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CENTRAL INTELLIGENCE AGENCY
THE PROSPECTSNITED STATES OF INDONESIA
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THE PROSPECTSNITED STATES OF INDONESIA SUMMARY
Indonesia is important to the US and to Western Europeource ol rawnecessary both to thc rehabilitation and development of the economies of those countries, and to thc creation of stockpiles of certain strategic materials. Besides being the principal Far Eastern source of oil, Indonesiaf the world's tinf its natural rubber. Ofare but necessary product as cinchona bark, from which quinine is obtained, itf the world's supply. Because of the need of such strategic materials, loss of Indonesia to Japan2 was keenly felt by the Allies; and In another war or in preparation for one, utilization of the whole Indonesian potential wouldaluable asset.
Instability in the area resulting from Dutch-Republican strife has, since thc war, made full exploitation of Indonesian raw materials impossible. Though futurebetween thc two sides may not find expression ln as much violence as has been seen over the past few years, continuation of the underlying disagreements willwith the availability of commodities from the productive areas of Java and Sumatra.
Developments in Indonesiaonsiderable period ln the future will center around the formation of the United States of Indonesia (USI)ederal framework of government to be estabbshed in the territory of the Netherlands Indies, and the efforts of the Dutch on one side and of the Indonesian Republic on the other to realize in the USI the basic objectives which have dictated their policies since the end of World War n.
Dutch policies and actions will be directed toward the preservation of Dutchin the archipelago and will therefore work toward neutralizing that of theby attempting to confine the scope of Republican authority lo as small an area as possible and encircling the Republicederation of pro-Dutch slates. Republican policies and actions will be directed toward the replacement of Dutch influence In the USI and its component states by predominant Republican influence and will therefore work for the revival of its prestige, the rapid delegation of Dutch powers to Indonesian governing bodies, the early creationovereign and independent USI, and the utilization of the federal structure lo Republican advantage wherever possible.
The basic conflict between Dutch and Republican aims will involve the entire archipelago through the efforts of both parties to obtain the support of lheand leaders of Indonesian political units outside the Republic
Prior to thc formation of the USI, originally scheduledhe conflict will be perceived in the Dutch terms lor the admission of the Republicre-
Noie: The information In this report Is as of8
The Intelligence orftanfzauona of lhe Departments of Slate and of thc Navy concur in una report, the Intelligence Division. Department of the Army, concurs with loose sections relating to military implications: and the Air Intelligence Division. Air Intelligence Directorate. Department Of the Air Force, had no comment.
liminary federal organization, in the plebiscites to determine thc wishes nf thc newunits on the question of joining the Republic or possessing autonomy In the USI, and in the operation of an interim federal government preparatory lo theof the USI. After the USI has been established, thc conflict will be manifest In the development of governing organs of the USI and the NeUierlands-Indonesian Union and in the contest for control in those organizations.
The prolongation of the conflict will delay the restoration of poliUcal stability and the rehabilitation of the area's economy, and may enhance the possibilityinal outcome unfavorable to the interests of the US. The achievement of stability and economic rehabilitation would best be furthered by the development of the USIiddle course, affording expression to Indonesian nationalism but permitting the continuation of Dutch assistance and guidance In Indonesia. Pursuit ofiddle course, however, is likely to require the continuing influence of third powers in the Indonesian problem. Both the Dutch and the Republic, on the other hand, will continue their efforts to divert third-power influence In the direction of their respective objectives, the Dutch bringing to bear their position in Europe and the technicalthey can offer In developing the Indonesian economy while allegingInfiltration in the Republic, and the Republic concentrating on the economic assets which lt may be able to offer to the world.
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THE PROSPECTSNITED STATES OF INDONESIA 1. Thk Problem in Indonesia.
The basic problem in thc Netherlands Indies is thc conflict between the objectives of thc Netherlands and Netherlands Indies governments on the one hand and of the Indonesian Republic on the other regarding the future political and economicof the archipelago. This problem has dominated all events ln Indonesia since the end of World War II and will continue to be the prime issue even within theof thc United Stales of Indonesia (USI) wluch itself has been advancedolution to that problem. An eventual adjustment of conflicting objectives would neccessitatc great concessions by both parties and Is therefore likely to require the Influence of third parties, particularly those now represented on thc Good Officesof the UN Security Council.
Thc Dutch in working toward their objectives concerning thc future political organization of Indonesia, possess the pre-eminent advantage of thc military superiority of their forces in the area over those of the Indonesian Republic. Thc considerable territorial and political gains accruing to the Dutch from their "police action" of the latter half7 will promote the establishment of the form of the USI principally along the lines desired by lhe Dutch. The Republic, faced with this Dutch superiority during the formation of thc USI and in the early stages of ils operation, must limit its efforts to extracting the maximum advantage from whatever structure is established in order to further the eventual achievement of basic Republican objectives wherever possible. The interaction of Dutch and Republican efforts lo achieve their respective aims will constitute the core of political developments in Indonesiaonsiderable period in the future.
