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Wednesday, 11 May 1960

Mr McEWEN - It has been reported that the Indian Minister for Food, who is at present in North America, suggested that, in view of India's balance of payments problems, Canada and Australia might agree that India should be obliged to purchase lower quantities commercially than 400,000 tons this year. This, as I said yesterday, was a condition attached by the United States Government in agreeing to supply to India, on the basis of payments to be made in Indian rupees - later to be re-lent to the Indian Government or, in cases, given to the Indian Government - a quantity of 3,000,000 tons of wheat, to be further supported with another 1,000,000 tons of wheat and, over a period of four years, 1,000,000 tons of rice. This condition, which was attached by the American Administration, is the outcome of a negotiated arrangement which was initiated by the United States a year ago and to which the wheat exporting countries are parties. It is designed to enable the United States to exercise its great generosity in helping the underdeveloped countries without at the same time seriously damaging the economics of other countries and other friends, such as Australia, who are exporters of the commodity in question. The decision of the United States that 400,000 tons was a fair quantity for India to buy commercially, as compared with the 4,000,000 tons she provided otherwise, was in conformity with that policy; but it was a decision taken by the United States Administration, and I am sure it is to the United States Administration that the Indian Government will, of necessity, direct its proposals.

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