Your telegram 16. [1]

1. The former Republican territories are now administered by local
Dutch Military Commands assisted by civilian advisors who are
being increased in number. This is regarded as a temporary
arrangement. The Dutch Administration, however, appears confined
to the main towns, while the Republicans are still in control in
other areas. If correct, this means the Dutch military withdrawal
need not result in disorders but may indeed help restore order,
particularly if economic assistance is rendered.

2. No definite information is available as to the relations
between TNI guerilla bands and the Communists. At the commencement
of the action the Communists held under guard at Djokjakarta
either were released or escaped, though twenty of their leaders
are reported to have been shot by Republican forces. The
Republicans in Batavia consider that nine of the prominent
Communists would be accepted by TNI. However 'Sin Po', a Chinese
Batavia daily, reports that Communists are fighting with the
guerillas.

3. Republican sources continue to claim increased guerilla
activities and extensive scorched-earth. The report of Military
Observers, who have been restricted by safety considerations, may
be summarised as follows:-

(a) Extensive scorched earth policy.

(i) North Sumatra. Numerous bridges were blown and it is
understood that several large estates were flooded by breaking of
irrigation channels. The Manager of the largest rubber estate
(Wingfield) stated that the factory was partially destroyed by
fire.

(ii) Central Sumatra. Seventy percent of the town of Pakan Baroe
was destroyed by fire.

(iii) South Sumatra. Of 200 oil wells in Djambi area, 37 were
fired. 28 fires had been extinguished by January 13th. The entire
Pasar area of Djambi was destroyed, damage being estimated at
between 12 and 14 million Singapore dollars.

(iv) West Java. Sabotage is reported to be only on a minor scale.

(v) Central Java. Insufficient information so far to hand.

(vi) East Java (North). Already reported K249. [2]

(vii) East Java (South). Extensive destruction of bridges and
European-type buildings. Water and electricity supply systems were
put out of action but have now been restored.

(viii) General. The scorched-earth policy has been applied in all
areas but owing to the limited authentic information available it
is not yet possible to assess its extent of effects.

(b) Guerilla activities. Guerilla units are active in all areas so
that there are very few roads on which Dutch vehicles can safely
travel except in armed convoys. A Military Observer team in
Central Java reports that a convoy accompanied by Military
Observers was ambushed on January 17th. There have been some
reports that bridges repaired by day by the Dutch are destroyed by
the guerillas each night.