BASIC DUTCH-INDONESIAN ISSUES AND THE LINGGADJATI AGREEMENT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-01617A002900020004-4
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 17
• Document Creation Date: December 27, 2016
• Document Release Date: March 1, 2013
• Sequence Number: 4
• Publication Date: June 9, 1947
• Content Type: REPORT

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? CENTRAL INTELLIGENCE GROUP
BASIC DUTCH-INDONESIAN ISSUES -
AND THE LINGGADJATI AGREEMENT
,ro. No.
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Auth.:
Date.: 1 _7
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9 June 1947
COPY NO 31
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the HISTORICAL REVIEW PROGRAM of
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Date
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United States of Indonesia
Netherlands Indonesia
Union
Dutch controlled areas
Republican area according
to Unggadjati Agreement
INDONESIA
UNDER THE
LING GAD JATI AGREEMENT
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ORE 20
9 June 1947
CENTRAL INTELLIGENCE GROUP
2430 E Street, N. W.
Washington 25, D. C.
BASIC DUTCH-INDONESIAN ISSUES
AND
THE LINGGADJATI AGREEMENT
SUMMA.RY
$41,
COPY NO. 31
The signing of the Linggadjati or Draft Agreement between the rep-
resentatives of the Netherlands and the Indonesian Republic on 25 March 1947
climaxed nearly fourteen months of difficult negOtiations. Remaining dif-
ferences in interpretation of the agreement, however, are so deep and fun-
damental that orderly progress toward final adjustment of Dutch and Indo-
nesian aspirations in the islands cannot be expected.
The fundamental conflict is between the Dutch view that the Nether-
lands will continue to be the sovereign power in the Indies until the United
States of Indonesia (USI) is formed, and the Republic's view that Netherlands
sovereignty does not extend over Republican territory in the itterim period.
This difference impedes the process of mutual adjustment and jeopardizes any
effort of either party directed toward the formation of the USI and the es-
tablishment of a durable relationship between the Netherlands and the Indo-
nesian Republic. Stemming from this basic issue and the mutual distrust
which it has engendered are the following issues which must be adjusted in
the next two years before the USI can be established: (1) the reduction of
military forces on both sides; (2) the restoration of Dutch properties in
Republican territory to their former owners: (3) the reconciliation of the
foreign trade policies of the Netherlands Indies Government and tic Indone-
sian Republic; (4) the political organization of the.portions of the Indies
which lie outside the Republic; and (5) the control of the foreign relations
of the Republic.
In the resolution of these IBMS, the bargaining positions of the
Netherlands and the Indonesian Republic are nearly balanced in political,
economic, and military terms. Tho resultant delays in negotiations are
leading the Dutch to consider an attempt to reach a decision by military
force. This,in turn, will aggravate anti-Western sentiment throughout the
Far East and might lead to a consideration of io dispute by the UN Secur-
ity Council.
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Further discussion of basic Dutch-Indonesian issues and the Lingga-
djati Agreement will be found in the Enclosure hereto. Current negotiations,
including the Dutch proposal of 27 Nay 1947 for the establishment of a joint
interim federal government pending the formation of the USI, are reported in
the CIG Daily Simmnry and analyzed in the CIG Weekly Summary.
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ENCLOSURE
1. Background
At the conclusion of World War II a deadlock developed between
Dutch and Indonesian plans for the future. The Dutch hoped to establish
a Commonwealth subject to the Crown, embracing as equals the Netherlands,
Surinam and Curasao in the Western Hemisphere, and the Netherlands Indies.
The newly-formed Republic of Indonesia, however, demanded complete inde-
pendence from the Netherlands. The collapse of Dutch power and prestige
in the early days of World Mar II and the subsequent Japanese occupation
policies of humiliating the white race and stimulating the already strong
nationalistic spirit of the Indonesian peoples, made impossible any re-
turn to the pre-war status quo. As Allied power began to threaten Japan's
position in the Indies, a Japanese-sponsored Independence Preparatory Com-
mittee was *formed in Java in the spring of 1945 to lay down the framework
of an independent Indonesian Republic.
