministry of Foreign
Affairs revealed that the Van Mook-Hatta discussions [3] had been
concluded in a friendly atmosphere and it was evident that the
Netherlands Government entertained considerable hopes of their
outcome. We have no information yet on their purport, but think
that prima facie their conclusion is an encouraging sign.