Foreign Relations of the United States, 1951, Asia and the Pacific, Volume VI, Part 2

Karachi Embassy Files: Lot 58F29: Box 101

Department of State Policy Statement¹

secret

[Washington,] July 1, 1951.

Pakistan

a. objectives

Our objectives with respect to Pakistan are to increase the orientation of its Government and people toward the United States, the UN and the West; to strengthen the stability of a non-communist government desirous of developing, in accordance with democratic principles, a healthy political and economic state capable of satisfying the growing needs of its people; to encourage Pakistan to improve its relations with its neighbors, including the Muslim nations to the West; to achieve closer consultation with Pakistan for the purpose of increasing its participation in and responsibility for the solution of problems of special interest to all Asian countries; and to develop in Pakistan an attitude which would afford the United States and its allies access to those facilities, resources and markets desired in time of peace and required in the event of war, and which would deny such facilities, resources and markets to the countries of the Soviet bloc.

b. policies

US policy is to assist Pakistan, within the limits of our capabilities, to maintain a stable government capable of developing along democratic lines. Pakistan has maintained internal stability and demonstrated vitality in overcoming many of its problems. Nevertheless, it remains dependent upon outside assistance for defense material and for the rate of economic development required to provide an early basis for stable popular government and democratic institutions.

The position of the dominant Muslim League party was weakened during the past year because it failed to take effective steps for the social and economic advancement of the country, because UN action on the Kashmir issue was slow, and because the central government appeared to use dilatory tactics in dealing with Afghan demands for the independence of certain tribal areas (“Pushtoonistan”) and failed to take effective steps for the social and economic advancement of the country. These problems have provided political capital for the opposition to the present Muslim League that began early in 1950 with the formation of the Awami Muslim League in the West Punjab. Since then, under the virile leadership of Suhrawardy,² this party has grown in all the provinces and has attracted support from religious mullahs, unsettled refugees, and Muslim Leaguers who were unsuccessful in obtaining positions in the central or provincial governments. The Awami Muslim League thus provides a focal point for all opposition to the Muslim League, which is charged with relying unduly upon the Commonwealth, the UN, and the US for solutions to Pakistan international problems, with corrupt practices and with dictatorial curtailment of civil liberties.

Since the establishment of the USSR Embassy in Karachi in March 1950, Communist activities have increased considerably in both West and East Pakistan. While the Pakistan Communist Party lacks widespread popular support, it has an organization and leadership that has proved capable of increasingly disruptive activities. The government’s dependence upon large land-holders, who are conservative and are moving too slowly to remedy real popular grievances, gives the Communists in Pakistan an opportunity to agitate strongly for reform measures. The central government is aware of the dangers of Communism and the Pakistan Communist Party, and, at times, it has exercised close surveillance over Communist leaders and has used strong measures to repress their activities. During the past year the Communist-dominated labor unions affiliated with the WFTU waged a running fight for control of the labor movement with the government-sponsored unions affiliated with the ICFTU; the latter had the greater success. Both the central and provincial governments have shown a readiness to cooperate with Western democracies in building a counter-propaganda program to prevent the spread of Communism in Pakistan, against which the tenets of Islam may not provide as strong a bulwark as we have thought. Our policy is to stimulate among the people of Pakistan a fuller understanding of the aggressive objectives of international Communism and the constructive aims of the United States and other Western democracies.

Pakistan occupies the eastern and western flanks of one of the largest non-Communist areas of Asia. Eastern Pakistan lying next to Burma has attained new importance in relation to possible expansive tendencies of the Chinese Peoples Republic. This area, moreover, lying between Communist centers in India and Burma as well as near Tibet, provides a potential underground base and channel for building the link between external and internal Communism in the subcontinent. Western Pakistan inherited the primary responsibility for the defense of the Northwest Frontier, the traditional gateway for large-scale invasions of the Indo-Pakistan subcontinent. Although the security of this frontier and of the subcontinent against any major aggressor would require the joint action of Pakistan, India and Afghanistan, Pakistan’s current difficulties with her neighbors militate against such effective cooperation during the foreseeable future. Indeed, Pakistan is searching outside the South Asian area for alliances, especially with the Muslim countries of the Near East, and for the assistance it would require in the event of an attack by the Communist governments of Russia and China.

