I refer to my telegram No. 65 [1] of to-day's date concerning the
Relief Supplies for Indonesia.

2. With regard to the Netherlands proposal that they should
substitute textiles of a neutral colour from their own stocks for
those textiles among the Australian supplies coloured blue and
khaki to the import of which the Government of Indonesia will not
consent, the Far Eastern Office has now written to me as follows:

'Before indicating which markings the textiles to be provided by
the Government of Indonesia in exchange of the Australian
supplies, will bear, it will be necessary to ascertain the present
value of the textiles to be replaced.

'The total of supplies destined for Republican areas was
originally mentioned to be A126,000. Experience however has shown
that the actual market value of the goods may not necessarily be
the same. It is therefore suggested that the
textiles to be replaced be valued by experts to be appointed in
common agreement between the Indonesian and Australian authorities
in Batavia.'

They suggest that 'in order to finalize this matter at an early
date' it would be advisable for me to contact the Head of the
Trade Division of the Department of Economic Affairs directly. I
regret that owing to my illness I have not been able to discuss
this point with either the Far Eastern Office or the Department of
Economic Affairs and have no comments to offer at this stage.

However, Jhr. de Ranitz of the Far Eastern Office in a note [2] to
me dated 7th February, stated that the ban on the import of the
Australian textiles would not be lifted for at least two months
and since then he has on several occasions informed me that he
could see no prospect of the ban being lifted even at the end of
two months. As I advised you in my telegram No. 2 [3] of 5th
January, the objection to the distribution of the Australian
textiles comes from the Army authorities and the present situation
offers no grounds for belief that they will be now inclined to
modify their position. I should therefore be grateful for your
instructions on this new proposal.

3. Arrangements for the distribution of the medical supplies are
now fairly well advanced. Lieut. Col. Sullivan discussed the
matter with Dr. Bahder Djohan, the representative in Batavia of
the Indonesian Red Cross and proposed that his organisation should
handle the distribution of the supplies. Under this arrangement
the distribution could be effected quite independently of the
Netherlands and Indonesian authorities and the supplies would be
transported from Batavia to their final destinations in Republican
areas entirely by the Indonesian Red Cross.

4. Dr. Bahder Djohan was agreeable and I then discussed detailed
arrangements with him and Dr. Leimena, the Minister for Health in
the Republican Cabinet. We agreed that the procedure should be for
Dr. Bahder Djohan to inform the hospitals at Djocja and Solo of
what supplies were available and invite them to submit
requisitions. Supplies would then be forwarded to the hospitals
under cover of a form listing the goods delivered and stating
clearly their nature as a post-U.N.R.R.A. gift from the Australian
Government and that they were for the hospitals' use only. It was
suggested that the form should be in quadruplicate, the hospitals
retaining one copy and signing and returning the other three as
receipts. Both Dr. Bahder Djohan and Dr. Leimena assured me that
the supplies would be properly used by the hospitals they
nominated and that there would be no chance of any leakage onto
the black market or of the goods being diverted into hospitals not
servicing Indonesian civilians in the Republican areas.

5. Dr. Leimena said that if possible, he should like a portion of
the supplies to go to the Republican area in Atjeh and in view of
the lack of communications with Atjeh, suggested that the
Netherlands authorities should be approached through the United
Nations Commission for Indonesia for assistance. However, in the
meantime, Jhr. de Ranitz informed me that he thought there would
be little difficulty in arranging for the transport of supplies to
Atjeh and I am to discuss this question directly with him.

6. The present position is that Dr. Bahder Djohan has now given to
me the requisitions from Djocja and Solo. However, to meet these
requisitions will involve opening the cases of supplies. As it
would be unwise to do this in the present place of storage the
best solution appears to be for the Indonesian Red Cross to
transfer all the supplies into their own store rooms where the
cases might be opened safely. I have asked Mr. Cutts to try and
arrange this and am awaiting his advice. It would, however, be of
assistance if you could supply me with lists detailing the
contents of the various cases as the lists forwarded with your
memorandum No. 260 (892/2/2) of 8th December, 1948, do not give
the contents in full.