403.919/8–153: Telegram
The Ambassador in India (Allen) to the Department of State
priority
243. Deptel 116, July 30. I called on Pillai today to say that while I had not yet received instructions in thorium nitrate case, I had word that Department was actively studying matter. I was passing this on to [Page 1706] him merely to keep him au courant and to say that while I did not know what aspects were being studied, I felt confident that one important consideration with my government would be clear indication whether Washington was likely to be faced with another problem of this kind next week, next month, or next year. I told Pillai that I sympathized with GOI difficulties and hoped he similarly understood our problems. I said any assurance Indian authorities could let me have to pass on to Washington that there would be no similar occurrences in future would be most helpful.
He expressed appreciation for my remarks and said he would talk to Bhatnagar and others immediately. He hoped to let me have definite word Monday or Tuesday.
I repeated that Washington would want to be very clear that similar case would not arise again and that it might be necessary for me to have further talk with Prime Minister at appropriate time. I referred with appreciation to Prime Minister’s expression of willingness to “cooperate broadly” and mentioned his reference to previous misunderstanding regarding respective positions of our governments. I said We should all try to avoid any further misunderstanding on any level. Pillai agreed.
Comment: Key members of my staff and I, including Drumright, Loftus, Willson and Corry, have given considerable thought to this problem. We would like to suggest most earnest review in Washington of possibilities of purchasing Indian thorium nitrate. Corry estimates entire annual output of processing plant at no more than $500,000. Since our aid figure this year will be between $75 and 90 million, could we not use less than 1 percent of that amount to purchase this output. India infant processing industries should be supported. Use of funds for purchase would be concrete example of trade not aid. While I am aware that repercussions elsewhere may create complications, we shall find it increasingly difficult to sustain position on denying trade with iron curtain countries unless we show some willingness to purchase ourselves. This is especially true as regards this specific commodity in India, which consumes small parts of its output and must seek outside buyers.