THE PRESIDENT'S DAILY BRIEF 19 JULY 1975

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006014853
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 11
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: July 19, 1975

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The President's Daily Brief
July 19, 1975
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Exempt from general
declassification schedule of E.O. 11652
exemption category, 5B(I ).(2),(3)
declassified onbi on approval of
the Director of Central Intelligence
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FOR THE PRESIDENT ONLY
July 19, 1975
Table of Contents
Portugal: The power struggle between Communists
and moderates appears to be nearing a showdown.
(Page 1)
India: 'We present the key points of an interagency
memorandum, India's Political Prospects over
the Next Year. (Page 3)
Notes: Egypt; Syria-Israel; Canada; North Korea;
Iran - Iraq - Saudi Arabia; Angola; Tanzania-
Uganda (Pages 5, 6, and 7)
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PORTUGAL
The power struggle between Commu-
nists and moderates appears to be.nearing
a showdown.
Despite Communist threats to prevent the demon-
stration in Oporto last evening, the Socialists
opened all roads into the city and a crowd of more
than 70,000 put on an impressive show of strength.
Small groups of Communists dispersed quickly and
there were reportedly only brief clashes.
A potentially more serious test of strength
will likely occur today in Lisbon, where the, Commu-
nists have set up a number of roadblocks in an ef-
fort to prevent another Socialist demonstration.
Following a quickly summoned meeting of members of
the Revolutionary Council yesterday afternoon, Pres-
ident Costa Gomes called in Socialist and Communist
leaders for consultations and the military was put
on full alert.
The spokesman for the Council subsequently an-
nounced that the roadblocks around Lisbon would be
manned only by the armed forces--not to prevent peo-
ple from entering Lisbon, but "to check only for
possible reactionary elements." Discipline within
the military is weak right now, and we are unsure
what this may mean in practice./
The Communists are increasingly apprehensive
over whether they can retain the influence they
have enjoyed through the radical officers who have
dominated the Armed Forces Movement. The prospect
of losing their main peg to power--Prime Minister
Goncalves--appears to have stiffened their determi-
nation to meet the moderate challenge.
President Costa Gomes has decided he must sup-
port the moderates in their attempt to oust Prime
Minister Goncalves in the Revolutionary Council
meeting today or risk a further erosion of his own
power base.
(continued)
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Moscow has placed itself more fully
and-openly on the side of the:.Portuguese
Communists_and Armed Forces Movement in
the current political crisis.
Over the past few days signed commentaries
have appeared.in Izvestiya and Pravda pillorying
the Portuguese Socialists and expressing support
for the Armed Forces Movement. The Izvestiya com-
mentary, going further than Moscow has heretofore,
asserts that the "new Portugal" can count on active
economic and political support from the "socialist"
countries.
Moscow's more forthright backing of the Armed
Forces Movement and the Portuguese Communists sug-
gests the Soviets expect the rapidly developing
crisis will soon come to a head. The Soviets
clearly want to be publicly aligned with the "prog-
ressive" forces, and they may be under pressure
from the Portuguese Communists to take a stronger
stand. If, as Moscow apparently believes, the
Armed Forces Movement comes out on top, the Soviets
will be in a better position in Lisbon. Even if
things go badly for the Portuguese Communists, the
Soviet gesture of support at a critical juncture
could help protect Moscow from criticism within
the communist movement.
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INDIA
We present the key points of an
interagency memorandum, India's Polit-
ical Prospects over, the Next Year,
July 18, 1975.
Prime Minister Gandhi's recent repressive ac-
tions, though technically lawful, have substantially
changed India's political system.
She has dramatically tightened her control
and is likely to remain in power for at least the
next year.
--Within the Ruling Congress Party, opposition
to Gandhi is unlikely to grow serious enough
to jeopardize her position.
--Anti-Congress opposition groups will prob-
ably remain unable to mount a major challenge
for some time.
--The security forces are likely to remain
loyal to the Prime Minister's constitutional
authority and to be able to contain protest
activities.
The Indian Supreme Court's decision on Gandhi's
alleged campaign violations is not likely to lead to
her removal as Prime Minister.
--Even if the decision were adverse, she prob-
ably would take steps that would enable her
legally to remain in office.