The Republic was proclaimed on 17 August 1945 and immediately
began to extend its power throughout the Indies following the surrender
of Japan. Allied reoccupation a month later found Republican governors
in several of the outlying islands and Republican control well established
in Java. Thus, a fait accompli faced Dutch authorities as they returned
to the Indies and prevented the restoration of Dutch control in Java, Ma-
dura, and Sumatra. Negotiations to resolve the impasse between the Dutch
and the Republic were delayed until February 1946 by widening hostilities
between Republic forces on one hand and British and Dutch troops on the ?
other. Furthermore, the Dutch refused to have anything to do with the
President of the Republic, Achmed Sookarno, whom they regarded as a traitor.
Negotiations finally began 10 February 1946 through the good of-
fices of Sir Archibald Clark-Kerr, British special representative in the
Netherlands Indies, and were based upon the Dutch Statement of Policy of
that date. This statement provided for a democratic partnership for the
component parts of the pro-war Kingdom of the Netherlands, with a clear
recognition of the right of Indonesia, after a given period, to elect to
leave the partnership. The Dutch, however, expressed the view that the
best interests of Indonesia would be served through the continuance of one
realm. The Indonesians answered the Dutch Statement on 14 March 1946 with
a counter-proposal including a letter from Premier Sjahrir, which demanded
(a) Dutch recognition of Republican sovereignty in the Netherlands Indies,
and (b) the immediate realization of the Indonesians' right to self-deter-
mination. The Republic regarded the Commonwealth suggested by the Dutch
as merely an attempt to restore Dutch control under a now name.
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Conversations continued during March and April with the question .
of Sumatra's position within or outside the Republic left in abeyance. The
Dutch Protocol of 19 May 1946 recognized Republican de facto authority in
Java, but not in Sumatra. Sumatra, like other areas in the Indies, was to
be given an opportunity freely to determine its own status in the proposed
free state of Indonesia. In June, this Protocol was rejected by the Indo-
nesians, and negotiations were broken off and were not resumed until early
in October, by which time a Dutch Commission-General had arrived in the In.-
dies to carry on the talks.
The declaration, on 14 October 1946, of a truce in the Dutch-
Indonesian hostilities helped to create fav6rable conditions for an adjust-
ment between the opposing views. The Dutch then, on 1 November 1946, pro-
posed recognition of the Republic's de facto authority in Java and Sumatra
and the inclusion of the Republic in the Federated States of Indonesia. In
answer, the Indonesians proposed confirmation of Dutch economic rights in
Indonesia and a reduction of Dutch forces. Agreement on these points was
reached at the town of Linggadjati (inland from Cheribon) on 12 November
1946, and the draft agreement (see Appendix A) was initialled three days
later. Both delegations then returned to their respective governments to
obtain authorization for signing.
During the succeeding months, moderate members of both governments
encountered strong opposition from extremist elements. In the Netherlands,
conservative military leaders and businessmen felt that Dutch political and
economic power in the islands was jeopardized by the vague position of the
Crown in the new arrangement (see Appendix A, Article VIII) and by the am-
biguous provisions of Article XIV of the Draft Agreement concerning the
restitution of Dutch property to former owners. In Indonesia, extremists
regarded the Agreement as a diplomatic defeat for the Republic because the
Republic had not been given immediate independence.
The Netherlands Government, despite the opposition, finally ap-
proved the Draft Agreement as "basic policy" on 20 December 1946, but its
delay in taking this action had added to Indonesian suspicions of Dutch
intentions and had thus made the position of Indonesian proponents of the
Draft Agreement more difficult.
At the end of January 1947, though both the Dutch and the Indo-
nesians declared their readiness to sign the Linggadjati Agreement, they
disagreed as to the conditions of signing. The Dutch insisted that the
Indonesians issue a general cease-fire order to implement the truce of
14 October 1946, and agree to the Dutch interpretations of the Agreement.
These interpretations were embodied in a statement by Dutch Overseas Min-
ister Jonkman and in the Elucidating Memorandum of the Commission-General
presented to the States General on 10 December 1946 in defense of the
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Linggadjati Agreement. The Dutch interpretations stressed that the Nether-
lands would remain the sovereign power in the Indies 'until the establishment
of the USI, and that the Netherlands would maintain adequate military power
there until satisfactory guarantees for the continuation of Dutch interests
were secured.
