WEEKLY INTELLIGENCE SUMMARY NO. 92

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01090A000300060028-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 8
• Document Creation Date: December 9, 2016
• Document Release Date: January 29, 1999
• Sequence Number: 28
• Publication Date: December 13, 1949
• Content Type: SUMMARY

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OiFICE Of REPORTS AND ESTWATES
TIVINSPORTATION DIVISION
tS December 149
'Seekly Intelligence Summary No. 92
:3ECTION I, =WIRY OF TRENDS AND DEVELOPUENTS
The Danish commitment to build taker n for the USSR under the terms
'oe a 1946 trade agreement may be avoided as a result of Soviet refusal to
2ormit inspection of tho steel for the program, (Item No. 1, A)
No wcakening of its port closure policy should be Inferred frol the
Vationalist decision to allow the NS cargo ship SIR JOHN FRANKLIN 4o do-
part from :;hanghsio The Chinese. Minister of Foreign Af:eairs has 1.Lformed
OS Charge Waffaires at on Kong that special permission, was oven
only at the reqUest of the US Goverment and should not be considered
R3 establishing n precedent. (Item No, 2, B)
Recent efforts of the Chinese Communists to acquire rails abroad
indicate thv,t they wish to commence the rehabilitation of their railway
cystem immediately,,regardiess of the drain on their limited forelEn
:change resources (Item No
A lacrig railroad /ink connecting the province of Assam with ti * port
of Calcutta by a route entirely-within Indian territory has .been sem-
pleted some three months ahead of schedule. This development has re-
.sulted from the partitioning of Bengal...which placed a large portion of
the former tengal Assam railway in East Pakistan. (Item,NO, 4, C)
Restitution of foreign rolling stock still hell';, in ;lectern Gf-rmany
may soon be carriod out, Recent cm4sideration of thss problem hi),
/ranch and US occupational authorities has revealed general agreemi?w: thit
the tmproved operational efficiency of the eman rsiligey systlin cvl-
denced by the recent handling of t.bc harvest hraffic and general -ca,Iction
of the tovn-arouDd time for t!raight car,now make 1-..,E,.:itkAtion posao
without ondargoring the German economy. ( tem No, 6, M)
COOUNIENT
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The Assistant Military Attache of the Soviet jiiribltssy in. Ott
apparently showing an active interest in current transportatio ae,,
-velopments in Canada's western provinces?, (item No. 6, C)
Present indjcations are that estern f.'rerNar.y may be included in the
International Customs Convention on TouriCommerical Road Vehicles and
:International Transport of Goods by Read, signed in Geneva on 16 June
1949 by various European ECE representati7es and now awaiting ratifica-
tion by their respective governments. Item No.
An the event that Czechoslovakia
their operation on scheduled services
only if a common policy is maintained
Which such flights wOuld take place,,
countries would provide an opening of
take advantage. (Item No. 8, A)
acquires four-64ine air trensporta,
to tho Near East can be prohibited
by the Mediterranean countries over
Defection by any one of theao
which Czechoslovakia would quickly
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TCTION II. CU. NT DEVELOPMENTS
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SURFACE TMINSPORTATIOTI
The Danish commitment to build tankers for the USSR under the terms
of a iiia.-76;;;CiWT7P 'e-ern?e-nr 7.ria-Ti;i7a7v-o-fiGrets?i-Fe.ufra-Soviet r enaz al to
permit inspection, or the stool for the program. The agreement called for
the USSR to supply ship plates for three tankers, among other- vesselss
The Soviet Union, however, has refused to allow entry to a Danish ship-
Suilder, who contracted to build one of those tankers and five other
sssssels, and wished to inspect the steel prior to its delivery to the
shipyards in Denmark. (This may have been an attempt to force the Danes
to supply steel, ow intight supply in the USSR) Following this refusal,
ths shipbui/dor undertook to supply the required stsel from other sources,
' The Department of State has instructed US-EMbassys Copenhagen, to
solicit Denmark's agreement to refrain from building tankers, which the
US has classified,l-A on its list of prosoribed export items for either
Soviet or Satellite purchasers. With respect to the USSR, the inspeotion
difficulties provide a possible basis for Danish action to nullify its
tanker .commitment The Department has suggested that the US would have
I ittle objection to a compensatory increase in dry cargo ship oonstruction.
for the USSR, although other compensating. exports would be even more
preferables A Danish oommitment to the US along the foregoing linos may
also balk Poland present efforts during trade talks with Denmark to con- ,
tract for the oorstruction of four large, ocean-.goirg tankers. 'Ibis would
be particularly- advantageoues, in view of the danger that Poland might
transfer such vessels to the USSR. This possibility is suggested by therecent sale of Polish passenger vessels to the USSR (see D/Tr Weekly no.
