We have been advised by Netherlands Minister here that action will
be taken very shortly to declare 'Communist activity' illegal in
Indonesia. Minister gave assurance that this would not be directed
against Republic as such but against certain cells within
Republican regime.

2. He was advised informally that in our view the only way of
preventing the spread of Communist influence is by making
immediate settlement with present moderate Republican Government.

3. Please report fully on any action that is taken.