I refer to form memorandum No. 267 attached. †

2. On December 8th, 1948, Cabinet approved the export of certain items of military equipment to India and Pakistan.²⁹ This approval applied specifically to a long list of items which the Government of Pakistan had requested. The list is entitled "Annexture to M.G.O. Letter No. D.O. MGO/7 dated 27 10 48". This Annexture included an item of 114,750 rounds of 20 mm ammunition. The Canadian Commercial Corporation now request permission to export 576,000 rounds of this ammunition. The Annexture included an item of 24,540 rounds of 6 pounder 7 cwt. H.E. Shell. The Canadian Commercial Corporation now wish to export to Pakistan 50,757 rounds of this ammunition, and they point out that the Annexture included a similar item of 78,143 rounds of 6 pounder 7 cwt. APCBC/SVDS.

3. The departmental memorandum to Cabinet which recommended the approval included the following political considerations as pertinent in considering the applications:

(1) There had been no resolution in the Security Council of the United Nations which would require Canada to forbid the export of military equipment to these countries, although items concerning Kashmir and' Hyderabad had been on the Security Council agenda for some time and final disposition of them had not been made. It was stated that the United Kingdom had been supplying military equipment to both India and Pakistan.

(2) At the meeting of Prime Ministers in London in 1948, India and Pakistan representatives had both stressed the importance of maintaining their military strength in order to provide a defence against Soviet expansion and Communism at home.

4. The memorandum to Cabinet also stated that the representative of India had made it clear, when approached informally, that he considered that Canada should, as a matter of course, sell arms to another member of the Commonwealth.

5. The Canadian Commercial Corporation has obtained final approval from this Department for each shipment of items of military equipment listed in the Annexture. We have approved exports valued at $10,900,000 in 1949 of this equipment, and in addition, authority has been obtained and approval given for other exports of arms and ammunition by the Canadian Commercial Corporation and exports of aircraft and spare parts by private companies, so that the total value of exports of arms and ammunition to Pakistan approved by this Department in 1949 is $11,265,987. Pakistan is by far our largest customer for arms and ammunition.

6. We understand from the Canadian Commercial Corporation that the list approved by Cabinet on December 8th, 1948, if filled entirely, would mean exports to Pakistan of equipment worth hundreds of millions of dollars.

7. I understand that the situation in Kashmir is very tense, and I am, therefore, recommending to the Minister that the whole question of exports to Pakistan should be again submitted to Cabinet. I should be glad to have, at your early convenience, comments on the recommendation which should be made to Cabinet on this particular request from the Canadian Commercial Corporation and on the whole policy of exports of arms and ammunition to India and Pakistan.

A.F.W. P[LUMPTRE]