[Enclosure 1]
Memorandum by the President to the Director
of the Foreign Operations Administration (Stassen)
secret
[Washington,] June 29,
1954.
Subject:
- Purchase of Thorium Nitrate from and Related Technical
Assistance to the Government of India
In accordance with the recommendation contained in your
memorandum of June 29, 1954, I hereby determine, pursuant to the
authority vested in me by Section 303(a)
of the Mutual Defense Assistance Act of 1949, as amended, that
up to $2.2 million of funds appropriated pursuant to that
Section may be used for the purchase of approximately 230 long
tons of thorium nitrate (to be resold to
[Page 1763]
the Atomic Energy Commission)
from and for related technical assistance to the Government of
India. I further determine that these expenditures will serve to
accomplish the policies and purposes of that Act, and are
important to the security of the United States.
The Secretaries of State and of Defense, the Chairman of the
Atomic Energy Commission and the Director of the Bureau of the
Budget are to be notified by you of this determination.
- Recommended by: W. B.
Smith
- The Department of State
- A. C.
Davis
- The Department of
Defense
- Jos. M.
Dodge
- The Director of the Bureau of the
Budget
- Lewis L.
Strauss
- The Atomic Energy
Commission
[Enclosure 2]
Memorandum by the Director of the Foreign
Operations Administration (Stassen) to the President
secret
[Washington,] June 29,
1954.
Subject:
- Purchase of Thorium Nitrate from and Related Technical
Assistance to the Government of India
Thorium nitrate is a source material for fissionable atomic
energy uses as set forth in section 5 (b)
(1) of the Atomic Energy Act of 19461 and by virtue of that is
listed on Title I, Category A, item 203(e) of the Battle Act. This listing requires that aid be
terminated forthwith, without exception, to any country
receiving aid which “knowingly and willfully” ships such a
material to the Soviet Bloc. In 1953 a shipment of this material
was made from India to Communist China, which I have found not
to be knowing and willful. Diversion or sale of such material to
the Soviet Bloc is possible in the future in the absence of
extraordinary efforts on the part of this Government to the end
of preventing such shipments and/or diversions from India.
Negotiations have been underway which, if successfully
consummated, will enable this Government to make a pre-emptive
purchase of the estimated Indian production in excess of
domestic requirements for the next several years. The political
situation in India does not permit obtaining adequate assurances
from the Indian Government that there will be no shipments to
the Soviet Bloc in the absence of this pre-emptive arrangement.
We have sought in negotiating this arrangement
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to provide the utmost security
both as regards the disclosure of this arrangement and the
achievement of a net result which will bring about a denial of
fissionable materials of Indian source to the Soviet Bloc and
the availability of this important material to the defense needs
of the United States and the free world.
It is planned to purchase approximately 230 long tons of thorium
nitrate at $2.20 plus duty per pound through a contract between
the General Services Administration, on behalf of the Foreign
Operations Administration, and the Government of India. The
additional costs to cover a 30% ad valorem duty and
administrative overhead bring the total estimated landed cost to
$1,530,000. The Atomic Energy Commission has agreed to
repurchase all thorium nitrate procured under this contract at
the contract price of $2.20 per pound. In addition, in order to
conclude successfully these purchase arrangements with the
Government of India, it will be necessary to provide technical
assistance for scientific and industrial research in the amount
of approximately $670,000 (equivalent to $1.30 per pound of the
thorium nitrate to be purchased from the Government of
India).
Section 303(a) of the Mutual Defense
Assistance Act of 1949, as amended, authorizes the President to
expend funds in the General Area of China to accomplish the
policies and purposes declared in that Act. It is recommended
that up to $2.2 million appropriated pursuant to this Section be
made available for use as needed to defray these costs.
Although there is no specific legislative provision which
requires the submission of a program determination of this
nature to the President for approval, it has been the consistent
practice within the Executive Branch to seek such approval
whenever an entirely new program has been proposed for
implementation under the broad provisions of Section 303(a) of the Mutual Defense Assistance Act.
Accordingly, it is recommended that the President sign the
attached determination.
This recommendation has the concurrence of the Secretary of
State, the Secretary of Defense, the Chairman of the Atomic
Energy Commission, and the Director of the Bureau of the
Budget.
