CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A003100060001-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 41
• Document Creation Date: December 16, 2016
• Document Release Date: March 2, 2005
• Sequence Number: 1
• Publication Date: March 16, 1961
• Content Type: SUMMARY

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CONFIDENTIAL
r?n-c-CT
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
COPY NO. 1226
OCI NO. 0271/61
16 March 1961
CENTRAL INTELLIGENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
IAN;
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State Department review completed CLASS. CHANGED TO 25X1
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THIS MATERIAL CONTAINS INFORMATION AFFECT-
ING THE NATIONAL DEFENSE OF THE UNITED STATES
WITHIN THE MEANING OF THE ESPIONAGE LAWS,
TITLE 18, USC, SECTIONS 793 AND 794, THE TRANSMIS-
SION OR REVELATION OF WHICH IN ANY MANNER TO
AN UNAUTHORIZED PERSON IS PROHIBITED BY LAW.
The Current Intelligence Weekly Summary has been prepared
primarily for the internal use of the Central Intelligence
Agency. It does not represent a complete coverage of all
current situations. Comments and conclusions represent the
immediate appraisal of the Office of Current Intelligence.
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T H E W E E K I N B R I E F
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LAOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 1
The failure of talks in Phnom Penh between Souvanna
Phouma and Laotian Government representatives has removed
any prospect for an early political resolution of the
Laotian crisis. After agreeing in an earlier meeting with
General Phoumi on the need for the prior creation of a
neutral nations commission to end foreign interference in
Laos, Souvanna, under strong Communist pressure, has re-
verted to insistence on a 14-nation conference as a pre-
requisite to any settlement. Insisting that he remains
a free agent, Souvanna left on 15 March on a tour of various
world capitals to seek support for his Communist-supported
peace plan for Laos. The military situation, meanwhile,
remains critical.
The Tananarive conference of Congolese leaders, in
setting up a "Confederation of Central African States" to
replace the Congo's present centralized constitution, has
encouraged further fragmentation of the country. The con-
ference was dominated throughout by Katanga President
Tshombd, and its outcome reflects Tshombd's separatist
policy. Meanwhile, the Gizenga regime, unable so far
to obtain the material assistance it wants from the bloc
or the UAR, has adopted a more moderate posture. Tensions
between the UN and Congolese in Leopoldville have eased
somewhat, but anti-Asian feeling may lead to incidents
involving the Indian troops now arriving.
The French Government announced on 15 March that it is
ready to begin formal negotiations with the Algerian rebels.
The meeting of the Algerian provisional government, which
began in Tunis on 14 March, `As expected to formulate the
rebels' response to the French position
re remains, owever, along with the crucial problem o
determining sovereignty over the Sahara.
CUBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 7
Cuba is reported to be encountering increasing agricultural
difficulties and some shortages of basic foodstuffs. Dissi-
dents are continuing sabotage and terrorist activities
throughout the island. Argentina's rejected offer of "good
offices" in easing US-Cuban tension has provoked consider-
able discussion among other Latin American governments as
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he problem of implementation o a cease-
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 CURRENT INTELLIGENCE WEEKLY SUMMARY
16 March 1961
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to whether the Cuban problem is one for collective hemisphere
action rather than for single-country mediation. A number
of leaders, including President Lleras of Colombia, have
indicated agreement with the US position that collective
action is required.
ARGENTINA . . . . . . . . . . . . . . . . . . . . . . . . Page 8
Dissatisfaction over political and economic conditions
is growing in Argentina. Concerned over two electoral de-
feats of his party during February, President Frondizi
wants to lessen the discontent through a number of moves,
including termination of the unpopular security measures
imposed to counter Peronista plotting. Such a step is
opposed by the arm .
MOSCOW REVIEWING CENSORSHIP PRACTICES. . . . . . . . . . . Page 9
Reports from Moscow that the Soviet Government is
about to end formal censorship of foreign correspondents
coincide with publication in Izvestia of charges that
Soviet correspondents in the US are subjected to discrimina-
tory restrictions and harassment. The Kremlin might
expect not only to gain some propaganda advantage from
relaxing censorship but also to induce the US to cut back
its limitations on Soviet press representatives. Because
of the many devices for indirect pressure and influence
which would remain, the removal of formal censorship would
not in fact lessen Moscow's control over outgoing press
material.
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WEST GERMANY AND THE FOREIGN AID QUESTION. . . . . . . . . Page 12
The West German cabinet appears to be nearing agree-
ment that, in principle, future German contributions to aid
for underdeveloped countries should be calculated at one
percent of the annual gross national product. In 1960,
one percent of the GNP was approximately $700,000,000.
In the past, Bonn preferred to direct most of its assistance
through private commercial channels, and the slow pace
at which monies are being collected and allocated for
Bonn's special 1961 bilateral loan fund suggests that
West Germans are still a long way, from effectively as-
suming a substantially larger share of Western economic
aid to underdeveloped areas.
Page 13
The recent revaluation of the West German mark and
the Netherlands guilder reflects the continued disparity in
economic trends between the generally booming Common
Market (EEC) countries on the one side and the Anglo-Saxon
countries on the other. Although the 5-percent currency
appreciation was probably too small to have a sizable
effect on the international payments situation, it is
expected to improve the already favorable competitive
position of France and Italy in the Common Market. This
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CURRENT INTELLIGENCE WEEKLY SUMMARY
and the considerable anxiety in most EEC countries over
inflationary pressures may result in accelerated tariff
reductions within the Common Market and a more liberal
tariff policy toward nonmembers..
SOMALI REPUBLIC . . . . . . . . . . . . . . . . . . . . . Page 14
Attacks from the leftist opposition are causing
leaders of the moderate government of the Somali Republic
to question their ability tosuivive the national referendum
scheduled for next June. Italy, the former administering
power, has not fulfilled its promises of economic and mili-
tary aid. In an effort to demonstrate progress in economic
development and defense, the Somali Government has there-
fore accepted aid from the UAR. So far this year Cairo
has delivered two shipments of gift arms, signed trade
and payments accords, extended development credits, and
concluded a cultural agreement.
COMMUNAL AGITATION AGAIN PLAGUES CEYLON . . . . . . . . . Page 15
The chronic dispute between Ceylon's two major ethnic
and religious communities--the Buddhist Singhalese majority
and the Hindu Tamils--has flared up as a result of the
Bandaranaike government's attempts since early January to
enforce the adoption of Singhalese as the sole official
language. A protest campaign led by the Tamils' Federal
party is gaining support and has virtually halted govern-
ment operations in the Tamil-dominated northeast region
of the island. The government has refused to yield to
the Tamil demands, but probably will be forced to re-
treat if major violence occurs or if the large plantation
labor force, predominantly Tamil and essential to the
economy, joins the campaign.
EVACUATION OF CHINESE NATIONALIST IRREGULARS . . . . . . . Page 16
Chiang Kai-shek's agreement to withdraw Chinese ir-
regular forces from the Thai-Burmese-Laotian border area is
unlikely to result in the evacuation of more than 3,000
troops. Most of these will come from the group that has been
driven into Laos. However, those in the Thai-Burmese
border area, numbering 3,000-4,000, will probably refuse to
leave and will continue to create trouble for the Burmese
Government.
ANTICHURCH CAMPAIGN IN HUNGARY . . . . . . . . . . . . . . Page 17
The Kadar regime, in order to avoid an increase in
public hostility and an open break with the bishops, may
have relaxed its crackdown on obstructionist elements
within the Catholic Church. Priests and laymen` are still
being arrested, but the arrests apparently are not on a
scale comparable to those four or five weeks ago. Budapest
still desires to "regularize" relations with the United
States.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
16 March 1961
ECONOMIC GROWTH OF EUROPEAN SATELLITES SLOWED IN 1960 . . Page 18
The rate of economic growth for the European satel-
lites declined last year. A slowdown was anticipated after
the high growth rate in 1959, but a generally poor agricul-
tural year, together with investment and foreign trade
problems, retarded growth beyond expectations. East Ger-
many's 1960 record makes achievement of its Seven-Year Plan
by 1965 more doubtful than ever. Accomplishments in the
other countries were more in keeping with their objectives
for 1965, but Bulgaria, Hungary, and Poland may find it
difficult to maintain high rates of growth as repayments
on foreign debts fall due.
NEW SOVIET TANKER PURCHASES . . . . . . . . . . . . . . . . Page 20
Moscow continues to stress the building of a modern
tanker fleet as an integral part of its program to expand
Soviet oil sales in competition with Western suppliers. In
addition to its domestic shipbuilding program and its ac-
quisition from the European satellites, the USSR has pur-
chased or contracted for more than 20 large, modern tankers
from Western Europe, Japan, and Yugoslavia since it began
the tanker procurement program last autumn. Delivery of
these ships will boost the tonnage of the Soviet tanker
fleet by a least 700,000 dead-weight tons (DWT); in mid-
1960 the total fleet was only 990,000 DWT. Four nonbloc
tankers have been acquired by the USSR thus far--two of
40,000 DWT from Japan and two from Yugoslavia and the
Netherlands, each of 25,000 DWT. Prior to their delivery
the Soviet fleet had only two tankers larger than 13,500
DWT.
SOCIALIZATION OF TIBET POSTPONED . . . . . . . . . Page
Peiping has declared a three- to five-year postpone-
ment of further efforts to communize Tibet. The people
have been told they may live their lives as before and prac-
tice their religion freely. Collectivized land in central
Tibet is being returned to its owners. Internal difficul-
ties--particularly the food and fuel shortages--and Tibetan
recalcitrance have apparently motivated Peiping's decision.