While the cease-fire order was finally issued effective 16 Febru-
ary 1947, the Republic steadfastly refused to be bound by Dutch interpreta-
tions, maintaining that the Republic would recognize only the articles of
the Agreement itself and the official 'correspondence between the two dele-
gations. Indonesian opposition to the Linggadjati Agreement increased
steadily after the initialling of the Draft Agreement, as a result of bit-
ter fighting between Dutch and Indonesian forces and of Dutch insistence on
Republic adherence to their interpretations. In order to forestall rejec-
'tion of the Agreement by the Republic's provisional parliament, the KNIT?,
President Soekarno issued a presidential decree increasing the membership
of that body with representatives selected from political parties more fa-
vorably disposed to the Agreement. This novo aroused considerable debate
and was finally passed only under the throat of resignation by President
Soekarro and Vice-President Hatta. Final approval of the Linggadjati Agree-
ment was given by the KNIP on 5 March 1947 in a vote of confidence in the
government's policies from which the influential Nationalist and Masjoomi
(Moslem) Parties abstained.
.The deadlock over the inclusion of the Dutch interpretations had
been broken.by a letter on 2 March 1947 from the Chairman of the Commission-
General to Premier Sjahrir indicating that the Netherlands GOvernment did
not intend to commit the Republic to these interpretations and that the
right of the Republic to make its own interpretations was clearly under-
stood. This was accepted by Sjahrir on 16 March 1947 and signatures were
finally affixed to the Linggadjati Agreement on 25 March 1947, and a-joint
economic committee was immediately established to implement the economic
provisions in the Agreenent.
2. Remaining Issues
a. The Basic Issue of Sovereignty
The signing of the Linggadjati Agreement left unsettled many issues
in Dutch-Indonesian relations. The most important disagreement, which con-
plicates the resolution of all other issues, is on the question of Sove-
reignty. Prominent Indonesian leaders now regard the Republic as an inde-
pendent state, claiming that Dutch de facto recognition of Republican au-
thority in Java, Madura, and Sumatra (see Appendix A, Article I) amounts
to recognition of sovereignty. The Dutch, on the other hand, have empha-
sized that the basic sovereign entity envisioned for the Indies in the
^
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Linggadjati Agreement is not the Republic but the United States of Indonesia,
in which the Republic is but one of three component parts. The Dutch also
hold that during the interim period preceding the formation of the USI, the
Netherlands will continue to be the sovereign power in the whole of the
Netherlands Indies.
This basic dissension, together with the strong mutur0 suspicions
built up through the past year of hostilities and of slow, delicate nego-
tiations, is the most serious inpediment to the establishment of new polit-
ical and economic relationships between the Dutch and the Indonesians.
b. .12MEE2E2_21:_fat_Aaeonent
This fundamental difference in views is reflected in the Dutch and
Indonesian opinions as to the general nature and purpose of the Linggadjati
Agreement. While the Dutch regard it as a "charter of principles" upon which
a new Dutch-Indonesian partnership can be built, to thc Indonesians it is
merely a convenient step toward the unalterable goal of complete independence.
Indonesian. military and political loaders have repeatedly warned the people
that the Agreement is only a temporary measure, that its signing has not
ended the "national struggle", and that, if no longer necessary to the na-
tion, it will be abandoned.
c. .Withdrawal of Troops
No progress has been made toward implementing Article XVI of the
Agreement (see Appendix A), which provides for a reduction of the armed
forces of both parties directly after the conclusion of the Agreement.
