Foreign Relations of the United States, 1958–1960, South and Southeast Asia, Volume XV

168. Telegram From the Embassy in Afghanistan to the Department of State¹

Kabul, July 3, 1960.

4. During my recent consultations I sought explain difficulties arising out of planning our aid programs on project basis and advantages of shifting to longer term commitments, covering total magnitude of aid we willing to allocate to Afghanistan provided suitable projects available. I wrote memorandum at request Under Secretary Dillon for use as illustration in discussions NSC. Same time I understood that in view forthcoming elections and Congressional cycle it virtually impossible anything positive could be done along this line re Afghanistan until next year.

While I appreciate complexity of problem as seen from Washington I regret to report that on basis Embassy’s analysis of current trends we feel this timetable is not good enough and will not effectively meet problem. When in Washington I felt that we might be able to stall at least until early months of new administration. I do not feel any longer that this the case. As indicated in numerous recent reports:

(1) RGA embarked on policy forced development at fastest technically possible rate and with maximum foreign financing regardless of source and will risk its political future on success this all-out effort. Accordingly RGA will base its future development plans as well as its future general orientation on the kinds of long-term assurances it can get now for foreign support.

(2) Strength of Soviet position here is based on its acceptance of point (1) above as the foundation of Soviet policy. Accordingly we are convinced that USSR has offered to finance total foreign exchange costs of entire second 5-year plan (now estimated at about $500 million), as well as military aid and numerous special projects. While RGA apparently has not yet accepted this entirely and has made crystal clear its desire to see United States increase its participation Afghan development, it is also clear that RGA will accept Soviet financing to the extent required to cover what is unavailable from United States. Foreign Minister emphasized this to me by saying that RGA plans are not based on any concept of “balance of aid between East and West” (Embassy telegram 1195).² We must also recall Foreign Minister’s statement that under RGA planning procedures size and scope second 5-year plan will not be determined finally until extent of foreign financing is known. While this may not be approved method of planning it demonstrates clearly need of RGA for some assurance now before completing next 5-year plan which will go into effect in September 1961.

It can be seen therefore that an American schedule which defers decision on long-term financing problem until close next Congressional session will not meet the challenge we face here. Therefore we have sought formulate new concept this problem which would make it possible for us to discuss future aid with RGA and in most general terms to indicate general level of total financial support which free world might be able to give. This concept based upon following principal elements:

(1) Coordinated approach by free world countries best able to make significant contribution, that is, principally United States, Germany, Japan and perhaps including Turkey because of its special position here. On such basis it might be possible present RGA with general proposal that four countries would provide financing and aid equal to about one-half, that is about $250 million, presently estimated foreign exchange costs of second 5-year plan. This would force rough balance between free and Soviet blocs while pre-empting sizeable free world role in Afghanistan for next five years. Would also give RGA greater assurance re future. It possible of course that size of second 5-year plan might be increased or that Soviets might raise the ante but the limitation on Afghan absorptive capacity provides best possible brake. Money, whether from East or West, can only be actually spent as fast as it can be used. Key point is for free world to carve out in advance a large enough role and then to play it effectively by implementing its projects efficiently. What we propose is not the addition of a great amount of money over what we may end up spending in a 5-year period. The basic change is that we reap the political benefits of being able to make a commitment now, and in conjunction with other nations.

(2) By rejecting current level technical assistance for five years and adding approximately $15 million special assistance annually, by assuming total $25 million DLF support over next five years and, on basis liberalization PL 480 and possibility multi-year program (Department telegram 991)³ [and?] assuming $75 million wheat program plus other commodity imports over five years, it is possible estimate total level United States assistance at roughly $200 million.

(3) We understand Germans have previously considered supporting 5-year plan to extent $40 million. We fear however that in absence some coordinated approach which offers promise of success, Germans may be discouraged by difficulties some of their firms and projects having lately. By bringing in Germans with $40 million and by encouraging Japanese and perhaps others to raise level by $10 million it would be possible put together a $250 million free world level of aid.

We realize there are many complexities involved and that multilateral planning is difficult but this is the only way we see now by which free world can even possibly meet challenge on timely basis.

It impossible serve here and associate with official Afghans on daily basis without sensing their disappointment and frustration that United States system makes it impossible for us to participate in their future plans. Even low officials give impression RGA cannot hold up its planning for perhaps over a year and that they will reluctantly accept bulk of assistance from Communist bloc. To be sure some Afghans would not do so [1½ lines of source text not declassified]. Unfortunately those inclined to restraint are decided minority.

Regret to report that unless some such approach as above can be devised it is opinion this Embassy that we cannot expect much longer to be able accurately to refer to Afghanistan as neutral nation. In our opinion the necessity RGA feels for rapid development will win over caution against over-commitment to the Soviets. They will not knowingly take steps which they consider will lose their independence but we feel that if they consider it necessary in order to have continued and increasing pace of development they will place the ability to achieve this result over continued neutrality.

I would appreciate it if the Department and interested agencies would give urgent and serious consideration to this general approach and advise us of Washington views. If this approach acceptable for planning purposes Embassy and USOM will draw up more precise proposal. If plan can be devised it would then be necessary to coordinate with other three nations both in Washington and Kabul and it might be desirable to keep DAG and OECD informed.⁴

Byroade

1. Source: Department of State, Central Files, 789.5–MSP/7–460. Confidential.
2. In telegram 1195, June 1, Byroade reported on two conversations which he had with Naim on May 24 and May 28, during which they discussed U.S. and Soviet aid to Afghanistan. “I told Naim,” the Ambassador noted in part, “that while I did not know if current rumors were true I had begun to wonder if Soviets might not be attempting to ‘buy’ us entirely out of Afghanistan. He quickly replied that RGA itself would have to be involved in any such decision, and that it most certainly would not agree to any such plan. He said on contrary they wanted the US involved in Afghanistan just as much as possible.” (Ibid., 861.0089/6–160)
3. In telegram 991, June 30, the Department pointed out that it had no objections to exploring with Afghanistan the possibility of a multiyear program of economic assistance. (Ibid., 411.8941/6–2360)
4. The Department of State replied in telegram 30 to Kabul, July 9, which reads in part as follows: “Department appreciates suggestion contained reftel and agrees offer of long term commitment to assist Afghanistan’s economic development would make it easier for RGA plan such development in accordance prospective US and other foreign contributions thereto. Department still believes it impossible, however, justify at this time firm commitment since data or detailed plans which might support such long term determination for period 1961–66 simply not now available in case Afghanistan.” (Ibid., 789.5–MSP/7–360)