2. Dutch Objectives.
Basic Dutch Objecfive. The basic Dutch objective is the preservation of Dutch influence in Indonesia to thc degree necessary to maintain Dutch economic advantages based on the control of the material resources of the area The principal subsidiary objectives arc: (a) the reduction of Republican nationalist influence, which Is directed against the continuation of the Dutch role in Indonesian affairs; and (b) theand direction, where necessary, of non-Republican nationalismessnature.
The achievement of these objectives entails: (a) the creationoliticalfor all of Indonesiaovernment in which Dutch influence can bethrough the transformation of the Netherlands Indies Government into the ali-Indoncsian government, lb) thc promotion of thc participation of non-Republican Indonesian leaders in that government; (c) the encouragement of the formation of new states in territories from wluch Republican control has been eliminated. <d) theof the Republic and the dilution of Republican influence in an all-Indonesian
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through the numerical preponderance of these new states in such aand {e) the creationovereign structure in which the influence of the Netherlands will always equal, if not surpass, the Influence of native nationalism in Indonesia.
Dutch Concept. The Dutch concept of the future poliUcal organizationovereign, democratic, federal state, thc United States of Indonesia, composed of an as yet undetermined number of units based on geographic and ethnic divisions in thc Netherlands Indies and linked closely with the Kingdometherlands-Indonesian UnionFor the evolution of the Dutchsee Enclosure A,n practtcal terms, the Dutch concept appears to contemplate the continuation of Dutch Influence throughout the area by means of the transformation of the Netherlands Indies Government into Uie federal government of the USI, the elevation of non-Republican Indonesians to high office in thc USI and the NTU, the membership of new, relaUvely pro-Dutch states in thc USI in sufficient numbers to counterbalance the effects of Republican participation, and theof the USI into the NIU under the King of the Netherlands. Although Dutch proposals regarding the NIU do not give the impressionuper-state isas the USI develops there mayendency on thc part of the Dutch to reserve to the NIU certain powers and funcUons, over which the USI,overeign state, would normally possess full jurisdiction, and. in other ways, to subordinate the USIuperior sovereignty, that of the NIU.
3. Republican Objectives.
Basic Republican Objective. Thc basic Republican objective is the achievement of preponderant influence, if not control, over the Indonesian archipelago by serving as thc focus and principal champion of the powerful forces of Indonesian nationalism which received such Impetus during and after World War II. The concreteof this objective is seen In thc parallel objective ofnitary state in Indonesia, basedommon Indonesian nationalism, in which the Republic, by virtue of its vigorous defense of Indonesian national aspirations, would assume the position of leadership. Thc principal subsidiary objective is therefore the reduction and eventual elimination of Dutch influence In the area and thc encouragement ot anti-Dutch nationalism, paralleling that of the Republic, in politically less developed areas which arc at present organized into relatively pro-Dutch stales. Theof the objectivenitary slate in Indonesia Is impossible for Lhe present in view of the superiority of Dutch military power and the consequent force given to the Dutch objectiveederal structure for lhe area. Thc Republic must therefore seek to utilize the federal structure to its own advantage where possible in order to replace Dutch influence with Republican leadershiptep toward the eventual goal of complete independence and the predominance of Republican influence in Indonesia.
At present, the Republic isosition far less favorable lo the attainment of its objectives lhan that of7 before thc Dutch "policeonsequently the attainment of Republican goals firstevival of its former prestige through
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the stimulation of pro-Republican expressions of public opinion in possible plebiscites under the UN Good Offices Committee and in Influencing the selection and activities of members of the Constituent Assembly which will draft the constitution of the USI.
The achievement of Republican objectives also requires: (a) the perpetuation of the identity of the Republic and its attributes of sovereignty, independent control of military and foreign affairs, until the formation of the USI; (b) the vigorous advocacyapid and early transfer of powers from the Netherlands Indies Government to the federal organs of the USI; (c) the promotion of Indonesian nationalthroughout the archipelago, accompanied by the encouragement of theof parallel policiesis the Dutch on the part of the Republic, East Indonesia, and whatever other nationalist groups can be won over; (d) the utilization ofpolitical skill and experience to offset the Republic's possible numericalin the governmental bodies of the USI; and (e) resistance against theof the NIU into an international entityealityovereignty superior lo that of the USI.
