176. Intelligence Memorandum1

OCI No. 2942/65



A major source of instability in Southeast Asia has been Indonesia’s “confrontation” of Malaysia which began in early 1963. Following the change of political climate in Djakarta, there has been speculation that [Page 372]the Indonesian army might bring an end to confrontation. It is unlikely, however, that the army because of the political liabilities involved and its own anti-Malaysia orientation, is now ready to take such action. In the near future military activity against Malaysia, already at a low level, should not be significantly affected by the Indonesian upheaval.

Although there was a massive Indonesian buildup along the Borneo border and in Sumatra, beginning last December and largely completed by May, military activity directed against Malaysia has declined during the past six months. With few exceptions, only routine patroling and minor probing action has taken place along the Borneo border. The last Indonesian attempt to infiltrate an armed guerrilla unit into the Malayan peninsula occurred last March. Indonesian planning for demolition sabotage against the Malayan peninsula has continued but implementation has been limited. During the past two months there has been only one explosion attributed to an Indonesian agent.
This lag in Indonesian activity has resulted in large part from the almost total lack of success the Indonesians have had in their past operations in Borneo and in the Malayan peninsula. In Borneo, effective British cross-border operations have disrupted Indonesian planning and have placed the approximately 17,000 Indonesian troops in the area on the defensive. Since August 1963, when Indonesian infiltration attempts against Malaya began, British and Malaysian security forces have captured or killed over 500 of the nearly 700 Indonesian guerrillas involved in these unsuccessful efforts.
Several recent reports have indicated that the Indonesian army now intends to reach a modus vivendi with Malaysia. However, there is reason to doubt whether the army favors an end to confrontation. While opposed to many of Sukarno’s internal policies and his fostering of Communist influence, the army in the past has accepted enthusiastically Sukarno’s expansionist policies and has apparently been convinced that Malaysia is a British scheme aimed against Indonesia. A good example of the army’s somewhat naive international view is the lingering and apparently sincere belief among the army leadership that the British, as well as Communist China, played a role in instigating the “30 September” plot against the army.
If the army eventually becomes the ruling force in Indonesia it will inherit a number of pressing economic and social problems compounded by the current unrest. In the past Sukarno made use of foreign adventures and international issues to divert attention from these problems. The army could conceivably feel the need to borrow a page from Sukarno and re-emphasize confrontation.
Even should the army want to end confrontation, it would be difficult for it to move in this direction in the near future. After two years of anti-Malaysian propaganda, the average Indonesian considers [Page 373]confrontation a patriotic duty. Even a hint of a conciliatory army position toward “neocolonialist” Malaysia would give Sukarno the ammunition he needs to undermine the army’s attempts to maintain its present political initiative.
Although, for the above reasons, an early end to confrontation seems unlikely, military activity against Malaysia is likely to remain at a low ebb while the army is deeply involved in political maneuvering and suppression of the Communist Party. The current level of confrontation activity does not require the large numbers of troops now deployed around the periphery of Malaysia. One brigade of troops has recently been returned from the confrontation theater to the now critical areas of Central and East Java, and other similar redeployments can be expected.
Malaysian leaders, in recent statements, have indicated they have little hope for a settlement with Indonesia in the near future. However, a new generation of political leadership, more nationalistic, parochially Malay and anti-Chinese in outlook, is now emerging in Kuala Lumpur. If an Indonesia emerges in which Communist influence has been muzzled, Sukarno has been ousted from real power and more moderate leadership prevails, Kuala Lumpur, anxious to present a more “Afro-Asian” image, will be eager for an accommodation with its “Malay brothers” to the south and might take the lead in seeking a settlement.
The new nation of Singapore would look with disfavor upon a sudden normalization of relations between Malaysia and Indonesia which would also bring the elimination or reduction of British military presence in the area. Prime Minister Lee Kuan Yew, noting the current anti-Chinese activity in Indonesia, has already expressed alarm over the prospects of a Malay “encirclement” of Chinese Singapore.
  1. Source: Johnson Library, National Security File, Country File, Indonesia, Vol. VI, 11/65–5/66. Secret; No Foreign Dissem; Background Use Only. Prepared in the Office of Current Intelligence, Central Intelligence Agency.