Foreign Relations of the United States, 1969–1976, Volume E–8, Documents on South Asia, 1973–1976

131. Telegram 115596 From the Department of State to the Embassy in India¹ ²

Washington, June 14, 1973, 1454Z.

Subj:

• Aid India Consortium

1. Ambassador Meyer called in Indian Ambassador Kaul June 13 to preview for him USG position at Paris aid in consortium meeting. Ambassador Meyer said we were informing Indians in advance to assure that they were not surprised by our actions and understood our rationale.

2. Ambassador Meyer outlined our general views on debt rescheduling as indicated in State 108805 and 108334. Acting Assistant AID Administrator White elaborated these noting our concern re need for full participation by all consortium members and by World Bank, our desire for better quality of participation, and for an effort to obtain similar action by non-consortium members.

3. In brief discussion, Kaul expressed doubt about utility of aid club trying lay down rules for non-members. He said India’s main interest was in outcome and probed re likely U.S. action. Ambassador Meyer emphasized that we were disposed to be positive and were hopeful we would participate with the $29 million share recommended by the World Bank.

4. Ambassador Meyer then reviewed our proposed statement on development assistance pledging, drawing on State 114189, Kaul said he had no official comment, but characterized our stance as “not very helpful”. Uncertainty about availability of U.S. aid would hamper India’s preparation for fifth 5-year plan. If others took similar position, this would add to India’s difficulties. Ambassador Meyer said that our comments were not intended to be negative. We would shortly be discussing with Indians the question of a possible role of U.S. assistance as part of our broader economic dialogue. Kaul said that GOI did not doubt U.S. sincerity in pursuing economic dialogue and in seeking better relations, but simply wanted to know where it stood on aid.

5. FYI: Just before session with Kaul, we received word that President had approved Department’s recommendation with regard to initiation of talks on form and purpose of possible future U.S. economic assistance. End FYI.

1. Source: National Archives, RG 59, Central Files 1970–73, AID 3 India. Confidential; Immediate. It was repeated immediate to the Mission to OECD. It was drafted by Kux; cleared by AID/ASIA and NEA/INS; and approved by Meyer.
2. Ambassador Meyer met with Indian Ambassador Kaul to discuss the U.S. Government’s position on Indian debt rescheduling. Kaul pressed Meyer for a more definite declaration of availability of future U.S. aid to India, noting that the current vagueness of U.S. intentions would hamper India’s ability to construct its fifth five-year economic plan. Meyer indicated that he believed the U.S. would rule in favor of extending future aid to India.