Republican Concept. Thc Republican concept of the future political organization Of Indonesiaovereign, democratic, and Independent republicederal basis, the United States of Indonesia, linked loosely with the Netherlands in aUnion. (For the evolution of the Republican concept, see Enclosure A, Part II) In practical terms, the Republican concept appears to contemplate the restoration of Republican prestige to the level held at the time ofnggadjatiuccessful defense of Indonesian nationalism prior to Uie formation of the USI, the encouragement of close Ues wiUi the non-Republican governments In thc archipelago, and the adoption of the role, prior to and in Uie USI, of chief advocate of Indonesian Independence
4. Present Negotiations and tu* USI
Principal Problems in Negotiations. The principal problems in the immediate future will be the reconciliation of Dutch and Republican positions In present ncgoUa-tions regarding: (a) the status of the Republic and thc scope of its authority; (b) the conditions for Uie Republic's admission to an Interim federal organization prior to the formation of the USI; and (c> the forms and areas of jurisdiction of the USI and the NIU, their interrelationship and their relations with their component states, the Kingdom of the Netherlands and the states of the USI.
Dutch Potition. The Dutch have setrecondition for Republican admission to an interim federal government the Republic's acceptance of the statustate in the interim government and the USI, implying Republican abdication olovereignty separate from that of thc interim government. The Dutch will seek in the present negotiations lo obtain Republican acknowledgment oftatus and to settle procedures for the dissolution of present Republican attributes of sovereignty such as an independent army, independent foreign representaUon, and
iscussion ofngfadjall Aeicemenl. seeBasic Dutch -Indonesian Usucs and thc Lineead|atl
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Independent financial and economic arrangements affecting the general economic life of Indonesia.
RepuWIcon Position. By accepting the "Six Principles" of the UN Good Offices Committee for the settlement of the basic political disagreement, which were embodied ln Lhe Renville Agreementhe Republic accepted the statustate in the USI. The Republic, however, desires to obtain ln the negotiations certain firm commitments from the Dutch regarding the forms and relationships of the USI and the NTU before the Republic abdicates its bargaining position by surrendering its sovereignty and dissolving Its Independent army and foreign representation. Furthermore, thewould prefer to surrender its sovereignty directlyovereign USI rather than to an Interim federal organisation over which the Netherlands would exercise Interim sovereignty. The latter step wouldurrender of Republican sovereignty to the Netherlands and would gravely Jeopardize the position of any Republicanwhich consented toapitulation. The Republic, moreover, believes that the scope of Its authoritytate In .the USI should include Sumatra, Java, and Madura because, in the Republic's view, the states which have arisen Inareas of those three islands, are undemocratic in origin, based on Dutch military occupation and in complete disregard of the real desires of the local populations. The Republic will therefore make every effort to prove during and after the negotiations that the people of the new states desire toart of the Republic.
Possible Results of Negotiations. Thc negotiations are delicate and complex, with each party seeking to reduce the bargaining position of the other. The diametrical opposition of the positions of the two parties has resulted ln slow progress, at timestalemate.omplete deadlock Is reached in thc political discussions, the UN Good Offices Committee will probably urge the Dutch delegation to make one last effort to end the impasse by presenting its final terms on the form of the USI and th* NTU. on the conditions for Republican admission into an Interim federal government, and on the position of Republican representatives inovernment. The Good Offices Committee would make every eflorl to ensure that these final Dutch terms would be generous so as to facilitate Republican acceptance. Republicanof these terms might very readily result in the complete rupture of negotiations, the withdrawal of the Good Offices Committee from Indonesia, and the reversion of the problem lo thc Security Council.evelopment would imply the abrogation of the Renville Agreement and its provisions, those which favor thc Republic as well as those which favor the Dutch. In this case. It Is conceivable that thc Dutch would then regard thc present organization comprising non-Republican states as an interim federal government; the question of Republican admission to il would be decided in large pari by the capability of lhe Republic to stand alone, apart from thc real of the archipelago. The remainder of this study is based on the assumption thai aof negotiations will be averted, and that an interim federal government will be formed, prior lo the establishment of the USI, in which the Republic will participate.
lMUMlon of the Renville AErremenl. we OIR Situation0repared by the Department of Slute.
s. Tu.'.overnment.
The Interim federal government will precede thc establishment of the USI and Is Intended to serve as the government of the archipelago, under Netherlandsunder which problems could be worked out which relate to (a) theof the USI and the drafting of its constitutiononstituent Assembly and (b) the transfer of sovereignly from the Netherlands to the USI. if agreement has notbeen reached between the Dutch and the Republic.
The Republic and the Interim Government. If thc Republic joins the Interim federal government, lt will devote its efforts to demonstrating its appeal to theof the states established in former Republican areas, and will work (a) to reduce Dutch influence in the interim government and (b) to expedite the earlyof the USI.
