Office of the Historian

85. Memorandum From the Acting Assistant Secretary of State for Near Eastern and South Asian Affairs (Kennedy) to the Secretary of State1

Washington, November 13, 1959.

SUBJECT

  • Indus Waters

At your staff meeting yesterday morning you inquired as to our participation in the financing of the settlement of the Indus Waters question proposed by the IBRD.2 Perhaps some further background would be of interest:

1.
The partition line establishing the independent states of India and Pakistan cut across the system of canals which irrigate land in the Indus Basin and, in effect, gave control of the waters which the area now a part of Pakistan historically used, to India. This has been potentially the most dangerously explosive issue between the two countries.
2.
The IBRD has been working with India and Pakistan for eight years in an effort to reach an agreed division of the Indus Waters, and this has been in fact achieved.
3.
The solution, the Bank estimates, will cost a little over $1,000,000,000 in foreign exchange and local currencies of which we would put up about fifty percent. Other contributors would include the IBRD, the United Kingdom, Germany, Canada, Australia and New Zealand, and construction would take about ten years.
4.
It was generally agreed that the elimination of this problem will contribute greatly to a lessening of the tensions between the two countries, thus augmenting their resistance to Communist tactics, and to encouraging closer economic cooperation between them. The 1550 Determination, which provides for an advance commitment on the part of the United States to contribute to the cost of the system of works, was concurred in by Secretary of the Treasury Anderson, Director of the Bureau Stans and Under Secretary Dillon.
5.
Prior to obtaining final signatures on the Determination, Mr. Dillon briefed the President on the plan, informing him of the commitments made by other countries and of the commitment proposed for the United States. The President agreed that we should go ahead and said that he was much happier about this specific project than many others in the foreign aid field.
6.
Mr. Dillon also briefed the Senate Foreign Relations Committee and the House Foreign Affairs Committee. Neither committee expressed opposition.
7.
The present action, which occasioned your query, is to assist Mr. Iliff, Vice President of the IBRD, in completing his final negotiation of a water treaty.

  1. Source: Department of State, Central Files, 690D.91322/11–2359. Confidential. Drafted by Kennedy and cleared with Bartlett. Copies were sent to Dillon, John O. Bell, and Leland Barrows of ICA.↩
  2. A record of the Secretary’s Staff Meeting on November 12 is ibid., Secretary’s Staff Meetings: Lot 63 D 75.↩