BELGIAN PARLIAMENTARY ELECTIONS . . . . . . . . . . . . . . Page 22
Belgian parliamentary elections, scheduled for 26
March, have been advanced by over a year in an effort to
give the country a fresh start after the various crises
occasioned by developments in the Congo. The chief issue
in the campaign is the government's economic program. As
a result of the 34-day strike in protest against the pro-
gram's austerity aspects by the Socialist. trade unions in
December and January-,the Socialists are likely to lose
middle-class votes to the governing Social Christians
and Liberals and to suffer left-wing defections to the
small Communist party.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SPECIAL ARTICLES
MOSCOW AND A NUCLEAR TEST BAN . . . . . . . . . . . . . . . . Page 1
When the nuclear test ban negotiations resume in Geneva
on 21 March, the USSR will be faced with a dilemma arising
from the conflict between Soviet and Chinese interests on
the issue. Moscow's decision to continue the talks during
the post-summit anti-American campaign last year, despite
its withdrawal from the general disarmament talks, sug-
gests that Khrushchev is still interested in exploring
the possibility of agreement with the US and the UK. He
is aware that the Soviet position in the negotiations
will have an important bearing on the West's attitude
toward high-level talks on other questions, and Soviet
spokesmen have indicated that the USSR will adopt a
flexible attitude on certain crucial issues. On the
other hand, Khrushchev's freedom of action may be sharply
limited by Peiping's determination to achieve a nuclear
weapons capability and by its opposition to a test ban
without an over-all prohibition and destruction of nuclear
weapons.
INDIAN COMMUNIST PARTY SPLIT . . . . . . . . . . . . . . . . Page 7
Indian Communist leaders remain divided in spite of a
series of party policy meetings in February. Their wran-
gling has been accentuated by the Sino-Soviet ideological
dispute. Last fall's Moscow declaration, which was in-
tended to reconcile the differences between Moscow and
Peiping, merely compounded the confusion among Indian
Communists. Leaders of the moderate and extremist fac-
tions of the Indian party are preparing for a fight at
the party's national congress in April. This meeting,
like those in February, probably will produce only a
compromise designed to hold the party together for the
national elections early next year. 25X1
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CURRENT INTELLIGENCE WEEKLY SUMMARY
LAOS
The failure of the 14-15
March talks in Phnom Penh be-
tween Souvanna Phouma and a
delegation from the Boun Oum
government has removed pros-
pects for an early political
resolution of the Laotian cri-
sis. Souvanna, bending to
strong Communist pressure, has
reverted to insistence on a
14-nation conference as the
prerequisite for any settle-
ment, after agreeing in earlier
talks with General Phoumi on
the need for priority creation
of a neutral nations commission
to end foreign interference
in Laos.
Souvanna left on 15 March
to visit Rangoon, New Delhi,
Paris, London, Moscow, Peiping,
Hanoi, and possibly other cap-
itals to gain further inter-
national support for his Com-
munist-supported peace plan
for Laos. Souvanna Phouma
continues to insist that he
is a free agent, and that
his Xieng Khouang - based
regime is independent of the
pro-Communist Pathet Lao. It
is becoming increasingly clear,
however, that the ascendancy of
Communist control over the anti-
government political-military
apparatus in Laos has virtually
ended Souvanna's flexibility
of action.
The atmosphere of rap-
prochement surrounding the
Phoumi-Souvanna talks in Phnom
Penh on 9-10 March and the com-
munique which followed apparent-
ly was viewed in the bloc as a
serious potential threat to
the Communist effort to drive
the hardest possible bargain
in Laos--an effort pinned to a
great extent on Souvanna's un-
willingness to deal with Boun
Oum and Phoumi. The communi-
que, in addition to endorsing
an international commission for
Laos, referred to an eventual
meeting of representatives of
the Vientiane government, Sou-
vanna, and the Pathet Lao.
The reaction of the Com-
munists was reflected in bloc
broadcasts. Moscow reported
that Phoumi had suffered a
"diplomatic defeat" in coming
to Phnom Penh and claimed that
Souvanna stood firm in his de-
mand for a 14-nation interna-
tional conference. Both Peiping
and Hanoi took a less optimis-
tic tack and implied that Sou-
vanna's position would be weak
indeed were it not for support
by the pro-Communist forces in
Laos. The bloc avoided direct
criticism of Souvanna, and most
of these veiled warnings to him
were conveyed by repeating
Pathet Lao broadcasts such as
one on 13 March which indicated
that the Pathet Lao would sup-
port Souvanna so long as he
stayed in line but stated that
it "is resolutely opposed to
all compromises."
Simultaneous with these
political pressures, pro-Commu-
nist forces in Laos have pressed
their military advantage with
the aim of demoralizing the
Laotian Army and weakening the
bargaining position of the Vien-
tiane government. The retreat
of government forces north from
the Phou Khoun road junction,
however, has at least temporarily
been halted. Morale is still
low, and the ability to withstand
a concerted enemy drive on Luang
Prabang is highly questionable.
For the moment at least, the
Kong Le - Pathet Lao forces on
this particular front appear
to have overextended their sup-
ply lines and are exerting only
light pressure.
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BURMA .
Muting Sai:
To NW N
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STATUTE MILES 200
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Antigovernment forces to
the south of the road junction
have effective control of the
highway as far as Muong Kassy,
and may be preparing an attack
against Vang Vieng. Although
their unit strength in this
area is not great, they are be-
ing aided by Pathet Lao guer-
rillas. Meanwhile, in Xieng
Khouang Province, Kong Le -
Pathet Lao forces in the block-
ing position at Ban TaViang
are being reinforced to consol-
idate control of the southern
approach to the Plaine des
Jarres. Phoumi forces, aided
considerably by far-roving pro-
government Meo guerrilla bands,
had made limited gains in
recent weeks, but now appear to
be going on the defensive again.
In a 10 March conversation
with British Foreign Secretary
Lord Home, Soviet Ambassador Sol-
datov reaffirmed Soviet support
for an international conference
and maintained that the 18 Febru-
ary Soviet proposals to reacti-
vate the ICC and convene an in-
ternational conference were in-
separable. Soldatov took issue
with Lord Home's opinion that a
conference would only provide a
forum for acrimonious exchange
and contended that the 1954
Geneva Conference had worked
efficiently and harmoniously.
The Soviet ambassador prob-
ably wanted to make it clear to
the British, whose reply to the
Soviet proposals is still
pending, that the USSR would
not accept Western agreement
on the ICC plan if it did not
call at the same time for an
international conference.
The Tananarive Conference
The trend in the Congo to-
ward fragmentation into numer?-
ous tribally based autonomous
states was stimulated by the
conference of Congolese leaders
at Tananarive from 8-12 March.
The proceedings were dominated
by Katanga's secessionist-minced
Moise 'tshombe, and the agree-
ment to reconstitute ,the coun-
try into a "Confederation of
Central African States" shows
the impact of his influence on
the other leaders.
Several of these officials,
particularly those from Leopold-
ville, had previously resisted
Tshombes efforts to gain rec-
ognition. The central govern-
ment delegates, however, ap-
peared chastened at Tananarive
and seemed to act more as a pro-
vincial than'as a national del-
egation. Some of them are al-
ready concerned about a future
role in the projected confedera-
tion.
The Gizenga regime was not
represented at Tananarive and
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CURRENT INTELLIGENCE WEEKLY SUMMARY
has attacked the conference
participants as "imperialist
puppets." Communist bloc propa-
ganda has strongly condemned
both the participants and the
confederal agreement.
The details of the agree-
ment are still to be worked Out,
and conferences for this purpose
are to convene at Bakwanga and
Elisabethville within the next
few weeks. In the absence of
any single authority with means
to enforce its decisions, ad-
justment of the structure of the
Congo to existing tribal and
political realities would ap-
pear inevitable.
The Tananarive conferees,
however, did provide for a veto
power by each state in the pol-
icy-making Council of States,
an extreme adjustment which
mould practically deprive the
central government of any ef-
fective role even in internation-
al matters. The council is to
comprise the president of the
confederation--Joseph Kasavubu--
and the presidents of the mem-
ber states. It will determine
general policy--both internal"
and international. An "inter-
state coordination organization"
is to implement the council's
decisions. All these arrange-
ments are merely expressions of
the ambitions of the individual
politicians, each of whom hopes
to maximize his own role.
The provision specifying
that the existing and future
states are "sovereign in rela-
tion to each other" is an open
invitation to further fragmenta-
tion into tribal states. Press
sources quote observers in Leo-
poldville as predicting that the
number of such "independent"
states, originally envisaged as
eight, might increase to forty
or more. By 15 March the number
had already reached twelve. If
even part of these "governments"
become more than fictions, an
obvious opportunity has been
created for interference by the
bloc and radical African
states, as well as by Bel-
gium.
UN-Congolese Relations
The Tananarive agreements
appear to have produced a eu-
phoric atmosphere in Leopold-
ville, and, coupled with the de-
parture for New York of the un-
popular UN representative Daya13
have improved the chance of an
early understanding under which
the UN Command could re-estab=
fish its presence in the ports
of Matadi and Banana. The Con-
golese have apparently reacted
favorably to Hammarskjold's
new pro "tempore representative,
Makki Abbas, and are avoiding
bellicose gestures for the pres-
ent. However, the Congolese
are not yet reconciled to the
arrival of the UN's Indian rein-
forcements--particularly in the
Leopoldville area--and their
presence may lead to new inci-
dents.
The return of Dayal to the
Congo after his consultations
in New York could have the same
effect. On 14 March Hammar-
skjold revealed to an American
official that he is thinking
of sending Dayal back to the
Congo around the first of April
for a "few weeks." Hammarsklold
thought he might first install
three African assistants to
whom most of the duties now
handled by the UN representa-
tive would be assigned. He said
that he eventually expected to
designate an African as head
of the UN Congo operation, to
be assisted by another-African
and an Asian.