Pakistan has the military manpower which could assist Near East countries in blocking Russian aggression especially through Iran. The Pakistan army, properly equipped, would be in a position to send troops to Iran’s assistance and so to fulfill one of the traditional functions of British-Indian troops in past wars. Furthermore, as Pakistan does not suffer from the violent anti-Westernism and deep-rooted neutrality that prevent India from cooperating fully with the US and its allies, Pakistan might be persuaded to afford military bases to the US and the UK in the Indian Ocean area. Until Pakistan is relieved of threats to its territorial integrity, however, it cannot be persuaded to participate more actively with the US, UK and the UN in opposing aggression wherever it occurs.

Pakistan was the first country in South Asia to sign an agreement³ under Section 408(e) of PL 621⁴ and is now receiving procurement assistance in purchasing US military supplies, equipment and services on a reimbursable basis. This assistance is limited by other demands of higher priority and is intended to meet requirements for Pakistan’s internal security, self-defense or participation in the defense of South Asia/Pakistan’s requests have hitherto been modest and, owing to present shortage of US military supplies, we are not in position to respond to significantly greater demands for such aid.

The primary agricultural economy of Pakistan was seriously strained in September 1949, when India refused to sanction transactions with Pakistan at the new rate between the Pakistan and Indian rupees, which arose out of India’s devaluation and Pakistan’s maintenance of the previous value of its rupee. The resulting economic dislocations and political reactions brought trade between the two countries practically to a standstill. In February, 1951, however, the two countries signed a comprehensive bilateral trade agreement for the period February 27, 1951 to June 30, 1952. In view of India’s acceptance of Pakistan’s exchange rate implied in the conclusion of this agreement, the International Monetary Fund in March 1951 formally accepted the par value of the Pakistan rupee at 3.32 to the U.S. dollar. It is too early to estimate the final effect of these developments, but all evidence points to the resumption of normal trade and financial transfers between India and Pakistan. As this would coincide with US policy objectives in the area, we look with favor on the renewal of this trade agreement for an indefinite period.

While avoiding the assumption of responsibility for the economic welfare and development of Pakistan, our policy is to encourage the GOP to carry out a well-balanced program of economic development. Where practicable in the light of other demands of higher priority, we will help Pakistan to obtain its import requirement from the US, the Commonwealth and other western democracies.

We are assisting Pakistan to obtain technical assistance under the Point IV Program, both through the UN and through US official and private agencies. Following discussions with the Government of Pakistan, the general Point IV bilateral agreement was signed on February 9, 1951,⁵ and a week later the official requests for such assistance were received. The program is being set up as rapidly as possible to cover the fields in which Point IV assistance is most needed: agriculture, geological surveys, transportation, light industries, public health and administration.

It is our policy to encourage the investment of private capital, to the extent that it is available as a source of foreign assistance for the Pakistan economy. Pakistan has been encouraged to establish opportunities for US private investors on a mutually satisfactory legal basis. It should be recognized, however, that private capital alone cannot meet Pakistan’s requirements for foreign aid. Therefore, to the extent that private capital proves to be unavailable for the financing of certain basic developments in Pakistan, we will support consideration by both the International Bank and the Eximbank of loans for specific projects which in our judgment will contribute toward balanced economic development in Pakistan in as short a time as practicable. Priorities should be given to those programs designed to increase food output, to develop economically sound industries, and to improve transport and communications facilities.

Nevertheless, the prospective rate of economic development does not appear adequate to cope effectively with the forces threatening Pakistan’s stability. Accordingly, the Department is presently proposing to present to Congress a grant program of financial assistance for Pakistan during the fiscal year 1952, which would be of great benefit for political purposes. The primary economic aim of this grant aid would be to increase agricultural production as well as to build up certain industries and educational facilities. The proposed projects should encourage Pakistanis to more effective action on their own initiative. All US and other programs of both investment and technical aid should, of course, be coordinated to the greatest possible extent.

Our commercial policy is to encourage Pakistan’s full participation in the expansion of world trade. The Government of Pakistan is committed to a multilateral trade policy by its provisional acceptance in 1948 of the General Agreement on Tariffs and Trade. The bilateral trade conferences and agreements hitherto concluded by Pakistan with several Arab states, the USSR and certain satellite countries have not had any appreciable effect on Pakistan’s trade policy. At our suggestion, Pakistan signed the protocol stipulating that most-favored-nation treatment would be extended to the Federal Republic of Germany and we have been assured that similar treatment, under certain conditions, will be given to Occupied Japan.

Pakistan’s continuing relationships with Commonwealth countries require the maintenance of certain restrictive trade and financial policies, principally those involving Empire preferences; however, these do not appear to be inconsistent with the General Agreement on Tariffs and Trade. There is so far no evidence that import controls will be utilized for the purpose of protecting marginal or new industries not suited to Pakistan.

