SITUATION SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91T01172R000200020005-0
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 11
• Document Creation Date: December 22, 2016
• Document Release Date: April 7, 2006
• Sequence Number: 5
• Publication Date: February 5, 1955
• Content Type: SUMMARY

Declassified in Part - Sanitized Copy Approved for Release 2012/03/16: CIA-RDP91T01172R000200020005-0
TOP SECRET
4 February 1955
Copy No. 131
SITUATION SUMMARY
*esament No. ___Is --------------
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Date:.,- 27
Office of Current Intelligence
CENTRAL INTELLIGENCE AGENCY
TOP SECRET
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4 February 1955
This publication ceases in its present form with this issue.
Beginning next week it will be incorporated in a new wetly
publication: The Current Intelligence Weekly Review.
as .titan irec or,
C,irrr ant Inwo~.i i rrco
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Page
. . . . . . . . . . . . . . . . . . . . . 1
Japan . . . . . . . . . . . . . . . . . .
Relations with the USSR
India . . . . . . . . . . . . . . . . . . . . . . . . . .
The Andhra state legislature election
Bulgaria . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Defense expenditures for 1'55
Iceland . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
indications of labor trouble
USSR .............................. 6
Soviet position on Formosa
Central Committee Plenum.
Reported. Soviet orders regarding Black Sea territoriaL waters
Moscow anti-aircraft defenses
4 February 1955
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Peiping's rejection of UN invitation: Chou En-lai's letter to UN
Secretary General Hammarskjold on 3 February supports other indica-
tions that Peiping does not want to conclude an early cease-fire but
intends, at least for the near future, to promote tension in the China
area. Chou declared the Chinese Communist representatives will not
attend Security Council discussions until the Chinese Nationalist
representative has been "driven out" and replaced by a Chinese Communist.
The Security Council voted 10-1 against such action on 31 January.
Chou's letter, like other recent Chinese Communist comment on a
cease-fire, suggests that, even if Peiping's conditions for attending;
the UN debate were met, Chinese Communist representatives would raain--
ta:Ln a stubborn attitude and would demand the withdrawal of Ameri.car
1. Fcbrualry 9`)';
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Japan
Relations with the USSR: Moscow has confirmed that the unsigned
documents delivered to Prime Minister Hatoyama in late January by the
chief of the unrecognized Soviet mission constitutes an official
approach for negotiations on the resumption of Soviet diplomatic
relations with Japan. The Soviet Union denied press reports, however,
that a settlement over the Japanese-claimed Habomai and Shikotan islands
was discussed. The Japanese Foreign Office feels that the current Soviet
tactic is to try to restore diplomatic relations prior to the discussion
of vital differences. Moscow might make a declaration ending the state
of war between the two countries as a means of putting pressure on Japan
for such a short-term settlement.
3 - 4 February 1955
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The Andhra state legislature election: The pre-election maneuvering
in the Andhra state legislature election, scheduled to begin on 11 Feb-
ruary, indicates that all parties are aware of its significance as the
first real opportunity the Communists have had to gain control of an
Indian state government. US observers, commenting on the intimidation
and physical violence exercised by the Communists as well as by the
incumbent Congress Party report,that this may well be the roughest
election in post-independence ludia.
Andhra, whose 20 million people are bound together by a common
language, was formed in October 1953 as India's first "linguistic" state.
It is an area of unusual Communist strength. The Communists in Andhra
are reported to have an efficient propaganda and organizational apparatus.
.In some areas of the state, they have engaged in extra-legal activities
without interference from the police, who reportedly are understaffed
and Communist-infiltrated. Success in the forthcoming election also
would advance Communist plans to "expand the peace movement in India."
25X1 The Indian Communists believe they will receive 96 to 100 of the
196 seats in the election,
Minister Nehru and Congress Party leaders recently ma e separate tours
of Andhra to point out the Communist menace and to bolster the weak
Congress Party machine. There are also indications that the Congress
Party will adopt extreme measures to prevent a Communist victory or
that, in the event of such a victor New Delhi will take over direct
control of the state government.
4 February 1955
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Bulgaria
dangers of "aggression" from the West.
announce an increase in defense appropriations to counter increased
Defense expenditures for 1955: The new Bulgarian defense budget
announced on 1 February as a part of the 1955 draft budget represents
a slight decline, in both absolute and percentage value, from the 1954
level. The defense allocations of 1,922 million levy represents 11.0
per cent of the total budget for 1955, as compared with 1,934 million
leva, or 11.4 per cent of the total, for 1954. This levelling off in
the amount directly allocated for military purposes is in accord with
current Bulgarian propaganda, which has not explicitly stated that
defense expenditures would be affected by the Paris agreements.
Official comment on the budget continues to stress new course goals of
expanding both the peacetime economy and foreign trade.
If the Paris accords are ratified, however, Bulgaria may publicly
politically motivated strikes.
Icelandic Federation of Labor would increase the likelihood of
Indications of labor trouble: According to US defense officials
in Iceland, the Communists are spearheading a drive for wage increases.