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The Stanleyville Government
The Gizenga regime, unable
to obtain substantial bloc aid
and in desperate economic
straits as a result of the
blockade of the Congo River, is
attempting to develop a more
moderate public image.
occupy a position between
Lundula and Interior Minister
Gbenye, who has been described
as a "potentially dangerous,
vindictive, stupid racist."
A fourth center of power
is provincial president Jean
Foster Manzikala, who has a rep-
utation as a moderate but seems
chiefly interested in building
up a position from which to
challenge Gizenga.
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Although Gizenga was crit-
ical of Kasavubu, he said he
recognized him as chief of state.
He also said that if his secu-
rity were assured, he would be
willing to attend a session of
the Congolese parliament, and
that if voted out of the govern-
ment, he would remain in the
legislature as part of the op-
position.
Although the situation in
Orientale Province outside
Stanleyville reportedly has
degenerated into virtual chaos,
the authorities in the city it-
self have managed to maintain
order. This is largely the work
of General Lundula, Gizenga's
chief of staff, who appears to
be a member of the moderate
wing of the regime.
Gizenga reportedly realizes
his unpopularity with the local
inhabitants and rarely moves
out of his house. He seems to
K rus chev also took an un-
compromising stand-regarding
the Congo. He claimed that
the Soviet Union had been pre-
pared for serious discussion
with the United States to work
out a common approach but that
American actions show that the
United States intends to sup-
port the "colonialists." There-
fore, Khrushchev said, the
bloc's position will be to op-
pose any decisions which could
damage the interests of the
"legal" Congo government, i.e.,
Gizenga's Stanleyville regime.
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Paris announced on 15 March,
following meetings of the govern-
ment's Algerian Affairs Commit-
tee and the cabinet, that it
was ready to negotiate with the
Algerian rebels. The announce-
ment said the cabinet "wished to
see the opening of talks on the
conditions for the self-deter-
mination of the Algerian people
as well as on related problems."
By using this language, Paris
apparently opened the way to
political negotiations without
requiring a prior formal cease-
fire agreement. The initial
rebel acknowledgment of Paris'
announcement was favorable.
the problems of implementing a
cease-fire and determining sov-
ereignty over the Sahara will
be especially difficult points
during negotiations.
Following the meeting of
the rebel provisional Algerian
government (PAG) which began in
Tunis on 14 March, the rebels
are expected to respond to the
French proposals on an Algerian
settlement reportedly made in
the preliminary talks.
the French Army and the ALN may
be generating pressure on their
respective governments not to
make concessions on the cease-
fire issue.
Although the PAG considers
it already has a mandate to nego-
tiate a settlement, the 62-man
National Council of the Algerian
Revolution (CNRA), the supreme
governing body of the rebel move-
ment to which the PAG is at least
theoretically responsible, may
insist on ratifying the negotiat-
ing position formulated by the_PAG.
The CNRA is reportedly
gathering in Tunis, and key
civilian and military members
from within Algeria, often at
odds with the Tunis-based PAG,
are reported skeptical that a
satisfactory settlement can be
reached unless the rebels continue
the war and score significant
military victories.
in Algiers and Oran.
tightening security precautions
The commander of the Algiers
army corps, Lieutenant General
Vezinet, told the US consul gen-
eral on 11 March he fears that
Moslem-instigated disorders may
follow the ending of Ramadan
on 17 March. Vezinet said agita-
tors "of several kinds" are at
work among the Moslems, who are
under great emotional strain
because of fasting and expecta-
tions that hostilities will soon
end. The general added that
there were still some European
activists interested in creat-
ing incidents designed to pro-
voke counteraction from the Mos-
lems. The French are reportedly
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Several recent reports in-
dicate that Cuba may be con-
fronted with increasing agricul-
tural difficulties.
u a recently
purchased more than 3,800 metric
tons of corn from France--de-
spite the fact that Cuba usually
harvests three or four corn crops
of its own each year. This is
the largest single purchase ever
made by Cuba from France.
program and said it was formu-
lated as the result of US alarm,
"not over the welfare of Latin
America, but over fear of losing
America." He characterized the
proposed US expenditure of
$500,000,000 in Latin America
as "alms" and stated his convic-
tion that "the conscience of
Latin America cannot be purchased."
He also railed against the
alleged US plan to back the es-
tablishment of an anti-Castro
Cuban government-in-exile, and
he pledged that "as soon as
imperialism forms a counter-
revolutionary government-in-
exile, we will form many revolu-
tionary governments-in-exile."
He specified a "Free Puerto
Rico" as the first to be thus
formed.
this
year's sugar crop is eked
to approach the normal yearly
total of about 5,500,000 to
6,000,000 tons.
Opposition forces in Cuba
are continuing their campaign
of sabotage, terrorism, and sub-
version, despite government ef-
forts to reduce dissident ac-
tivity by arrests, executions,
and possible attempts to provoke
a premature uprising by pro-
Castro infiltrators among the
opposition.
There has been no sign of
a letup in the Castro regime's
barrage of anti-US statements.
In a 14 March speech at Havana
University, the Cuban premier
lashed out at President Kennedy's
ten-point Latin American aid
Havana has also attacked
President Kennedy for his "im-
perialist objectives" in pub-
licizing the recent action of
the American Red Cross at the
Guantanamo base in supplying
what the Cubans called "dated"
and "useless" polio vaccine to
combat an outbreak of the dis-
ease in Guantanamo city. The
regime's press and radio branded
the creation of the US Peace
Corps "demagogic" and "ridicul-
ous" and concluded that the or-
ganization was "doomed to fail-
ure."
Argentina's offer of "good
offices" to improve US-Cuban re-
lations--an offer rejected by
Cuba on 8 March--has aroused
considerable discussion among
other Latin American governments
as to whether the Cuban problem
is an issue for collective hem-
isphere action rather than sin-
gle-country mediation. A number
of leaders have indicated agree-
ment with the US position that
it is the concern of all the
hemisphere nations.
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The widely respected Presi-
dent Lleras of Colombia stated
publicly on 9 March that the in-
ter-American system "should act
on, examine, and resolve the
Cuban case," and that if Cuba
chooses to remain outside this
system, it should accept its
responsibility and, without any
equivocation, permit the American
nations to assume theirs." Lleras
refused, however, to sever dip-
lomatic relations with Cuba now.
The Brazilian Government did not
comment on the Argentine proposal
and has not denied press,reports
that President Quadros on 28
February stated his opposition
to collective intervention in
Cuban affairs.
Discontent over political
and economic conditions is grow-
ing in Argentina. Concerned over
two electoral defeats of his
party during February, President
Frondizi is seeking means of
diverting public criticism from
priority programs, such as the
US-backed stabilization plan
and petroleum development.
The stabilization program
initiated in January 1959 has
achieved a sound currency and
attracted foreign investment
and short-term loans; but aside
from petroleum, it has not yet
expanded industrial production,
and business has remained de-
pressed by credit restrictions.
The rate of inflation declined
during 1960 with only a 12-per-
cent rise in living costs, but
labor has not regained the 25-
percent loss in real wages it
suffered during 195g when living
costs doubled.
Notable progress in petro-
leum development, aided since
late 1958 by US companies under
government contract, is expected
to give Argentina self-sufficien-
cy and to allow for some exports
by late in 1961. This progress
will help offset the poor pros-
pects for exports of farm prod-
ucts, which still provide the
bulk of foreign exchange earn-
ings.
Complaints over Frondizi's
policies emanate from both the
left, whose pro-Castro Socialist
candidate won the Buenos Aires
congressional elections on 5
February, and the right, which
won the Mendoza provincial elec-
tions on 12 February. The large
non-Communist opposition parties,
such as the leading People's
Radical Civic Union, have in-
hibited political and economic
recovery by their all-out attacks
on government policies with
propaganda scarcely distinguish-
able from the Communist line and
with appeals to partisan military
elements. A conference of provin-
cial governors of Frondizi's
own UCRI party reportedly in-
sisted last month that their
political organizations would
be finished if help were not
given to enable them to show
some visible achievements under
the economic program.
Frondizi's plans for new
policy moves include more active
trade promotion and more atten-
tion to "social" programs, such
as housing and highways. The
government hopes to release
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control of the General Confedera-
tion of Labor to union represent-
atives: in the next few days
if the unions are able to settle
their long-standing disagreements.
Frondizi also plans to lift the
special security measures which
have been in effect for more
than two years to cope with
Peronist and Communist agitation.
Army elements, usually sus-
picious of any "softness" to-
ward Pex6nista s , and Communists,
have been disturbed by reports
of these plans.
MOSCOW REVIEWING CENSORSHIP PRACTICES
Moscow has decided to
abolish direct censorship of
outgoing press dispatches and
films of foreign correspondents,
according to a Time-Life corre-
spondent who wr_oT_ea-letter to
Khrushchev early last month urg-
ing this step. Other Western
correspondents have reported
that the Foreign Ministry's
Press Department, which has been
in charge of censorship, favored
its abolition. The issue apparent-
ly has been under consideration
by L.F. Ilyichev, head of the
central committee's agitprop
sector for the union republics
and former head of the Press
Department.
The authorities may feel
they have little to lose, as they
could continue indirect pressures
--such as threats of expulsion
or denial of news-gathering op-
portunities. Such a decision
would probably be aimed at
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silencing irritating Western
criticism and to gain propa-
ganda advantages by advertising
"complete freedom of the press."
The publication in Moscow
at this same time of a list of
grievances concerning the situa-
tion of Soviet press representa-
tives in the United States sug-
gests that the Kremlin may be
attempting to secure some con-
cessions in return. An article
published in Izvestia on 2 March,
and subsequently propagated by
TASS, protests against purported
discriminatory practices applied
to Soviet journalists by US of-
ficials: regulations requiring
them to register with the Justice
Department and to submit periodic
financial accountings; the FBI's
asserted right to search TASS
premises; demands for finger-
printing in connection with visa
extensions; and travel restric-
tions imposed on Soviet corre-
spondents at the UN. The article
concludes with the observation
that "one word from the people
in authority would suffice to
change 'the' situation im-
mediately."
