Created: 5/17/1960

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The /oBowfnp inteHfcpence organisation*ke preparation of thU ttUmatt: The Central hUtMlgenee Agency end the ffltaWpence wpanlwltonr a/ the DepartmeiUM of State, tfte Army, the Kavg. the Ate Forte, and The Joint Staff.

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To assess Sino-IncUan relations and their international implications.


border clashes havetbe appearance of cordiality between the two states. Early agreement on the boundary dispute is unlikely. However, both sides are probably willing to live with the present stalemate for some time,further border clashes may occur. In the eventrolonged failure tothe dispute, the climate could alter significantly, particularly if Nehru leaves the sceneettlementwe are inclined to believe that an eventual settlement could beprobably involving Indian concessions in Ladakh in return fox Chinese recognition of India's claims in the North EastAgencyowever, even if the border issue is setUed, it is unlikely that the friendly relations which existed in the past can be fully restored. (Paras.)

Pdping'3 moves have sharply Increased anti-Chinese sentiment in India. They have also tended to create inore sympathetic view of US policies, though India remains dedicated to the principle of nonalignment. and will also beby interest in continued large-scale Soviet aid and by some hope that the USSR will restrain Communist China. The position of the Indian Communist


Party has been made more difficult, but It has notritical setback.

To date Communist China has out-stripped India in economic growth. The present wide gap in growth rates isto narrow, but the absolutebetween the economies willcontinue lo widen.esult China will be able tomilitary superiority over India. However, as long as India is making significant economic progress, most Asian countries will probablyto derive encouragement from India's example. )

Communist China's growing strength and its aggressiveness haveore somber assessment of Chinese Communist motivations among Asian leaders. Even if the Sino-Indlan border dispute isthrough negotiations, the more apprehensive Asian view of Communist China that has recently developedwill not be erased. Nevertheless, it is likely that Communist China's strength and dynamism and its ambitions forhegemony will figure morein Asia than will India's influence.




ne Tibetan revolt and the border clashes which took place9risis In Sino-Indian relations and forced both countries to re-examine iheir policies toward each other.

Communist China's leaders hare longthe Indian Governmentourgeois regime with which there could be nocooperation. However, they considered that India was not ripe for Communistand sought to take advantage ol India's policy of nonallgnment and of Its supportarger role for Communist China in world affairs. Peiping regarded this policy assince It demanded little of Communist China beyond lip service to peace, Sino-Indian friendship, and Asian solidarity.

India's attitude toward Communist China reflected the belief that good relations between the two were essential for the peace of Asia. Most Indian leaders initially regardednese Communists as more Asian thanhi outlook, snd welcomedajor step In Asia's resurgence. Nehru hoped that by befriending China,lis admission to the UN. andassurances Of Peiping's peacefulas in the case of the Panel siuia (Fiveof Peacefullikelihood of Chinese expansionism could be reduced and Its ties to Moscow lessened. India alsothe special rights In Tibet which it had Inherited from British India, andTibet as part of China.

Nevertheless, India had same suspicions of Chinese Intentions, particularly after theof Tibet. Its military weakness vls-ft-vls China, India sought to protect itself byassurances of an autonomous status for Tibet and by negotiating new treaties with Nepal, Bhutan, and Slkklm aimed at Insuring India's primacy in tbose areas. India'sincreased steadily6 because of the hardening of Peiping's policy, asby its support of the USSR in theof the HnngBrian revolution and theof Nagy. by CtiBwse attacks onby the abrupt termination of the brief "hundred Sowers" period of liberalism, and by the imposition of the communes. Indian leaders were also disturbed by Peiping'spublication of maps showing as part of China large areas claimed by India.

The Border Conflict

ordcr dispute was inherent inointly recognised boundary and the Inability of either side tolearcut case for its borderowever,9 when the seriousness of Communist China's claims first became clear to India, the issue was largely quiescent and both countries attempted to keep it from public view.

'The UO-mllc Slkkim-Tloct borderthe only part of theSlno-lndian frontier that has been oecaarcatsd. In the east, the dispute concerns the Xorlh But Frontier Agency in1cfa) In Assam State, an area ofquare mite InhaWted by about 7OCUX0 prtmlUteIndia claims that the border in this area Is tbe McMihoa Line, which generally follows the lUmalaysn watershed This lute was drawn at4 Simla Conference by representatives of tbe United Kingdom, Tibet, and China, but the Simla agreement was not reliAed by the Chinese Government.Communist and Wattonstlrt claims that the boondary Is at the southern edge Of Ihe Himalayan Foothills. Ai though Chinese maps showquare miles inhutan adjoining hefa os Chinese, COou Ba-lal stated tn New Delhi In0 thst Petpmg bad no claims on Bhutan.