At the same time, the Republic will also press for greater states* rights and will coordinate this campaign with other states represented in the Interim government, such as East Indonesia. Every emphasis will be placed on the formation of the USI by thc original target dateny tendency by the Dutch lo delay this step will be denounced by the Republic as an act of bad faith and might become the subjectepublican protest to the UN Security Council.
The Dutch and the Interim Government. The Republic's activities in the Interim government will be opposed by the Dutch who are nowuch stronger position relative to the Republic than ever before. Dutch policy will be directed toward neutralizing; Republican Influence in the archipelago by attempting to confine theterritory to Java, If not to Central Java, while promoting the influence In the Interim government of leaders and states more amenable to Dutch desires. Theof the USI may be delayed beyond thc target date until the relatively pro-Dutch states develop the capacity to balance thc Republic, if not to neutralize lt. In the councils of thc USI. Dutch officials have already stated that the completion of the structure of the USI by democratic processes may easilyonger period ol time than previously estimated. They have also indicated that firm agreement would have to be reached regarding the form of the bond between the Netherlands and thehe NIU, before sovereignty could be transferred to theefinite effort will be made by the Dutch to reinforce the structure of the NIU if the Republic appearscapable of acquiring preponderant influence in the USI and thus drawing It away from the Netherlandsompletely Independent course ol action. Theof sovereignty to the USI may well be delayed until the Dutch are sure that the NIU possesses adequate safeguards against the loss ol the Indies to the Netherlands.
6. Thi Operation or the USI.
The structural details ol the USI have not yet been finally determined Both the Dutch and thc Republic have put iorth their views on its organization but these will require adjustment andelicate process which will occupy apart ol thc energies of both parties and of the UN Good Offices Committeerotracted period to come.
Dutch Desires. The Dutch, who by virtue ol their present military and political superiority hold the initiative in the organization ol the USI. have made relatively few statements on the structural details of the USI. Thc Constitution of the United States has been mentioned asasis for the development of federal organs, especially as regards thc Executive and the Senate. The US Senate, as abody whose membership is not based on population distribution,odelepresentative body in the USI In which the overwhelming concentration ofIn Republican Java could be nullified, thus promoting the relative influence of minority populations, such as the Chinese, the Eurasians, and the Dutch, andrepresentation equal to crowded Java for sparsely populated areas such as Borneo. An indication of Dutch intentions to provide representation in thc USI for as many pro Dutch units and groups as possible has been noted in the Dutchof "fair representation" in thc Renville Agreement as providing fornot only for the new states In the archipelago but also for special districts not yet organized as states. Equal representation from all political units in Indonesiaof their degree of development, as well as from various minority groups, would further dilute Republican strength in the USI.
The Influence of the Netherlands Indies Government would be preserved by the continuation of the present process of transferring departmental posts toIndonesians. The former Netherlands Indies government departments, andtheir personnel, would form the nuclei of the government departments of the USI, much as proposed in the Dutch notes ofutch personnel on high levels would gradually withdraw Trom active operational duties but could be expected lo retain, or seek to retain, advisory responsibilitiesonsiderable period, especially in thc fields of finance, economics, foreign relations, and police operations. In these fields, Dutch advisers would stress the necessity of malnlalning the "political andunity of Indonesia In thc world" in order to minimize independent contactlhe Republic and foreign powers with which the Republic had establishedbefore the "police action" took place. In police and defense matters, Dutch influence would remain strong through the role of Dutch military personnel acting as defense and police forces in the Interim period and through Dutch contributions of equipment and training personnel toward the creation of the armed forces and police of thc USI Dutch technical assistance will be necessaryeng time to come in assuring lhe efficient or semi efficient operation of the valuable economic plant of the Indies and.esult, Dutch influence will endure in all economic activity in Indonesia which is in any way associated with exports and the outside world.
In their working papers recently submitted to the UN Good Offices Committee, the Dutch have indicated their position Ihat membership in the USI and participation In lis formation should be open to any territory ol the Netherlands Indies whoseexpressesesire by democratic processes The powers of the USI and of lhe member states should be so divided that the USI will exercise authority over matters pertaining to foreign affairs, defense, the main economic and financialand other matters which can be handled wiihin the sphere of the federation
Tlic constitution of tlic member states ln the USI should contain no provisions contrary to the principles of the statutes or the NIU and the USI. Thc constitution of thc USI should coinc into operation nt thc same moment as does the statute of thc NIU.