Soviet authorities have
long refused to admit the exist-
ence of direct censorship. How-
ever, texts of all dispatches,
wires, telephone calls, and
broadcasts must be submitted in
triplicate at the Press Depart-
ment's section in the Central
Telegraph Office. After a de-
lay ranging from five minutes
to 36 hours, one copy--with any
censored portions deleted--is
stamped "Approved for Transmis-
sion Outside the USSR" and is
returned to the correspondent.
Another copy is kept on file,
and the third is transmitted
before the correspondent has
had an opportunity to make any
revisions. If the whole story
is censored, no copy is re-
turned. Telephone calls are
monitored; if the newsman de-
viates from the approved text
he is likely to be cut off.
The correspondent has no
contact with the actual censors,
who apparently are women highly
skilled in languages and expert
in the party line on current
affairs. They are likely to
pass any copy based on pieces
in the Soviet press, but they
have shown sensitivity to gen-
eral speculative articles, for
example, on the fall of Bulganin
and on Khrushchev's visit to
Peiping just before the Chinese
Communists began to bombard the
offshore islands in 1958. In-
terpretation of the rules is
not uniform, however, and cor-
respondents sometimes wait to
submit copy until they think
one of the more permissive cen-
sors is on duty.
All film for communications
media is supposed to be devel-
oped in the USSR and reviewed
by the censors. In practice,
only wire services comply with
this rule. All press photographers
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CURRENT INTELLIGENCE WEEKLY SUMMARY
bypass the system whenever pos-
sible because of the delays in-
volved and poor Soviet devel-
oping facilities. Undeveloped
films are transported by West-
ern travelers to the nearest
free world bureau of the news-
paper involved. The authori-
ties are fully aware of these
violations and even facilitate
transmittal of films by notify-
ing photographers of the depar-
ture dates of suitable couriers.
Khrushchev and Mikoyan on
their trips abroad have been
impressed with the resource-
fulness of foreign newsmen and
seem concerned about main-
taining good public relations
with the foreign press. Ac-
cording to a veteran Moscow
correspondent, however, the
bureaucrats of the information
control apparatus--such as
Ilyichev, M. A. Kharlamov,
present head of the Foreign
Ministry's Press Department,
and Georgy Zhukov, head of
the State Committee on For-
eign Cultural Relations--be-
lieve that all foreign corre-
spondents are spies, or at
least enemies who must be
closely watched.
Even in the rare instances
in which normal censorship re-
strictions have been waived--
as during the visits of Prime
Minister Macmillan and Vice
President Nixon--the Foreign
Ministry has violated its
agreements. Correspondents
accompanying Nixon from the US
were allowed to telephone di-
rectly from their hotel rooms,
but resident correspondents
were not allowed to file stories
from the Central Telegraph Agency
without censorship. On the
third day of the visit the For-
eign Ministry announced that
only developed film could be
shipped out. After Nixon had
complained to Kozlov, the For-
eign Ministry said that film
taken in Moscow and Leningrad
could be sent out undeveloped,
but that film shot in Siberia
would have to be developed first.
The Press Department also
used bribery and blackmail as
means of control. Those cor-
respondents who "write good
stories" are rewarded with
privileges in the form of travel
permits, special interviews,
and easy transmission of copy.
On the other hand, the depart-
ment calls in men whose stories
it dislikes, threatening them
with expulsion, prosecution
under the Soviet State Secrets
Law, or other punishment. Some-
times it tries to drive a wedge
between the correspondent and
his employers by suggesting
that it objects not to his copy
but to the general anti-Soviet
line taken by his newspaper.
The Press Department also
has seen advantages in allowing
some illegal operations, as in
the case of transmitting un-
developed films, because'they
provide additional opportuni-
ties to pressure correspondents
at the suitable moment. 25X1
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The West German cabinet
appears to be nearing agreement
that in principle, future Ger-
man contributions to aid for
underdeveloped countries should
be calculated at one percent
of the annual gross national
product. In 1960, one percent
of the GNP was approximately
$700,000,000. The slow pace
at which monies are being col-
lected and allocated for Bonn's
special 1961 bilateral loan
fund suggests that West Germans
are still a long way from ef-
fectively assuming a substan-
tially larger share of the
Western economic aid to under-
developed areas.
The 1961 funds from such
sources as industry and state
government loans, proceeds
from the sale of the Volkswagen
company, and Marshall Plan "re-
flow" funds now are expected
to total only $600,000,000,
considerably less than original-
ly planned. The cabinet has
decided to ask the Bundestag
for an additional $125,000,000
federal government contribution.
With regular budgetary appro-
priations for technical assist-
ance and contributions to multi-
lateral institutions amounting
to $135,000,000, anticipated
aid funds come to $860,000,000,
of which approximately $725,-
000,000 will eventually be
available for development loans.
In charge of administering
the new loan fund is the Recon-
struction Loan Corporation (KfW)
a semiofficial agency which has
long provided foreign credits
linked to the purchase of Ger-
man exports. Many government
officials now favor liberaliz-
ing credit terms, and loans
under the new fund will probably
not be tied to the purchase of
German goods.
Financial and commercial
interests--which are providing
a sizable contribution--still
prefer loans on regular com-
mercial terms at rates prevail-
ing in the West German capital
market, but there are-indica-
tions that a considerable por-
tion of the funds will be made
available for noncommercial
projects on easier terms and
with repayment extending to 15
years and possibly even longer
in special cases. A $36,000,-
000 loan promised to Pakistan
runs for 15 years and is not
tied to purchases in Germany.
Bonn reportedly offered simi-
lar terms for a large loan to
Indonesia.
Although Bonn has preferred
to direct most of its assistance
through private commercial chan-
nels, it has occasionally extended
modest grants for technical as-
sitance and has made a direct
contribution to the Indus River
project. Bonn, however, remains
basically opposed to grants for
development projects and has re-
sisted US efforts to obtain German
aid in relieving the Turkish debt-
servicing burden--even though a
large share of Turkish debt pay-
ments are going to West Germany.
In Bonn's view, a major dif-
ficulty in increasing its foreign
aid lies in the reluctance or in-
ability of underdeveloped coun-
tries to provide "the facts and
figures" to justify desired proj-
ects. Germany officials frequent-
ly have complained they are un-
able to find enough sound projects
for the monies available. Since
only about $250,000,000 of the
1961 funds have been committed
for development projects in India,
Pakistan, Liberia, Argentina,
and Turkey, it seems doubtful
the scheduled aid will be fully
allocated this year.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The 5-percent appreciation
of the West German mark and the
Netherlands guilder on 4 and 6
March is not expected to have a
material effect on the current
imbalance in international pay-
ments. In the first week after
the revaluation, speculation an-
ticipating additional exchange
adjustments more than defeated
the purpose of the German move,
with heavy inflows of funds into
West Germany and mounting pres-
sures on sterling. These move-
ments are tapering off, but
prospects are that the old sit-
uation will soon be restored
rather than improved unless ad-
ditional measures are taken and
there is some moderation of the
disparate economic trends, par-
ticularly between the booming
Common Market (EEC) countries
on the one hand and the Anglo-
Saxon countries on the other.
Recognition that the boom
had developed serious inflationary
tendencies appears to have been
the major factor in the sudden
revaluation decision, which Bonn
had periodically considered but
put off since 1959. With wages
and prices both rising, indica-
tions of another speculative in-
flux of foreign funds confronted
the Bundesbank with the choice
of revaluing or losing control.
Inaction would have been risky,
in view of the sensitivity of
the German man-in-the-street on
inflation, and the government
may also have feared that an ag-
gravated surplus problem would
increase pressure from the US
for a larger foreign aid pro-
gram. Economics Minister Erhard
apparently had this in mind when
he observed on 5 March that
Bonn's foreign exchange earnings
had produced "greatly exaggerated
judgments of West Germany's
economic capacity."
Although inflationary pres-
sures are also being felt in
several other EEC countries--
notably the Netherlands and to
a lesser extent France--the EEC
as a whole is likely to share
Bonn's caution about instituting
restrictive measures. In addi-
tion to the political unpopularity
of such measures, it has long
been the consensus in the EEC
that a high level of prosperity
is the sine qua non for success-
ful implementation of the Common
Market treaty. Accordingly, at
a meeting of the EEC's Business
Cycle Committee last month, con-
siderable concern was evident
over the possibility that econom-
ic activity might level off dur-
ing the second half of 1961, and
the member countries were ex-
horted to maintain "at all costs"
the expansion of internal demand.
Realization that inflation
would be a serious threat to
continued expansion may, however,
lead the EEC countries to take
an increasingly liberal position
on the matter of tariff levels.
The German revaluation is expect-
ed to improve the already strong
competitive position in the Com-
mon Market of France and Italy
--normally the most protectionist-
minded of the EEC countries.
Moreover, there have been a num-
ber of rumors that, as an anti-
inflationary measure, France may
soon unilaterally reduce tariffs
by roughly 5 percent. If so,
this would materially improve
the outlook for the EEC to double
the next 10-percent internal
tariff reduction--as it did the
last--bringing to 50 percent the
total internal tariff reduction
by 31 December.
This increasingly liberal
attitude might also benefit out-
siders in general and the United
States in particular, since the
Business Cycle Committee has rec-
ommended' that in the forthcoming
GATT negotiations on a 20-per-
cent reduction in the EEC's ex-
ternal tariffs, the EEC not in-
sist on immediate reciprocity.
