791.5/8–1352: Telegram

The Ambassador in India (Bowles) to the Department of State

secret

639. Acting Fon Secy R. K. Nehru summoned Drumright yesterday and took up GOI’s desire buy Amer tanks (Deptel 337, Aug 2).1 Nehru explained Ind’s present tanks obtained after last war now worn out and GOI in urgent need replacements. GOI had accordingly instructed Amb Sen seek procurement 200 M4A4 tanks with maintenance spares. Sen had later been informed US Govt agreeable release 200 M4A1 tanks and spares at cost 19 million dollars. Nehru said Ind Amb has now been instructed negot direct with Defense Dept re price and delivery date, adding GOI feels price quoted for M4A1 tank excessive. He contended this tank obsolete for US purposes and GOI financial resources too slender permit tank outlay at price quoted. He also [Page 1661] stated GOI engaged in great internal economic construction program, in which US assisting, and GOI anxious utilize maximum number dollars that program. However, he contd, Ind had to look to preservation her security and needed replacement tanks as part that program. He concluded by saying GOI wld appreciate receiving tanks at lowest price quoted any other purchaser and wld be grateful for Emb interposition to that end.

Drumright confined remarks largely to intimation Emb had heard of Sen’s original approach and to statement he wld report to me.

I am well aware of fact GOI in poor position to divert scarce foreign exchange to mil requirements, especially when GOI needs her meager resources for econ construction program on which she now embarked with our help. I wld be particularly reluctant to see a disproportionate part of GOI resources spent for unproductive mil purchases such as purchase of jet aircraft (Nehru made no ref to jet aircraft and I presume their purchase not being actively pursued.)

Nevertheless it only fair to recognize GOI has growing security problem arising from Commie expansion in Asia and tank replacement is one important way through which GOI defenses can be buttressed. Moreover, I believe this useful opportunity encourage Ind use US equipment rather than have PriMin Nehru cast about elsewhere incl perhaps Soviet Union for needed mil equipment. I wld also like point out GOI has been notably sparing in requesting favors of US. Other things being equal, I feel a gesture on our part by way of knocked down tank prices wld be gratefully recd, wld probably contribute to improved relations, and wld at same time help strengthen GOI’s capacity to fight aggression, a factor which may eventually be of great importance to us here in South Asia. For these various considerations, I wld appreciate Dept doing what it appropriately can to obtain tanks for GOI at reduced prices.2

Bowles
  1. Not printed; the Department informed the Embassy in New Delhi in this telegram of what had occurred when Assistant Secretary of State Byroade had met with Indian Ambassador Sen and Brigadier Banerji on Aug. 1; see p. 1658 (601.9111/8–252).
  2. The Department responded on Aug. 15 in telegram 461 to New Delhi, not printed, that the $19 million cost figure quoted to the Indian Government for M4A1 tanks covered the expense of reconditioning the vehicles, providing each tank with a main battery gun, plus 5 years’ supply of spare parts, and that this was the lowest price which could be quoted (791.5/8–1352).