"ملف ٥٧/١١ الوضع السياسي في الهند وباكستان" [و‎‎٥] (٢٦/٩)

received the Pakistan Governments reply to their note of 23rd
December, they submitted their complaint to the Security Council*
Financial Relations * At the meeting at Lahore on 8th December
referred to above agreement was reached between the two Dominions on
a number of important outstanding questions* Pakistan’s share of the
cash balances of the old undivided Government of India on the date of
partition was agreed at Hs,75 crores, instead of only Rs*20 crores.
Pakistan's share of the uncovered debt was agreed at 17wfo, to be
paid in Indian rupees in fifty annual payments of principal and
interest* The value of all pensions in issue are to be capitalised
and the liability shared in the ratio agreed for sharing the
uncovered debt, Pakistan’s share of military stores is to be one
third of the stocks held on 15th August. In addition to the sterling
assets to be transferred to Pakistan under the Pakistan (Monetary
System and Reserve Bank) Order, it was agreed that Pakistan should be
allowed to buy additional blocked sterling up to a limit to be
ascertained by an agreed formula. Agreement was also reached on the
question of the treatment of property belonging to refugees.
7* Subsequently an Indian Delegation visited Karachi for preparatory
talks with the Pakistan Government on sterling balance releases. It
was agreed that a system of separate accounting for foreign exchange
earnings and expenditure for the two Dominions should come into force
on 1st January.
8. These agreements encouraged hope that, despite the deadlock on •
Kashmir reached at the same meeting, a settlement on Kashmir also
might follow, but these hopes were stilled when, at the subsequent
meeting at Delhi on 21st and 22nd December, the Governnent of India
made it clear that they were for the time being not prepared to
implement the agreement of 8th December so far as it related to the
transfer of Rs.55 erores cash balances until the Pakistan Government
ceased helping the Moslem forces in Kashmir.
/J unagadh