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SOMALI REPUBLIC
The moderate government in
the Somali Republic may adopt
a more neutralist foreign pol-
icy following the UAR's prompt
response to Premier Abdirascid's
plea for early military and eco-
nomic aid. In contrast to
Italy's procrastination in pro-
viding promised funds to cover
the 1960 budget deficit of its
former trust territory, ship-
ments of gift arms offered by
Nasir during Abdirascid's visit
to the UAR last November ar-
rived in Mogadiscio in mid-
February and early March. Cairo
also moved rapidly to imple-
ment cultural and economic
agreements signed with the new
republic. A Foreign Ministry
spokesman in Rome indicated
that Italy will honor its pledge
but that special legislation
will be required before payment
can be made.
Under the economic agree-
ment, which spells out details
of trade and payments accords
signed last November, the UAR
is to provide a credit of $11,-
200,000 on favorable terms for
development projects. A UAR
economic mission now in the
Somali Republic is studying
plans for the construction of
a textile mill, a sugar mill,
and a slaughterhouse, and is
investigating the possibility
of expanding Somali production
of sugar cane and introducing
the cultivation of short-staple
cotton. The mission has com-
mitted UAR firms to buy bananas,
livestock, and frankincense.
Cairo demonstrated its
special interest in the north-
ern region--formerly the Brit-
ish Somaliland protectorate--
by opening a consulate general
in the provincial capital of
Hargeisa and by earmarking sev-
eral thousand dollars of the
credit for livestock improve-
ment in that area.
Abdirascid's government,
which has been in power since
the territory became independ-
ent last July, believes it must
demonstrate substantial progress
in economic development and de-
fense in order to survive a
national referendum, scheduled
for 20 June. The referendum
is being held to approve or re-
ject the draft constitution
which provides for national
elections every five years.
The leftist opposition--which
has received financial support
from Communist countries--is
aware that approval of the ref-
erendum will in effect prolong
the tenure of the present
government for another five
years. The leftists therefore
are expected to conduct a vig-
orous campaign to defeat the
referendum.
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COMMUNAL AGITATION AGAIN PLAGUES CEYLON
The chronic language dis-
pute between Ceylon's Singha-
lese-speaking Buddhist majority
(about 70 percent of. the popu-
latior) and the Tamil-speaking
Hindu minority (about 24 per-
cent) threatens to result in
violence if the Bandaranaike
government continues to enforce
the adoption of Singhalese as
the sole official language.
The Tamil Federal party
launched a "passive resistance"
protest campaign on 2 January,
the day after the 1956 Official
Language Act went into effect.
Initially the government seemed
to believe that a hands-off
policy would undermine the
Federal party's efforts to gain
official status for the Tamil
language. Instead, the party
intensified the agitation with
a "direct action" campaign be-
ginning on 20 February. Since
then, picketing of government
offices has spread to the point
where operations at most admin-
istrative centers in the Tamil-
dominated northeast have been
virtually halted. In early
March the government sent
troops to various trouble spots.
The government's supporters,
as well as its critics, prob-
ably fearing a repetition of
the violent communal riots in
1958 over the language issue,
have urged it to withdraw the
troops and to negotiate with
the Tamils. In a broadcast
shortly before her departure
for the Commonwealth prime
ministers' conference, however,
Mrs. Bandaranaike said that
while she would discuss any
"hardships" imposed on the Tamils
by the Language Act, there
would be no change in the deci-
sion to implement its provi-
sions, nor would she hold talks
with Tamil leaders unless the
campaign were called off.
Meanwhile, the "direct action"
campaign is gaining support in
the Tamil areas.
The government can afford
to take a firm position as
long as the agitation remains
essentially nonviolent and
limited to Tamil areas. It
does not need Tamil support in
Parliament, and in any case
would be unwilling to yield for
fear of damaging its prestige
with the majority--or inviting
counteragitation by Singha-
lese extremists. Should major
violence occur, however, or if
the large and predominantly
Tamil plantation labor force
joins the campaign, the govern-
ment will be forced to compro-
mise. The plantations are the
basis of the island's export
earnings, and prolonged strikes
would cripple the already un-
healthy economy.
The government's problem is
complicated by the fact that
many of its high-level military
and civil service officials be-
long to the Tamil or other ethnic
or religious minority groups
and are said to be concerned
over the language policy.
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EVACUATION OF CHINESE NATIONALIST IRREGULARS
Chiang Kai-shek now appears
willing to withdraw all Chinese
irregular troops who choose to
leave the Thai-Burmese-Laotian
border area. Chiang. however,
believes the evacuation, which
is scheduled to begin on 17
March, will damage Nationalist
interests, and he may hope the
situation in Laos will deterio-
rate to the point where the
evacuation will be called off.
General Lai Ming-tang, vice
chief of the general staff,
heads a military mission now
in the border area to arrange
for the withdrawal.
Lai visited villages in
Thailand and Laos where the ir-
regulars are concentrated to
persuade as many as possible
to leave. As an inducement, the
irregulars were offered integra-
tion in the Chinese Nationalist
Army on favorable terms. Of-
ficers will be allowed to take
their dependents and will re-
ceive assistance for resettle-
ment.
their dependents are willing to
be evacuated, it is unlikely
that more than about 3,000 troops
will go to Taiwan. Most of the 25X1
3,000 irregulars now in Laos
probably will consent to evac-
uation,
os o the 3,000
to 4,000 irregulars in the
Burmese-Thai border area have
been relatively independent of
Taipei's control and will prob-
ably refuse to leave.
irregulars who reject evacua-
tion will undoubtedly attempt
to return to bases in Burma
and continue to create trouble
for the Burmese Government.
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Prospects have developed
during the past week for some
Burmese-Thai military coopera-
tion in removing the irregulars
who have refused evacuation.
In his State of the Union address
to Parliament on 13 March, Bur-
mese Prime Minister Nu said Burma
would "take all appropriate steps,
in conjunction with our neigh-
bors," to assist in such an 25X1
operation.
Although Lai has reported
that 4,500 of the 6,000 to 7,-
000 irregulars and 1,500 of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
ANTICHURCH CAMPAIGN IN
The prospect of worsening
public morale and an open break
with the bishops may prompt the
Hungarian Government to relax
its crackdown on "obstruction-
ist elements" within the Catho-
lic Church. The population is
already disturbed by the impo-
sition of stricter work controls
and agricultural collectiviza-
tion, and there is growing ap-
prehension that the Kadar govern-
ment is reverting to the poli-
cies of the pre-revolt Rakosi
leadership. The US Legation
reports that priests and laymen
are still being arrested, par-
ticularly in the primatial dio-
cese of Esztergom. However,
the arrests apparently are not
on a scale comparable to those
of four or five weeks ago, when
as many as 1,200 persons may
have been detained at least
temporarily.
Despite the renewal in
January of the regime's annual
$3,000,000 subsidy to the Bench
of Bishops, church-state rela-
tions had been deteriorating
rapidly since last fall. Fifty-
eight priests reportedly were
arrested in November in Budapest
Szekesfehervar, Eger, and Pecs.
The authorities seem to have
hoped thereby to develop in-
criminating evidence against
the local bishops, who had de-
nied advancement to the collab-
orationict clergy. In January,
Gyor County party Secretary
Ferenc Lombos attacked local
seminarians and senior clergy
for refusing to associate with
the pro-regime "peace priests."
regime's announcemen Lt.
persons, including eight priests,
had been arrested for plotting
against the state.
Security authorities sub-
sequently conducted a door-to-
door search of the Christina
Varis District of Budapest and
reportedly arrested 500 priests
and laymen in the capital and
up to 700 elsewhere. The pris-
oners are being held at a spe-
cial detention center in Ujpest,
a suburb of the capital. Employ-
ees of the Ministry of Justice,
some of them veterans of the
antichurch campaign of the late
1940s and the trial of Cardinal
Mindszenty, reportedly were
working overtime two weeks ago
on indictments. At least one
employee of the Ministry of
Interior has been seeking evi-
dence to link the clergy with
church officials in the West.
In the meantime, attendance
at Catholic services has remained
gengrally normal, with one
exception in which a 30-percent
"protest" increase was noted
by Western observers. Diplomats
with extensive contacts in Hun-
garian cultural circles report
that members of the intelligent-
sia are jittery and, to a lim-
ited extent, defiant--presumably
because the antichurch campaign
may foreshadow a reimposition
of all-out cultural controls.
The arrests in recent
months probably have disrupted
the church's internal adminis-
tration, and Kadar may have con-
cluded that trials ot further
arrests are unnecessary at this
time. Moreover, the government
may be easing up on its anti-
church campaign in order to
further its efforts to "regu-
larize" relations with the
United States.
I I
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The rate of economic growth I tion of Hung
ary. Higher employ-
ZZO
for the European satellites as
a whole declined during 1960.
There were only moderate gains
in gross national product--4 to
6 percent in most countries--
and improvements in living con-
ditions last year were either
small or insignificant. Agri-
culture, generally hindered by
bad weather and, in three sat-
ellites, by collectivization
drives as well, contributed
little to economic growth. As
in most years, the greatest
achievements were in industry.
All the satellites made
significant gains in industrial
production during 1960. Never-
theless, increases in gross in-
dustrial output in Albania,
-Bulgaria, and East Germany were
.Much smaller than in 1959; of
these three, only Albania reached
its goal. Growth rates for 1960
rose slightly in Czechoslovakia,
Hungary, and Poland and increased
considerably in Rumania, which
has replaced Bulgaria as the
most ambitious economic planner
among the satellites.
Increased labor productiv-
ity was the dominant factor in
industrial growth in all coun-
tries with the possible excep--
ment nonethiess did contribute
significantly to industrial ex-
pansion in Bulgaria, Czecho-
slovakia, and Rumania, as well
as in Hungary. The investment
drive of recent years--an im-
portant factor in satellite
industrial development--slowed
down last year, causing concern
in several countries. For East
Germany, the la; in investment,
together with decelerated ex-
pansion of industrial output
and foreign trade, strengthens
doubts that its 1.965 goals can
be achieved.