Treaty relations between the US and Pakistan continue to be based upon US–UK and US–India treaties and agreements which are applicable to Pakistan in accordance with the Indian Independence (International Arrangements) Order, 1947. The US and Pakistan have exchanged notes confirming the application to Pakistan of previous agreements. Negotiations of new treaties should therefore be undertaken, not only to replace US–UK and US–British India agreements which are no longer appropriate in view of Pakistan’s statehood, but also to fill the gaps in our treaty relations. A draft Treaty of Friendship, Commerce and Navigation was presented to the Government of Pakistan some time ago and is now being negotiated. Drafts of a Consular Convention and a Military Air Agreement have been submitted to the Pakistan Government, and a draft agreement for the exchange of official publications has recently been transmitted to our Embassy at Karachi. Pakistan’s lack of trained negotiators, however, may well retard the conclusion of these agreements.

The USIE program in Pakistan is designed to develop a public opinion oriented toward the United States and the other democracies, and capable of promoting the stability of the country and encouraging its growth along democratic lines. The program seeks also to foster on the part of the people of Pakistan an appreciation of the responsibilities of their newly acquired independence and of our interest in their progress. With the allocation of additional funds during fiscal 1951, the USIE program has been expanded to permit the production and more effective utilization of materials specifically designed to carry out its objectives.

The organized labor force of Pakistan is only a small part of the working population, but it is politically important because it includes an overwhelming majority of non-agricultural workers. We intend to continue, in collaboration with other members of the ICFTU, to strengthen the ties between non-Communist labor organizations in Pakistan and those in the US and other western democracies.

c. relations with other states

Pakistan’s foreign policy and its relations with the US are affected by its proximity to India and Afghanistan, its connection with the Commonwealth and its desire to strengthen its relationship with Muslim States to the West.

Pakistan’s foreign policy is continuously influenced by its struggle with India over an equitable settlement of the Kashmir issue, in which both Pakistan and India have agreed to abide by the result of a plebiscite conducted under UN supervision. The government and people of Pakistan, however, are now convinced that India wishes both to avoid carrying out this commitment and also to postpone agreement, until the status of Kashmir is clear, concerning other major disputes arising from the partition of the subcontinent (such as compensation for refugee property and canal water rights involving rivers rising in Kashmir and India). The government has thus far controlled the tide of resentment against India, which has recently risen to new heights following Indian encouragement of the establishment in the Indian-held portion of Kashmir of a Constituent Assembly to define the future affiliation of the State; Unable by itself to stop these proceedings, Pakistan has pressed the US and the UK more and more for support in the UN.

Former grievances against the UK have been augmented by its apparent inability to give material help in settling the Kashmir and allied problems. This feeling reached its highest point when the Pakistan Prime Minister threatened to boycott the January 1951 Conference of Commonwealth Prime Ministers. Pakistani leaders, however, appreciated the subsequent attempts of the Commonwealth Ministers, especially those from Australia and New Zealand, to develop a solution. Pakistan’s irritation with the UK (and the US) was also recently reduced by the strong UK–US Security Council Resolution of February 1951, providing for a UN Representative to effect demilitarization of the State (in preparation for a plebiscite) and for the arbitration of points on which this Representative and the two parties may not reach agreement. Progress toward a settlement and the outcome of this issue will strongly influence Pakistan’s estimate of the value of US and UK friendship, as well as the utility of cooperation with the UN, in settling international disputes.

Our policy is to remain impartial in all Pakistan–India disputes. As the US has heavy commitments in other parts of the world and as Pakistan will be more inclined to cooperate with us and other Western democracies if it remains a member of the Commonwealth, we wish Pakistan–UK ties to remain close and friendly; we therefore avoid any action which might weaken them. Recognizing the special interest of the UK and the Commonwealth in Pakistan and its neighbors, we shall continue to encourage the UK to assume leadership in attempting to devise a settlement in Kashmir. We shall also continue to consult with the UK as to means by which our individual policies and actions towards Pakistan can be better coordinated to achieve our mutual objectives in both the security and economic fields.

Kashmir also affects Pakistan–Afghanistan relations, which remain discordant because of Afghan support for the independence of tribes living in the North West Frontier district to the east of the Durand Line. Afghan Government persistence in vigorous propaganda demanding recognition of some form of independence for these tribes has provoked Pakistan to retaliate by moving troops to the undemarcated border, by engaging in counter-propaganda, and by withdrawing economic privileges long allowed to the Afghans. The Government of Pakistan contends that there is no basis for Afghan interference with these tribes and that the issue will be easily resolved when the Kashmir dispute is settled, as the Afghans can then no longer count on India’s support for their claims.

