Foreign Relations of the United States, 1949, The Far East: China, Volume IX

893.00/1–549

The British Embassy to the Department of State ¹⁵

January 5, 1949

Continuation of Paper on China Attached to Sir Oliver Franks’ Letter of 5th January 1949 to Mr. Lovett

Political Effects on Adjacent Areas.

(a) Japan

The spread of Communism in China will enhance the political and strategic importance of Japan as the most important non-Communist area in East Asia, and seems certain to strengthen the determination of the United States Government that Japan shall not fall under Communist domination.

(b) Hong Kong

Communist domination of China down to the Yangtze is not in the first instance likely to affect Hong Kong very seriously. The colony’s major problem is likely to be a steady stream of refugees. If, as may be expected, the Communists continue southward, they may well try to “soften up” Hong Kong by instigating strikes to coincide with their advance. Since labour in public utilities and on the waterfront in Hong Kong is mainly Communist in sympathy, such strikes might temporarily paralyse the colony. Serious clashes between Communist and Kuomintang supporters might also occur.

If all China were dominated by the Communists, the retention of Hong Kong as a British colony, in the absence of strong British naval and military forces, might depend on whether the Communists found the existence of a well-organised, well-run British port convenient for their trade with the outside world. In that event, while Hong Kong might be faced with a vast refugee problem, the colony could continue its life, but would be living on the edge of a volcano. Meanwhile the Communists would no doubt continue their infiltration tactics. If, on the other hand, the Communists were to demand the rendition of Hong Kong to China, they would use every method short of war to undermine it.

(c) The Federation of Malaya and Singapore

Communist control of China down to the Yangtze would not have such serious effects on Malaya as Communist domination of the whole of China, because most of the Malayan Chinese come from South China and because the Communist-controlled areas would not be contiguous to the frontier of French Indo-China. The following reactions among Malayan Chinese during such a period could, however, be expected, while some of the effects forecast below would also be felt—

(i) an intensification of Kuomintang activity. An increase in Kuomintang activity has already been reported in recent weeks (including paper plans for an underground cell system);

(ii) strong support for the China Democratic League and the Kuomintang Revolutionary Committee, which would increase if a coalition Government were formed in China;

(iii) increased political activity by the Chinese community, with agitation for increased representation of the Chinese in the Federal or State Councils, to which the Malays wold react strongly.

Communist control of the whole of China would be a grave danger to Malaya and would mean that:—

(i) Militant communism would be very close to Malaya’s northern frontier, with Siam and French Indo-China as poor buffers;

(ii) the morale of the Malayan Communists would be bound to improve;

(iii) there might very well be increased activity by China Communist Party agents infiltrating into Malaya. A number of China Communist Party agents are already reported to have reached Singapore;

(iv) a comparatively small increase in the successes of the Malayan Communists might have wide repercussions among the passive Chinese community, since Chinese morale as a whole in Malaya has never been good, and is very sensitive to bandit successes, intimidation, and propaganda;

(v) the Chinese population in general might well be even less ready to co-operate actively with the Malayan Government than at present. They will continue to sit firmly on the fence and hope that a Communist administration in China will turn out to be peaceful and reformist;

(vi) subversive activities by Kuomintang diehards might well continue, though admittedly without the backing of the Chinese Government, which it has hitherto enjoyed to the detriment of good government in Malaya;

(vii) there would be some increase in illegal immigration into Malaya and there might also be a demand for asylum for political refugees;

(viii) there would be repercussions among the Malays to any increase in Chinese political activity and also if militant communism were to spread in Indonesia.

(d) Sarawak and North Borneo

In Sarawak and North Borneo it is expected that Communist successes in North China will probably lead to an increase in Communist sympathies among the local Chinese population and reinforcement of present Communist attempts to persuade Chinese intelligentsia that national aspirations can now best be achieved through communism. At the same time a parallel increase in Kuomintang activity may be expected in the form of tightening control over registered societies, and increasing pressure on the Communists.

(e) India and Pakistan

The political consequences to India and Pakistan of Communist domination of China would be indirect but none the less formidable. They would be moderated or delayed to the extent that Communist domination did not spread over the whole of China. They would consist in the first instance of the great moral effect of China becoming a Communist State. India, and to a lesser extent Pakistan, are the field where Western and Asian civilisations meet, and there is always a tension between them. Hitherto, Russia has been a third factor but the adoption of communism by a major Asiatic country would be likely to cause it to be regarded in India and Pakistan more favourably than when it was predominantly a northern and western development. Although China has no common frontier with India, a Communist-dominated China would certainly result in a strengthening of communism in Burma, and the countries to the north of India—Tibet, Nepal and Bhutan—would gradually be penetrated by Communist influence. Thus there would at once be a threat of political and strategic encirclement of India and Pakistan’s land frontiers by Communist states, which might in a relatively short time become a reality.