In keeping with their misgivings about Indonesian intentions, the
Dutch desire to maintain their military power in the Indies until there are
effective guarantees that the new rule of law will be observed by the Indo-
nesians. As a. result, the Dutch have been reluctant to implement Article
XVI. The Dutch claim they are observing this Article by initiating neces-
sary measures preparatory to reductions in their troop strength. The Indo-
nesians want immediate troop reductions without any dilatory preliminaries
and have sought to hasten reduction by suggesting that the rate of restora-
tion of Dutch properties in Republican territory will be determined by the
rate of Dutch troop withdrawals. Furthermore, the facts have not been lot
on the Indonesians that (a) the Dutch undertook military actbns in Eastern
Java after the Agreement had been signed; (b) Dutch troops, said to be re-
yilacemonts, continuo to arrive; and (c) the Dutch plan to send 60% of the
1947 draft class of 50,000 men to the Indies, now that overseas duty for
conscripts has been authorized by the State General. For their part; Indo-
nesian irregular groups have announced that they will not disband until the
end of the "revolutionary period".
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d. Restoration of Properties
In Article XIV of the Agreement, the Republic recognizes the claims
of non-Indonesians to the restoration of their rights and the,restitution of
their goods. The return to Indonesia of non-Indonesian businessmen and plan-
tation owners, however, will be complicated by economic policies laid down by
the Republic, designed to prevent any return to colonial monopolistic exploi-
tation of native resources and labor. The Republic will continue to hold
ownership of State properties such as railways, public works, and utilities,
and of such property as was owned by Japan in Republican territory. Certain
enterprises, to be determined as "vital" by a special Republic committee,
will be expropriated and their former owners will be indemnified. Republic
Minister of Economic Affairs Gani has declared that the Republic cannot grant
permission to foreign owners to resume operatione before an agreement is
reached between the Owner and the Republic concerning such basic matters as
wages, worker security, induction of Indonesian personnel into the manage-
ment of the enterprise, land rent, taxation, import and export quotas, and
production and distribution policies.
There has been some recent evidence that the single labor organiza-
tion of the Republic, SOBSI, is acting as local custodian for foreign plants.
A long period of delicate negotiations with a powerful but inexperienced
labor union is in prospect before Dutch economic interests may resume their
activities, and even then they will be resumed under greatly restricted cir-
cumstances as compared with their pre-war freedom.
Certain foreign companies have already reacted to this policy by
demanding assurances that all installations and facilities, as well as
their operations and employees, will be under the company's direct and
exclusive control in order to facilitate improvements in the conditions
of the workers as operations are resumed.
e. Ea.9.1211_21211.9.
The problems of reconciling the foreign trade objectives of the ReL.
public with the trade and shipping controls of the Dutch also derive from
the conflicts in Dutch and Indonesian views on the Republic's sovereignty
in the interim period. The Dutch trade regulations of 28 January 1947 and
their enforcement, notably in the case of the US vessel "Martin Behrman",
were designed to prevent the Republic's engaging in foreign trade except
through Dutch official channels. The decrees were justified by the Dutch
on the grounds that tho products sold in trade by the Republic were ob-
tained illicitly from European estates and were sold indiscriminately at
prices below their value in the world market, thereby progressively impov-
erishing the Indies. The Republic's view was that such trade was not il-
legal under its rights as a de facto authority to sell the products of
estates under its control, particularly when the cost of maintenance of
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the estates and labor since the end of the Japanese occupation had been borne
by the Republic. The Republic, by its contention that the formulation of
regulations governing exports, imports, and financial matters in Java, Ma-
dura, and Sumntra are matters for the Republic to decide, has impeded the
operations of the Joint Ebonomic Committee charged with implementing the
economic provisions of the Linggadjati Agreenent. This, in turn, has shaken
the faith of Dutch business interests in the efficacy of negotiations with
the Republic and has strengthened the position of those who advocate the use
of force to bring about implementation of the Linggadjati Agreement.
f. Formation of the USI
In the political sphere, Dutch and Indonesian views differ on the
organization of the areas of the Indies which lie outside the Republic.
The Dutch desire that the USI embrace at least three distinct states, more
or less balanced against each other, to'prevent the Republic's achieving
a dominant position vis-a-vis the others.
