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

79. Letter From the Acting Secretary of State to the President of the International Bank for Reconstruction and Development (Black)¹

Washington, August 14, 1959.

Dear Mr. Black: The Government of the United States has examined the International Bank Memorandum (Indus Waters) dated July 13, 1959 and, in view of the importance which it attaches to a settlement of the Indus Waters problem, from the point of view both of the economic development of the area and of the promotion of peace and stability in the area, desires to assist towards its solution.

The Government of the United States is accordingly prepared to give sympathetic consideration to participation in the financing of the proposed system of works in the form of a contribution of the nature, and in amounts not exceeding the order of magnitude in paragraph 9E of the Bank Memorandum of July 13, 1959. This is on the understanding that the International Bank receives appropriate assurances from other friendly governments of their intention to give sympathetic consideration to participation to the extent sought from them in that Memorandum.

Any participation of the Government of the United States would be subject to obtaining such legislative authorization and appropriation as may be necessary, and would be dependent upon agreement being reached between India and Pakistan on the provisions to be included in an International Water Treaty for the settlement of “the Indus Waters Dispute” and upon detailed terms and conditions for the administration of the funds to be expended on the construction of the proposed system of works being worked out on a basis satisfactory to all the interested parties.

Furthermore, it is the expectation of the Government of the United States that the contribution of the several countries which will be providing financial assistance will be drawn upon pari passu, unless otherwise agreed to by the countries concerned.

With reference to paragraph 13 of the Bank Memorandum of July 13, 1959,² the Government of the United States will, as in the past, maintain their interest in the economic development of India and Pakistan, and will hope to continue in the future to make such contributions towards such development as its resources permit, in addition to this contribution in respect of Indus Waters.

The assurances of sympathetic consideration given above are, of course, subject to review by the Government of the United States in the event that unforeseen circumstances intervene.³

Sincerely yours,

Douglas Dillon⁴

1. Source: Department of State, Central Files, 690D.91322/8–1459. Secret. Drafted by Kennedy on August 13 and cleared with U/MSC, L/MSA, and H.
2. Paragraph 13 of the IBRD memorandum reads as follows: “The President of the Bank would urge that any aid that friendly governments may provide towards financing an Indus Basin settlement plan should be additional to the expectations by India and by Pakistan of normal aid from those sources.”
3. On August 17, Dillon sent copies of this letter to Anderson and Stans. (Department of State, Central Files, 690D.91322/8–1159 and 690D.91322/8–1259)
4. Printed from copy that bears this typed signature.