Although a substantial cargo ship program would obviously inorease
the coeam-going transport potential of the USSR, suob tonnage would b of
much less value to the Soviet Union than would even s few Cast moolors
tankers. The USSR's repeated efforts to soqusre tanlsrs from other
European shipyards suggest Usat tnrker toanags constitutes the major short.
age in the SOViet ocean-going faeet, (At oresent the USSR's oossao.gosng
tanker tonnage ranks fourtossoth inwor:id tanker flests, totaling only
12i,000 gross tons as or 30 Juno i949s) Ooreovor, ohe recent Soviet
chartering of US and other foregnsrlag tsnkers to supply its pcs000leum
noods in the Far East indictqs courrent inability to moos. its petooloum
transport needs (see D/Tr Weokly Ao. 9),) If tho USSR were to aoovioe four
vessels equivalest to the US T.2. the isnker kacet sould be lncressed by
only 40,00i1 gross tons but the Trans-Sihsrian ralsoad would be relieved
of some of the strain under which it nool onoratos, (Secret)
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? No weakening of its portelosure )oliey should be inferred free.. the
at lo773.arie-fTde-c-is-ro-n-To?aroiri7Sii"W-cia-iai; 'aiii7i-IITYON-TWAATIII to d.e.
part grom Shanghai. The Chinese Minister of Foreign Affairs has informed
the US Charge d'Affaires at Hong Kong that upecial permission was -given
enly at the request of the US Government and ihold not be coneidered as
establishing a precedent The Minister, furthermore, requests the 3mbassy
eo take Steps to warn the vessel's operator, Isbrandteens against repetitlen
or peat attempts to violate the closure order by sending ships into
'Sham,shai.
Meanwhile, both the Far Eastern representative of isbrandtsen aAd. the
Sine's Shanghai agent now believe that it would be .unwise to. attempt
Purther entries into Shanghai under present conditione, The basis fer
Vsoir attitude i3 not known, but it is unusual in thst it apparently con-
flicts with that of the US home office, In all probability the repeesen-
tatives realize that, despite US protests, the Nationalists may staled firm
on their clooure policy in the futurec and that movements into Shanshai
will become increasingly dangerous. (Cenfidentdal)
3. Recent efforts of the Chinese Communir;te to aoquire rails abroe6
Indicate that they wish to ocaamene,e the rehabilitation, of their railway
system immediately, regardless of the drain -on their limited. fereige.
exchange resources.
An attempt. to resolvn-the railway problem with domestic resources hse
resulted in the restoration of most lines, although many of these are
capable of handling only light traffic. In this restoration, the Commu-
nists have been forced to utilize rails taken from sidings and yards, -
from the second track or double tracked lines, and from an abandoned
japanese military railroad between Peian end Eel:leo-in north Manchuria,
Although an order was placed with. the. Northweet Iron and.Steel Con.pwy
at Taiyuan for 'large quantities of rails and other track materials, ,
the capabilities of this plant are relatively limitea. The steel plants
in Manchuria, ,moreover, have been dismontieds
It is not positively confirmed that the Communist-controlled raile
roads of China havo received any rail material from abroad, Reparta to
the effect that about 300 miles of rail have been, deliVered from. tha USII
to Manchuria may refer to nothing more then the reallocation to these
lines of rails which were removed from them after the Japanese collaseses
In any case, the Chinese Communiste are knewn to have negotiated for
large quantities of rails from both Germany and Oapan. to nest German
companies have been approached by. a London firm to supply 75,000 tons of
65-pound rails for the Chinese Communista. The orders have been held sp,
however, at the request of the US State Department, A Tokyo metal ':irm
has alsoteen asked to supply 65,000 tons of rails and 10,000 tone of rail
laying materials to the same customer. Trio order, however, has likewise
encountered delays ,in obtaining SCA? approva).. (Uonfidential)
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A new railroad link connecting theirovince of Assam with tho port
Care-U-Eia---15I-a?FoVre?enIT.4-iftlirr-, Indian terrITOiis been corn-
plotee some three months ahead of schedule, The new line?is. about 145
wiles long and connects Fakiragram on the existing Assam railway- line
-.aith the Aliporo depot, south of Calcutta, The now track runs throu,gh
Ist fi'engal? Bihar and Coach Behar in order to avoid entering Eaat
Pakistan territory. This development has resulted from the partiticniug
,af Bengal which placed a large portion of the former bengal Assamtii
mty in East Pakiatan.
