845.515/507
Memorandum by the Chief of the Financial Division (Livesey)
Lend-Leasing Silver to India
After the meeting at the Treasury described in Mr. McGuire’s43 memorandum of August 24,44 Mr. Livesey telephoned Mr. E. M. Bernstein of the Treasury that the Department was opposed in general to [Page 278] lend-leasing materials direct to India, but would not oppose direct lend-leasing of 20 million ounces of silver to be used for currency purposes in India. This was the only direct lend-lease transaction with India the Department was prepared to approve, and it did not foresee any other transactions which it would approve. It would not approve the proposed lend-leasing of 100 million ounces of silver to India for anti-inflationary purposes. Any silver for this purpose should be lend-leased to the British Government and not to the Government of India.
Mr. Bernstein said he would immediately report all this to Sir Cecil Kisch of the India delegation and would procede with the arrangements regarding the 20 million ounces for currency purposes.
Mr. Livesey then telephoned Mr. Knollenberg45 of the Office of Lend-Lease Administration and told him the foregoing. Mr. Knollenberg said he was interested to learn that the Department of State shared his opposition to direct lend-lease arrangements with India. He had not known this.