THE PROBABLE OUTLOOK FOR INDONESIA THROUGH 1954

Created: 5/19/1954

OCR scan of the original document, errors are possible

THE PROBABLE OUTLOOK FOR INDONESIA4

THE PROBLEM

To assess the political situation in Indonesia and to estimate probable political developments in that country

CONCLUSIONS

least through the period of thispolitical developments In Indonesia will probably continue to center around efforts of the Nationalist Party (PNI) to retain and consolidate control of theTo maintain its majority in parliament, the present PNI coalition government depends on the support of Communist votes. If the PNI moves too rapidly in its efforts to build up itsor goes too far in its acceptance of Cornmunist support, it runs the risk of being overthrown, eitherilitary coup or by parliamentary action.the PNI apparently recognizes this clanger and, moreover, will probablyto have the strong support ofSukarno. The disparate elements which make up the opposition are so far only loosely aligned with one another and have not coordinated their efforts to any degree.onsequence, wethat the PNIetter than even chance of retaining power

Continued rule by the presentis likely to be marked by somedeterioration of the internal security and economic situation, but It is unlikelyerious threat to the stability of the country will emerge4esult of these trends.

The Communists will probablyto gain in strength and prestige during the period of this estimateonsequence of continuation of thegovernment in power. However, it is extremely unlikely that thewill beosition to gain control of the government, legally or by force,t is also unlikely that acknowledged members of theparty will be brought into thegovernment, becauseove might cause significant defections from the coalition, perhaps even within the PNI itself, and might provoke violentby opposition elements.

While the effects of military anddevelopments in the Associated States of Indochina may eventually forceto abandon its present self-styled "independent" position, it is unlikely that this will come to pass within the period of this estimate.

eakening of the opposition enable the present government to retain officerotracted periodhe Communists' capabilities for ultimately dominating the government would greatly increase, and could leadituation seriously prejudicial to US security interests in Southeast Asia' Loss of Indonesia to tbe Communist Bloc wouldistinct threat both to tbe

Philippines and Australia, and would provide the Cornmunists with ready access to important sources of petroleum, rubber, tin, and mica.trategic point of view, Indonesia would then be available for the establishment ofadvanced naval and air bases which could dominate and control the sea and air lines of communications of this vitally strategic area.

present situation

he political situation in indonesia remains unsettled. no national elections have ever been held, and the presentopular mandate. partly in anticipation of elections now scheduled fornd partly in reaction tosupport for the government, anwide division has developed between the incumbent nationalist party (pni) and its moderate rivals, the moslem party (masjurnl) and the socialists. the condition of political instability has been intensified by theof the political parties with factionalism in the armed forces. the communists have gained substantial opportunities fortheir influence.

ntilndonesia had, with one short-livederies of coalitionincluding representatives of both the pnt and the masjumi signs of anbreakdown in this coalition system appeared in the so-calledctober affairhen the pniotion which

'the assistant chief of. intelligence, department of the Army, would substitute the following for the above sentence:

the increase in ccmmunlst strengthonsequence of continuation of uiegovernment in poweretrimental lo the stability and present orientauon of indonesia. it is considered unlikely that positive counteracuor. will be taken by the opposition to check this trend therefore, it is likely that the progressive development of this trend could eventually leadituation which would seriously jeopardize us security interests in southeastas critical of the minister of defense and was aimed at blocking government plans forthe armyore compactaction of the armed forces came near to revolt and demandedof parliament and immediatethe intervention of president sukarno resolved the immediate crisis. however, pni sniping at the coalition continued, and3 the government finally resigned rather thanni-supportedvote. nine weeks later, after fourattempts toabinet had failed. president sukarno finallynt-led cabinet from which members of the mas) ami and the socialist party were excluded.

& the ali government which took office on3 is the farthest left of indonesia's cabinets to date. ail himself is generallyin outlook, but seven membersdefense. jusuce, labor, finance. agriculture, education, and foreign affairsarc men of leftist background. none, however, is an avowed corcmunlst, althoughtheof defense and laborhave comported themselves as though they might be fellow travellers. since assuming office, the minister of foreign affairs has been markedlywith the us ambassador, and theof agriculture, finance, and education have also tended to cooperate with american official and business representatives inhowever, in order to maintain amajority, the government depends on theoles of the communist party and the communist-run labor federation, sobsi.

he All cabinet has the support ofSukarno, who remains Indonesia's strongest and most influential figure. motives in backing the presentare not entirely clear. He ma; hare done so partly in an effort to reduce Masjuml Influence, fearingasjuml victory In the planned elections might result In greatly increased Moslem influence, possiblyoslem constitution for Indonesia. He may also have done so partly in an effort to reduce the influence of the military group which led thectober affair. Finally, he may have regarded acceptance and support of the All cabinet as the only alternative to ancabinet In which he would either have to take personal responsibility for day-to-day governmental operations or turn matters over to Vice-President Halta. Whatever Sukarno's motives, his support of the All cabinet and his efforts to aid that cabinet have caused him to become increasingly identified ineyes with the PNI. and his unifying Influenceurely national figure above party politics has somewhat diminished.