Since partition in August 1947, it has been nocossary to move tT,00ds
passengers from indials frontier province of Assam to the rest of
Thdiau territory by means of the East Bengal Railway of Pakistan. Thin
,-Alroad has boon. tho principal route for delivering cargoes of juta and
Lea from. Assam to Calcutta and from there to the markets of the world.,
The existence of so large a portion of the railroad,a track within
Vakistan has given. Pakistan authorities a degree of control over the
zi.ovement of tea shipments considered undesirable by the Indian toa
1ndostry
The desirability and necessity of constructing en all-Indian
route was immediately apparent to the aevemment of India and its a,A1?,
way board, which late in. 1947 authorized ti o construction of the Assam
Rail Link Project. According to press dispatches, 7,00ds traffic wa.s to
commence over the entire distance of tho new line on. 9 December with
formal opening of the line for both passenger and goods traffic to take
place on 26 January 1950, when the country celebrates tha inauguration of
the Indian Republic. (Restricted)
Eestitution of foreign rolling stock still held ln. WesternGerp.,any
may soon be Carried cut.; Recent conaideraton of the problem by :irltish?
Frone3-: and US occupational authorities Ima revealed general agrsom)nt .
4hat the impt-oved operational otriciency e the Gorman railway syhtc.m,
as evidenced by the recent handing of the harvest traXfic and gensTal
reduotion of the turn-around time for freight cars,,new make restition
possible without endangering the German economy,,
2ubject to explicit reservations in falYor of foreign eountrie which
may be entitled to reparation or compensa-Uon through a future Gem.
peaee treaty, the occupational authorities aro studying the feasibility
of negotiating and implementing jointly such agreements between Western
Germany and other countries whose rolling stock is still in Western.
Germany, or countries whioh are holding Roichsbahn equipment,. The occu,
uational authorities will probably inSist that agreements making Piniaa
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dlepoeition without compensation, must dispose of all of the roliIg
ook in Western lermany belonging to any given country in such c -ray
that there will he no unliquidated claims of this type against Carmany,
The agreeeemts would probably carry varying conditions with
respect to tho different categories of equipment. Freight cars owned
.ny railways, nhether serviceable or unserviceable, and passenger equip-
ment, lueeaee vans and locomotivea in serviceable condition will prob-
ably be ex.aanged on a one-for-one, alleforeall, or equal value from
each side. Unserviceable rolling stook in the latter three oateeories
and privately-owned rolling stock and equipment not othezerino eovered
will probOly be returned without compensations,
ally nroced along these lines should result in substantial reduction and
poseeble notal elimination of foreign rolline stock still held in tiormany
during 1'50. (Confidential)
The Assistant Military Attache of the Soviet Embassy in Ottawa is
apparent .y showing an active interest in current transportation develop-
ments in Canadas western provinoos, These projects are designed to
provide ail connections and improve highway links between the US and
Aleska (Jee Or Weekly No. 89). According to the publisher of the
"Alaska Lighway Weweat Fort St., John, 'the Soviet Attache not only is a
subscriher to this weekly newspaper, but is eatherng news apers from
other northern points in the Highway area,, (Restricted,
Present indications are that Western Goymely elay be included in the
Internationortuaoma Coaveetcon on tlring, Cimmerefalllmjd Viee
and Internationel Transport of Goods by Road, signed in Geneva on 16
June 1949, by var!oue European ME representatives and now awaitIng
ratifictetion by their respective governments
TheUS delefation in Geneva, although not representing a contracting
government, favoes the inclusion of WesterneGermann and indicatea that
the German Goverment, having instituted alisztges in, official regulations
in order to conferm to the conventions provisions, also desires to be-
come a party to he agreement,,
Article VI of the Convention provides for sigvature or accession
only by those gorernments "invited to take port in preparation of draft
conventions" ane thus fracludes Western Germany, liowever, Article II 2
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vidinf!. specifically for occupied a:-eas, states that a "corrtrac'.