In the west Use dispute center* on0 square mile Akial Chin plalesu In the lad turn region ol Kashmir state. This ares, which Ilea betwwD tbe Karakoram and Kuniun Banses. Is desolate and uninhabited Both India andChins base tbeir claims on tbeborder which, however, has never been Identified by treaty.

There are suto several small disputed areas totaling several hundred square miles along the frontier between Lactam and Nepal. The 1k4 Sine-Indian agreement on Tibet specifies that certain passes will be open to travelers, but China claims this nareemenl has no bearing on the locution of the border.

EC/llB T

India nor Communist China had felt much sense of urgency ln settling the issue, since the territory was sparsely occupied,of access, and only partially adrniriisteied. Communist China occupied Sinklang and TibetL and soon establishedgarrisons near the frontier and built roads to Improve Its position. India reacted by establishing some new frontier posts andsome new roads Into the frontier lands, although it did little to strengthen its military farces in tbe border areas.he Indian Government formed tbe North East Frontier Agency (NEFA) and placed It under direct central government control, to part for reasons of defense. Inthe Chineseoad across northeastern Ladakh. All of these moves brought some officials and troops of each country into regions claimed by the other and made an overt dispute almost inevitable.

outbreak of the Tibetan revolt lncaused China to take rapid andto put It down. Pelping,as an Internal Chinese probUm andthat the revolt was beingIndia, gave little thought lo IndianChinese accusations that theimperialist designs on Tibet increasedand intensity, particularly afterLama was granted asylum ln India.of Communist troops In thewas expanded and the Himalayanin an effort both to stop theof refugees and lo prevent anyof arms and armed Increasing numbers ofon its frontier, strengthened Itsthe border areas, where they metpatrols. Border clashes werethe first formal presentation ofclaims and by an exchange of


II. Pelplng's actions resultedharpof anti-Chinese sentiment in India. Most educated Indians were sharplyand vigorous demandstrong

Indian stand were made in Parliament and the press. The failure of Nehru's policy of befriending Communist China caused adecline in his prestige, and publicencouraged him to harden his position against the Chinese. While he retains great prestige, be is unlikely again to enjoy theunquestioned power to direct India's foreign policy.

The Chines? threat has enhanced tlieof the Indian military forces. The entire Slno-Indlan frontier has been placed under army control,etired Cruel of Staff has been named Governor of Assam. Military leaders have been assured tbat resources will be provided for strengthening border defenses. Despite the Increased authority accorded to the military, the government has made it clear that there will oe no aiminution of civilian control. While there is likely lo be somebetween the military and the government as long as Krishna Menun rtmains as Defense Minister, the military leadersasicfor the principle of civilian control and are unlikely seriously to challenge it

The deterioration of Slno-Indlan relations will affect thepossibly thethe Indian economic effort. Indian leaders believe that success in meeting the long-term Chinese threat requires Increased emphasis onheavy Industry and defenseIndia's devetopment program. Additional funds will almost certainly be expended for expansion and modernization of the Indian military forces5 and for development of the border areas. While the amount of theseprobably will be small In relation to India's total expenditures, they will placeburdens on the Indian economy.

The initial failure of the Communist Party of India (CPI) to support India's position In the border dispute not only intensified the antagonism of non-Communists toward the CPI but also sharpened dissensions within the party itself. The moderate faction of the CPI eventually pushedompromise "pa-

1 An Increaseillion lo defenselanned for the1 biaxfet.

resolution, but factionalism willto weaken the party. In addition, the Indian Government, although unlikely tothe CPI, will almost certainly keep it under greater surveillance.

communism in Indiahas notritical setback.of the Soviet Union, which hasa neutral stand on the borderhigh. The CPI itself cannotoff. It is still the best organizedcapably led of the oppositionlocal elections indicate that itshas probably not been seriouslyIndia's unsolved social andwill continue to provide manysupporters for the party.