The second component part of the United States of Indonesia, the
state of East Indonesia, was established at Den'Pasar, Bali, on 24 December
1946, following a series of conferences, at Malin? in July 1946 and at Pang-
kal Pinang in October 1946, between the Dutch and representatives of the
outlying areas. The future status of Borneo is still indefinite. Pro-
Republican sentiment, especially in South Borneo, has prevented the forma-
tion of a unitary state in Borneo. The Dutch meanwhile have sponsored the
formation of a separate state of West Borneo, and are now organizing other
regimes in East and Central Borneo.
The absence of Republic participation in these conferences has led
the Republic to charge the Dutch with violating Article II of the Linggadjati
Agreement, which provides for Dutch-Republic cooperation in the formation of
the USI. The Republic further has charged that the conferences were not truly
representative since various pro-Republic groups in the outer islands were not
included. The latter groups have announced their support of the Republic in
numerous assemblies and broadcast resolutions.
Furthermore, several statements by Republic officials oppose Dutch
plans to the extent of announcing the Republic's intention of bringing the
entire archipelago under the Republic's control. Vice-President Hatta has
also declared that the creation of the USI is "the first step toward the
unity of the entire Indonesian archipelago under the Republi.c regime."
E. Area of the Republic
Parallel with Republic efforts to draw portions of the outlying
islands into its sphere of influence, there have been attempts to divide
the Republic and to reduce its area. On 25 March 1947, Dutch Overseas
Minister Jonkman stated that Articles III and IV of the Linggadjati
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Agreement "give an opportunity possibly to split the present Republic in such
parts as would desire independence -- the opportunity has been held open for
Madura, for Sumatra (integrally or in subdivisions), for the Sunda lands, and
whichever other population-groups one might consider, to obtain a position of
their own in the federation (USI) likewise the possibility exists that an
area not now part of the Republic's territory may choose for the Republic."
The leaders of the Pasoendan Party, claiming to represent about 12,-
000,000 Sundanese in West Java, proclaimed the independence of a Pasoendan
State from the Republic on 4 May 1947, a development which must be viewed in
the light of Jonkman's remarks as a part of the Dutch policy aimed at limit-
ing the Republic's territory. The Dutch may also attempt to draw Madura and
portions of Sumatra away from Republican control, capitalizing on Sumatran
antipathy to any rule of Sumatra by Javanese. Continunl efforts by the Re-
public to penetrate and strengthen Nationalist and pro-Republican movements
in the outlying islands of the "Malin() Area", together with Dutch counter-
efforts to limit the Republic's area of authority and prevent its acquiring
a dominant influence in the Indies, will also constitute a serious obstacle
to the formation of the USI by the planned date of 1 Janunry 1949.
Ii. Foreign Relations
Dutch-Indonesian differences extend also to the field of foreign re- .
lations. The Dutch view is that, since the Netherlands will continue as the
sovereign power in the Indies until the formation of the USI, the Indonesians
will not be entitled to conduct independent diplomatic relations until after
the USI has come into being. In the interim period, the Dutch plan to admit
Indonesians to the foreign service of the Realm and to conduct foreign rela-
tions, as they relate to the Indies, through a newly-established Far Eastern
Office of the Foreign Ministry in Batavia.
The Indonesians, however, regard these plans as merely Dutch inter-
pretations of the Linggadjati Agreement which, as such, cannot be considered
as binding upon the Republic. The Republic regards continued Dutch efforts
to retain control of Indonesian representation abroad as an attempt to prove
to the world that Indonesia is still a part of the Kingdom of the Netherlands;
accordingly, the Republic has proceeded unilaterally to work out the prelimi-
nary steps for establishing diplomatic relations with Australia, India, the
Arab League, Egypt, Siam, and Malaya. While the Republic lacks the means ac-
tually to transport its representatives abroad, its insistence upon its right
to handle its own diplomatic affairs prior to the formation of the USI, and
the sympathetic attitude of the Arab League, Australia, and India to this con-
tention, will lend an international aspect to Dutch-Indonesian differences on
this question.
i. Arbitration
Article XVII of the Linggadjati Agreement states that the Dutch and
the Republic delegations "shall settle by arbitration any dispute which might
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arise from this Agreement and which cannot be solved by joint consultation in
conference between those delegations"; yet there is disagreement between the
Dutch and Indonesians even upon the natter of settling their disagreements.
