845.24/312: Telegram

The Officer in Charge at New Delhi (Merrell) to the Secretary of State

10. President of Federation Indian Chambers of Commerce and Industry, G. L. Mehta, in speech at Bombay January 5 which reflects sentiment of important section of Indian business community, remarked that proposed direct lend-lease agreement should be made subject to important reservations: (1) amount of Indian reciprocal aid should not exceed amount of lend-lease aid received, and (2) because of its undeveloped industrial status India could not agree to “removal” of tariff barriers. He added Government of India must make latter reservation to assure India’s industrial development and preserve fiscal autonomy.

Reference Mission’s 954, December 17, 11 a.m.94 and 1, January 2, noon [midnight].

Referring to Britain’s reported desire that India assume larger portion war expenditure he said there could be no equality of sacrifice, as proposed by Britain, without equality of status. Reference Mission’s 958, of December 18, 3 p.m.95 He said India is being asked to carry burdens of member of the United Nations without being given corresponding rights and powers.