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Show Marquis Child's British Need U. S. Loan To Recover LONDON One of the most Important features of the British-American talks held in Washington in September ia only just now becoming apparent. This la the three-way deal that holds the hope for British recovery re-covery at least potentially as great as the Marshall plan aid. Both American and British 'Sources are cautious In their references to it since it has not yet . taken final form. But, nevertheless, outlines of whst can become a major development already are clear. During the Washington talks Foreign Minister Bevin and Chancellor of the Exchequer, Crlppa both Impressed on Secy, of State Achesnn the grave handicap to recovery of the British debt Incurred during the war to the far east and middle east. The largest amounts are owed to India and Pakistan. Both are new nations in urgent, if not desperate, need of capital Investment in order to expand their economy and thereby prevent pre-vent unemployment, chaos and communism. In consequence, the presaur on Britain has been great. Brit Ish manufacturers find it easy to send goods to that noncompetitive noncom-petitive market One competent American observer expressed the belief that virtually all of Britain's Increased exports have gone to that erea. While the British say this Is Incorrect, It Is undoubtedly true that a large proportion of the Increased export ex-port ha been absorbed by sterling ster-ling debts. Projected In Washington talks and now being pushed was the prospect of a major long-term loan by the United States for the development of India and Pakistan. Those nations would then be asked to scale down the sterling debt and refund It In such a way that it would not be - a drag during the next few years on the British effort to bring exports snd Imports Into balance. bal-ance. This prospect was discussed st least tentatively with Prime Minister Nehru both in Washington Wash-ington and when he stopped in London on his return Journey to India. It Is a most sensitive point with India, since the suspicion long has been growing that the debt would be permanently frozen. fro-zen. But Indications are that the burden en Britain could be relieved re-lieved if substantial help is forthcoming from the United States. Effects Everywhere As viewed by high officials here, the salutary effect of such sn arrangement would be felt not merely In Britain but. throughout the European continent. conti-nent. Countries of southeast Asia would distribute order for machines and other capital goods In western Europe. The me-chines me-chines would be paid for In dollars dol-lars provided by the American loan, and dollars earned that way would go to help cur the European deficit Thia Is stressed here because at the tune of the Washington Ulks the French took with wild alarm the reports that the United States intended to adopt a new and special relationship with Britain and the commonwealth common-wealth which would leave continental con-tinental Europe Isolated. There was never any substantial reason rea-son for thia fright which has, unhappily, prejudiced the relationship rela-tionship between the two nation. na-tion. The fact of the French fear la one reason for their cautious approach to the three-way three-way deal and for keeping It la confidence on the highest level of the three governments. Th sterling debt to India, a given In unofficial figures, la 21.820.000.000. For Pakistan th unofficial figure I $420.-000.000. $420.-000.000. Th sterling balance held by Egypt I 2W0.0O0.O00 and with Australia It la 2M,-000,000. 2M,-000,000. Balance larreaac Before the war sterling balances bal-ances held ip th far east and middle east were always sizable since Londoi was the banker for the whole rea. But they were nothing like the amount held today, the increase representing repre-senting almost entirely loan ad- vanced for material and mea to proeecute the war. Ia August, 1939, the total outstanding sterling balance la all the world was f 1,300,000.000 (at th present rate of $2.80 to the pound). On June 30 of thi( ytr th "' '" w 23,200,000.000. Although most ! of the repayments have gone to India and Pakistan nearly half the world today still Is owed to southeast Aaia sad th ' middle east. . Ia hia broadcast oa devaluation devalua-tion and la subsequent debate la the house of common Mr. Cripp mad no mention of these figure. But they hover Uke a black cloud over the British fiscal fis-cal policy and also and even more Important over the efforts ef-forts to keep Asia aad the middle east out of the Communist orbit With good will and without any appreciable additional burden bur-den on the American taxpayer for foreign assistance, it should le possible to remove, what ia aa intolerable drag on world recovery re-covery and reconstruction. Copyright, 1KB. United Feature Syndicate |