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SECURITY ARCAIVES AND RECORDS - 2 - SERVICE" :- GOTERN impressive successes. Final results for Traveneore-Cochin show that the communists and their allies have obtained 32 seats to h4 for the Congress Party, the latter having failed to obtain an absolute majority. As of the moment, the communists and their allies have obtained 42 seats in Hyderabad to 93 for the Congress Party and 56 seats in Madras to 140 for the Congress Party. The Congress Perty leadership has been shaken by these results which show that commust agents are successfully exploiting hunger and poverty. In the immediate future the Congress Perty will have control of the Central Parliament and majorities in most of the state assemblies; but if perceptible progress is not made in the economic field during the next two or thres years, the ecomunist campaign to subvert India will almost certainly enjoy increasing success. Subversion of India vould, of course, place other free Asian countries in almost untenable positions and hasten the day when all of the Asien land-mase, with nore then a billion people, would fall into the Soviet bloc. Furthermors, a demonstration that democracy works in India would be of inestimable value in offsetting propaganda from China about the successes of the communist regimo in improving the economic position of its people. Absence of progress in India in the economic sphere would only result in serious loss of political stability, which would lead inevitably to rising dissatisfaction fanned by subversive propaganda. Pakistan's noed for assistance is correspondingly great and equally urgent. At the present moment we believe that the proposed program for Pakistan should be directed towards the following general areas for which preliminary estimates of dollar costs have been developeda Agriculture, forestry and fisheries, about $23 aillion, in which the importent items would be tube wells, fertiliser imports, fara implements imports, reclamation and irrigation projects, and the erection of 5 fertilizer plan; education about $3 million; porer and other national resources development, about $5 milliong hoalth and smitation, about $1.5 million; and other miscellaneous technical assistance projects and joint surveys of less than $1 million. Pakistan, strategically athwart the historic invasion route to the subcentinent, has exhibited strong pre-Western attitudes which have been especially helpful to the United States in United Nations affairs, and the internal situation in Pakisten on the surface has a peared to be fairly stable. It should be remembered, however, that last year the Chief of Staff and other high any officers vere arrested on the eve of an attempted coup to take over the government. Their triel is still in progress, but it is kenom that communists vere involved in the conspiracy. In the fall of 1951 the Prime Minister, Liaquat Ali Khan, was assessinated, and athough the new Prime Minister assumed offico without internal strife, there is growing evidence that there has been subatantial loss of leadership in the country. Momwhile, the extrenely low staddard of living invites communist propaganda an d subversive tactics. Like India, therefore, Pakistn must show progress in the economic sphere.

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    "ocrText": "SECURITY\nARCAIVES AND\nRECORDS\n- 2 -\nSERVICE\"\n:- GOTERN\nimpressive successes. Final results for Traveneore-Cochin show that the\ncommunists and their allies have obtained 32 seats to h4 for the Congress\nParty, the latter having failed to obtain an absolute majority. As of the\nmoment, the communists and their allies have obtained 42 seats in Hyderabad\nto 93 for the Congress Party and 56 seats in Madras to 140 for the Congress\nParty. The Congress Perty leadership has been shaken by these results\nwhich show that commust agents are successfully exploiting hunger and\npoverty.\nIn the immediate future the Congress Perty will have control of the\nCentral Parliament and majorities in most of the state assemblies; but if\nperceptible progress is not made in the economic field during the next\ntwo or thres years, the ecomunist campaign to subvert India will almost\ncertainly enjoy increasing success. Subversion of India vould, of course,\nplace other free Asian countries in almost untenable positions and hasten\nthe day when all of the Asien land-mase, with nore then a billion people,\nwould fall into the Soviet bloc.\nFurthermors, a demonstration that democracy works in India would be\nof inestimable value in offsetting propaganda from China about the successes\nof the communist regimo in improving the economic position of its people.\nAbsence of progress in India in the economic sphere would only result in\nserious loss of political stability, which would lead inevitably to rising\ndissatisfaction fanned by subversive propaganda.\nPakistan's noed for assistance is correspondingly great and equally\nurgent. At the present moment we believe that the proposed program for\nPakistan should be directed towards the following general areas for which\npreliminary estimates of dollar costs have been developeda Agriculture,\nforestry and fisheries, about $23 aillion, in which the importent items\nwould be tube wells, fertiliser imports, fara implements imports, reclamation\nand irrigation projects, and the erection of 5 fertilizer plan; education\nabout $3 million; porer and other national resources development, about\n$5 milliong hoalth and smitation, about $1.5 million; and other miscellaneous\ntechnical assistance projects and joint surveys of less than $1 million.\nPakistan, strategically athwart the historic invasion route to the\nsubcentinent, has exhibited strong pre-Western attitudes which have been\nespecially helpful to the United States in United Nations affairs, and the\ninternal situation in Pakisten on the surface has a peared to be fairly\nstable. It should be remembered, however, that last year the Chief of Staff\nand other high any officers vere arrested on the eve of an attempted coup\nto take over the government. Their triel is still in progress, but it is\nkenom that communists vere involved in the conspiracy. In the fall of 1951\nthe Prime Minister, Liaquat Ali Khan, was assessinated, and athough the new\nPrime Minister assumed offico without internal strife, there is growing\nevidence that there has been subatantial loss of leadership in the country.\nMomwhile, the extrenely low staddard of living invites communist propaganda\nan d subversive tactics. Like India, therefore, Pakistn must show progress\nin the economic sphere."
}