Republican Desires. Republican working papers agree with those of the Dutch as regards thc participation of states in the USI, and the division of powers between the USI and tlic member states, except that the Republic urges thc enumeration of powers in which the USI and the member states exercise concurrent jurisdiction and thc acknowledgment that residual powers fall to the states, points not mentioned ln the Dutch papers. The Republic states that the constitutions of thc member states should contain no provisions contrary lo thc constitution of the USI but makes no mention in this connection of the statute of the NTU. Further, the Republic believes that the constitution of the sovereign USI should come Into operation prior to the statute of the NIU so that the USI and the Kingdom of the Netherlands could establish the NIUnion of members of equal status. The thus demonstrated equality of the USI and the Kingdom of thc Netherlands in the NIU would be of great importance to the Republic in opposing the development ot the NTU into an indissoluble bond between the Netherlands and thc USI.
Within the USI the Republic will continue Its efforts to reduce Dutch influence in Indonesia and will oppose any Dutch moves to perpetuate that Influence through the organization of the USI If Dutch control declines appreciably after the transfer of sovereignty lo the USI, the Republic will return to Its original objectivo ofa unitary state in Indonesia. If Republican influence replaces Dutch control and becomes paramount ln the USI, the campaign for stales rights will be abandoned In favor of "measures strengthening thc unity oft the same time strenuous efforts will be made to reinforce good relations between the Republic and tlic more nationalistic states elsewhere in the archipelago. The recent exchange of recognition between the Republic and East Indonesia and the highly successful East Indonesian good-will mission lo the Republic arc steps in the direction of greaterbetween these two stales whose effect will be to complicate the perpetuation of Dutch influence in thc area. The Republic may also endeavor to revive its contacts in an unofficial manner, with sympathetic countries, such as those of the Arab League, in order to enhance its international position.
Position of Non-Iicpublican Groups Distributed between the Dutch at one pole and the Republic at the other in terms of their plans for Indonesia are thc various minorities and non-Republican groups In Indonesia outside the area of thc Republic. Eurasians generally identify themselves with thc Dutch and so lend to favor theof Dutch administration in which they can hold positions of some Influence and social prestige. Chinese, Arab, and Indian commercial groups generally believe that their economic advantage would be greater under the Dutch where Ihey have long held middlemen roles than under the Republican economic nationalism.these groups also favor the Dutch-Many members of the native aristocracy in Sumatra, Borneo, and East Indonesia fear the social revolution inherent in Republican proclamations for the future and
tend to regard Dutch control as necessary to maintain their favored status quo.certain members of the aristocracies, such as the Sultan of Jogjakarta, have Joined the Republic without detriment to their position, and their example may be used to weaken the adherence to Lhe Dutch by local rulers in other areas. Some rulers, such as the Sultan of Deli, on Sumatra, will lend to Join whichever side offers Uiem the most In local power. Opportunistically, such figures may join the Republic if It shows signs of replacing the Dutch as the preponderant Influence in the archipelago.
Political leaders among thc non-Republican Indonesians in territories occupied from thc Republic are, in most cases, sincere nationalists who desire thc eventual termination of Dutch control, but many of them are doubtful that the Republic offers Lhe best alternative to Dutch rule and would prefer an Indonesian government with more moderate leaders than some of these present ln Republican ranks.Indonesian leaders are the mainstay of Dutch plans for the USI and may therefore be expected to be Lhe chief target of Republican propaganda and conciliatory efforts. If the Republican government maintains Its present moderate cast, if it refrains from reprisal or threats of reprisal against those who haveo cooperate with the Dutch, if It appears in the future toenuine champion of Indonesian nationalism, and if. at the same time, Dutch influence In the USI is heavy-handed and perceptible, many of these key figures may draw closer to the Republic
Leaders of political groups in Borneo and East Indonesia are generally lessadvanced than the non-Republican leaders of Sumatra, Java, and Madura and the leaders of the Republic. While they have been led by the Dutch to fear domination by the Javanese Republic, they might work with the Republicoose and self-interested alliance against thc Dutch or play the Republic and the Dutch against each other for the enhancement of their own Influence In the USI and for the protection of their states from either Dutch or Republican domination. The recent policy of the East Indonesian Governmentis the Republic is an Illustration of Lhe former possible course of action.
Prospects. For the foreseeable future, Indonesia will be the scenetruggle between (a) the Dutch aim ofederal structure In which its Influence can be perpetuated through friendly Indonesian states In sufficient number to balance the Republic, and (b) the Republican aim of replacing Dutch influence with Its ownederal structure which will then evolvenitary stale. The waging of this struggle will postpone the restoration of political stability, the rehabilitation of the area's economy, and thc resumption of normal trade.
