While awaiting directions from the Security Council we have been
doing our best to keep the Council informed of developments here.

Military Situation
Unfortunately this is not always easy; the reports from the
military observers in the field are not all that might be desired.

Consequently only with considerable difficulty have we succeeded
in obtaining Belgian agreement to a report which will not have a
damaging effect on the situation here. As it is, the words of
compromise are neither smooth nor direct. Military observers are,
of course, gravely handicapped. Attached to Dutch headquarters
they are always in the company of Dutch military officers and few,
if any, have gained the confidence of the Republicans sufficiently
to obtain the information from that side which is necessary for a
full appraisal of the military situation. Attachment 1 is the
report [1] which we shall telegraph to the Security Council today.

It is as balanced as we can make it in the circumstances but I
still feel badly that it refers to fears of reprisals because of
guerilla activity whereas there is no information whatever about
the burning of villages by Netherlands troops, or of the civilian
casualties resulting from Dutch artillery fire.

Notwithstanding these difficulties it contrasts strikingly with
the Dutch summary of the military situation which was issued to
the press on 24th January (attachment 2 [2]).

Colonel Rhys, who has just returned from a tour of Sumatra,
reports that the Dutch are grimly hanging on in many areas with
too few troops to control the situation. Djambi is a notable
exception. Here a large number of TNI are claimed to have given up
their arms and offered co-operation with the Netherlands
authorities. Djambi itself is badly damaged by sabotage, but the
city, which has a very large Chinese population, is comparatively
peaceful.

The Republican viewpoint is set out in attachment 3 [3]-notes for
the American Representative on the Committee prepared by
Priggodigdo, who was Advisor to the Chairman of the Republican
Delegation. Pringgodigdo's information is usually reliable. In
next week's bag I hope to include a translation of a feature
article, 'A week with guerillas', published in one of the Chinese
papers. This article confirms the reports from Republican sources
that I have already sent to Canberra.

The Federalists
'Disappointing' sums up the Dutch view of the past week. Drees
returned with his party to The Hague without having accomplished
anything positive, as is fully reflected in his farewell statement
(Attachment 4). [4] Apart from the misleading impression that the
Mission discussed with the Committee how meetings could be
arranged with the republicans, the statement does indeed emphasise
that some of the Dutch are belatedly realising the importance of
the Republican leaders. The significance of Drees's statement has
not passed unnoticed by the local Dutch press. Batavia Daily Het
Dagblad deplored the fact that Sukarno's Republic had been put
into the foreground again, whereas 'according to a former
Government statement, it had ceased to exist after the police
action'. This paper could not accept fully Drees's standpoint that
the Indonesians have to decide on the future of their country
themselves. And it especially complained that whereas some
Federalists were flirting with the Republic it could not be
understood why other 'real' Federalists did not publicly tell
Indonesia and the international world that the Dutch were carrying
out a policy they wanted.

Newspaper comment gives the impression that the reactionary
elements feel that the military action has placed them firmly in
the saddle in Indonesia and disposed of the Republican issue. This
suggests the importance of continued and strong international
pressure to keep these elements in check.

Disappointment that Sukarno, Hatta and other Republicans did not
accept the Federalists' invitation to come to Batavia for
discussions with the B.F.O. reveals a surprisingly weak Dutch
appreciation of the Republic's position. Another vicious circle
may be created. Netherlands officials are hinting that if Sukarno
and Hatta would come to Batavia and negotiate with the Federalists
the question of releasing them would become so much easier. On the
other hand the Republicans are not unreasonably insisting that
their release must precede any consideration of negotiations.

Attachment 5 [5] is a translation of the Federalist invitation to
the Republican leaders and the latters' replies.

Visits of Batavia Republicans to Bangka and Prapat
This subject has been covered in my telegrams. Attachment 6 [6] is
a report on the trip from Soedjono, Secretary-General of the
Republican Delegation, which the Committee will forward to Lake
Success with the Netherlands comments today.

Assaat has now written to me authorising the release to the press
or any other use I may see fit to make of his report on the
conditions of the internees at Bangka (see attachment 5 of my
letter [7] of 18th January).

Sjahrir and Leimena will go to Bangka today for discussions with
Hatta. It is most unlikely, however, that the Netherlands will
provide facilities for a Republican Mission to Lake Success. Since
there is little prospect of a mission arriving in New York in time
to be of any value, failure of the Dutch to grant permission is
probably the most useful response to their request the Republicans
could obtain. I shall endeavour to have the Committee report on
this matter by telegram today.

Pasundan
In my telegram K.257 [8] I have reported the Pasundan situation.

With this letter is a copy of the Proclamation of the military
government (attachment 7 [9]). Democracy does not shine in
Indonesia. In Pasundan it has been brighter than in most other
states created by the Dutch; but recent happenings prove how thin
the tinsel is even there.

Security Council Resolution
Today may see the last meeting of the Good Offices Committee. If
the Security Council accepts the Four Power resolution [10] it
will still be open to doubt whether it will be accepted. On the
Dutch side the decision will be taken at The Hague although it is
certain that the Government here will report on the difficulties
involved in such a decision. The Republicans will also be in two
minds. I believe they will accept the Resolution but I am by no
means certain that the fighting can be stopped. If both sides
accept the Resolution there will still be wide opportunities for
the Netherlands to sabotage its implementation. The United Nations
Commission will, therefore, have an extremely difficult task.

I notice that the Resolution makes no mention of the armed forces
of the Republic. Presumably this is deliberate. While it will be
necessary to avoid the creation of a Republican army not fully
under control of the Government, it will be just as necessary to
ensure that the Republican Government has at its disposal a well-
disciplined and organized security force of police and militia. It
will also be highly desirable to arrange for the early formation
of a federal army into which individual members of the TNI can be
recruited according to their suitability. But, of course, this is
only one of the problems that may be in store.