The Netherlands interpretation of Article XVII holds that it applies only to
to relations between the Republic and the Netherlands but not to natters per-
taining to the USI as a whole. The text of the Agreement seems clearly to
indicate, however, that disputes concerning the .USI should be included in ar-
bitration settlements, since the USI is an integral part of the Linggadjati
Agreement.
d. Conclusions
In sunnary? the Dutch desire to achieve, through the Linggadjati
Agreement, (a) the maintenance of Netherlands sovereignty througheut the
Indies until the formation of the USI; (b) the integration of the Repub-
lic into a federal USI as one of its component parts; and (c) the resto-
ration of economic rights and control of foreign relations.
In opposition to these aims, the Indonesian Republic seeks (a) the
free exercise of all the prerogatives of a sovereign state by virtue of the
de facto recognition of its authority in Java, Madura, and Sumatra, includ-
ing the control of economic activities within its territory and the conduct
of its own foreign relations; and (b) the control of the entire Indies ar-
chipelago through a unitary USI tinder Republican domination.
The resolution of these divergent aims in the future depends upon
the relative bargaining positions in political, economic, and military terms
of the two adversaries.
In political terns, the Republic is strong so long as the presence of
the Dutch in Java and Sumatra constitutes a menace to the Republic's exist-
ence. Moderates and extremists in the government of the Republic vigorously
oppose any effort by the Dutch to impose their will by force, but split apart
during negotiations, according to their moderate or extreme reactions to
Dutch proposals. Indonesian nationalism is externally a source of strength
in its unifying force in opposition to Dutch colonialism, but there is, in-
ternally, an element of weakness in its antagonisms, traditional or fostered,
toward the dominant Javanese on the part of other ethnic groups. Such antag-
onisms can be used by the Dutch to further a divide-and-rule strategy and to
convey an impression of weakness and dissension within the Republic.
The Netherlands, however, is also politically divided over Indies
policy between conservatives; business interests, and the military on the '
one hand, and moderates, liberals, and left-wing elements on the other.
The former desire a strong policy aimed at the rapid restoration of Dutch
rights in the Indies, while the latter favor negotiated settlement and the
creation of a partnership of the Netherlands and the Indies as the best
means of preserving Dutch influence overseas.
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In international terms, the Republic is strengthened by the sympathy
of Oriental peoples who are also opposed to Western control, such as India,
Burma, and Vietnam, or who have common ties of religion, such as the nations
of the Arab League. The Republicts struggle for independence also engen-
ders widespread, sympathy throughout the world, while other nations desiring
access to the resources of,the Indies are quite willing to deal with the Re-
public. The Netherlands, however, retains the monopoly on diplomatic repre-
sentation for the Indies and continues to be recognized by other nations as
the sovereign authority over the area.
In economic terms, the Republic possesses great natural wealth but
lacks the technical experience to exploit it to its own best advantage, and
is prevented from exporting commodities now on hand by stringent Dutch trade
regulations and their enforcement by naval blockade. The Dutch, for their
part, need access to the wealth of Java and Sumatra to acquire the foreign
exchange necessary to finance the rehabilitation of the Netherlands and the
Indies. The prolongation of the present stalemate will therefore result in
financial and economic hardships to both sides.
In military terms, the Republican forces are less well-equipped and
trained, but these disadvantages are balanced by greater ease of mobiliza-
tion and movement on interior lines of communication. Dutch forces, on the
other hand, must be supplied across a distance of many thousands of miles,
require a long period of acclimatization to tropical conditions, and possess
complex equipment subject to rapid deterioration in tropical warfare. Fur-
th6rmore, the cost of maintaining over one hundred thousand troops in the
Indies places a considerable strain on the economy of the Netherlanls which
cannot be offset by the proceeds of a normal flow of trade until relative
economic stability is restored.