Although New Delhi has been shocked by the extent of Communist China's trucuience, it apparently remains convinced of theof maintaining am (cable relations with Peiping. Nehru has stressed that India will rely on diplomatic methods to settle the border dispute. Although any further Ciinese incursions win probably be forcibly resisted, Nehru win almost certainly continue to reject extremist demands that India use force to eject the Chinese from Indian-claimed

Chinese communismighly nationalistic, and the regime will not sacrifice what ItImportant Chinese Interests In order to improve relations with India. Nevertheless, Peiping probably believes that continuationilitant policy toward India would force India toward closer relations with the West and further damage Communist China'sIn Asia. In addition, China probably hopes that India will continue to press for broader international acceptance ofChina. Thus China win continue to seek negotiations over the border disputeeneral Improvement in Slno-Indian relations.

Ihe Border Negotiations

IS. The Chou-Nehru talks ofade no material progress, although discussions are to continueower level. Considerations of national prestige on both sides wlU limit the bargairuruj freedom of both countries. In addition, there is strong public sentiment In India against any territorialNehru's position win be further complicated by the recent decision of the Indian Supreme Court that New Delhitransfer Indian territory to another countryonstitutional amendment. Thus we believe that an early settlement is unlikely.

Despite the failure of the recentwe believe that each side wishes to damp down the dispute Hence we believe that both sides wUl be willing to five with theundefined condition of stalemate for some lime.

In the eventrolonged failure tothe dispute, the climate could alterFurther border clashes may occur, and the firmness of New Delhi's position could become an Issue in2 Indian general election. If Nehru leaves the political scene before theuccessor Indian government would probablyasically harder line. Nor can it be assumed thatwill maintainonciliatory posture in the faceontinued adamant stand by India on lis claims.

Nevertheless, each country has strongtoesolution, and we arc inclined to believe that an eventual settlement could be achieved. The general outline ofettlement lias already been foreshadowed. Communist China almost certainly wUl not yield control of the strategically Important trans-Ladakh road, which provides the only feasible link from Sinklang to western Tibet. Northeastern Ladakh lies beyond India's natural defenseact admitted by Indian military leaders. Hence India will probably be willing eventually to concede Chinese control of this area.

n return, India will insist oo theof Chinese claims on the area of the NEFA, which India regards as vital lo itsThe Chinese have already indicated that they an prepared, as parteneral



recognizing their claims In Ladakh. toorder which substantially follows the McMahon Line. Once agreement has been reached on Ladakh and NEFA. agreement cm the smallernot alreadyprobably would follow.

border agreement would not solveproblems Theumber of years In view ofterrain Involved, and there woulddisputes over details. Moreover,probablj' attempt to subvert tbemost of whom are culturallycloser to the Tibetans than toSet India probably win be ableChinese subversion and maintainIts border areas.

Nepal, Bhutan, and Sikkim

Interest In Sucktm andto be peripheral, and Peipingavoid directly challengingin tliem. On the other hand,are likely to continue activewith India for influence In Nepal, andof Nepal to try to play oil onethe other will probably continueproblems in Eino-Indlan relations.1

Broader Issues

venorder agreement Is achieved, It Is unlikely that the friendly relations wluch existed In the past can be fully restored.undoubtedly calculates that It is less able to exploit lbs relations wtth India to lis own advantage. India recognises more clearly that the two countries have divergentbut will probably continue to support Peiping on various matters, for example the UN seat. However, neither country willthe disputes over the Tibetan issue and the border. Moreover, as time passes, India will probably become increasingly aware of the long-term problem it faces in Communist China's growing economic and military power and its political ambitions.

'See. "The Outlook tor Nepal. Bhutan, and Sitktavovember IOCS.

ommunist China haa outstripped India In economic growth to dale. China's gross national product increased about twice as rapidly as thatdls during their first five-year plans, and therowth rates baa been even greater in the past several years. Communist China probably will be unable to maintain rts recent very high rate of growth, however, and IndU's rate of growth Is likely to Increase somewhat. Thus the wide gap between Chinese and Indian growth rates Is expected to narrow. Nevertheless, thedisparity between the two ecoDornies will probably continue to widen, andChina will increasingly overshadow India In terms of butuatrlsl output and generalseir-sufflelency.esult China will be able toprobably Increase-Its military superiority over India andwill also be able lohe economic life of other Asian countries.


