289. Memorandum of a Conversation, Department of State, Washington, October 31, 19601
SUBJECT
- Call on the Under Secretary by the Ambassador of Nepal
PARTICIPANTS
- His Excellency, Rishikesh Shaha, Ambassador of Nepal
- Mr. Jagdish S. Rana, Second Secretary, Embassy of Nepal
- The Under Secretary
- SOA—Mr. T. Eliot Weil
- SOA—J. Wesley Adams
Ambassador Shaha stated that he had been asked by his government to stress to the United States Government Nepal’s urgent need for additional economic assistance, especially in Indian rupees. Without additional United States aid a number of the projects now under way might have to be discontinued. He referred to the fact that in Fiscal Year 1960 the United States Government had advanced $16.8 million in Indian rupees but that none had been provided in FY 1961. He added that a representative of the U.S. Government was currently in Nepal discussing the aid program and that the Deputy Prime Minister had expressed alarm over the possibility that American aid might not continue at its present level.
Mr. Dillon explained that $15 million in Indian rupees extended as a grant in the last days of our FY 1960 was not to be considered as an aid contribution for that particular year. It had actually been contemplated that the grant would be extended early in FY 1961. The date had been advanced in view of a new Congressional requirement that local currency loans and grants would in the future require dollar appropriations. He added that even with this advance in date he had had some difficulty in getting agreement that the $15 million in rupees could be made available without an appropriation.
The Ambassador said his government had estimated that for FY 1962 it would require a grant of $14 million and a loan of $18 million in Indian rupees. He asked if he could inform his government that assistance in this amount might be expected for that year. Mr. Dillon explained that Congress appropriated money on a global basis and not for particular countries. He thought, however, that assistance to Nepal in the range of the figures mentioned by the Ambassador might be possible. Mr. Dillon added that he understood our people in Kathmandu had recently discussed with the Nepalese Government the possibility of a very substantial increase in U.S. aid for FY 1962. He did not think aid at that level could be provided.
The Ambassador inquired if it might be possible to obtain some small additional assistance in FY 1961. Mr. Dillon said that this might be possible; there was a Contingency Fund from which small additional amounts could, from time to time, be advanced.
The Ambassador said that Nepal was in an emerging state economically and that it would no doubt require assistance from the United States for at least the next four or five years. He inquired whether Nepal might expect such assistance. Mr. Dillon said we appreciated Nepal’s needs, and that we intended to do what we could to help. He mentioned the Development Loan Fund as one possible source of more assistance.
- Source: Department of State, Secretary’s Memoranda of Conversation: Lot 64 D 199. Limited Official Use. Drafted by Adams.↩