,overnmont Ray at any time, by notification to UN SYG, declare thnt the
i,resent agreement shall extend to any of the other territories for :'yhich
it has international responsibility,"
The ECE Secretariat has stated that, so far as tb.e UN is concerned,
inclusion of 'Western Germany can be accomplished legally by notification
to tho UN Jy the Trench or British Governments that the agreement
extends to Western Germany. The British are now considering consults,.
tion with the Allied Co mission? Germany, with a TiEYW to reporting to the
7N an agreement among the three occupying powers to thia effect-,
CIVIL AVIATION
In the event that Czeohoslovae.a acquires four-ergino
Lheir operation. on scheduled services to the Isar .ast onn
only. if a comton policy is maintained by the Mediterranean
which such flights would...take place, Defection by any ona
countries would provide an opening of which Czechoslovakia
take advantage,,
air transporte,
oe prw-aeik,e4,
courtrie:s ovor
theso
would quickly
Numerous reports-emanating from. the Greek Smbasey at Prague ha,ic
concerned tha efforts of Czechoslovak Airlines (CSA) to obtain modern.
air transports, These reports have boon accepted with some roserve -by
US officials, because it was felt that they have been pEdvtly inspired by
the Charges desire to eromote ft chan,e ir Greek aviation eolic toward
25X1X7 Czechoslovakia,
now seems to bear out these warnings that aents in. '314.1tzeriand are pre-
pared to sell the Cz,echoelovaks lont;7range air equipment, in conierua-
tion with General Stanovaky, Chief of the Czechoslovak Ministry of Trans-
:25X1X7 ports Aviation Division, learned that thq
Ceneral "confidently" expects to purchase four W.; four-eagino transports
in Switzerland,
Concerir.. of the Greek Chnrge at Prague over his country's position
vie-n-vAs Czechoslovakia, as a result of,Greok denial of landing rfhts
at Athens for C5welloslovak Airlines (OSA), has onusel him to report all
rumors affecting developments which might permit modification of Greek ?
obligations to deny repeated Czechoslovak overtures on this score,
Believing that his government has borne tho principal burden of imple-
menting US-UK Satellite evintion policy in thelliadita.,-ranean to the
dotriment,of its trade relations with Czechoslovakia, the Charge?apparently
is attempting to show .that this prime responsillity should now be shifted
to Italy beomase, with new long-range aircra.ft, oculd by-pass Athens
from Rome en route to the Fast,
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The ability of CSA to fly non-stop from Rome to Lydda would net of
itself insure the granting by Italy of the necessary transit right e to
the Near East. CSA, in fact, has been denied the right to transit Italy
on the ground that the airline has no specified terminal point beyond
Italy. to justify such operations. (A refusal of transit rights over
Turkey by CSA was based on similar grounds.) Even if CSA could obtain
these terminal rights for scheduled services, Italy, although a member
Aith Czechoslovakia of the International Civil Aviation Organization and
thus bound by the articles of the Chicago Convention:, has not adhered
to the International Air Transit Agreement as have Czechoslovakia and
Greece, and therefore is not obligated to grant overflight privileges to
foreign airlines.
. During recent personal visits to Greece, Israel and Italy, General
Stsmovsky attempted in each country to break down resistance to. CSA us .
Mediterranean operations, but without success. Although Israel has not
been asked to collaborate in implementing the US-b6 Satellite aviatZon
policy, it has in effect done so by indicating that it is not ready to
discuss civil air matters with Czechoslovakia until after an Israeli-US
air agreement has been concluded, negotiations for which have not yet
commenced.
OSA has one remaining avenue of approach to the Eastern Mediterranean
through Belgrade. The present political tension between Czechoslovekia
and Yugoslavia, however, would appear to preclude any arrangement of this
nature. (Secret)
CORFIDENTIAL
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