Since taking office, the All government has concentrated on strengthening its own position and weakening that of theIt has removed some Masjuml and Socialist sympathizers from key positions in the provincial administrations and in the various ministries, and is continuing its efforts in this regard. In preparing for the national elections, the government has tried to rig the electoral machinery. Masjuml and Socialist representatives were completelyfrom the central electionsset up by the government. Following Masjumi protests, however, representation was granted, on the subordinate regional committees that were later established.

The government has also strengthened its hold over the armed forces. DefenseIwa Kusumasumantri has indicated that he wants control of all military appointments down through regimental level. He hasin transferring to his own staffall the powers of the Armed Forces Chief of Staff. Several army officers of Iwa's own choice have been named to high staff posts without the consent of the Army Chief of Staff.

he efforts of the government forces to weaken the political opposition and totheir control over the armed forces have met increasing though not alwaysresistance. Ineeling against Iwa's actions cameead among army laders. and there were rumorsoup. The Army Chief of Staff submitted his resignation, and four out of the seven Territorial Commanders joinedemand for Iwa's resignation. erious crisis was avertedompromise personally arranged by President Sukarno. Iwa'swere allowed to stand, but the Army Chief of Staff retained his post and Iwato make no further appointments without consulting him. More recently, the parliamentary opposition, which rallied to the support of the dissenting Territorialin December, has become moreagainst the government and ItsOn two recent occasions the Masjuml staged mass demonstrations in protest against PNI and Communist propagandaon it.

nified opposition, prepared to take the initiative against the government, has still to emerge. The government'scritics, who probably still hold more than twe-thirds of the key field commands, have made no effort to obtain politicaland have actually done little to band together among themselves. The political parties opposing the government inare divided on many issues and have thus far made no serious coordinated effort to drive the PNI from office.

The actions of the All government and the PNI since coming into power have been marked by continuing close collaboration with the Communists. The willingness of the government and the PNI to work with the Communists probably derives from belief that the Communists can safely be used to help forestall Masjumi domination ofrather thanesire to help the Communists to implement their program.

However, some government policies to date have been to the advantage of the Communist as well as the PNI position. Both havefrom the weakening of Masjumi and Socialist Influences in the civil service and the army. There is no evidence of direct Communist control over government policy, but on occasion both the government and the PNI have taken action specifically beneficial to the Communists alone. The government has shown partiality toward SOBSI, thelabor federation In itsof Ministry of Labor patronage. On the other hand, the government bos thus far resisted the Defense Minister's efforts to arm PERBEPSI. the Communist-dominated vet-terans organization, and has refused to allow continued occupation of estate lands inby Communist-led squatters.the prestige and influence of thehave been enhanced by their close association with the government.

The principal Communist threat In the present situation derives from theacceptance of Communist support. Communist party membership Is estimated at lessutopulation of aboutillion, and Communist military strength is still limitedew guerrilla bands in Java. However, by successful exploitationunited front" policy, the Communists have achieved l'NI acceptance of their support, thus enhancing Communist prestige andand have been able to infiltratemachinery and non-Communistorganizations. In addition, thehave considerable potential totheir aims through their control of SOBSI, whosoembers make up the bulk of organizedOBSI general strike, by disrupting estate production and transportation, couldinimum seriously embarrass the

The government has made little progress with the major problems of establishing law and order throughout Indonesia. Nosteps have been taken to quell dlssldence In south Celebes, and disorders have broken out among the Atjehnese of northernThe activities of the fanatic Moslem dissident group. Darul Islam, continue

Indonesia's economic position hasto deteriorate during therastic drop In world tin and rubber prices haserious deficit in balance of payments, and foreign exchange reserves have fallen to within four percent of the minimumercent reserve requirement The government deficit has increased The government has done little to solve any ofeconomic problems, though It hasew bilateral trade deals in an effort to obtain markets for its tin and rubber.

The Ali government has continued the Indonesian foreign policy of "independence" in the East-West struggle. Relations with the Communist bloc have been strengthened by sending ambassadors to Moscow and Pei-plng and by opening trade negotiations with certain Bloc countries. At the same time, relations with the US, which had deteriorated2ave recently shown some signs ofequest has been made for US assistance in national police training, and the Foreign Minister hasa desire to proceedreaty of Commerce and Navigation. Although"independent" and "anticolonlalist" policy frequently leads it to be critical of Western actions in the present worldIndonesia's economic and political ties continue to be predominantly with the West.

II. PROBABLE POLITICAL DEVELOPMENTS4

developments in Indonesiacontinue, at leastaround the efforts of the PNI toconsolidate its control of thePNI recognizes that its chiefMasjumi. appears to be politicallyIndonesia and might evenmajority in an honest election. Thealso aware that many military leadersto the present government'srespect to the armed forces and arecritical of gOTernmentwith the Communists. However, ifattempts too blatantly to rig the elector-

al machinery, appears to be unduly delaying elections, or goes too fast in attempting to consolidate control over the armed forces, it runs the risk of being overthrown eithernilitary coup or parliamentary action.

