Office of the Historian

283. National Intelligence Estimate1

NIE 55–59
Washington, November 24, 1959.

THE OUTLOOK FOR NEPAL, BHUTAN, AND SIKKIM2

The Problem

To estimate probable developments in Nepal, Bhutan, and Sikkim during the next few years, including the relations of these states with India, the Sino-Soviet Bloc, and the West.

Conclusions

1.
Nepal, Bhutan, and Sikkim are strategically located on India’s northern frontier and are vulnerable to Chinese Communist pressures. India views this vulnerability as directly endangering its own security. (Paras. 8, 23, 27, 34)
2.
Nepal’s first experiment in representative government began with the elections of 1959. The moderate socialist Nepali Congress Party won a sweeping victory. Its leaders, headed by Prime Minister Koirala, seem to be working harmoniously with King Mahendra, who retains extensive powers under the new constitution. These circumstances improve the prospects for stable government over the next few years. (Paras. 9–13)
3.
Nevertheless, Nepal faces formidable internal problems. Differences between Mahendra and the Nepali Congress government could emerge and disrupt their present cooperation. Internal dissensions [Page 599] might in time weaken the Nepali Congress. Conservative forces may be able to exploit differences between King and government. (Paras. 13–15, 17–20)
4.
Local Communist subversive activities are unlikely to pose a serious threat to the government within the next few years, though these capabilities will probably grow with tightening Chinese Communist control of Tibet and greater Bloc interest in Nepal. (Para. 16)
5.
In foreign affairs, Nepal will maintain its neutralist policy. Being more fearful of Communist China than of India, it will continue to rely primarily on the latter to preserve its independence, while seeking not to antagonize Communist China. At the same time, it will welcome financial and moral support from the US. (Paras. 23–33)
6.
The remoteness and backwardness of Nepal make major economic progress unlikely for years to come. However, with continued outside aid, modest improvements in output and living standards are feasible over a period of time, and these would probably be enough to satisfy the expectations of the Nepalese. (Paras. 21–22)
7.
India will continue to control the foreign relations of the small and primitive states of Bhutan and Sikkim, and to assume responsibility for their defense. However, India would find it particularly difficult to defend Bhutan until roads now planned link the countries. India already has troops in Sikkim and will take whatever action it deems necessary to maintain effective control over that state. (Paras. 34–38)

[Here follows the “Discussion” section, comprising numbered paragraphs 8–38.]

  1. Source: Department of State, INR–NIE Files. Secret. National Intelligence Estimates were high-level interdepartmental reports appraising foreign policy problems. NIEs were drafted by officers from those agencies represented on the U.S. Intelligence Board, discussed and revised by interdepartmental working groups, coordinated by the Office of National Estimates of the CIA, approved by the USIB, and circulated under the aegis of the President to appropriate officers of cabinet level and the members of the NSC.

    According to a note on the cover sheet, the following intelligence organizations participated in the preparation of this estimate: the CIA and the intelligence organizations of the Departments of State, Army, Navy, Air Force, and The Joint Staff. All members of the USIB concurred with the estimate on November 24 with the exception of the representatives of the Atomic Energy Commission and the Federal Bureau of Investigation. Those representatives abstained since the subject being considered was outside their jurisdiction.

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  2. This estimate is devoted primarily to the outlook for Nepal; consideration of Bhutan and Sikkim is limited almost entirely to likely developments in their relations with India and China. [Footnote in the source text.]↩