The failure of the USI to developtable organization and the overwhelming success of either the Dutch or Republican objectives at the expense of the other within thc framework of the USI would seriously affect the prestige both of the US and ol the UN in the Far East. The virtual elimination of lhe Republicolitical entity in lhe USI and the conversion of the USIeague of pro-Dutch states would be regarded by the rest of Asiariumph of Western Imperialism in which the US and the UN were implicated through the Good Offices Committee The emergence of the Republic as thc dominant element In Indonesia and the possible consequent expulsion
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of Dutch influence fiom the archipelago would represent to the rest of Asia the victory of local nationalism over Western and foreign domination. These two alternatives represent the two extremes In possible developments within the USI. Themost favorable to thc achievement of stability and economic rehabilitation would be one In which the USI could evolveiddle way, affording the nationalism of Indonesia ample expression while avoiding Jeopardizing needed Dutch assistance and guidance.
SECRET
ENCLOSURE A
Thc positions of thc Netherlands and Netherlands Indies governments on one hand and of the Republic on the other concerning the future organization of Indonesia are the result of the evolution of their respective objectives conditioned by the changes in their respective military and political capabilities.
PART IEVOLUTION OF THE DUTCH CONCEPT
Thc Dutch concept Is the result of successive revisions of Dutch attitudes toward the Netherlands Indies under the impact of the war and the subsequentand continued existence of an Indonesian government, the Indonesian Republic, asserting full independence and exercising authorityonsiderable portion of the archipelago. In the months after the Japanese surrender when the Republic claimed authority over all the territory of thc Netherlands Indies, and Dutch military strength was virtually nonexistent, Dutch proposals were made to the Republic for the future organization of the entire archipelago,acit recognition of the Republic as spokesman for all of Indonesia. The basic theme of thc proposals at this time appeared toartnership between thc Netherlands and anorganized eithernitary state orommonwealthore or less unitary basis in which thc Indonesian Republicoremost position.
The growth of Dutch military power in Indonesia accompanying the ^occupation of Borneo and the Great East (Celebes, Lesser Sun das, and the Moluccas)hange in the Dutch attitude toward the Republic which was reflected ln the nature of Dutch proposals to the Republic. This change occurred In February and6 after which time Dutch offers increasingly distinguished between Borneo and the Great East and the Republic; the Dutch proposals of6 offered only to recognize the Republic as "exercising at facto authority over Java except in placesby alliedther innovations were notable In these proposals in that: first, the structure proposed for the Netherlands Indiesederation, rathernitary form, in which the Republic would be but one member state, rather than spokesman for all Indonesia; second, the Implication was conveyed that negotiations with the Republic would henceforth be for the delermination of the status only of Java. Madura, and possibly Sumatra, while the Dutch proceeded toew political system for Indonesia, with Republican help, if possible; and, third, the Dutch reserved the right to develop special relationships with areas choosing to retain closer ties with the Netherlands apart from the rest of Indonesia. The basic lines laid down at this time have been developed and Intensified in the succeeding two years ofand form thc fundamentals of the present Dutch concept of the futureof Indonesia, the USI.
In the summerhe Dutch initiated actionolicy based on theirmilitary power in the Netherlands Indies of proceeding with the politicalf Ih. rest ol Indonesia without availing thr settlement Ol thfl Dutch Republican dispute, ofederal organization in which the Republic would
but one part, and of organizing areas under Dutch control into counterweights to the Republic within that federal structure. This policy continues in force at present and its implementation in the past has resultedhe establishment of several autonomous administrations outside the Republic in the territory of the Netherlands Indies;umerous proposals and attempts toward the unification of these areasederal framework in preparation for the formation of the USI.
The first phase In the Implementation of Dutch policy, the establishment ofadministrations, began early6 and concerned at first only Borneo and the Great East, areas where the return of Dutch authority had eliminated Insubstantial Republican control. In most of the area local sentiment for the Republic and its objectivenitary state for Indonesia had scarcely developed and thus offered little hindrance to the Dutch program. The Dutch sponsored or encouraged whereverthe formation of anti-Republican groups and included their representatives In local councils formed to assist the Dutch in administering the area. The leaders of these councils, other native leaders, and hereditary rulers were approached for the formation of federations for each island, or large area thereof, uniting new native administrations and those which had survived from the prewar period. These Island federations were then bound together into aggregations large enough to balance the Republic in any future federal organization. One such grouping, the state of East Indonesia, was created from the territory of the Great East inimilar grouping for Borneo was obstructed by pro-Republican sentiment in certain parts of Borneo and in7 only West Borneo could be organizedtate.