Gross agricultural produc-
tion apparently did not increase
as much as 5 percent in any
satellite except Czechoslovakia,
and net production there re-
mained lower than in 1958. Pre-
sumably because of this poor
1960 record, planned increases
announced so far for agricul-
tural. production in 1961 are
con sis t-ently higher than aver-
age rates scheduled for 1961-65.
As a consequence of agri-
cultural collectivization drives
last year in East Germany, Hun-
gary, and Rumania, private hold-
ings in six satellites at the
e.d ,. ~f 10_163 wccc:tntau for less
INDUSTRY
PLANNED ACTUAL
ALBANIA BULGARIA CZECHOSLOVAKIA EAST GERMANY
SECRET
AGRICULTURE
PLANNED ACTUAL IEST,
HUNGARY POLAND RUMANIA
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than one fifth of farmland or
cultivated area and had been
reduced to relatively little
economic importance. In Po-
land, the only satellite not to
push collectivization during
the past five years, almost 87
percent of agricultural land
is still privately owned.
The unusually rapid growth
of foreign trade in 1959 was
PERCENT
100
mostly Soviet--credits. They
face a reduced ability to handle
economic problems and maintain
the desired high rates of growth
as debt payments come due dur-
ing the next few years.
Per capita consumption
gains in 1960 were slight, and
in the case of Poland there was
none at all. The Polish re-
gime's Planned deferment of
EASTERN EUROPE:
LAND IN COLLECTIVE AND STATE FARMS
DEC MAR JUN SEP DEC MAR JUN SEP DEC MAR JUN SEP DEC MAR JUN SEP DEC MAR JUN SEP DEC
1955 1956 1957 1958 1959 1960
not maintained in 1960, but most
countries made substantial gains,
and Bulgaria and Poland reduced
their trade deficits by rough-
ly $o5,000,000 and $105,000,000
respectively. On the other
hand, the Hungarian trade defi-
cit grew by a reported $70,000,-
000. During 1956-60, economic
development in these three sat=
ellites has been based in part
on the receipt of foreign--
relatively generous 1gains
for consumers until 1964-65
obviously involves some
risk of popular disturbances,
as do labor-norm revisions now
under way or imminent in several
satellites. Since 1956, however,
the satellites have modified un-
popular economic programs where
there has been serious opposi-
tion. (Prepared
by ORR)
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NEW SOVIET TANKER PURCHASES
In addition to increasing
its petroleum production and
planning further expansion of
its network of oil pipelines,
Moscow is stressing the build-
ing of a modern tanker fleet
as an integral part of its pro-
gram to push Soviet oil sales
in competition with Western
suppliers. To supplement its
domestic shipbuilding-program
and its acquisitions from the
European satellites, the USSR
is continuing to purchase large,
modern oil tankers from nonbloc
countries. Recent Soviet con-
tracts for the construction of
tankers in Japanese and Italian
yards raise to more than 20
the number of tankers the USSR
has ordered from Western Eu
rope, Japan, and Yugoslavia
since last autumn. Delivery
of these ships will boost the
tonnage of the Soviet tanker
fleet by at least 700,000
deadweight tons (DWT); in mid-
1960 the total fleet was only
990,000 DWT.
Although there is a world-
wide surplus of tankers avail-
able for charter, the USSR pre-
fers to reduce its dependence
on free world resources in
this as in other fields. Ap-
parently in response to the
Cuban need for Soviet oil de-
liveries at an annual rate of
over 3,500,000 tons, as well
as to increased oil exports to
other areas, Moscow embarked
on its tanker-procurement pro-
gram in the latter half of
1960. The program includes the
purchase of tankers for immedi-
ate delivery, as well as con-
tracts for construction of new
ships.
The four nonbloc tankers
the USSR has acquired thus far
--two of 40,000 DWT from Japan
and one each of 25,000 DWT
from Yugoslavia and the Nether-
lands--were immediately em-
ployed on the run to Cuba. All
but two of the tankers previous-
ly used in the Soviet fleet were
of the ' 13, 500 DWT class or
smaller.
New Soviet orders in Japan
provide for the construction of
two 35,ODU-DWT tankers, in ad-
dition to four similar vessels
ordered in December 1960. The
orders are well beyond the
scope of the Soviet-Japanese
three-year trade agreement
signed in March 1960 and even
exceed the terms of the agree-
ment as revised last December.
These purchases, arranged on
deferred payment terms, make
the USSR one of Japan's major
customers for merchant ships.
Using its Japanese orders
as an example of the potential
profits to be made, Moscow
arranged for the purchase of as
many as 11 tankers in the
Soviet-Italian trade pacts re-
cently drawn up in Moscow. At
least one, and possibly three,
48,000-DWT tankers are to be
delivered this year, and from
six to eight 35,000-DWT tankers
will be constructed for the
USSR during 1962-65.
Tanker negotiations with
West Germany and Spain are being
conducted by Moscow but have
not yet resulted in firm orders.
Bonn's new trade agreement with
the USSR has a clause calling
for West Germany to build some
$37,000,000 worth of ships, in-
cluding tankers, for the Soviet
Union between 1961 and 1965.
The tankers apparently were in-
cluded during the final stages
of the trade talks last Decem-
ber at the insistence of the
Soviet side. Moscow is seek-
ing to buy four tankers from
Spain ranging from 20,000 to
32,000 DWT. The sales are being
actively promoted by the Spanish
Government as part of its pro-
gram of increasing exports to
the Soviet bloc.
The Netherlands probably
will supply four more ships of
25,000 DWT each during the next
two years, and Yugoslavia may
have agreed to supply one addi-
tional 25,000-ton tanker.
(Prepared
by ORR)
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SOCIALIZATION OF TIBET POSTPONED
Just two years after the
rebellion of March 1959, Peiping
has declared a moratorium on
further efforts to communize
.Tibet. China's internal dif-
ficulties--the food and fuel
shortages in particular--and
Tibetan recalcitrance have
played a part in this decision.
Through 1960, the Chinese
national press optimittically
reported "progress" in Tibet.
The deputy secretary of the
Tibetan party committee wrote
in the 1 December issue of Red
Flag that the region had har-
vested a bumper crop, which in
turn had improved the standard
of living. Since their emanci-
pation from serfdom, he wrote,
"peasants' enthusiasm for pro-
duction had risen to unprecedent-
ed heights." Land reform had
been carried out with great
success, mutual aid teams had
brought immense benefits to the
majority of the farming popu-
lation, and some agricultural
cooperatives had been set up.
The article implied that "demo-
cratic reforms" had been an un-
qualified success and said they
"would be carried through to
the end."
The day after the article
was published, however, the
Tibet party committee announced
that cooperativization would be
postponed three to five years,
as "mutual aid teams had not
yet been perfected" and the
"Tibet region still does not
have the prerequisite conditions
for turning the democratic rev-
olution into a socialist revolu-
tion."
i e ans
have been told they may live
their lives as before and prac-
tice their religion freely.
Collectivized land in central
Tibet is being returned to its
owners. Private trade has re-
sumed on a small scale, and the
Chinese reportedly have offered
to furnish capital for Tibetans
who wish to establish private
businesses. Mass indoctrina-
tion meetings in Lhasa have been
suspended. Refugees also refute
Peiping's claims of a bumper
harvest and assert that Tibet
is on the verge of starvation,
primarily because of the dis-
locations caused by the rebellion
and land reform.
Peiping's reversal of pol-
icy is comparable to the six-
year moratorium on communiza-
tion of Tibet declared by Mao
Tse-tung in February 1957. This
period of grace came to an abrupt
end in 1959, however, with the
Tibetan uprising.
The Chinese Communists-now
admit that both Tibetan and
Chinese cadres "made too many
mistakes" in the implementation
of land reform--intimating that
their highhanded policy aroused
a great deal of wrath among the
people. The Panchen Lama re-
cently said, "We need more ex-
perience in dealing with vast
pastoral areas characterized by
vastness in area, sparsity in
population, and scattered dis-
tribution and great mobility of
inhabitants." To force through
their program on Tibet now, the
Chinese would have to expend
manpower and resources which
are needed much closer to home.
Peiping has made it clear,
however, that the postponement
of Tibetan reforms is an act of
expediency and not an indefinite
moratorium. Tibetans have been
informed that the political need
for reform persists, and the
process of socializing Tibet is
likely to be started again when-
ever the circumstances are deemed
favorable. As long as the ap-
proximately 110,000 Chinese
troops remain in Tibet--one for
every ten inhabitants--Peiping
will certainly maintain its con-
trol of the region.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The Belgian parliamentary
elections, to be held on 26
March, are expected to diminish
the strength of the opposition
Socialists, who are being held
responsible for the violent, un-
successful 34-day strike in De-
cember and January against the
austerity aspects of the govern-
ment's economic program. The
governing Social Christian-and
Liberal parties. are expected
to gain.
Regular quadrennial elec-
tions would have been held in
June 1962; however, the three
major parties believed elections
were necessary now in order to
give the country a fresh start
after a series of crises stem-
ming largely from the Congo trou=?-
ble. This issue has not yet playedd
a prominent part: in the cam-
paign, and the Eyskens govern-
ment is reluctant to take any
drastic action regarding the
withdrawal of Belgian advisers
from the Congo, for fear of
stirring up a bitter domestic
controversy. Moreover, the three
major parties all participated
in the original Brussels round-
table conference which set up
independence for the Congo.
The principal issue in the
campaign is the "loi unique"--
the economic austerity and ex-
pansion program--and the strike
against it.
The major parties agree
that Belgium's lagging economy
needs stimulation--its rate of
economic growth is one of the
lowest in Western Europe--but
they disagree as to the means..
The Socialists have attacked the
loi unique as bearing too heavily
on the low-income groups.