The political consequences of this situation may be summarised as follows:—

(i) The Indian Communists would derive enhanced prestige and greater influence. At present they are a small but vigorous minority. They would be fortified by the infiltration of Communist agents and Communist finance through Burma, Eastern Pakistan and through North-West Pakistan.

(ii) The Indian Communists would redouble their efforts to acquire influence over organised labour. They already have an influential trade union organisation under their effective domination. The agricultural population is illiterate and politically inert and therefore the urban population of India, which is small, has an influence out of all proportion to its size.

(iii) Any economic disaster, such as a famine, would give communism an opportunity to spread to rural areas.

(iv) The present attitude of neutrality on the part of India in foreign policy as between the Communist States and the Western democracies might harden as Communists rise to power in Asia. On the other hand, Hinduism is strongly opposed to communism in outlook and initially at any rate the Nehru¹⁶ Government would be likely to make a determined stand against communism, their ability to maintain it depending on their ability to provide progressive improvement of the economic condition of the masses.

(v) Burmese rice might be diverted away from India if Burma went Communist and joined in any attempt to overthrow the existing regime in India. This would be a powerful factor militating against an improvement in India’s economic condition.

(vi) The Government of Pakistan would be likely to be strongly anti-Communist if their disputes with India, particularly over Kashmir, were disposed of. Until that happens, however, there is a possibility that Pakistan might prefer Russian support against India, even with some knowledge of Russia’s price, to absorption or conquest by India, which she still regards as India’s primary objective. A solution of the Kashmir dispute would therefore become even more essential from our point of view if the Chinese Communists succeed in controlling China.

(f) Foreign Territories in South-East Asia

In general, it may be expected that Communist successes in China will stimulate Communist movements throughout the area. If the Chinese Communists succeed in overrunning the whole of China, the possibilities of contacts with the Communists in Indo-China, Siam and Burma will be greatly facilitated, and it may be expected the Communist agitation in various forms will be accelerated to a marked degree.

Burma

The frontier between Burma and China is in part undefined, and in view of the fact that the present Burmese Government lacks effective control, it would be difficult to prevent the infiltration of Chinese Communists and a link-up between them and Burmese Communists against the Government were the whole of South-West China to come under Chinese Communist control. The general disorder in Burma might render it very difficult to cope with any considerable increase in Communist strength. There might also be the two further dangers of communism seeping over the border into India and Pakistan (East Bengal), and of the Chinese Communists pressing China’s extensive frontier claims against Burma.

Indo-China

Direct contact between Communist-controlled China and Northern Indo-China will greatly increase the difficulties of the situation in the latter territory, where the failure of the French Government to take effective measures to seek a solution has resulted in an alliance between the Nationalist and Communist elements. The French forces in Indo-China are already stretched and if the Viet Minh were to be strongly reinforced as a result of Communist-controlled China, the situation might well become untenable for the French, at any rate in the north. There would be an increased threat to South-East Asia in general through the strengthening of the Communist position in Indo-China.

Indonesia

If the Dutch fail to reach a settlement in the near future there may easily be an alliance between Nationalists and Communists which might result in a long period of disorder with serious consequences not only to Indonesia but to South-East Asia as a whole.

Siam

There is quite a strong Chinese Communist element in Siam which so far has not caused serious trouble, but encouraged by the situation in China it might well get out of hand, and it is by no means certain that the comparatively inefficient administration in Siam would be able to deal with it effectively. There is a considerable danger that if the Communists got out of control in southern Siam, they might combine with Communist elements in Malaya, thus rendering the suppression of the latter immeasurably more difficult.

Sinkiang and Tibet

Chinese Communist control in Sinkiang would facilitate increased Russian pressure, which is already apparent in that region. It is just conceivable, however, that if the Russians sought complete domination in Sinkiang, this might cause a rift with the Chinese Communists, whose nationalism would not take kindly to Russian acquisitiveness. In Tibet, it is not likely that the Tibetans would welcome Chinese Communists any more than they welcome attempts at domination by the National Government of China. But obviously the potential danger is greater as the area to the north and east of Tibet comes under Communist domination.

Washington, 10 January, 1949.

15. Handed to the Director of the Office of Far Eastern Affairs (Butterworth) by the Counselor of the British Embassy (Graves) on January 10.
16. Jawaharlal Nehru, Indian Prime Minister.