The Dutch and Indonesian bargaining positions are thus nearly tal-
anced, although the Republic probably can afford some delay better than the
Netherlands, which is under increasing economic pressure. This pressure is
leading the Dutch to consider seriously an attempt to reach a decision by
military means, which would result in a prolonged and costly campaign. This,
in turn, would engender increased anti4lestern feeling in Asia and might lead
to consideration of the dispute by the United Nations Security Council.
Continued attempts at negotiated settlement will also be protracted
because of the relative balance of power and the crucial importance of the
issues involved. Delays in negotiation, apparently hopeless stalemates, and
the growth of mutual suspicion and impatience increase the possibility of
armed clashes in the period of adjustment preceding the creation of the USI.
The USI, itself, when and if established, will possess grave weaknesses re-
sulting from its evolution from compromise to compromise, whose non-observ-
ance night easily lead to a final break and the collapse of the whole struc-
ture. Meanwhile, the lack of a settlement continues to make it impossible
for the rich resources of the Netherlands Indies to contribute to the estab-
lishment of economic stability throughout the world.
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APPENDIX A
TEXT OF THE DUTCH-INDONESIAN AGREELENT
? PREAME
The Netherlands Government, represented by the Commission General for the
Netherlands Indies, and the Government of the Republic of Indonesia, represented
by the Indonesian delegation, moved by a sincere desire to insure good rela-
tions between the peoples of the Netherlands and Indonesia in nev forms of
voluntary cooperation which offer the test guarantee for sdund and strong
development of both countries in the future and which make it possible to give
a new foundation to the relationship between the two peoples, agree as :follows
and will submit this agreement at the shortest possible notice for the approval
of the respective Parliaments:
ARTICLE I
The Netherlands Government recognizes the Government of the Republic of
Indonesia as exercising de facto authority over Java,Vadura and Sumatra. The
areas occupied by Allied or Netherlands forces shall be included gradually,
through mutual cooperation, in republican territory., To this end, the necessary
measures shall at once be taken in order that this inclusion shall be completed
at the latest on the date mentioned in Article XII.
ARTICLE II
. The Netherlands Government and the Government of the Republic shall co-
operate in the rapid formation of a sovereign democratic state on a federal
basis. to be called the United States of Indonesia..
ARTICLE III ?
The United States of Indonesia shall comprise the entire territory of'
the Netherlands Indies with the provision, however, that in case the nopula-
tion of any territory Indies,
dUe consultation with the. other territories, should
decide by demodratic process that they are not, or not yet, willing to join
the United States of Indonesia, they.can,establish a Special.relationship for
such a.territory to the United States'of Indonesia and to the Kingdom of the
Netherlands.
ARTICLE IV
The component parts of the United States of Indonesia shall be the Repub-
lic of Indonesia, Borneo and the' Great East. without prejudice to the right of
the population of tiny territoryto decide by democratic nrocess that its posi-
tion in the United States of Indonesia shall be arranged otherwise. Without
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derogation of the provisions of Article III and of the first paragraph of this
article, the United States of Indonesia may make special arrangements con-
cerning the territory of its 'Capital.
ARTICLE V
? The Constitution of the United States of Indonesia shall be determined
by a Constituent Assembly':Composed of the democratically'nominated representa-
tives of the Republic' and of the other futurepartners of the United States
of Indonesia to which the follordng paragraph of this article shall apply.:
Both parties shall consult each other in the method of particiration in
this Constituent Assembly by the Republic of Indonesia, by the territories
not under the authority of the Republic and by the groups of the population
not, or insufficiently, represented with due observance of the responsibility
of the Netherlands Government and the Government of the Republic, respectively.
7 ARTICLE VI
To promote the joint.interests of the Netherlands and Indonesia, the -
Netherlands Government and the Government of the Republic of Indonesia shall
cooperate in the establishment of a Netherlands-Indonesian Union by which '
the Kingdom of the Netherlands, comprising the Netherlands, the Netherlands
Surinam and Curacao, shall be converted into,said,union consisting
on the one hand of the Kingdom of the Netherlands, cemprising,the Nether-
lands, Surinam and Curacao, and.On-the other hand the United States of
Indonesia.
The foregoing paragraph' does not exclude the possibility 'of a further
arrangement of the relations:bet7een the Netherlands, Surinam and Curacao.