Thus, when Dutch "police action" commenced Inhe states of East Indonesia and West Borneo existed to counterbalance the Republic whenever the USI provided by the Linggadjati Agreement of7 was established. Shortly after the "police action" began, thc policy of creating autonomous areas was applied to territory previously recognized as being under Republican de facto authority, but occupied by thc Dutch. Previous attempts to detach Sumatra and West Java from thc Republic had failed until Dutch military occupation of those areas impaired the potential of the Republiceterrent and an alternative to Dutch patterns offor those areas.
Autonomous Areas. The process of creating autonomous areas tends to follow the same course regardless of thc locale of the developmentbeforen West Borneo and the Great East, and since that date in the remainder of Borneo and in Dutch-held areas of Sumatra, Java, and Madura. First, there is the re-entry of Dutch military forces, followed by the re-establishment of Dutch civil administration. Republican authority, if ll was actually present before the Dutch re-entry, is declared null and void. Local patriotism and elhnic self-consciousness arc appealed lo and non-Republican or former Republican leaders arc Invited to assist in thc localContact committees arc formed including these leaders, and popular demonstrations occur at which petitions are presented to the Dutch authoritiesthe desire of the population to acquire autonomous status within the USI. The committee of leaders theneries of metamorphoses in which it is
transformed firstreliminary organizing body, thenrovisional council when the area is given the autonomous statusacrahpecial district) by the Netherlands Indian Government, and, finally,rovisional governmentasic statute has been drafted and the area Is elevated to the statusegataurther step occurs as the separate special districts and stalesarge geographic unit, such as Borneo, are integratedederation whose borders are or will be those of the geographic unit. This federation would then be admittednit to the proposed USI, which in turn would be lied to thc Netherlands in the Netherlands-Indonesian Union (NIU).
Variations occur in this procedure and occasionally several stages are telescoped. At the present, starting with Northern Sumatra and proceeding eastward, thcshows varying stages of development within this general program. Northern Sumatra, or Atjeh, hasong tradition of opposition lo rule by any and alland has not yet been organized, althoughhe Netherlands Indies Government was reported to have declared itself ready to consider requests from the people of North Sumatra to separate from the Republic. Sincearch, the east coast of Sumatra has held the statustate roughlyar with East Indonesia. Thc west coast of Sumatra has petitioned for the status of special district. South Sumatra has been mentioned by the Dutch as ready for autonomous status but definite steps have not yet been taken In this area. West Java has recentlytale of Pasundanepublican official as head of State. Since that time, some preliminary steps have been taken towardon Republicanfor Uie Batavia area. Some mention was also made of the possibility ofa non-Republican Indonesian regime for Central Java in thc Dutch Semarang sector during the early stages of the Dutch "policeut little has been heard of the project since. In East Java, the preparatory committee was reported to have been dissolved at Uie end of8esult of popular resistance to Uie scpara-Uon of East Java from the Republic. The formation of autonomous areas in Java has been greatly complicated by Uie proximity of Uie Republic in Central Java and by the fear of Republican reprisal against Indonesians too closely identified with the Dutch. On Madura, which had been separated from the Republic on Java by Dutch salients around Surabaya, fear of Republican reprisal was mucheterrent; the island now enjoys an autonomous status and may shortlytate On Borneo, the various native administrations are being integrated into an all-Borneo federation. East Indonesia has been organizedtale sinceG and local national consciousness isrowing tendency to resist Dutch influence and to draw closer to the RepubliceUow-champion of Indonesian national aspirations. If this tendency increases greatly In the future the unity ol East Indonesia may be broken by the secession of pro-Dutch areas, such as Ambon Furthermore. Uieof East Indonesia into much smaller units may become necessary in order to "satisfy the desires of peoples topecial relationship with theand lhe USI" and. as in the case of the Republic, to confine the areas of resistance to Dutch influenceircle of more tractable states.
Preliminary Federalyhe development ofareas hadointtart could be made In Integrating the new states and special districts Into an all-embracing structure. At that time, leaders of the various autonomous areas together with non-Republican Indonesians In the Netherlands Indies Governmentommitteenited Indonesia to work for the formationederal government for all Indonesiahis groupesolution to high officials of thc Netherlands and Netherlands Indies governments urging the Immediate formation of an interim government to prepareovereign USI. Onanuary. Netherlands Premier Reelrogram for the formation of the USI and Lt Governor-General Van Mook proclaimed aFederal Council to be constituted as of that date. As was the case with the metamorphosesative committee for organizing an autonomous area, most of the members of the Committeenited Indonesia were assigned places In the Provisional Federal Council and thc Committee itself was dissolved.arch, another metamorphosis occurred and the Provisional Federal Council became theFederal Government which will continue until the formation of the USI.