--In the unlikely event she did leave office,
her likely successor would be Agriculture
Minister Ram or Foreign Minister Chavan? either
of whom would probably be less leftist-oriented
than Gandhi and perhaps somewhat friendlier to
the US and China.
The timing of the next national election will
depend on Gandhi's reading of the mood of the
country.
(continued)
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--Under the state of emergency, the normal
constitutional deadline for the next election--
March 1976--could be waived.
--Whenever the election is held, the Congress
Party appears likely to win a majority.
In the foreign policy field, Gandhi may re-
vive her campaign against alleged external threats,
but she probably will not attempt foreign adventures
or make any basic changes in policy over the next
year.
India's longer term future is less clear.
--Monsoon failures and the inability of the
government to get the economy moving could
lead to serious unrest and instability.
--This could lead to even more sweeping con-
trols and repressive measures.
--Gandhi might succeed in cowing all opposi-
tion by such action, but the chances of either
the Congress Party replacing her or of the
military stepping in to assume power would in-
crease as would the possibility of general in-
stability.
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NOTES
Egypt
Syrian-Israel
Canada announced yesterday that it will put
phase two of the Foreign Investment Review Act into
effect on October 153 giving the government full
control over new foreign investment in the country.
The move will be used to implement Prime Minister
Trudeau's goal of keeping foreign ownership of new
resource projects under 50 percent.
Under the expanded act, government screening
of all foreign takeovers of Canadian firms will be
extended to cover the large number of representa-
tive offices currently being set up by foreign banks.
Foreign-controlled firms are particularly concerned
because Ottawa now has the authority to limit their
expansion into new lines of business. Ottawa will
be tempted to use the act to pare US involvement
in the economy. US firms own or control 44 percent
of Canadian manufacturing, 58 percent of the petro-
leum industry, and 43 percent of the mining indus-
try. Last year, US firms accounted for 95 percent
of the $445 million in new foreign direct invest-
ment.
(continued)
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North Korea has consented to reopen talks with
Seoul as part of a campaign to project an image of
flexibility and reason.
Pyongyang has agreed to resume Red Cross nego-
tiations next week on such problems as the reunion
of separated families. At the same time, the North
is sounding a softer note on its preconditions for
a resumption of talks by the North-South Coordi-
nating Committee to explore possibilities for po-
litical accommodation. The North Koreans are par-
ticularly anxious to enhance their prospects for
membership in the conference of nonaligned nations
in August and for passage of a resolution favor-
able to their interests at the UN General Assembly
this fall.
North Korea will an-
nounce a new peace proposal Sunday which could in
essence be its proposed UN resolution.
'Iran, 'Iraq, and' Saudi Arabia failed to agree
on new steps to strengthen regional security coop-
eration during this week's Islamic Conference.
no decisions were taken because the majority of
states were uninterested in moving quickly on the
subject. Earlier this year, the Shah of Iran was
encouraged by political developments in the Gulf
to believe that the time was ripe for a formula
under which Iran could play a greater peacekeeping
role on the Gulf's western shore. The main ob-
stacle to an agreement was apparently Saudi Arabia,
with the smaller Gulf states probably following its
lead. The Saudis do not believe a regional secu-
rity arrangement is warranted and they certainly
do not share the Shah's perception of a power vacuum
on the western side of the Gulf that Iran should
help fill. The Iranians can be expected to put
the results of the conference in the best possible
light. Nevertheless, the Shah's failure to get
some sort of an agreement on security cooperation
is a disappointment for him.
(continued)
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Holden Roberto, the head of the National Front
for the Liberation of Angola, reportedly has left
Zaire to direct the Front's military operations in
northern Angola.
Since the Angolan transitional government was
established last January, Roberto has been under
considerable pressure from Zairian President Mobutu,
his chief backer, and from other' Front leaders in-
side Angola to move to Luanda. His refusal to do
so has seriously impaired the Front's military and
political effectiveness. If Roberto is indeed in
Angola, it appears too late for him to reestablish
a military presence in the capital. The past week's
fighting has left the Front virtually isolated to
its tribal base in the north after being forced out
of Luanda by the rival Popular Movement for the
Liberation of Angola.
Tanzania
ITaanda
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