Labor trouble--possibly including strikes--appears probable by 1 March.
The Communist-dominated dockworkers union, Dagsbrun, terminated its
contract effective 1 March, and a slow-down in unloading operations has
already begun. US officials report that a dock workers' strike would.
seriously affect the US defense force in Iceland. Twelve other
Reykjavik unions are serving notice of contract termination, and the
Communist-dominated factory workers union, Idja, is expected to
terminate itr- contract. It was expected that the election last November
of Communists and left-wing Socialists as leaders of the 26,000-member
4 February 1955
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USSR
Soviet position on Formosa: While Peiping stepped up its military
pressure on the offshore islands and maintained its intransigent
political attitude, Moscow maneuvered to retain its flexibility on the
issue. The Soviet press gave unusual publicity to the British
Ambassador's representations to Molotov, made on 28 January, asking the
Soviet Union to urge Peiping to consider a UN solution. Molotov's
interview with William Randolph Hearst on the following day was also
given complete coverage. Pravda included Hearst's suggestion that a
temporary cease-fire might be regarded as the first step to an eventual
settlement of the whole Formosan problem. It further reported Hearst's
statement that the US had never undertaken an offensive war.
On 30 January the Soviet delegate at the UN introduced a resolution
calling for debate on US "aggression" in Formosa. This was followed the
next day by an announcement that the Soviet Union had 'immediately" for-
warded to Peiping the British views on the need for UN mediation, since
Moscow, like the British, was alarmed over the dangerous situation off
the China coast--a situation which was entirely due to the presence of
US troops in the area; hence, the charges of US aggression in China's
internal affairs was the only proper subject for UN debate.
At a Security Council dinner in. New York on 3 February, the :.ctiz?
Chief Soviet delegate expressed doubt that Peiping could accept the
Council's invitation and said this problem must be dealt with by
discussions in smaller groups. He observed that, if the Chinese Cam.-
munists did come, ':hey would do so only after some time, and it would. be
necessary to set up secret talks with only a few people present. This
hint of delay and other maneuver possibly foreshadowed the negative
Chinese reply of 3 February.
Behind the present Communist strategy may well lie some difference
between Moscow's apparent desire to lessen international tensions and
Peiping's interest in keeping alive the threat of capitalist encircle-
ment as well as its avowed intention to "regain its territory".
Moscow has consistently left the Sino-Soviet alliance unmentioned
in relation to Formosa and. has given Peiping no public military
commitment on Formosa. Thus, while Peiping can apply military prey tir.c
to heighten tension over the Formosan issue, the USSR is free to ml;! a--
tain its pretense of being an impartial moderator in international
councils.
1+ February ''.9'" 5
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Central Committee plenum: According to preliminary information,
the published decision of the 25-31 January plenum of the Central
Committee of the Soviet Communist Party is devoted almost wholly to
problems of increasing agricultural and livestock production, with a
brief introduction reiterating the importance of heavy industry as the
basis of the economy. Agricultural goals given for the Sixth Five-
Year Plan (1956-1960) are very ambitious and probably unattainable.
They indicate that agriculture, on which the "new course" has concentra-
ted, will continue to receive heavy emphasis.
It seems unlikely, however, that a plenum would have been called
at this time solely to discuss agricultural and livestock production.
The meeting took place shortly after the regime apparently had reached
a decision to reaffirm the emphasis on heavy industrial production and
at a time when decisions connected with projected West German rearmament
and the increasingly sensitive Formosa situation may have been reached.
The recall to Moscow of a number of Soviet ambassadors supports the
possibility that foreign policy was one of the subjects discussed.
Apparently, the plenum was timed to precede the Supreme Soviet
session, called for 3 February, at which any shifts in policy may
become evident.
Reported Soviet orders regarding Black Sea territorial waters:
According to the US Naval Attache in Ankara the Turkish Military Attache
in Moscow has recently received information
that the Soviet Black Sea Fleet has been ordered to
destroy all Turkish or US submarines discovered in Soviet Black Sea
7 - 4 February 1955
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S%W
territorial waters. The US Naval Attache believes this information may
have been planted by the USSR to cause curtailment of Turkish naval
operations in the Black Sea.
In early December, surface vessels and submarines of the Turkish
Navy maneuvered in the Batumi area for several hours while within sight
of Soviet naval forces. The Soviet Union claims sovereignty over
coastal waters extending 12 miles from shore, and it may have been
considered that the Turks had violated or would in the future violate
the 12-mile zone.
The inclusion of US submarines in the alleged order may have resulted
in part from the fact that most of Turkey's submarines are ex-US vessels.
It is possible that observers received the impression that US submarines
were exercising with the Turks in the December maneuver.
Moscow anti-aircraft defenses: Extensive movement of AAA equipment 25X1
in the city of Moscow observed by US attaches during the period 24 to
28 January follows the normal pattern of rotation of batteries to winter
firing ranges. During the winter firing, Moscow does not have maximum
anti-aircraft protection.
4 February 1955
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