Although, this problem has so far not yielded to several efforts to persuade the two countries to hold bilateral discussions, we believe our interests would be seriously prejudiced by their failure to reach an accord on matters involving the control and welfare of the tribes on either side of the Durand Line. In November 1950 we presented to both governments a four-point proposal regarding measures they might take to improve their relations, including informal bilateral conversations without an agenda or pre-conditions. Afghanistan promptly accepted while Pakistan, after considerable hesitation, asked us in March 1951, to transmit to the Afghans a counter-proposal accepting some of our original proposals but suggesting that the two countries might exchange views through diplomatic channels before deciding to hold any other conference concerning their differences.

The exchange of ambassadors between the USSR and Pakistan was completed in March 1950 when the Soviet Ambassador⁶ established an Embassy in Karachi. Pakistan joined other South Asian countries in recognizing the Chinese Peoples Republic and, although an exchange of ambassadors has not occurred, Pakistan has sent a Chargé d’Affaires⁷ to Peiping. In March, 1951 a Czechoslovakian Ambassador⁸ arrived in Karachi. Trade arrangements were renewed this year with Poland and Czechoslovakia; a trade mission from the USSR spent several months in Pakistan late in 1949, without arriving at an agreement; and a Hungarian trade mission arrived in Karachi early in 1951. The USSR last year renewed its June 1949 invitation to the Prime Minister of Pakistan to visit Moscow suggesting August 14, 1950 (Pakistan’s Independence Day) as a suitable date; the Prime Minister was unable to accept and it now appears that his Moscow visit is postponed indefinitely. Though these events had aroused some feeling for a greater rapprochement between the USSR and Pakistan, this trend was sharply reversed in March 1951 because Pakistan Communists were involved in an abortive plot to overthrow the present government and set up a military dictatorship on the Communist model.

Pakistan’s fear that India refuses to recognize the fact of an independent Pakistan and its distrust of India’s efforts to assume leadership in South and South East Asia encourage Pakistan to assume a more prominent position among Muslim countries of the Middle East. It has signed treaties of friendship with Egypt, Iran, Iraq and Syria, and sponsored conferences for Muslim countries, i.e., the World Muslim Conference, and the Islamic Economic Conference. Pakistan strengthened its ties of friendship with Iran in 1950 by entertaining the Shah. Its stature among Muslim countries has grown. In the light of Pakistan’s present orientation to the West, and its active cooperation with the countries of Middle East, we should encourage its participation in problems common to the Middle East and its orientation toward Turkey. We should likewise consult more intimately with the Government of Pakistan on questions of common interest in the Middle East.

Admitted to the UN in September 1947, Pakistan has taken a leading role among Muslim states. It has assumed a strong initiative on such matters as Palestine and the disposition of former Italian colonies. It has served on the United Nations Special Committee on the Balkans since that organ was established, and it is also a member of the Council advising the United Nations Commissioner in Libya, the Commission of Inquiry for Eritrea, the Peace Observation Commission (established under the “Uniting for Peace” resolution of the Fifth General Assembly), and the United Nations Commission for the Unification and Rehabilitation of Korea (UNCURK). The Prime Minister of Pakistan immediately supported the Security Council Korean Resolutions of June 25 and 27, 1950, and offered 5,000 tons of wheat as a contribution to UN forces in Korea. His action was approved unanimously in October 1950 by the Legislative Assembly. Pakistan helped to develop the UN Arab-Asian peace proposals relating to Communist China, including the proposition that the future of Formosa should be discussed during such negotiations. Pakistan’s genuine interest in the UN is further exemplified by its membership in the Economic Commission for Asia and the Far East (ECAFE), the broad range of its participation in the work of the UN specialized agencies, and its recently expressed desire to obtain a seat on the Security Council for the next two years. We shall encourage Pakistan to support the United Nations and endeavor to extend friendly aid so that it may achieve its rightful place in UN organizations.