Indianwtsk she Weal ond wwh *a


Chinese agrresalveneae has tended toamong Indianore sympathetic view of US opposition to Communist Cfllna. There is probably also some greater apprecsi-tion of the valuetrongIn Asia to counterbalance China. India also rtrailns acutely conscious of Its need for Western economic akl.Nehru has no Intention of alteringbasic policy of nceuligrunent, and the bulk of Indian opinion apparently still shares his attachment to this policy.

India's willingness lo corporate mare closely with the West will also be limitedope that the USSR will restrain Communist China, although Indian leaders are aware that there are limits on Soviet ability andto influence Helping The neutraladopted by the Soviet Union on the border dlspute Indicates that the USSR has beenby the crudenees if not the substance of China's actions. The USSR Is likely toto urge tbe two countries to seek a


settlement ol the Issue. Inthe extent of India's willingness towith the Wen will also be limitedeluctance to jeopardize continued Soviet economic aid.

elations with Position

he deterioration of Sino-Indian relations has Increased Indian interest in improving relations with Pakistan. President Ayub's concern over the growth of Soviet influence in Afghanistan hasorresponding effect Ln Pakistan. During recent months, most of the border disputes between India and Pakistan have been resolved, and some progress has been made toward settling longstandingdisputes. In addition, the problem of dividing the waters of the Indus River system appears to be movingolution. On the other hand, no settlement ot theKashmir issue is inheof this dispute, combined with Nehrul continuing adherence to nonalignment. mike It likely that Nehru will continue to reject Ayub's caDotnt defense agreement India has, however, moved one division from the Pakistani to the Communist Chineseand there Is likely to be furtherof troops away irom theborder If outside pressures on thegrow.

Impact on other Asian Countries

Developments tn India and China and the relationships between these two giants of Asia are bound to affect their Asian neighbors. This ii particularly true In Southeast Asia, which historically haseeting place of Chinese and Indian influences.

Among the uncommitted nations of Asia, India's prestige has been highesult Of Its prominent role ln the UN, its strong stand against Imperialism and cokmiattsro. Usto promote world peace, and Nehru'sstature. However, those Asian

Indeed the Kashmir quarrel may be comptlcaleO by Pakistan's Insistence that IndU has no rt|hi to yield to Commanlstany territory lo Ladalh, which Is pan of Kashmir.

nations aligned with the West have considered Indian foreign policy dangerously weak.

These pro-Western countries viewChina's growing strength withalarm. On the other hand, thenations hare taken some vicarious pride inevelopmentymbol of Asian Importance In world affairs. They have been both attracted and repelled by the Chineae Communist revolution and by the rapid growth oi Chinese economic andpower. Following India's lead, they hive sought comfort ta China's professions of peaceful iolcat and reaped lor Its neighbors' Independence as set down In tbe Pench Shila and reiterated tn the Bandung prtnci-les.

Conununlit China's ruthless suppression of the revolt In Tibet and Its ajarraslve actions on the Indian border have stimulated more somber assessments of China's underlyingAlthough there are varying views of the immediacy of the threat, all tho Asian countries are aware of China's subversiveand are sensitive to growing Chinese strength and trucuknee. Pear of China has led some uncommitted nations lo make ac-ccrnmodatlons In their poildea ln order to avoid Irritating Pelping. Thb tendency has not been to strong, however, as to cause these nations lo yield on mitten which theyto be of vital importance to them.ecent illustration is Indonesia's firmness in restricting the activities of ovems Chinese merchants despiterotests) Keen If the Stno-lndiin border dhpute Is resolved through negotiations, the moreAsian view of Communist China that has developed during the past two years probably wtli not be erased.

s long as India makes significantprogress, moat Asian countries are Likely to derive encouragement from Indian ability to maintain economic growth without sacrificing traditional valuw. Nevertheless, many younger Ail ins are Impatient fn rapid national progress and are searching forpanaceas. lags In domestic economic



growth. If coupled with an image ofMarry factors other than the nature of

Cnineae advances, might greatly aid

subversive efforts. The Asianthe two countries will affect Asian trends

will, however, be more Influenced bythe coming years. Nevertheless, it is likely

ability to move forward under economicCommunist China's strength and dyna-

ganizitlons of their own deviling then byand its ambitions for political hegemony

prcssions concerning the relative progressfigure more prominently In Asia than

will India's influence.

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