The Indonesian Republic has not been Ignored during these steps toward the formation of the USL The Committeenited Indonesia Invited the Republic to Join In its efforts toederal government and high Dutch officials indicated that the Republic mightutossibleosts ln the Provisional Federal Council. While initial Republican reactions to these invitations were negative, after the signing of the Renville Agreement onith Its provisions for an eventual sovereign USI, the Republic announced its willingness to participate In the interim federal organizations. In desiring to join these organizations, the Republic at that time was looking ahead to the formation of the USIhc transfer of sovereignty to the USI. and the possibility that, by virtue of Its record as defender of Indonesian nationalism and Its experience in practical politics, the Republic mightreponderant influence in Indonesia through the machinery of the USI.
PART ITEVOLUTION OF THE REPUBLICAN CONCEPT
AIler the Japanese surrender inhe Indonesian Republic, proclaimed onugust, rapidly strengthened its position In Sumatra, Java, and Madura through taking over existing Japanese administrative machinery and appointed governors for Borneo and various areas In the Great East. Indonesia was then, on paper, organizednitary basis and nominally, at least, under the Republic. The Republic regarded itself as the authority for all Indonesia and endeavored to obtain internationalas the de facto government "of thet Insisted upon immediateand rejected as Inadequate the Dutch proposals for partnershipransitional period. During negotiations with the Dutch In the springhe Republic's basic assumption was that Indonesiaully sovereign stale prepared to enter treaty relations with the Netherlands, and that "Indonesia" would eventually Include the entire archipelago, except for certain areas which mightpecial relationship with the Netherlandsixed period. These views
SE/KBT
were reflected in the negotiations before and after thc Linggadjati Agreement from6 tond led to the Republican interpretation that Dutch recognition of the Republic's de facto authority by the Agreement was tantamount to Dutch recognition of Republican sovereignly. Republican policy concerning the USI was directed at this time toward the eventual unification of thc archipelago,an Indonesian nation ratheronglomeration of ethnic or geographic areas. This policy In turn was responsible for the Republican concept of the Interim Government during the interchange of notes with the Dutch in May. June, andhe Republic agreed with the Dutch that the Interim Government shouldorerunnerederal USI. but differed with the Dutch in maintaining that the main function of the Interim Government should be to receive the transfer of the functions of the Netherlands Indies Government to the federal organs and to the component states of the USI. Thc Republic further insisted upon one-half thc seats In the Central Council which would control most of the other bodies of the Interim Government.
By the end ofnd the commencement of Dutch "policehe Republic's policy was directed toward the formationederal USI of three states exercising sovereignty over Indonesia and scheduled for complete independencerior to the formation of the USI, government functions in the Indies would be carried out by an interim regime In which the Republic would possess at least one-half of the control and In which the influence of the Netherlands Indies Government would steadily decline as its powers were transferred to the federal bodies and to the states comprising thc Interim Government. The USI In Republican plans Inas less suitable to tho Republic's aim of unifying all Indonesia under lis influence than the Commonwealth proposed by Van Mook inowever, the Republic would be one of three states and could work for the progressive liquidation of the role of the Netherlands Indies Government In theGovernment and the substitution In Its placeederal organisation, in the governing body of which the Republic might possess preponderant Influence.
The effect of the Dutch "police action" and Uie concomitant creation ofareas and inauguration ot preliminary forms of federal organization has been to reduce thc position of the Republic from that of one of three statesroposed USI to onearge number of statesSI already rapidly crystallizing around and wlUiout thc Republic. Despite its relatively disadvantageous position In an eventual federal structure, the Republic must Join it to avoid economic strangulation, political isolation from nationalist elements elsewhere in Indonesia, and defeat In its aim of eventually securing influence throughout the archipelago.
DISTRIBUTION
The President
Secretary ol At air
Chief ol Stuff to Commander in Chief Secretary of Defense Secretary ofhe Army Secretary of theSecretary of the Air Force
Executive Secretary. National Security Councilational Security Resource* Board Chief of Staff. US Army Chief of Naval Operations Chief of Staff, US Air Force
Director of Plana and Operatlona, General Staff. US Amy
Deputy Chief of Naval Operations <OperaUorui
Director ot Plana andS Air Force
Special Aaflktantht Secretary of state. Research aad Intelligence
Director of Intelligence. Oeneral Staff, US Army
Caief of Naval Intelligence
Dtrectcr of Intelligence. US Air Force
Secretary. Joint Chiefs Of Staff
Secretary, Joint Intelligence Qroup
Secretary, State*Army-Navy-Air Force Coordinating Committee
Executive BccrnUuy, Military Liaison Committee lo the Atomic Energy Commission
Director of Security and Intelligence, Atomic Energy Commission
Chief, AcqulilUon and Distribution, OICD, Department of Stale
Original document.
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