The Social Christians are
seeking to capitalize on the
widespread public resentment
against the strike. In an effort
to placate the party's trade
union wing and win over discon-
tented trade union elements in
the Socialist ranks, they have
postponed until after the elec-
tion the imposition of most of
the austerity aspects of the
loi unique. The Liberals are
hoping to profit from voter re-
sentment of this ambivalent
attitude on the part of their
coalition partners.
The small Communist party,
which has only two of the 212
seats in the Chamber of Deputies
and one of the 175 in the Senate,
may double its representation.
Left-wing Socialist and trade
union elements in the depressed
southern region of Wallonia,
disgruntled with the halfhearted
support the moderate Socialist
and trade union leaders in Brus-
sels gave the recent strike, may
vote for the Communists in pro-
test.
The Socialist leaders, on
the other hand, are apparently
hoping that the participation
of Paul-Henri Spaak, former
premier and recently secretary
general of NATO, will diminish
defections to the Social Chris
tuns by the middle class.
In any event, Premier Eyskens
is unlikely to lead the next
government. Political leaders
hope the election will lead to
the formation of a strong
government which can function
without being handicapped by past
failures or imminent elections.
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SPECIAL ARTICLES
MOSCOW AND A NUCLEAR TEST BAN
During his heated remarks
to the press in Paris after the
collapse of the summit meeting
last May, Khrushchev said that,
as far as the ten-nation dis-
armament talks were concerned,
he was "almost convinced that
our partners in Geneva do not
want disarmament--what is hap-
pening is merely procrastina-
tion." He stated flatly, how-
ever, that the USSR would con-
tinue the nuclear test ban
negotiations, thus indicating
that he considered the test ban
issue outside the framework of
general disarmament talks and
beyond the limits of Moscow's
anti-US agitation and propa-
ganda offensive.
Similarly, public state-
ments by Khrushchev during his
visit to Austria last July
seemed intended to provide as-
surance that the bloc walkout
on 27 June from the disarma-
ment talks did not foreshadow
a similar move in the test ban
negotiations.
The Soviet leaders were
nonetheless concerned that
their actions might lead to
Western withdrawal from the
test ban talks. Shortly after
the US announced on 17 July
that it would conduct 11 under-
ground tests for research pur-
poses during the next two years,
the Soviet delegation in Geneva
made a major concession in its
negotiating`- position. The
concession involved the ques-
tion of permitting international
inspection of sites at which in-
struments indicated a nuclear
explosion might have occurred.
The Soviets had previously
declared the precise number of
such inspections an issue beyond
the scope of the Geneva talks.
However, they conceded at this
point that they might allow three
annually. The number was pat-
ently, unacceptable to the West-
ern powers, but the initiative
was probably intended as a sign
of continuing Soviet interest in
arriving at a test ban agreement.
The USSR thus sought to keep
the test-ban talks alive despite
its militant anti-US campaign
and virtual severance of rela-
tions with the US in all other
matters pending a change in ad-
ministration. This persistence
probably stemmed from four main
factors: the obvious political
and strategic advantages of
maintaining a de facto but un-
controlled ban; a desire to use
the test ban question in future
efforts to promote some accom-
modation with the US; concern
over the spread of nuclear weap-
.ons within the Western alliance;
and an urgent need of a pretext
for rebuffing Communist China's
insistence that the USSR pro-
vide it with nuclear weapons.
The Soviet Position
When the Geneva talks
opened in October 1958, the
Soviet leaders probably decided
that protracted negotiations,
accompanied by an uncontrolled
moratorium on testing, would
serve both their political and
long-range strategic aims. They
appear to have concluded that,
despite US superiority in cer-
tain technological aspects, sta-
bilization of nuclear weapons
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technology would serve Soviet
military interests better than
a continuation of testing by
both sides with no assurance
that the USSR would improve its
relative military position by
further tests. The USSR, more-
over, had available a wide range
of nuclear weapons which were
probably considered adequate
to meet basic military require-
ments.
From the political view-
point, the Soviet leaders prob-
ably saw at least three dis-
tinct advantages to the talks:
they would further the Soviet
effort to single out and stig-
matize nuclear weapons; they
would strengthen the long So-
viet campaign for a test ban
as the first step in nuclear
disarmament; and they would
generate political problems in
the free world which would
serve to inhibit Western de-
fense planning.
The close relationship in
Soviet thinking between a test
ban and Western defense activ-
ities was reflected in Foreign
Minister Gromyko's announcement
in March 1958 of the USSR's
first unilateral cessation of
testing. Gromyko warned that
the West German decision to ac-
cept nuclear weapons and mis-
siles made a test ban agree-
ment an urgent and imperative
task,
Soviet Tactics
Moscow over the past three
years has tied .'its tactics
in negotiations to the over-all
state of Soviet relations with
the Western powers. From Octo-
ber 1958, when negotiations be-
gan, until Khrushchev's visit to
the US in September 1959, Soviet
moves on the test ban issue were
primarily designed to keep the
talks alive by making strictly
limited concessions on the vital
control issues. With the sum-
mit conference virtually agreed
upon after Khrushchev's visit,
the USSR adopted a more flexible
position and sought to isolate
a few outstanding problems for
settlement. After the Paris
conference, however, the Soviet
delegation withdrew some previ-
ous concessions, temporized on
almost all major issues, and
made it clear the USSR would
await negotiations with a new
US administration.
Soviet sources have recently
begun to revive the test ban
question as a summit-level topic,
and the Soviet note agreeing to
postpone negotiations from 6
February until 21 March was
couched in optimistic terms. A
number of Soviet spokesmen have
also implied that when negotia-
tions resume, the Soviet delega-
tion will be prepared to offer
concessions on key issues.
On the number of on-site
inspections, Soviet officials
and scientists at the Pugwash
Conference in Moscow last De-
cember implied that a compro-
mise would be possible in which
the USSR would accept the Amer-
ican proposal for 20 inspections
in the USSR each year in return
for American agreement to a
four-year moratorium on small
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underground tests, instead of
the 27-month moratorium proposed
by the US.
In his recent letter to the
American Committee for a Sane
Nuclear Policy, Khrushchev ac-
knowledged that the moratorium
and a research program to im-
prove detection methods for
small underground explosions re-
mained major unresolved issues.
The Soviet negotiating position
has been to defer settlement of
the question of a research pro-
gram until the duration of the
moratorium is agreed on. Mos-
cow probably believes that an
extended moratorium would make
it increasingly difficult for
the ?lest to resume underground
tests, even if an agreed re-
search program during the mora-
torium failed to yield results
in improving detection methods.
The Soviet leaders may also
anticipate that, following set-
tlement of the on-site inspec-
tion and moratorium problems,
continued rejection of the
American position on a coordi-
nated research program which
includes nuclear explosions
would endanger the talks.
Last August the Soviet
delegate also indicated some
interest in working out a com-
promise formula to resolve the
impasse over another key issue,
the composition of the control
commission.
In general, however, Mos-
cow is likely to await new
American proposals before de-
ciding on its. over-all
course and what concessions it
can make.
Sino-Soviet Relations
The question of Communist
China's acquisition of a nu-
clear capability has probably
become a major issue in the
Sino-Soviet dispute and per-
haps the overriding factor in
shaping Moscow's policy on a
test ban. Moscow almost cer-
tainly has not supplied any
stockpile nuclear weapons to
the Chinese. There is evidence,
however, that Soviet resistance
to strong Chinese pressure to
provide such weapons has been
one of the basic irritants in
Sino-Soviet relations.
In opposition to the
USSR's apparent willingness to
accept a freeze of weapons
technology, either through a
continued voluntary moratorium
on testing by both sides or in
a treaty, Chinese leaders have
made clear their determination
to make China a nuclear power.
They probably believe that
even a limited nuclear capa-
bility would have a powerful
impact in Asia and greatly en-
hance their bid to force accept-
ance of China's "rights" as a
great power. While the Soviets
have come to view a test ban as
an increasingly profitable area
for political accommodation
with the West, the Chinese have
strong military and political
reservations on the issue.
It is estimated that the
Chinese Communists could deto-
nate a nuclear device sometime
in 1963, although it might be
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as late as 1964, or as early
as 1962, depending on the de-
ree of Soviet assistance.
pro y consider that Moscow
is using the protracted negotia-
tions on a treaty as a means of
forestalling their ambitions.
The treaty as presently drafted,
moreover, would proscribe fur-
ther Soviet aid to China; the
first article forbids the sig-
natories from "causing, encour-
aging, or in any way participating
in the carrying out of nuclear
weapons test explosions anywhere."
The Chinese leaders are
also probably convinced that
a far-reaching accord between
the USSR and the West on such
a major issue would undermine
Peiping's posture of unremitting
hostility toward the US and im-
pose significant restraints on
Chinese foreign policies. Pei-
ping probably would view a test
ban agreement as a major step
toward a broad Soviet political
rapprochement with the US which
could only be at the expense of
Chinese interests.
While Peiping has probably
been concerned since mid-1958
with the possibility of Soviet
agreement to a test ban, the
issue probably did not assume
major proportions until the ne-
gotiations appeared to be moving
toward successful conclusion,
following Khrushchev's return
from the United States in Sep-
tember 1959.
Fear that the summit con-
ference would bring a decisive
advance toward a test ban treaty,
together with slackening Soviet
support for the Chinese weapons
program, probably sharpened Pei-
ping's determination to force
Moscow to reverse its policy.
When Khrushchev, in his address
to the Supreme Soviet on 14 Jan-
uary 1960, listed a test ban as
a major issue for the summit con-
ference, Peiping responded on
21 January with the first ex-
plicit declaration that it would
not be bound by any disarmament
agreement in which it did not
participate. At the Warsaw Pact
conference in February, the Chi-
nese representative depreciated
the chances for successful nego-
tiations with the West on dis-
armament.