ARTICLE VII ,
(A) -The Netherlands-Indonesian Union shall have its own organs. to pro-
mote the joint.interests'of the Kingdom of the Netherlands and the United .
.States of Indonesia.
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(B) Thede organs shall be formed by the Governnehts of the Kingdom of
the Netherlapds.and the United States of Indonesia and, if necessary, by the
Parliaments. of those countries.
(C) The joint interests shall be considered to be cooperation on foreign
relations, defense and, as far as necessary, finance, as well as subjects of
an economic Or cultural nature.
ARTICLE VIII
The King (Queen) of the Netherlands shall be at the head of the Nether
lands-Indonesian Union. Decrees and resolutions concerning the feint interests
shall be issued by the organs of the union in the King's (Queen's) name.
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ARTICLE IX
In order to promote the interests of the United States of Indoneaia in
the Netherlands and of the Kingdom of the Netherlands in Indonesia, a High
Commissioner shall be appointed by the respective Governments.
ARTICLE X
Statutes of the Netherlands-Indonesian Union shall, furthermore, contain
provisions regarding:
(A) Safeguarding of the rights of both parties toward one another and
guarantees for the fulfillment of their mutual obligations;
(B) Mutual exercise of civic rights by Netherlands and Indonesian
citizens;
(C) Regulations containing provisions in case no agreement can be
reached by the organs of the union;
(D) Regulation of the manner and conditions of the assistance to be
given by the services of the Kingdom of the Netherlands to the United States
of Indonesia as long as the services of the latter are not, or are insuffi-
ciently, organized, and
(E) Safeguarding in both parts of the union of the fundamental human
rights and liberties referred to in the Charter of the United Nations'
organization.
ARTICLE XI
(A) The statutes of the Netherlands-Indonesian Union shall be drafted
by a conference of representatives of the Kingdom of the Netherlands and the
future United States of Indonesia.
(B) The statutes shall come into effect after approval by the respective
parliaments.
ARTICLE XII
The Netherlands Government and the Government of the Republic of Indo-
nesia shall endeavor to establish the United States of Indonesia and the
Netherlands-Indonesian Union before Jan. 1, 1949.
ARTICLE XIII
The Netherlands Government shall forthwith take the necessary steps in
order to obtain the admission of the United States of Indonesia as a member
of the United Nations' organization immediately after the formation of the
Netherlands-Indonesian Union.
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ARTICLE XIV
The Government of the Republic of Indonesia recognizes the claims of
all non-Indonesians to the restoration of their rights and the restitution
of their goods as far as they are exercised or to be found in the territory
over which it exercises de facto authority. A Joint commission will be set
up to effect this restoration and restitution.
ARTICLE XV
In order to reform the Government of the Indies in suCh a way that its
composition and procedure shall conform as closely as possible to the recog-
nition of the Republic of Indonesia and to its projectedconstitutional
structure, the Netherlands Government, pending the realization of the United
States of Indonesia and of the Netherlands-Indonesian Union, shall forth-
with initiate the necessary local measures to adjust the constitutional and
international position of the Kingdom of the Netherlands to the new situa-
tion.
ARTICLE XVI
Directly after the conclusion of this agreement, both parties shall
proceed to reduce their armed forces. They will consult together concerning
the extent and rate of this reduction and their cooperation in military
matters.
ARTICLE XVII
(A) For the cooperation between the Netherlands Government and the -
Government of the Republic contemplated in this agreement, an organization
shall.be 'called into existence consisting of delegat'ions to be appointed
by each of the two Governments with a joint secretariat'.
(B) .The Netherlands government and the Government of the Republic of
Indonesia shall settle by arbitration any dispute which might arise from
this agreement and which cannot be solved by joint consultation in *con- .
ference between those delegations. In that Case a chairm? of another
nationality with a deciding vote shall be appointed by agreement between
the delegations or, if such agreement cannot be reached, by the President
of the International Court of Justice.
ARTICLE XVIII
This agreement shall be dram up in the Netherlands and Indonesian
languages. Both texts shall have equal authority.
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