Office of the Historian

201. Memorandum of a Conversation, Department of State, Washington, January 17, 19581

Washington, January 17, 1958

SUBJECT

  • U.S. Aid to India

PARTICIPANTS

  • The Secretary
  • G. L. Mehta, Indian Ambassador
  • Lampton Berry, Deputy Assistant Secretary, NEA
  • Armin H. Meyer, SOA

The Ambassador on behalf of India expressed deep appreciation for the economic assistance which the United States Government has decided to provide to his country. He said he was grateful that the [Page 420] United States had officially recognized India’s need, and added that it was not the quantum of aid which was important, but the spirit in which it was extended.

In reply, the Secretary said that the essential thing is that India has a government which is trying to solve its problems through democratic processes. That India should succeed is in the United States view a matter of importance overriding any areas of difference which might exist between our two countries. Ambassador Mehta suggested that while there may be some such areas of difference, there are not many.

In response to a specific inquiry from Ambassador Mehta, the Secretary stated that he has not ruled out the possibility of Congressional action with a view toward assisting India. The Secretary expressed the hope that the United States would be able to continue to assist India in succeeding years. He stated that he was making no promise but merely an expression of interest. The motivation for assistance to India this year, he said, logically calls for further help in succeeding years to enable India to close its foreign exchange gap. He explained that if the Five Year Plan were to collapse eighteen months from now, it would be a waste of the money which the United States is making available this year.

When Ambassador Mehta referred to other possible sources of aid for India such as the International Bank and Germany, the Secretary said he too hoped such aid would be forthcoming. He indicated that Germany in particular is manifesting a sympathetic interest.

  1. Source: Department of State, Central Files, 791.5–MSP/1–1758. Confidential. Drafted by Meyer. During this meeting, Dulles and Mehta discussed a number of other matters, including Indian-Pakistani relations; see Document 10.↩