The strain which this di-
vergence placed on Sino-Soviet
relations became more-apparent
as the summit approached and as
the Soviet delegation in Geneva
moved to narrow its disagreement
with the West on a number of
major issues. Thus, by the end
of March the Chinese leaders
were probably convinced that
Moscow actually intended to con-
clude a test ban agreement. They
made their dissenting views pub-
lic in April in a series of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
authoritative articles entitled
Long Live Leninism. In these ar-
ticles Peiping acknowledged the
possibility of agreement on
"banning of atomic and nuclear
weapons, but advocated strength-
ening of the "socialist camp"
with "modern weapons" as a
guarantee against the West's
refusal to reach an agreement.
In the same vein, the articles
urged socialist countries "to
utilize such new techniques as
atomic energy and rocketry" to
defend themselves. The arti-
cles avoided a specific endorse-
ment of a test ban and confined
Chinese support to a complete
"prohibition of nuclear weapons."
On the eve of the summit
meeting, Chou En-lai indicated
that Peiping would refuse to
take part in any disarmament
agreement as long as China was
not recognized by the partici-
pants.
Khrushchev's decision to
continue the test ban talks af-
ter the collapse of the Paris
summit meeting seems to have
provoked the Chinese into an
even more far-reaching attack
on the Soviet position. When
revisions in the Soviet general
disarmament scheme were un-
veiled in early June, Peiping
treated them as no more than
a propaganda exercise to test
the West and to expose the
"fraudulent" Western desire
for peace. People's Daily
again warned that Peiping would
not be bound by any agreements
reached without its formal par-
ticipation. Moreover, the
Chinese carried their attack
into the councils of the World
Federation of Trade Union meet-
ing in Peiping in June.
The Soviets responded to
these moves on the eve of the
Bucharest meeting of Communist
bloc leaders at the end of June
with a long letter to the par-
ticipants reaffirming the valid-
ity of Moscow's position on dis-
armament and emphasizing that
the bloc should be prepared for
any eventuality, including at
least a ban on tests, a renunci-
ation of the use of nuclear
weapons, and the destruction of
stockpiles. Moreover, the So-
viet letter argued that in this
event "the socialist camp would
be the gainer and would win the
sympathy of the people every-
where." Moscow concluded that,
contrary to the Chinese claim,
disarmament was not merely a
"diplomatic maneuver" but a
serious political aid in the
interests of the world social-
ist system.
Thus, while partially ac-
knowledging the Chinese view of
disarmament as a convenient weap-
on of political warfare, Moscow
also seemed to commit itself at
least to some partial disarmament
measures, which, in the Soviet
leaders' view, would yield a
net advantage for the bloc. The
Chinese representative at Bu-
charest charged the USSR with
adopting a proprietary attitude
and attempting to act as spokes-
man for Peiping in disarmament
talks.
These conflicting views
were again underscored during
the Moscow conference of Com-
munist leaders last November.
Moscow conference Soviet spokes-
men again defended a test ban
and prohibition of nuclear
weapons. The Chinese spokesman,
however, while paying lip service
to banning of nuclear weapons,
reverted to the position taken
in Long Live Leninism.
The final declaration of
the conference relies on the
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The final declaration of
the conference relies on the
general formula for "banning
atomic weapons as well as their
tests and production," but does
not single out a test ban alone
for endorsement. The accompany-
ing Peace Appeal also uses this
general formula, in contrast to
the 1957 Appeal which specifi-
cally called for a test ban as
well as prohibition on manufac-
ture and use of nuclear weapons.
The continuing Sino-Soviet
impasse on a crucial issue con-
cerning the bloc's long-range
political and military strategy
points up the dilemma which
confronts the Soviet leaders.
As the USSR prepares its position
for the resumption of the Geneva
talks, it now more than ever
must weigh the advantages to be
derived from further negotiations
and a possible test cessation
agreement against the obvious
risk that this would impel Pei
ping to discard the precarious
truce so laboriously achieved
by the Moscow Communist meeting.
The Chinese almost certainly
will view, the USSR's course
of action at Geneva as the first
major test since the Moscow
conference of Khrushchev's in-
tentions regarding the whole
range of Soviet policy toward
the US and its allies. The
Soviet premier, on the other
hand, is well aware that the
Western powers will be apply-
ing a similar test and that de-
velopments in the Geneva talks
will have a strong bearing on
the West's attitude toward high-
level negotiations on other
major East-West questions,
such as Berlin and Germany.
Khrushchev has heavily
committed his personal prestige
and authority in the Communist
world to the proposition that
what bloc leaders view as a
favorable trend in the world
"correlation of forces" can
be exploited to extract Western
concessions on these major ques-
tions at the negotiating table.
A constructive Soviet approach
at Geneva would provide tangible
support for Moscow's efforts to
bring the Western leaders to a
summit meeting on Berlin and
Germany.
Although the precise course
of Soviet policy at Geneva will
depend in part on Moscow's assess-
ment of Western intentions after
the initial phase of probing of
positions, Soviet spokesmen have
indicated to Western sources that
Moscow still considers the Chi-
nese Communist factor as more of
an incentive than an obstacle to
an agreement.
Khrushchev's final deci-
sion regarding the Soviet posi-
tion on a nuclear test ban is
likely to hinge on two main con-
siderations: 1) his over-all
evaluation of the effectiveness
of the USSR's present posture
of relative moderation and re-
straint toward the US and its
Western allies in obtaining a
summit conference on favorable
terms; and 2) Chinese Commu-
nist reaction and Moscow's
judgment of the effects of this
reaction on the USSR's position 25X1
in the Communist world.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
The Indian Communist par-
ty (CPI) remains deeply divided,
in spite of a round of meetings
in mid-February held by nation-
al and provincial leaders to
chart the party's future course.
Factional differences between
moderate and extremist lead-
ers, chronic among Indian
Communists since 1947, have
been sharply accentuated by
the Sino-Soviet ideological
dispute.
State to perform effective-
ly within a democratic frame-
work led to its dismissal by
New Delhi in July 1959
and election of a non-Com-
munist coalition. This fail-
ure strengthened the hand
of the radical leaders,
who demanded that the party
abandon its peaceful policy
and revert to more aggressive
tactics.
Under moderate leadership,
the CPI had made significant
gains in the 1957 national
elections through the use of
united-front tactics. With
only about 120,000 members,
the party polled nearly 10 per-
cent of the 120,000,000 votes
cast--twice its 1952 percent-
age--and increased its repre-
sentation in Parliament to 29
out of 494 elected seats.
The Communists also won
control for the first time of
a state government, assuming
power in economically dis-
tressed Kerala on India's
southwest coast. A "mass" mem-.
bersbip drive doubled CPI ranks
to about 230,000. Similar
gains were made in expanding
the party's already strong as-
sets in the labor movement.
These successes led to the for-
mal adoption of a "peaceful,
parliamentary approach to pow-
er" at the 1958 party congress
in Amritsar.
The failure of the Com-
munist government in Kerala
The CPI's fence-strad-
dling position on the Sino-
Indian border dispute and
support for Peiping's ac-
tions in Tibet, which made
many Indians aware for the
first time of its foreign
allegiance, hurt the par-
ty badly and brought the
factional struggle to the
point of an open break.
The moderate leader-
ship--traditionally oriented
toward Moscow--joined with
the "nationalist" wing of
the party in advocating sup-
port for the Indian Govern-
ment's position on the bor-
der as necessary to keep
the CPI in step with public
sentiment. The extreme left-
ist faction--taking its cue
from Peiping--argued that
loyalty to "proletarian in-
ternationalism" required the
Indian party to back Com-
munist China at all costs.
The moderates have managed
to retain control and to
push through several com-
promise resolutions during
the period since 1959, but
these have merely smoothed
over the differences and have
done little to repair the rift
in the party leadership.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Left vs. Right
The Moscow Declaration, is-
sued last November following the
conference of world Communist
leaders, served only to compound
the ideological confusion among
Indian Communists. The opposing
factions have found little dif-
ficulty in interpreting the
ambiguous terms of the declara-
tion to fit their own views.
The crux of the argument
now is the extent to which the
CPI should support Nehru and
the "progressive" policies of
his Congress party government.
Both the Soviet and Chi-
nese parties reportedly have
intervened from time to time
in the CPI's factional dis-
pute, and the Chinese have
made active efforts to gain
support for a harder line
since the Moscow conference.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Conflict Unresolved
The meetings of the central
executive committee and national
council from 9 to 22 February
not only failed to break the
policy deadlock but apparently
left the antagonists more em-
bittered than ever. The re-
sults of the secret balloting
on major policy questions and
the tone of the resolutions
adopted indicate that the mod-
erate leaders retain a comforta-
ble margin of control.
The party pledged general
support of the Indian Govern-
ment's peaceful, neutralist for-
eign policy, but complained that
India is no longer always in the
vanguard of the anticolonial
Afro-Asian movement. A state-
ment on the border question re-
affirmed the party's support for
a settlement based on the "tradi-
tional" frontier; noting that
"each" side had presented a mass
of material to prove its case,
the party called for continued
"direct" negotiations.
With regard to internal
political affairs, the national
council stressed the need for
a "fighting alliance of all
democratic forces" to campaign
for a united-front government,
which in turn would "facilitate"
the transition to socialism.
Key party leaders reportedly
admit that the resolutions rep-
resented compromises manufac-
tured only to hold the party
together for the national elec-
tions scheduled for February
1962. The radical faction con-
tinues to prepare for a showdown
fight over policy at the party's
national congress--originally
scheduled to be held in January
but postponed to early April.
Extremist leaders reportedly
have estimated that they will
have the support of a majority
of the 400-odd delegates, but
this seems overly optimistic in
view of the fact that the party
rank and file has generally
backed the moderate and "nation-
alist" elements in the leader-
ship. Further bitter wrangling
can be expected, but the out-
come of the convention in April
is not likely to differ much
from that of the recent execu-
tive meetings.
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