If the present government should fall by parliamentary means, the successorwould probably be headed by theand be drawn from the presentand from minor parties now In thegovernment. If the present government's downfall resulted from PNI refusal further to cooperate with the Communists, the new coalition might also Include PNIUnder the new government, efforts would almost certainly be made tothe activities of the IndonesianParty, but It is unlikely that the party would be formally banned. However, there is some chance that an "executivepending elections under Presidentmight take over. In any event, the new government would probably concentrate on preparation for elections.

Any attempt to overthrow the present government by force would probably Involve the MasjumI leadership and Vice-President Hatta. The latter is known to be concerned about the Communist problem and thegovernment's military policies, and Isreported to be at odds withEven if the military leaders took action without securing prior politicalthey would almost certainly welcome any support they could get from opposition political leaders. Those Territorialwho are in opposition to theinilitary policies and collaboration with the Communists appear to have the preponderance of military strength under their control. Most of the military units in west Java {site of theentral Java, north Sumatra, and0 troops, would probably side with theasubstantial proportion ofman Police Mobile Brigade. Many of the remaining units of the National Police Force scattered throughout Indonesia would probably also be sympatheticoup.

However, the success of any coup wouldonsiderable degree of coordinationumber of disparate elements which are so far only loosely aligned with one another. Moreover,evolt scored overwhelming Initial successes, there would almost certainly be resistance by some pro-government forces in Java. Under suchthe coup leaders would pr ibably have to secure the cooperation of Presidenttoong-drawn-out civil war from developing.

We believe that PNIetter than even chance of retaining powerecause of its awareness of the hazards of moving too fast, It will probably yield on specific issues when confronted with strong opposition. Moreover, It will probablyto have the strong support of President Sukarno, who in response to the threatened withdrawal of one of the smaller government parties reportedly threatened to dissolveand to retain All as prime minister. Some influential members of the PNI havedissatisfaction with party acceptance of Communist support, and there arereports of PNI attempts toorking agreement with the MasjumI and thus reform the coalition on which mostgovernments have beenNI-Communist spilt, which would bring down the government, does not appear likely to develop at any early date, because both sides profit from the presentMeanwhile, the military opponents of the regime, who apparently have no political ambitions of their own, have displayed little inclination, exceptast resort, to take up armsegally constitutedenjoying President Sukarno's support.

Continued rule by the PNI and its present allies will probably be marked by somedeterioration of Internal conditions in Indonesia Little progress is likely to be made in suppressing dissidents. There will probably be some further weakening of the effectiveness of the armed forcesesult of the government's efforts to reduce the strength of thectober element within the

PIIOBDIL

armed forces. However, it is unlikelyerious threat to the stability of the country will emerge4esult of these trends. Although the government willhave little success either in solving its fiscal and foreign trade problems or inforeign capitalheeffects of continued economic drift and depression will probably not become acute during this period.

ontinuation of the present coalition in power will provide the Communists withopportunities for building up theirstrength, infiltrating the governmentand pushing for adoption of policies favorable to the Communist cause. As athe Communists will probablyto gain In strength and prestige during the period of this estimate. It Is extremely unlikely, however, that the Communists will gain power, legally or by force,t is also unlikely that acknowledgedof the Communist party will be brought Into the present coalition government, becauseove might cause significantfrom the coalition, perhaps even within the PNI itself, and might provoke violentby opposition elements. Moreover, until conservative influence in the armed forces has been eliminated or greatly weakened, or until Communist guerrilla strength hasar greater extent, the Communists will remain Incapable of seizing control by force.

eakening of the oppositionthe present government to retain officerotracted periodhecapabilities for ultimatelythe government would greatly increase, and could leadituation seriouslyto US security Interests in Southeastoss of Indonesia to the Communist Bloc wouldistinct threat both to the Philippines and Australia, and would provide the Communists with ready access tosources of petroleum, rubber, tin, and mica.trategic point of view,would then be available for theof Communist advanced naval and air bases which could dominate and control the sea and air lines of communications of this vitally strategic area.

The self-styled "independent" foreignof the present government will probably remain substantially unchanged during the period of this estimate. The government will probably continue its efforts to develop its relations with the Communist world.negotiations with the Netherlands are likely to result In the dissolution of the Netherlands-Indonesia Union. Therequest for reinitiation of talks with the Netherlands on the future political status of Western New Guineahich was left unsettled at the time of the transfer of sovereignty to Indonesia, is unlikely to be granted. Indonesia's diplomatic actions will probably Include attempts to win support for the Indonesian position on New Guinea from other members of the Asian-African bloc.

While the effects of military and political developments In the Associated States ofmay eventually force Indonesia to abandon its present self-styled "independent" position, it Is unlikely that this will come to pass within the period of this estimate.

' The Assistant Chief of. Intelligence. Department of the Army, would substitute the following for the above sentence:

"The Increase In Communist strength and prestigeonsequence of conUnuatlon of the present government in power Is detrimental to the stability and present ortentaUon ofIt Is considered unlikely that poslUve counteraction will be taken by the opposlUon to check this trend. Therefore, It Is likely that the progressive development of this trend could eventually leadituation which wouldJeopardize US security interests InAsia."

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