d. policy evaluation

The hospitable reception accorded the Prime Minister during his 1950 visit to this country opened a period of more cordial relations between the government and peoples of Pakistan and the US. Nevertheless, the Kashmir dispute continues to be the greatest threat to realizing our objective that stability be maintained in Pakistan and in South Asia. This issue absorbs the major portion of the attention and effort of the Government of Pakistan, and prevents it from moving more rapidly toward domestic political goals (such as the enactment of the constitution, the assimilation of former princely states and of tribal areas, and the development of a national language and a modern educational system). The Kashmir issue, more than any other, is responsible for Pakistan’s desire for greater military security. It hasalso prevented Pakistan from contributing troops to the UN forces in Korea and from participating in measures to protect the security of the Middle East. This unsolved problem also seriously hampers the Government’s ability to meet the economic needs of the nation. It is compelling the Government to spend over half its national budget on its military establishment. It limits the central government’s ability to carry forward economic development programs. It hinders public and private investors from coming forward, and makes foreign investors hesitant to enter Pakistan. Accordingly, unless further progress is made toward an acceptable settlement of the Kashmir issue, opposition leaders can continue to make political capital out of this source of public dissatisfaction with the central and provincial governments.

This dissatisfaction provides fruitful soil for Communist doctrines promising a better way of life for the common people. We should not be lulled into neglect by believing that since the ideologies of Islam and Communism contain certain basic differences, there is no Communist threat to Pakistan. We will be in a better position to combat Communism when our own sympathy for Pakistan’s welfare finds more concrete expression. Our economic aid has been confined to a modest Point IV bilateral program and our informational activities have thus far reached only a limited variety of social groups.

Another threat to our objectives in Pakistan, less obvious than Communism, is presented by the activities of reactionary groups of landholders and uneducated religious leaders (mullahs) who oppose the present Western-minded government and favor a return to primitive Islamic principles. These groups draw their strength from the religious feeling and resistance to change prevailing among the largely illiterate population. Should their influence become predominant, Pakistan might become a theocratic state with a distinct anti-Western bias. Meanwhile, Islam remains the greatest single unifying force in Pakistan and vitally affects the nation’s political life. We should therefore support the earnest efforts of the existing government to develop a democratic constitution and a modern educational system that will contribute to the greater political maturity of the electorate and meet the urgent need for trained manpower.

Our professions of cooperation with Pakistan have exceeded our actual performance and our policies need greater implementation before we can realize our objectives. Furthermore, our earlier concentration on economic assistance to Europe, our strong reaction against aggression in Korea in contrast to our patient attempts to help the parties find a solution in Kashmir, and above all, our persistent neutrality in Indo-Pakistan disputes have led the people of Pakistan to believe that our policies toward them are not only of minor importance to us but also are overshadowed by our policies toward other countries, particularly India.

Pakistan has vigorously attacked many of its difficult problems and, by South Asian standards, is at present a viable state that can continue to develop independently unless forced into a war for survival. Geographically a part of the Indo-Pakistan subcontinent, it is politically independent with an inherent importance separate and distinct from India. Its continuing struggle with India is hardening the cultural differences which separate the two countries. It recognizes that, under present circumstances, it cannot expect any assistance from India in defending its frontiers. The Muslim character of the population, on the other hand, persuades it to look for new ties with the countries of the Near East. While India may refuse to give open support should aggression against Near East countries occur, Pakistan will seriously consider its capabilities to assist its co-religionists. Its nearness to the Middle East, its control of the two principal passes into the subcontinent, and its present leanings toward the West gives Pakistan a political identity which transcends the historical ties that tend to bind it to India.

1. This document is a complete revision of an earlier Policy Statement on Pakistan, dated April 3, 1950, of which a partial text is printed in Foreign Relations, 1950, vol. v, p. 1490. Department of State policy statements comprised a category of documents summarizing the current U.S. policy toward, the relations of principal powers with, and the issues and trends in a particular country or region. The statements were intended to provide information and guidance for officers in missions abroad. They were generally prepared by ad hoc working groups in the responsible geographic offices of the Department of State, were referred to the appropriate diplomatic missions abroad for comment and criticism, and were periodically revised.
2. Husseyn Shaheed Suhrawardy.
3. Mutual Defense Assistance Agreement with Pakistan, entered into force December 15, 1950. For text, see United States Treaties and Other International Agreements (UST), vol. 1, p. 884.
4. Public Law 621, July 26, 1950, An Act to Amend the Mutual Defense Assistance Act of 1949; 64 Stat. 373.
5. Agreement for Technical Cooperation Between the United States of America and Pakistan, entered into force February 9, 1951. For text, see 2 UST (pt. 1), p. 1008. For description, see Department of State Bulletin, February 19, 1951, p. 299.
6. Alexander Georgievich Stetsenko.
7. Ahmed All.
8. The Czechoslovakian diplomatic representative in Pakistan, Ladislav Kilka, actually held the rank of Minister.