791.56/11–1054
The Ambassador in India (Allen) to the Department of State
No. 526
Subject:
- Surplus Property Settlement
Reference is made to the Embassy’s telegram No. 29 of July 6, 1953 which summarized a note received from the Ministry of External Affairs under date of July 1, 1953, in reply to a note from this Embassy on the subject of American surplus property disposals in India. As mentioned in that telegram, 5 copies of the MEA note were personally transmitted to the Department by Mr. John Loftus, then Economic Counselor of this Embassy.
In the note under reference the Ministry of External Affairs: (1) stated that because of certain unsettled claims, it was unable at that time to settle accounts on sales of surplus commodities made prior to July 1, 1948, and (2) suggested that, because of certain circumstances set out in the note, the Embassy would “perhaps agree that no purpose of sharing of the sale proceeds affected after June 1948”.
According to Embassy records, correspondence with the Government of India on this subject rests with the note under reference. The Embassy is now desirous of making a further effort to settle this matter. It proposes to inquire of the MEA if a settlement may now be made on accounts prior to July 1, 1948. At the same time, however, it would appear desirable to comment on the MEA proposal that the U. S. Government forget about renegotiating the “cut-off” date. The Embassy is inclined to discount the GOI contention that handling and storage charges have more than consumed realizable proceeds. It is of the opinion that the question should at least be explored further with the GOI. The Embassy, however, would appreciate instruction on this point. It will withhold any approach to the GOI on the subject [Page 1778] pending receipt of such instruction and guidance as to the approach which might be taken. Possibly information on experience in other countries would be helpful.
Counselor for Economic Affairs