891.2546/12–1454
Memorandum by the Special Assistant to the Under Secretary of State (Bishop) to the Under Secretary of State (Hoover)
Subject:
- Beryl Agreement with India
There is still confusion in regard to the beryl arrangement with India. You should read the underlying memorandum from NEA (Tab A).1
There are two alternatives in solving this problem:
- 1)
- The Department could telegraph the Embassy in New Delhi to inform the Indian Government that, if they do not accept our proposal for a one-year extension of the present arrangement or some mutually acceptable variation thereof, we will give notice of termination of the present purchase arrangement. The Atomic Energy Commission has agreed to furnish the funds for this additional period. It is doubtful that the Indian Government would accept such a short-term arrangement. In any event, this alternative gives rise to the serious political difficulties which NEA foresees.
- 2)
- The OCB could decide that (as it presumably did on September 29) for political reasons, the national policies of the United States require that, if the Indian Government declines to extend the arrangement for one year or fails to reply to our proposal by December 31, the United States should allow the agreement to be automatically renewed for another 5 years by not giving notice of termination. In this [Page 1796] event, it would be necessary to find and commit funds to cover the 4 years beyond the one year for which the Atomic Energy Commission accepts responsibility.
I suggest that you lay these alternatives before the OCB as an item of emergency business at the meeting on December 15 and that you urge the OCB to give its approval to the second alternative. If this is agreed, the OCB should request the Atomic Energy Commission and FOA to determine prior to December 25 the source of funds necessary to cover the full 5-year period. If they are unable to agree, the OCB should request AEC and FOA to take the matter to the President for final determination. This was agreed to by AEC and FOA on September 29, according to Mr. Staats’ minutes. AEC did not understand this undertaking. Upon determination of the source of the funds to cover the full 5-year period, the Department of State can then telegraph instructions to the Embassy in New Delhi to allow renewal of the purchase agreement for 5 years. The United States position must be determined and the Embassy informed prior to December 31.